EXHIBIT 10.1
SUPPLY AGREEMENT
THIS SUPPLY AGREEMENT (this "Agreement") entered into as of the 23rd day of May,
2005 (the "Effective Date") by and among NOVA BIOGENETICS INC., a Delaware
corporation, having an address of 0000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, XX
00000 ("Supplier"), __________*___________, a Delaware corporation, having an
address of ______________________*______________________ ("Customer") and XXXXXX
XXXXXXX, INC., an Ohio corporation, having an address of 00000 Xxxxxxx Xxxx
Xxxx. Xxx. 000, Xxxxx Xxxxxxx, XX 00000-0000 ("Distributor")
WITNESSETH:
WHEREAS, Supplier is the manufacturer of those products set forth on
Exhibit A, attached hereto and by this reference made a part hereof (the
"Products"); and
WHEREAS, Supplier and Distributor wish to sell and Customer wishes to
purchase the Products on the terms more fully set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. DISTRIBUTION OF PRODUCTS: Supplier and Distributor agree to appoint Customer
as the EXCLUSIVE Licensee within the Territory, as set forth on Exhibit A, of
the Products in the __________*__________ industry with the right to resell the
Products under Supplier's trademarks to customers and potential customers at
premises located within the Territory, which customers and potential customers
shall be end users of the Products engaged in business in the Market. In
addition, Customer shall have the right to sell and package the Products as
Customer branded products within the Territory. Customer shall have the right to
sell Customer- branded products using Supplier's products as part of the
formulation. Supplier and Distributor acknowledge and agree that Customer shall
have the right distribute products outside of the Territory. In the event
Supplier elects to grant an exclusive license to resell the Products in Latin
America, Europe, Asia-Pacific or the Middle East regions, Customer shall have a
right of first refusal on such exclusive license. The exclusive license to sell
the Supplier technology by Customer shall pertain to an integral admixture
product to the markets outlined in Paragraph 4, below. Customer shall have the
non-exclusive right to sell the Product as surface-applied or in topical
applications in all markets.
2. PRODUCTS: Supplier shall have the right to add or delete Products and to
modify or improve the Products. Any addition or deletion shall take effect no
later than 90 days after Supplier sends Customer written notice of such addition
or deletion.
3. MARKET STUDIES: Customer shall provide Supplier and Distributor with a copy
of the Customer Market studies prepared by Customer, at Customer's sole expense.
Such Market studies shall also include Product purchase forecasts. The forecasts
are non-binding, but shall represent Customer's best estimate based upon the
then-current market knowledge. The estimated sales for North America are based
on a calendar year from October 1, 2005 to October 31 of the following year and
continuing for five consecutive years. Estimates for the following five years
are as follows: Year 1: 700,000 pounds, Year 2; 1,500,000 pounds, Year 3;
3,000,000 pounds, Year 4; 4,500,000 pounds, Year 5; 7,000,000 Pounds.
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4. MARKET: For purposes of this Agreement, the term "Market" shall mean the
__________*__________ market within the Territory. The proposed specific targets
are the following Market segments:
a) __________*__________
5. PRICES: Supplier and Distributor will sell and Customer will purchase the
Products at the prices set forth on Exhibit A to this Agreement for a period of
five years, Subject to price increase discussion in the event manufacturer
provides proof of an increase in raw materials however; in no event shall a
price increase exceed the CPI Index on an annual basis .
6. TERM: Unless otherwise terminated in accordance with Section 16 below, the
initial term of this Agreement shall be five years from the Effective Date (the
"Initial Term"). After the Initial Term, this Agreement shall automatically be
extended from year to year unless terminated by any party hereto with at least
90 days' prior written notice at any time after the Initial Term to the other
parties.
7. SALES POLICIES AND PROCEDURES:
(a) Customer and Distributor acknowledge the requirement for
satisfactory notice of orders and shall submit orders for Products to Supplier
for acceptance. Supplier and Distributor acknowledge the importance of on time
delivery to Customer. All parties agree to negotiate terms of delivery and
notice satisfactory to all companies.
(b) All Product sales and returns shall be subject to Supplier's
standard sales and return policies.
8. PAYMENT AND COMPENSATION TERMS:
(a) Customer shall pay Distributor invoices within 30 days of receipt
of invoice. Customer shall pay fees on past due invoices at a rate equal to the
lesser of one and one-half percent per month or the highest rate permitted by
law.
(b) All expenses and costs incurred by Customer in the performance of
the Agreement shall be for the account of Customer. Customer's sole compensation
hereunder shall consist of the difference between the Customer purchase price
paid to Distributor and the selling price received from its customer.
9. FREIGHT, TITLE AND TAXES: Unless otherwise specified in an order, Products
shall be shipped F.O.B. Supplier's plant or warehouse (with Customer being
responsible for arranging freight forwarding on their behalf),. All freight and
other charges are for Customer account, and title and risk of loss or damage
shall pass to Customer, upon Supplier's tender of the Products to the carrier.
Although shipping and delivery dates are approximate and subject to
confirmation, Supplier agrees to give Customer prompt notice of shipping delays
where Supplier has reason to believe such delays will extend five (5) days
beyond the projected shipping date. Prices exclude freight and Customer shall
pay all sales, use, excise, VAT, GST, export and import taxes, assessments and
similar fees imposed on the sale, transportation, delivery, storage or use of
the Products. Customer shall make any necessary arrangements for importation of
the Products into a country other than the United States, contained within the
Territory.
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10. DISTRIBUTION RIGHTS: Supplier shall have the right, at its option, to
enforce Territory or Market restrictions against Customer and Distributor.
Supplier shall have the obligation to Customer to enforce territorial or
customer restrictions against any and all of Supplier's distributors in said
market.
11. CUSTOMER OBLIGATIONS: Customer shall use its best efforts to actively
promote and continuously increase demand for and sales of the Products in the
Territory and the Market. From time to time, Supplier and Distributor, after
consultation with Customer, may establish non-binding sales goals or other
performance criteria to be achieved by Customer In the event Customer fails to
meet the performance criteria, Supplier shall have the right to modify the
exclusivity provisions of the license described herein, but shall continue to
make the Product available to Customer. Customer shall not directly or
indirectly offer, sell or attempt to sell goods or products which are
competitive with the Products in the Market in any part of the Territory.
Customer shall not obtain the Products from any other person or entity other
than Supplier, Distributor or a Supplier affiliated entity, and Customer shall
not, directly or indirectly, be engaged in or have any interest in any person or
entity which is engaged in the manufacture or distribution in the Territory of
any goods or products which compete with the Products.
12. PRODUCT WARRANTIES:
Except as specified herein, SUPPLIER EXPRESSLY DISCLAIMS, AND CUSTOMER
HEREBY WAIVES, ANY LIABILITY OR RESPONSIBILITY FOR, ANY WARRANTY OR
REPRESENTATION, EXPRESS OR IMPLIED, AS TO THE MERCHANTABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE. Supplier warrants and represents that the Products will: (1)
be of good quality and free of defects in material and workmanship; (2) strictly
conform to the specifications provided to Customer; and (3) not infringe upon or
violate any patent, copyright, trademark, trade name or any other right
belonging to others.
Supplier further warrants and represents that it shall comply with all
applicable federal, state, local and foreign laws, statutes, executive orders,
licensing and/or permit requirements, governmental orders, rules and regulations
(collectively referred to herein as "Laws"), as applicable, relating in any way
to the manufacture and sale of the Products. A certificate of analysis by the
Supplier will be sent with each and every shipment of Product to the Customer.
13. PROMOTIONAL MATERIALS:
(a) Supplier shall provide Customer, at no additional cost,
promotional, technical and safety bulletins and materials relating to the
Products, in types and quantities determined appropriate by Supplier Unless
Supplier agrees otherwise, all such materials shall be in the English language.
Customer agrees to promote the product at its sole expense, including
operational cost, marketing cost, promotional material and solicitation expense.
(b) Supplier shall provide supplementary technical and commercial
support, including technical training regarding the Products and their uses, at
levels determined appropriate by Supplier, in support of Customer's promotional
and sales efforts. If requested by Supplier, Customer shall pay travel and
living expenses incurred by Supplier personnel in providing such support and
training at locations other than Supplier's offices or plants in the United
States.
14. RELATIONSHIP OF THE PARTIES: Customer shall be the Exclusive Licensee within
the Territory, acting as an independent contractor, and neither Customer nor any
employee, agent or subcontractor of Customer shall be considered an employee or
agent of Supplier. No party hereto is authorized to assume or create any
obligation or responsibility, express or implied, on behalf of or in the name of
any other or to bind the others in any manner or thing whatsoever.
15. ETHICAL BUSINESS PRACTICES: No party to this Agreement shall do anything
which might, in any manner, jeopardize the goodwill or reputation of any other
party to this Agreement or the reputation of the Products.
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16. TERMINATION:
(a) If any party to this Agreement commits a material default under any
of the terms and conditions of this Agreement and fails to cure such default
within thirty (30) days after receipt of written notice from any other party to
this Agreement specifying such default, the non-defaulting party may, in
addition to and without prejudice to its other lawful rights and remedies,
terminate this Agreement at any time after the expiration of such thirty (30)
day period, provided, however, that if a non-monetary default is not reasonably
curable within such period, and the defaulting party shall have diligently
commenced to cure such default within such thirty (30) day period, the
defaulting party shall have a reasonable time thereafter within which to
complete the cure of such default.
(b) Notwithstanding any other provision of this Agreement, at any time
after the end of the second year of the Initial Term, any party hereto may
terminate this Agreement for any reason or no reason, upon one hundred twenty
(120) days notice to the others.
(c) The remedies reserved to Customer, Supplier or Distributor shall be
cumulative and in addition to all other or further remedies provided by law. No
waiver by either party of any breach, default or violation of any term,
warranty, representation, agreement, covenant, condition or provision hereof
shall constitute a waiver of any subsequent breach, default or violation of the
same or other term, warranty, representation, agreement, covenant, condition or
provision.
17. INDEMNITY:
Supplier agrees to indemnify, defend, and hold Customer and Distributor
harmless from and against any and all claims, actions, suits, liabilities,
obligations, demands, damages, losses, costs, expenses, fees (including
reasonable attorneys fees), fines, penalties, judgments and amounts paid in
settlement that relate to: (a) a breach by Supplier of any applicable warranty
and/or representation relating to the Products; (b) the manufacture, use or sale
of the Products; (c) a breach by Supplier of its obligations as set forth in
this Agreement; and/or (d) a claim by any third party that the Products violate
the intellectual property or others rights of such third party.
Customer agrees to indemnify, defend, hold Supplier and Distributor
harmless from and against any and all claims, actions, suits, liabilities,
obligations, demands, damages, losses, costs, expenses, fees (including
reasonable attorneys fees), fines, penalties, judgments and amounts paid in
settlement that relate to a breach by Customer of its obligations as set forth
in this Agreement.
Distributor agrees to indemnify, defend, hold Supplier and Customer
harmless from and against any and all claims, actions, suits, liabilities,
obligations, demands, damages, losses, costs, expenses, fees (including
reasonable attorneys fees), fines, penalties, judgments and amounts paid in
settlement that relate to a breach by Distributor of its obligations as set
forth in this Agreement.
IN NO EVENT SHALL ANY PARTY HERETO BE LIABLE TO ANOTHER PARTY FOR ANY INDIRECT,
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING BUT NOT
LIMITED TO LOST PROFITS OR LOST BUSINESS, ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR THE TRANSACTIONS BEING CONTEMPLATED HEREBY, REGARDLESS OF THE FORM
OR NATURE OF THE ACTION.
18. INSURANCE: At all times during the term of this Agreement, Supplier and
Distributor shall each procure and maintain insurance through an insurer
reasonably acceptable to Customer, including coverage for comprehensive general
liability insurance for products coverage, personal injury and property damage,
with minimum liability coverage of Two Million Dollars ($2,000,000). Supplier
and Distributor shall each provide Customer with a Certificate of Insurance and
shall name Customer as an additional insured under such policy. The failure by
either party to provide such Certificate of Insurance shall in no way relieve
Supplier or Distributor of its duties to comply with its obligations to procure
such insurance or act as a waiver by Customer to relieve either Supplier or
Distributor of its obligations.
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19. FORCE MAJEURE: None of the parties shall be responsible for damages caused
by any delay or failure to perform which is the result of an event of force
majeure. Events of force majeure refer to events and occurrences which could not
reasonably be avoided by the party failing to perform, including, but not
limited to, accident, natural catastrophe, act of God, riot or civil commotion,
enemy action, epidemic, explosion, fire, flood, insurrection, strike, lockout or
other labor trouble or shortage, unavailability or shortage of material,
equipment or transportation, war, or act, demand or requirement of the laws or
regulations of any governmental authority. If there are Product shortages for
any reason, Supplier may allocate the available supply of Product among itself,
its affiliates and its customers, including Customer, on whatever basis it deems
practical, provided, however, that Supplier shall give Customer prompt notice of
such shortages.
20. NOTICES: All required notices shall be in writing, in the English language
and sent by certified mail (return receipt requested), express mail service or
hand delivery with all charges prepaid or by telecopy with receipt confirmed to
the addresses set forth below, or to such other address as either party shall
designate by notice given as provided in this Article 21, and shall be deemed
effective on the date sent. If to Supplier:
NOVA BIOGENETICS INC.
0000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Contact: Xxx Xxxxx
Telephone: 000-000-0000 Fax: 000-000-0000
If to Customer:
__________*__________
__________*__________
__________*__________
__________*__________
__________*__________
If to Distributor:
XXXXXX HOLLAND, INC.
00000 Xxxxxxx Xxxx Xxxx. Xxx. 000
Xxxxx Xxxxxxx, XX 00000-0000
Contact: Xxxx Xxxxxxx
Telephone: 000-000-0000
21. GOVERNING LAW: The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of Delaware, U.S.A.
without regard to conflict of law principles. Any disputes hereunder shall be
settled by final and binding arbitration in Cleveland, Ohio, under the
Commercial Arbitration Rules of the American Arbitration Association.
22. COMPLIANCE WITH LAWS: All parties to this Agreement shall, at all times,
comply with all applicable International, National, State, provincial and local
laws, rules and regulations, and all amendments thereto. Customer shall not
resell, divert, transship, export or re-export any Product to any country or to
any person or entity, except in accordance with applicable international,
national, state, provincial and local laws, rules and regulations, including,
but not limited to, the U.S. Export Administration Act and the regulations
implementing such Act.
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23. ASSIGNMENT: The parties' respective rights and obligations under this
Agreement may not be assigned by any party without the prior written consent of
the other parties, which consent shall not be unreasonably withheld; provided,
however, that any party hereto may assign this Agreement to an affiliate or
subsidiary of such party without first obtaining the consent of the other
parties.
24. ENTIRE AGREEMENT: This Agreement constitutes the entire agreement among the
parties regarding the supply of the Products and it may not be modified except
by a written agreement signed by all parties.
25. SEVERABILITY: All provisions of this Agreement are intended to be severable.
If any provision or restriction is held to be invalid or unenforceable in any
respect, in whole or in part, such finding does not in any way affect the
validity or enforceability of any other provision of this Agreement. Any invalid
or unenforceable provision shall be deemed modified to be valid and enforceable
to the greatest extent permitted under the applicable law.
26. COUNTERPARTS: This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original, and all of which together shall constitute
an agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the day and year first set forth above.
NOVA BIOGENETICS INC. ______________*______________
BY:__________________________________ BY:_________________*________________
NAME:________________________________ NAME:_______________*________________
TITLE:_______________________________ TITLE:______________*________________
DATE:________________________________ DATE:________________________________
XXXXXX HOLLAND
BY:__________________________________
NAME:________________________________
TITLE:_______________________________
DATE:________________________________
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EXHIBIT A
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PRODUCTS
--------
Bioshield AM 500
$__*__/lb in 275 gallon totes that will contain 2,250 lbs. of Product per tote
TERRITORY
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NORTH AMERICA
Supplier and Distributor acknowledge and agree that Customer shall have the
right to distribute products outside of the Territory. In the event Supplier
elects to grant an exclusive license to resell the Products in Latin America,
Europe, Asia-Pacific or the Middle East regions, Customer shall have a right of
first refusal on such exclusive license.
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