EXHIBIT 10.43
DATED: July 10, 2001
BIOPROGRESS TECHNOLOGY INTERNATIONAL INC
and
FARMASIERRA, S.A.
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FILM SUPPLY AGREEMENT
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DATE: July 10, 2001
PARTIES:
1 'The Company': BIOPROGRESS TECHNOLOGY INTERNATIONAL INC a corporation
organised under the State of Nevada, United States of America of Xxxx 0,
Xxxxxxx Xxxx, Xxxxx, Xxxxxxxxxxxxxx XX00 0XX, Xxxxxxx; and
2 'The Purchaser': FARMASIERRA, S.A. a Spanish company, whose registered
office is at Carretera de Irun, Km 26,200 28700 San Sebastian de los
Reyes, Madrid, Spain.
RECITAL:
The purpose of this agreement is to record the terms under which the Company has
agreed to sell and the Purchaser to purchase certain goods.
OPERATIVE PROVISIONS:
1 Interpretation
1.1 In this Agreement, unless the context otherwise requires:
(a) 'an Affiliate' means, in relation to either party, a company which
at the relevant time is that company's holding company or subsidiary
(as defined by section 736 of the Companies Xxx 0000, as amended) or
the subsidiary of any such holding company
(b) 'an Expert' means a person to whom a reference is made under clause
10.1
(c) 'Force Majeure' means, in relation to either party, any
circumstances beyond the reasonable control of that party
(including, without limitation, any strike, lock-out or other
industrial action)
(d) 'the Goods' means the goods described in Schedule 1
(e) 'the Specification' means the specification in the form set out in
Schedule 2 in respect of each type of Goods and agreed by the
parties following completion of stability trials or any other
specification agreed in writing between the Company and the
Purchaser from time to time
(f) a 'Week' means a week beginning on a Monday and ending on the
following Sunday
(g) "Patent Licence" means a patent licence agreement between the
parties of even date herewith relating to patent application numbers
[CONFIDENTIALITY REQUESTED].
1.2 Any reference in this Agreement to 'writing', or cognate expressions,
includes a reference to any communication effected by telex, cable,
facsimile transmission or any comparable means.
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1.3 The headings in this Agreement are for convenience only and shall not
affect its interpretation.
2 Sale of Goods
2.1 During the continuance of this Agreement the Company shall sell and the
Purchaser shall purchase such quantities of Goods as may be ordered by the
Purchaser from time to time under clause 2.3, subject to the terms and
conditions of this Agreement.
2.2 Subject to clause 2.5 during the continuance of this Agreement the
Purchaser shall purchase all of its requirements for Goods from the
Company and accordingly, except as otherwise provided in this Agreement,
the Purchaser shall not purchase Goods from any other person provided the
Company is able and willing to supply the same on the terms of this
Agreement.
2.3 The Purchaser shall, no later than the last working day of each Week,
notify the Company in writing of its expected requirements for the Goods
for each of the next twelve Weeks. In respect of the first four of those
twelve Weeks the said notification shall be treated as a firm order for
the quantities concerned, save that:-
(a) if the amount so notified for any of the said first four Weeks is
the same as or less than the total amount for the Week in question
previously notified pursuant to this clause, the said notification
shall not be treated as an additional order for the Week in question
but merely a confirmation of the total amount previously so ordered;
and
(b) if the amount so notified for any of the said first four Weeks is
greater than the total amount for the Week in question previously
notified pursuant to this clause, the said notification shall be
treated as a firm order only for the amount of the excess over the
said total amount previously notified for that Week.
2.4 Whilst the Company agrees to take all such steps as may reasonably be
required to fulfil its obligations under this Agreement in the normal
course, the Company shall not be obliged to give the Purchaser priority
over other customers of the Company with regard to the supply and delivery
of the Goods.
3 Specification of the Goods
3.1 All Goods sold by the Company to the Purchaser pursuant to this Agreement
shall conform to the Specification and the Purchaser will be entitled to
reject any quantity of the Goods, which is not in accordance with the
Specification. The Company acknowledges that precise conformity with the
Specification is of the essence of this Agreement and accordingly the
Customer shall be entitled to reject the Goods if they are not in
conformity with this Agreement however slight the breach may be.
3.2 The Company shall consult with the Purchaser from time to time during the
continuance of this Agreement in order to ensure that the Specification of
the Goods to be sold by the Company to the Purchaser is acceptable to both
parties, but the Company shall not be obliged to agree to any change to
the Specification requested by the Purchaser (except, for the avoidance of
doubt, any change to the Specification
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required to ensure that the Goods comply with clause 7.2, to which the
Company will be obliged to agree).
3.3 For the purpose of ensuring that the Products conform to the Specification
the Company shall, subject to receiving reasonable notice, procure that
the Purchaser or any customer of the Purchaser is permitted to enter at
reasonable times during normal business hours any premises at which the
Goods are manufactured or stored for the purpose of inspecting
manufacturing procedures and conditions and any manufactured Goods.
4 Manufacture and delivery of the Goods
4.1 The Company shall use all reasonable endeavours to manufacture and
maintain sufficient stocks of the Goods to fulfil its obligations under
this Agreement. Without prejudice to the generality of the previous
sentence, the Company will maintain in stock at all times not less than
the quantity of Goods which the Purchaser has notified the Company it
expects to require in the next 12 weeks, pursuant to clause 2.3.
4.2 The Company shall deliver each of the Purchaser's orders for the Goods on
any date specified in the order (being a date not earlier than the
beginning of the Week to which the order relates pursuant to clause 2.3),
but the time of delivery shall not be of the essence.
4.3 All Goods supplied hereunder shall be supplied with a certificate of
analysis in such form as the parties may agree from time to time and the
Company warrants that each certificate of analysis in respect of Goods
will be complete and accurate.
4.4 Delivery of the Goods shall take place at the Purchaser's premises at
Carretera de Irun, Km. 26,200, 28700 San Sebastian de los Xxxxx, Madrid
Spain.
4.5 If the Purchaser rejects any delivery of the Goods which are not in
accordance with the Specification, the Company shall within 7 days of
being requested to do so by the Purchaser supply replacement Goods which
are in accordance with the Specification or shall notify the Purchaser
that it is unable to do so, whereupon (without prejudice to clause 12.2)
the Purchaser shall be entitled to obtain from any other person such
quantity of the Goods as the Company has been unable so to supply.
4.6 If there is any difference of opinion between the parties as to whether
any Goods supplied by the Company are in accordance with the Specification
the matter shall, at the request of either the Company or the Purchaser,
be determined by an Expert.
4.7 Risk in and responsibility for the Goods shall pass to the Purchaser on
delivery in accordance with clause 4.4.
5 Price of the Goods
5.1 Subject to clause 5.3, the price for each type of the Goods shall be the
prices set out in Schedule 3 ("the Prices").
5.2 The purchase price for Goods purchased by the Purchaser from the Company
hereunder shall be paid no later than 60 days following the date on which
the Goods are delivered (provided the Company has issued a valid invoice
for such Goods).
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5.3 Subject to clause 5.4 the Company reserves the right, by giving notice to
the Purchaser to increase the price of Goods to reflect any increase in
the cost to the Company which is due to any factor beyond its control
(such as, without limitation, any currency regulation, alteration of
duties, significant increase in the costs of labour, materials or other
costs of manufacture), any change in delivery dates, quantities or
specifications which is requested by the Purchaser, or any delay caused by
any instructions of the Purchaser or failure of the Purchaser to give the
Company adequate information or instructions (provided that the Purchaser
has been given reasonable notice of the information and instructions which
the Company requires) provided that:
5.3.1 the first such notice of increase shall not take effect before the
first anniversary of the date of this agreement and subsequent
notices shall not take effect more frequently than at 12 month
intervals.
5.4 The Price in respect of all Goods which are deemed to be notified to the
Company as a firm order pursuant to clause 2.3 shall be the Price on the
date such order is deemed to become firm notwithstanding that the Company
may have increased the Price of the Goods pursuant to clause 5.3 after the
date on which such order is deemed to be firm.
5.5 Unless otherwise expressly agreed in writing all prices referred to in
this agreement or elsewhere shall be exclusive of:
5.5.1 any costs of packaging, carriage and insurance of the Goods; and
5.5.2 any value added tax or other applicable sales tax or duty, which
shall be added to the sum in question.
5.6 If the Purchaser fails to pay on the due date any amount which is payable
to the Company under this Agreement then, without prejudice to clause
12.2:-
5.6.1 that amount shall bear interest from the due date until payment is
made in full, both before and after any judgment, at 4 per cent per
annum over Barclays Bank plc base rate from time to time; and
5.6.2 except where there is a genuine dispute as to whether payment is due
the Company shall be entitled to suspend deliveries of the Goods
until the outstanding amount has been received by the Company from
the Purchaser (and any dispute as to whether the dispute over
payment is genuine will be determined by the Expert).
6 Title to the Goods and documentation
6.1 Title to any Goods shall not pass to the Purchaser until the date that the
Purchase Price for the Goods in question and value added tax thereon (if
applicable) and any applicable packaging, carriage and insurance charges
have been paid in full to the Company ('the Payment Date').
6.2 Until the Payment Date the Purchaser shall not be entitled to sell
transfer lease charge assign by way of security or otherwise deal in or
encumber the Goods in question and the relationship between the Company
and the Purchaser in respect of such Goods including any proceeds of sale
or other consideration therefor shall be a fiduciary one.
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6.3 If either:
6.3.1 the Purchaser fails to effect payment in full of all sums due
hereunder by the due date; or
6.3.2 prior to the Payment Date the Purchaser convenes a meeting of its
creditors or a proposal is made for a voluntary arrangement within
Part I of the Insolvency Xxx 0000 or a proposal for any other
composition scheme or arrangement with (or assignment for the
benefit of) the Purchaser's creditors or if the Purchaser is unable
to pay its debts within the meaning of section 123 of the Insolvency
Xxx 0000 or if a trustee receiver administrative receiver or similar
officer is appointed in respect of all or any part of the business
or assets of the Purchaser or if a meeting is convened for the
purpose of considering a resolution or other steps are taken for the
winding up of the Purchaser or for the making of an administration
order (otherwise than for the purpose of an amalgamation or
reconstruction)
then the Company (without prejudice to any other legal remedies it may
have) shall at any time thereafter be entitled to enter on the Purchaser's
premises or any other premises where the Goods in question is located
(without notice to the Purchaser) and remove the Goods in question.
6.4 If in breach of clause 6.2 above the Purchaser sells any Goods prior to
the Payment Date then any proceeds of sale in respect thereof and all
rights arising under or in respect of said sale shall be held (in the case
of the proceeds of sale in a separate account) by the Purchaser as trustee
for the Company.
6.5 With effect from the date of delivery up to and including the Payment Date
the Purchaser shall insure the Goods in question for its full replacement
value with Royal Sun Alliance or such other insurance company as the
Company shall approve (such approval not to be unreasonably withheld).
7 Warranty in respect of Goods
7.1 Subject to the limitations upon its liability set out in clause 8 below
the Company warrants to the Purchaser that the Goods will for a period of
four years from the date of delivery pursuant to clause 4.4 above;
7.1.1 be free from defects in or arising from design materials workmanship
or delivery;
7.1.2 will be of satisfactory quality within the meaning of the Sale of
Goods Xxx 0000 (as amended) and fit for the purpose; and
7.1.3 will correspond to the Specification.
7.2 Subject to the limitations upon its liability set out in clause 8 below
the Company warrants to the Purchaser that:
7.2.1 on delivery the Goods will comply with all relevant standards, codes
of practice, statutory requirements and regulations relating to the
Goods;
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7.2.2 all necessary licences, consents, permits and authorities have been
obtained by the Company in relation to the supply of the Goods to
the Purchaser (including without limitation all necessary import and
export licences).
7.3 The Purchaser shall give notice to the Company as soon as it is reasonably
able upon becoming aware of a breach of warranty.
7.4 The Company shall as soon as it is reasonably able investigate any alleged
breach of warranty and shall remedy the same free of charge by either:
7.4.1 carrying out such repairs modifications or alterations to the
Goods as it shall in its absolute discretion think fit; or
7.4.2 replacing the Goods or any part of them; or
7.4.3 (where the Purchaser agrees that it is able) authorising the
Purchaser to carry out repairs, modifications or alterations to the
Goods, at the Company's cost.
7.5 Any defective Goods or component parts replaced by the Company pursuant to
clause 7.4.2 above ('Replaced Goods') shall upon replacement become the
property of the Company and the Purchaser warrants that its title to such
Replaced Goods shall be free and unencumbered or that it shall have all
necessary consents and authorities to part with possession of the Replaced
Goods. The Purchaser will at the Company's request deliver the Replaced
Goods back to the Company at the Company's cost.
7.6 Subject to the foregoing and with the exception of the condition and
warranties implied by section 12 of the Sale of Goods Xxx 0000 all
conditions warranties terms and undertakings express or implied statutory
or otherwise in respect of any Goods purchased hereunder are hereby
excluded.
7.7 The Company shall indemnify and keep indemnified the Purchaser from and
against all penalties, costs, losses and expenses that it incurs pursuant
to any contract or arrangement with its own customers (including a
customer who is an Affiliate) to the extent that such penalty, cost, loss
or expense arises from any breach by the Company of this Agreement.
8 Limitation of liability
8.1 The following provisions set out the Company's entire liability (including
any liability for the acts and omissions of its employees agents and
sub-contractors) to the Purchaser in respect of:
8.1.1 any breach of its contractual obligations arising under this
agreement, and
8.1.2 any representation statement or tortious act or omission including
negligence arising under or in connection with this agreement
AND THE PURCHASER'S ATTENTION IS IN PARTICULAR DRAWN TO THE PROVISIONS OF
THIS CLAUSE 8.
8.2 Any act or omission on the part of the Company or its employees agents or
sub-contractors falling within clause 8.1 above shall for the purposes of
this clause 8 be known as an 'Event of Default'.
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8.3 The Company's liability to the Purchaser:
8.3.1 for death or injury resulting from its own or its employees' agents'
or subcontractors' negligence, and
8.3.2 for all damage suffered by the Purchaser as a result of the implied
statutory undertakings as to title quiet possession and freedom from
encumbrances; and8.3.2 pursuant to clause 7.7 shall not be limited.
8.4 Subject to the provisions of clause 8.3 above the Company's entire
liability in respect of any Event of Default shall be limited to damages
of an amount equal to (pound)1,000,000.
8.5 If a number of Events of Default give rise substantially to the same loss
then they shall be regarded as giving rise to only one claim under this
agreement.
8.6 Except in the case of an Event of Default arising under clauses 8.3.1 and
8.3.2 above the Company shall have no liability to the Purchaser in
respect of any Event of Default unless the Purchaser shall have served
notice of the same upon the Company within 12 months of the date it became
aware of the circumstances giving rise to the Event of Default.
8.7 Nothing in this clause 8 shall confer any right or remedy upon the
Purchaser to which it would not otherwise be legally entitled.
8.8 Subject to the Purchaser notifying the Company of its intended activities
using Goods supplied hereunder, the Company shall maintain during the
period from the date hereof until the Upgrade Acceptance Date and for one
(1) year thereafter insurance on the Goods to a level suitable for the
activities so notified with an insurance company registered in the United
Kingdom and being a member of the British Insurers Association. The
Company shall provide the Purchaser with a copy of the certificate of such
insurance and evidence of the payment of premiums therefor promptly upon
request.
8.9 With effect from the Upgrade Acceptance Date and during the remaining term
of this Agreement and for one (1) year thereafter, the Company shall
maintain product liability insurance on the Goods with minimum limits of
the sterling equivalent of $1,000,000 (ONE MILLION DOLLARS) per occurrence
and $10,000,000 (TEN MILLION DOLLARS) in the aggregate with an insurance
company registered in the United Kingdom and being a member of the British
Insurers Association. The Company shall provide the Purchaser with a copy
of the certificate of such insurance and evidence of the payment of
premiums therefor promptly upon request.
8.10 For the avoidance of doubt all deductibles under insurance policies
maintained by the Company will be the sole and exclusive responsibility of
the Company and clauses 8.8 and 8.9 will not be deemed to limit in any way
the Company's liability under this Agreement.
9 Documentation
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9.1 Any documentation provided by either party ("the Provider") to the other
("the Receiver") hereunder is the copyright of the Provider and contains
confidential information of the Provider.
9.2 The Receiver shall take all such steps as shall be necessary to protect
the Provider's copyright and confidential information in such
documentation and without prejudice to the generality of the foregoing
shall not copy or reproduce the same nor distribute sell or disclose the
contents of the same to any third party without the prior consent of the
Provider.
9.3 The Receiver undertakes to the Provider to make its employees agents and
sub-contractors aware of the provisions of this clause 9 and to use all
reasonable endeavours to ensure compliance by its said employees agents
and sub-contractors with the obligations set out in clause 9.2 above.
10 Expert determination
10.1 Where under any provision of this Agreement any matter is to be determined
by an Expert, the matter shall be referred at the instance of either party
to such person as may be appointed by agreement between the parties or, in
default of agreement, nominated on the application of either party by the
President for the time being of the Proprietary Association of Great
Britain.
10.2 Any person to whom a reference is made under clause 10.1 shall act as an
expert and not as an arbitrator and shall be entitled to appoint such
technical expert or experts as he considers necessary to assist him in
determining the matter referred to him. The decision of the Expert (which
shall be given by him in writing stating his reasons therefor) shall be
final and binding on the parties.
10.3 Each party shall provide any Expert with such information as he may
reasonably require for the purposes of his determination; if either party
claims any such information to be confidential to it then, provided that
in the opinion of the Expert that party has properly claimed the same as
confidential, the Expert shall not disclose the same to the other party or
to any third party.
10.4 The costs of any Expert (including the costs of any technical expert
appointed by him) shall be borne in such proportions as the Expert may
determine to be fair and reasonable in all the circumstances or, if no
such determination is made by the Expert, by the parties in equal
proportions.
11 Force majeure
11.1 If either party is affected by Force Majeure it shall promptly notify the
other party of the nature and extent of the circumstances in question.
11.2 Notwithstanding any other provision of this Agreement, neither party shall
be deemed to be in breach of this Agreement, or otherwise be liable to the
other, for any delay in performance or the non-performance of any of its
obligations under this Agreement, to the extent that the delay or
non-performance is due to any Force Majeure of which it has notified the
other party, and the time for performance of that obligation shall be
extended accordingly.
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11.3 If at any time the Company claims Force Majeure in respect of its
obligations under this Agreement with regard to the supply of the Goods,
the Purchaser shall be entitled to obtain from any other person such
quantity of the Goods as the Company is unable to supply.
12 Duration and termination
12.1 This Agreement shall come into force on the date at the top of page 1
above and, subject to the following provisions of this clause, shall
continue in force for as long as the Patent Licence continues in force.
12.2 Either party shall be entitled forthwith to terminate this Agreement by
written notice to the other if:
12.2.1 that other party commits any continuing or material breach of any
of the provisions of this Agreement and, in the case of such a
breach, which is capable of remedy, fails to remedy the same
within 30 days after receipt of a written notice giving full
particulars of the breach and requiring it to be remedied;
12.2.2 an encumbrancer takes possession or a receiver is appointed over
any of the property or assets of that other party;
12.2.3 that other party makes any voluntary arrangement with its
creditors or becomes subject to an administration order;
12.2.4 that other party goes into liquidation (except for the purposes of
an amalgamation, reconstruction or other reorganisation and in
such manner that the company resulting from the reorganisation
effectively agrees to be bound by or to assume the obligations
imposed on that other party under this Agreement); or
12.2.5 that other party ceases, or threatens to cease, to carry on
business.
12.3 For the purpose of clause 12.2.1, a breach shall be considered capable of
remedy if the party in breach can comply with the provision in question in
all respects other than as to the time of performance (provided that time
of performance is not of the essence).
12.4 Any waiver by either party of a breach of any provision of this Agreement
shall not be considered as a waiver of any subsequent breach of the same
or any other provision.
12.5 The rights to terminate this Agreement given by this clause shall not
prejudice any other right or remedy of either party in respect of the
breach concerned (if any) or any other breach.
12.6 Upon the termination of this Agreement for any reason, subject as
otherwise provided in this Agreement and to any rights or obligations
which have accrued prior to termination, neither party shall have any
further obligation to the other under this Agreement.
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13 Nature of agreement
13.1 Either party shall be entitled to perform any of the obligations
undertaken by it and to exercise any of the rights granted to it under
this Agreement through an Affiliate. The Company may also assign any of
its rights and obligations hereunder to an Affiliate, and any such
Affiliate assignee may similarly assign such rights and obligations to any
company, which is its Affiliate. Any act or omission of any Affiliate to
whom rights or obligations are assigned or otherwise given pursuant to
this clause 13.1 shall be deemed to be the act or omission of the party to
this Agreement who originally had the right or obligation in question.
13.2 Subject to the Purchaser's consent (such consent not to be unreasonably
withheld or delayed) the Company shall be entitled to carry out its
obligations under this Agreement through any agents or sub-contractors
appointed by it in its absolute discretion for that purpose provided that
the Company shall be responsible for all acts or omissions of such agent
or subcontractor and any breach of this Agreement by such agent or
subcontractor shall be deemed to be a breach by the Company.
13.3 Except as provided in clauses 13.1 and 13.2, this Agreement is personal to
the parties, and neither of them may, without the written consent of the
other, assign, mortgage, charge (otherwise than by floating charge) or
dispose of any of its rights hereunder, or sub-contract or otherwise
delegate any of its obligations under this Agreement.
13.4 Nothing in this Agreement shall create, or be deemed to create, a
partnership between the parties.
13.5 This Agreement contains the entire agreement between the parties with
respect to its subject matter, supersedes all previous agreements and
understandings between the parties, and may not be modified except by an
instrument in writing signed by the duly authorised representatives of the
parties.
13.6 Each party acknowledges that, in entering into this Agreement, it does not
do so on the basis of or rely on any representation, warranty or other
provision except as expressly provided in this Agreement, and accordingly
all conditions, warranties or other terms implied by statute or common law
are hereby excluded to the fullest extent permitted by law provided that
this shall not exclude any liability which either party would otherwise
have to the other in respect of statements made fraudulently by that party
prior to the date of this Agreement.
13.7 If any provision of this Agreement is held by any court or other competent
authority to be void or unenforceable in whole or part, the other
provisions of this Agreement and the remainder of the affected provisions
shall continue to be valid.
13.8 This Agreement shall be governed by and construed in all respects in
accordance with the laws of England, and the Purchaser agrees to submit to
the exclusive jurisdiction of the English courts.
14 Notices
14.1 Any notice required to be given hereunder by either party to the other
shall be in writing and may be given by hand or sent by first class
prepaid post or facsimile transmission and shall be deemed to be duly
served:
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14.1.1 if delivered by hand, when left at the proper address for service;
14.1.2 is given or made by prepaid first class post, 48 hours after being
posted (excluding Saturdays, Sundays and public holidays);
14.1.3 if given or made by facsimile transmission at the time of
transmission, provided that a confirming copy is sent by first
class prepaid post to the other party within 24 hours after
transmission
provided that, where in the case of delivery by hand or transmission by
facsimile, such delivery or transmission occurs either after 4.00 pm on a
Business Day, or on a day other than a business Day, service shall be
deemed to occur at 9.00 am on the next following Business Day (such times
being local time at the address of the recipient).
14.2 Any demand, notice or communication shall be made in writing or by
facsimile addressed to the recipient at its registered office or its
address stated in this Agreement (or such other address or facsimile
number as may be notified in writing from time to time) and shall be
marked for the attention of the Company Secretary in the case of the
Purchaser and the Chief Financial Officer in the case of the Company.
14.3 For the purposes of this clause 14 "Business Day" means any day other than
Saturdays, Sundays and public or statutory holidays.
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SCHEDULE 1
The Goods (Clause 1.1(c))
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SCHEDULE 2
The Specification (Clause 1.1(d))
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SCHEDULE 3
The Prices (Clause 5.1)
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SIGNED
Xxxxxx X.X. Hind
.................................................................
on behalf of BioProgress Technology International Inc
Xxxxx Xxxxxxx
.................................................................
on behalf of Farmasierra S.A.
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