Supply Agreement
Supply
Agreement
THIS
SUPPLY AGREEMENT dated as of April 20, 2007 (this “Agreement”), by and between
Alltrista Plastics Corporation d/b/a Jarden Plastic Solutions, an Indiana
corporation with its principal place of business located at 0000 Xxxxx
Xxxxxxxxxx Xxxx, Xxxxx, XX 00000-0000 (“Jarden Plastic Solutions”), and Innopump
Inc., d/b/a Versadial, a Nevada corporation with its principal place of business
located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000 (“Versadial”). Each of Jarden
Plastic Solutions and Versadial is referred to herein as a “Party” and sometimes
collectively as the “Parties”.
WHEREAS,
Jarden Plastic Solutions is willing to sell Products to Versadial on the terms
and conditions contained in this Agreement; and
WHEREAS,
Versadial is willing to purchase 40MM and 49MM Dual Chambered Pumps including
all versions, extensions, and/or product enhancements thereto (“40MM and 49MM
Dual Chambered Pumps”), and to purchase other products as may be added to this
Agreement by the mutual written agreement (together with the 40MM and 49MM
Dual
Chambered Pumps “Products”), each as described on Schedules A-D (“Schedules),
upon the terms, provisions and conditions set forth in this Agreement.
NOW
THEREFORE, in consideration of the covenants and agreements herein, and other
good and valuable consideration, the sufficiency of which is hereby
acknowledged, the Parties agree as follows:
| 1. |
Manufacture/Purchase
Requirements Contract.
|
| (a) |
During
the Term (as hereinafter defined) of this Agreement, Versadial agrees
to
purchase from Jarden Plastic Solutions and Jarden Plastic Solutions
agrees
to sell to Versadial not less than 100,000,000 units in the aggregate
of
Versadial’s 40MM and 49MM Dual Chambered Pumps, which shall be produced
using the injection molding tooling and automation equipment referred
to
on Schedule A-D (the “Equipment”) and similar products as are developed
under this Agreement. During the Term (as hereinafter defined) of
this
Agreement, Jarden Plastic Solutions shall have first right of refusal
for
any future additional tooling for the 40MM and 49MM Dual Chambered
Pumps.
This right of first refusal shall be subject to the same criteria
with
respect to timing and terms
as the criteria for the right of first refusal set forth in Section
8(a)(ii) hereof. Jarden Plastic Solutions shall also sell to Versadial
such other Products as may be mutually agreed upon in writing from
time to
time by Versadial and Jarden Plastic Solutions. Versadial agrees
to place
orders of not less then One Hundred Million (100,000,000) units in
the
aggregate of the 40MM and 49 MM Dual Chambered Pumps (the “Minimum”)
during the Term of this Agreement, subject to the manufacturing capacity
of Jarden Plastic Solutions to meet that level of production. Jarden
Plastic Solutions hereby represents and warrants to Versadial that
Jarden
Plastic Solutions shall be able to manufacture, in accordance with
the
specifications and using the tooling and automation equipment referred
to
on Schedules A-D, not less than 100,000,000 Million units in the
aggregate
of the 40 MM and 49 MM Dual Chambered Pumps over the Term so that
it will
satisfy the Minimum and 20,000,000 units in the aggregate of the
40 MM and
49 MM Dual Chambered Pumps annually during each rolling twelve (12)
month
period commencing one (1) year after the date hereof (the “Monthly
Minimum”).
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| (b) |
Versadial
shall be deemed to have satisfied its obligation to place an order,
if it
places purchase orders (each a “Purchase Order”) for units within the
scheduled manufacturing capacity not less than 30 days in advance
of the
delivery date of the order. All purchase orders from Versadial which
comply with the immediately preceding sentence (i.e. are within the
scheduled manufacturing capacity) shall be accepted by Jarden Plastic
Solutions.
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| 2. |
Price,
Invoices and Payment Terms.
|
| (a) |
Price
-The prices for Products is determined as specified on the Schedule
A-D
and are exclusive of any and all taxes whatsoever, whether sales,
use,
excise or other, whether or not same are set forth separately on
invoice
to Versadial; provided
no
invoice shall include taxes in the nature of income taxes or franchise
taxes. If Jarden Plastic Solutions shall subsequently be required
to pay
any such taxes relating to the production, sale or transportation
of the
Products (other than income taxes or franchise taxes attributable
to
Jarden), Versadial will reimburse Jarden Plastic Solutions for such
taxes;
provided
that if any such taxes paid are subsequently refunded, Jarden Plastic
Solutions shall pay to Versadial the amount of any such refund. If
any of
the Products are imported into any other country by Versadial, Versadial
will be responsible for all legal, regulatory and administrative
requirements associated with any exportation and the payment of all
associated duties, taxes and fees. Prices may increase or decrease
from
those set forth in Schedule A-D; provided
that any such increase or decrease will only be made if there has
been an
actual change in the cost of any of the components included therein
(such
changes limited to the cost of the items on Schedule E, which sets
forth
the base unit cost of materials, labor, and power included in the
component prices set forth on Schedules A-D), which has actually
been
incurred by Jarden Plastic Solutions, based upon its third party
arm’s
length arrangements with the vendors of such materials. Any such
price
increase or decrease, if applicable, shall be made once every six
(6)
months. Subject to the foregoing, any such increase shall be on not
less
than thirty (30) days prior written notice from Jarden Plastic Solutions
to Versadial, which notice shall set forth the amount of any such
price
increase and such other information as Versadial may reasonably request
in
order to permit Versadial to verify and audit such price change.
Notwithstanding that prices are only subject to change every six
(6)
months (as aforesaid), should a catastrophic event occur which effects
the
then current price of resins or the particular component parts set
forth
on Schedules A-E (a “Catastrophic Price Event”), resulting in a price
increase or decrease by ten percent (10%) or more, upon not less
ten (10)
days prior written notice, from Jarden Plastic Solutions to Versadial,
the
price of the resins or effected component shall be increased or decreased.
Any price increase or decrease, other than purchased components,
shall be
limited to the actual increase or decrease in the component of the
aggregate price that has increased or decreased multiplied by the
margin
factor illustrated on Schedule F attached hereto. With respect to
purchased components, any price increase or decrease shall be limited
to
the actual increase or decrease in the component of the aggregate
price
that has increased or decreased. Schedule E attachment shows the
current
purchase costs of such components. If the audit by Versadial results
in a
difference of opinion as to the proposed price increase, the Parties
shall
attempt for a period of ten (10) days to resolve the difference.
If the
difference cannot be resolved within such ten (10) day period, it
shall be
submitted to binding arbitration pursuant to Section 31 hereof. Any
such
price increase that is being audited shall not be effective, except
as
provided in the immediately following sentence. The price increase
or
decrease shall go into effect thirty (30) days after such ten (10)
day
period, if an arbitration ensues and the arbitration is not concluded
within such thirty (30) day period. If as a result of the arbitration
it
is determined that the price increase was or decrease was greater
than
appropriate under the terms hereof, the Party that received the excess
increase or decrease shall pay to the other Party hereto, that amount
of
such excess together with interest thereon, at a rate equal to seven
percent (7%) per annum (calculated on the basis of a year of twelve
(12)
months of thirty (30) days) from the date the increase or decrease
went
into effect until such excess is paid in
full.
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| (b) |
Invoices
- Jarden Plastic Solutions shall invoice Versadial when Products
are
shipped from Jarden Plastic Solution’s manufacturing facility FOB, to
Versadial’s customers or pursuant to Versadial’s direction. All payments
by Versadial on invoices shall be due forty-five (45) days following
receipt of Jarden Plastic Solutions’ invoice, except for any invoice or
portion thereof that Versadial is disputing in good faith. Should
Versadial fail to pay the undisputed portion of any invoice within
forty-five (45) days of the date of the invoice, then Jarden Plastic
Solutions shall, in addition to and without prejudice to any other
remedies available to Jarden Plastic Solutions under the Agreement,
Versadial shall pay interest at the rate of 1.0% per month on any
undisputed unpaid portion of an invoice that is not paid when due
(prorated for any portion thereof, if less then a month).
|
| (c) |
Indemnification
and Other Payments - All other payments hereunder (regardless of
the Party
making the payment), inclusive of rebates, refunds and indemnification
shall be made thirty (30) days following written presentation of
the
applicable claim. If the payment is not received within such thirty
(30)
day period, in addition to and without prejudice to any other remedies
available to the Party making the claim, the other Party shall pay
interest at the rate of 1.0% per month of the an amount of the claim
(prorated for any portion thereof, if less than a month). All payments
between the Parties under this Agreement shall be made in U.S. dollars.
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| (d) |
Versadial
agrees to establish a “Lock Box” or similar secure, segregated account
(“Lock Box”) with a third party bank or other third party custodian
reasonably acceptable to Jarden Plastic Solutions, which Lock Box
shall be
governed by the terms of a separate agreement (the “Lock Box Agreement”),
reasonably acceptable to Jarden Plastic Solutions (which shall be
a third
party beneficiary thereto), to be entered into by and between Versadial
and the custodian of the Lock Box. The Lock Box Agreement will terminate
immediately when Versadial has paid all amounts owing under the separate
Amortization Agreement between Versadial and Jarden Plastic Solutions
in
the form of Exhibit 1 attached hereto (the “Amortization Agreement”).
Versadial shall direct all customers to whom it sells any of the
Products
or goods which incorporate the Products to remit all payments due
from
such customers that specifically relate to the Products or goods
which
incorporate the Products directly to the Lock Box. Versadial agrees,
and
the Lock Box Agreement shall provide, that any amounts held in the
Lock
Box shall be paid (i) first, to Jarden Plastic Solutions in respect
of any
amounts currently due to it pursuant to this Agreement for the applicable
Products for which the payment relates, and (ii) second, only after
all
amounts then due and payable to Jarden Plastic Solutions pursuant
to
clause (i) have been so paid, to Versadial. Subject to the consent
of
Versadial’s senior lender (which consent may or may not be given),
Versadial hereby agrees to xxxxx Xxxxxx Plastic Solutions a first
priority
security interest in the contents of the Lock Box and to execute
such
further documents and take such further actions as Jarden Plastic
Solutions may reasonably request in order to record and perfect such
security interest. The security interest shall terminate when all
amounts
due by Versadial pursuant to the Amortization Agreement have been
paid,
whereupon Jarden Plastic Solutions shall execute such documents and
take
such actions as Versadial may reasonably request in order to evidence
the
termination of such security interest. Versadial also agrees to provide
Jarden Plastic Solutions access to its invoices and other payment
and
billing records as it may reasonably request in order to verify the
determination and allocation of amounts distributed from the Lock
Box.
|
| 3. |
Specifications/Non-Conforming
Goods.
|
| (a) |
Jarden
Plastic Solutions represents and warrants that all Products produced
by
Jarden Plastic Solutions under this Agreement shall conform to their
respective Specifications as set forth in Exhibit A hereto (the
“Specifications”).
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| (b) |
Subject
to Versadial’s termination rights set forth in Section 8 hereof,
Versadial’s sole remedy for non-conforming Products or goods which
incorporate the Products (i.e. do not conform to the Specifications)
shall
be to receive a credit for each nonconforming Product. Notwithstanding
the
foregoing, if such non-conformance is due to the gross negligence
or
willful misconduct of Jarden Plastic Solutions, Versadial shall retain,
and be able to exercise, all of its rights and remedies hereunder,
and
under law and in equity, with respect to such non-conformance. Versadial
shall dispose of non-conforming Product at the sole cost and expense
of
Jarden Plastic Solutions, and, at Jarden Plastic Solutions’ request and,
at its cost and expense, shall ship to Jarden Plastic Solutions some
or
all non-conforming Products and goods for inspection by Jarden Plastic
Solutions.
|
| 4. |
Forecasts.
Versadial will provide good faith forecasts to Jarden Plastic Solutions
at
the beginning of each of calendar quarter during the Term for each
Product. Forecasts by Versadial are for Jarden Plastic Solutions’ planning
purposes only and shall not be deemed to be a binding commitment
of
Versadial and/or its affiliates.
|
| 5. |
Order
Procedure.
|
| (a) |
Versadial
shall place orders for Products to be supplied under this Agreement
using
a Purchase Order, specifying the quantity of each type of Product
ordered
and the requested delivery date. As specified above, Jarden Plastic
Solutions shall accept all order for Products that are within the
schedule
capacity of Jarden Plastic Solutions and which have not less than
a thirty
(30) day lead time. Unless specified otherwise in any Purchase Order,
FOB
Jarden Plastic Solutions manufacturing facility shall have the meaning
ascribed to it in Incoterms 2000.
|
| (b) |
Termination
of Purchase Orders - Accepted purchase orders, are not subject to
termination or modification, unless they can reasonably be replaced
at no
additional cost to Jarden Plastic Solutions or Versadial, depending
upon
which Party purports to terminate the purchase orders.
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| 6. |
Shipment,
Delivery and Title.
|
| (a) |
The
Products shall be delivered to Versadial and title to the Products
shall
pass to Versadial FOB Jarden Plastic Solutions’ manufacturing facility
located at Reedsville, PA. After two (2) years after the date hereof,
Jarden Plastic Solutions may change the manufacturing facility to
one of
its other manufacturing facilities in the continental United States,
unless Jarden Plastic Solutions sells the manufacturing facility
located
at Reedsville, PA prior to such two (2) year period or there is a
catastrophic event at such facility which results in such damage
or
destruction to such facility to render such facility incapable of
allowing
Jarden Plastic Solutions to fulfill its obligation hereunder from
such
facility, in which case the change may occur earlier, subject to
the
conditions specified in this Section 6(a). Any such change to a new
manufacturing facility shall be subject to the following: (i) Jarden
Plastic Solutions shall furnish Versadial with not less than ninety
(90)
days prior written notice of such change whenever practicable, (ii)
the
new manufacturing facility (x) shall be of comparable quality to
the then
existing manufacturing facility, shall be cGMP complaint and shall
have
FDA regulation in effect and (y) shall permit Jarden Plastic Solutions
to
satisfy all of its obligations and agreements hereunder; (iii) shall
be at
no additional cost or expense to Versadial and Jarden Plastic Solutions
shall pay for all additional costs and expenses incurred by Versadial
in
connection with the move (including, without limitation, all actual
costs
of the move itself); (iv) shall not result in the manufacturing process
being down or not fully operative for a period of more than four
(4)
weeks; and (v) Jarden Plastic Solutions shall satisfy all accepted
Purchase Orders received in accordance with the terms hereof prior
to the
date of the move from the then existing manufacturing facility in
accordance with the terms hereof.
|
| (b) |
Title
to the Products shall pass to Versadial as specified in Section 6(a)
above. If certain of the Product(s) ordered are destroyed prior to
title
passing to Versadial, Jarden Plastic Solutions shall have the right
to
require delivery of the goods not destroyed or damaged; provided
that Versadial’s customer whose order has been destroyed or damaged will
accept a partial shipment. Risk of loss to the Products shall remain
with
Jarden Plastic Solutions until title to the Products passes to
Versadial.
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| (c) |
If
all or any portion of an order is not delivered on the delivery date(s)
acknowledged in the relevant Purchase Order, Versadial may require
Jarden
Plastic Solutions to ship the order via premium means (such as air
freight) at Jarden Plastic Solution’s
expense.
|
| (d) |
Delivery
- If no delivery schedule is specified, the order shall be filled
promptly.
|
| 7. |
Inspection
at Destination/Rejection of Shipment. Versadial or its customer shall
inspect all Products upon delivery of the Products to Versadial’s customer
or specified in the applicable purchase order. If Products are not
rejected within fourteen (14) days of receipt they shall be deemed
accepted. Acceptance of Products shall be conclusive except as regards
latent defects, or fraud, gross negligence or willful misconduct
on the
part of Jarden Plastic Solutions which amounts to fraud. Without
limiting
Versadial’s rights or remedies for latent defects in Products and/or fraud
(including, without limitation, with respect to matters of products
liability), all such rights and remedies being hereby reserved, Jarden
Plastic Solutions shall be responsible for all of all reasonable
costs and
expenses of returning any such non-conforming
Products.
|
| 8. |
Term
and Termination.
|
| (a) |
Term
- This Agreement shall commence on the date first above written.
|
| (i) |
Unless
terminated earlier as provided herein, this Agreement shall expire
on the
fifth anniversary of the date first of this Agreement (the “Term”).
Notwithstanding the foregoing, if at the end of the fifth anniversary
of
the date hereof, Versadial has not issued Purchase Orders that meet
the
criteria described in Section 1(a) for the Minimum , the Term of
this
Agreement shall be extended until Versadial has issued such Purchase
Orders for the Minimum.
|
| (ii) |
Provided
that no Party is in material default of its obligations hereunder
and the
Agreement is still in effect, the Parties agree that at the expiration
of
the Term of this Agreement, the Parties shall negotiate in good faith
a
renewal of this Agreement. To the extent Versadial and Jarden Plastic
Solutions do not agree on the terms of any such renewal, Versadial
shall
solicit other bids for the manufacture of the Products from third
parties,
subject to a right of first refusal in favor of Jarden Plastic Solutions.
Prior to entering into any agreement with a third party, pursuant
to the
right of first refusal in favor of Jarden Plastic Solutions, Versadial
shall provide all of the material terms of the third party offer
it
intends to accept writing to Jarden Plastic Solutions. Jarden Plastic
Solutions shall have thirty (30) days after receipt of written notice
of
the material terms to accept such terms of the third party offer
as its
agreement with Versadial by giving written notice to Versadial within
such
thirty (30) day period. If Jarden Plastic Solutions fails to give
notice
of acceptance within such thirty (30) day period, this right of first
refusal will be deemed to have expired and Versadial shall be free
to
enter into the agreement with the third
party.
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| (b) |
Termination
- This Agreement may be terminated as
follows:
|
| (i) |
This
Agreement shall be terminable immediately, upon written notice by
the
Party terminating this Agreement (the “Terminating Party”) to the other
Party hereto:
|
| (A) |
If
the other Party (the “Non-Terminating Party”) dissolves or institutes
proceeding seeking relief under a bankruptcy code or similar law,
or
consents to the filing against it of any petition for the appointment
of a
receiver, liquidator, assignee, trustee, sequestrator (or any similar
official) over such Non-Terminating Party or all or substantially
all of
its assets, or permits any such proceeding to remain undismissed
for a
period of forty five (45) days or more, or makes an assignment for
the
benefit of creditors, or admits in writing its inability to pay its
debts
as they become due, or takes any action in furtherance of the
foregoing;
or
|
| (B) |
Upon
any default by the Non-Terminating Party under this Agreement of
any
material covenant, provision or agreement set forth herein to be
performed
or observed by the other party hereto (including, without limitation,
any
payment obligation of a party hereunder), if such default is or cannot
be
cured by the defaulting Party within thirty (30) days of receipt
of
written notice from the Terminating Party of the default specifying
in
detail the nature of the default, or such longer period of
time.
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| (ii) |
This
Agreement may be terminated immediately by Jarden Plastic Solutions
if the
Specifications for any Product are determined by a court of competent
jurisdiction to infringe upon any statutory or common law patent,
copyright, trademark or other intellectual property right of any
person,
entity, or party or if the Products or Specifications are determined
by a
court of competent jurisdiction to violate any applicable
law.
|
| (iii) |
In
addition to the other grounds for termination by Versadial set forth
in
this Section 8, this Agreement may be terminated at any time by Versadial
in accordance with this Section 8(iii), upon thirty (30) days prior
written notice from Versadial to Jarden Plastic Solutions without
any
grounds or reason; provided
that Versadial shall (x) reimburse Jarden Plastic Solutions for all
amounts owing and unpaid by Versadial hereunder through the date
of
termination, (y) pay all amounts remaining to be paid under the
Amortization Agreement and (z) pay a penalty to Jarden Plastic Solutions,
based upon when the termination occurs, as
follows:
|
|
(A) Prior
to the end of year one of this Agreement
|
$
|
2,500,000
|
||
|
(B) After
year one but prior to the end of year two of this
Agreement
|
$
|
1,600,000
|
||
|
(C) After
year two but prior to the end of year three of this
Agreement
|
$
|
1,000,000
|
||
|
(D) After
year three but prior to the end of year four of this
Agreement
|
$
|
500,000
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The
amount owing under clauses (x), (y) and (z) shall be placed by Versadial with
a
mutually agreed to third party escrow agent who shall be directed to release
the
funds from escrow concurrently with the return of the Equipment by Jarden
Plastic Solutions to Versadial (or as directed by Versadial), in good working
condition, subject to normal wear and tear, and free and clear of any and all
liens, mortgages, security interests or other encumbrances of any nature
whatsoever. The penalty set forth in this Section 8(b)(iii) shall not be
applicable to the termination of this Agreement for any other reason whatsoever
and/or pursuant to any other provision of this Agreement.
| (iv) |
This
Agreement may be terminated upon written notice from Versadial to
Jarden
Plastic Solutions if Jarden Plastic Solutions fails to deliver injection
molded parts at a level of eighty-five percent (85%) of the Annual
Minimum
number of parts in any rolling year starting twelve (12) months after
the
date of this Agreement; provided
that Versadial orders at least the Monthly Minimum in each month
of such
rolling year.
|
| (v) |
Versadial
may terminate this Agreement as to the assembly process only, and
move the
assembly process from Jarden Plastic Solutions facility if Jarden
Plastic
Solutions fails to assemble 85% of the Annual Minimum number of final
assemblies in any rolling year starting twelve (12) months after
the date
of this Agreement; provided
that Versadial orders at least the Monthly Minimum in each month
of such
rolling year.
|
| (c) |
Effects
of Termination - In the event that Jarden Plastic Solutions terminates
this Agreement pursuant to Sections 8(b)(i)(A), 8(b)(i)(B) or 8(b)(ii)
or
Versadial terminates this Agreement pursuant to Sections 8(b)(i)(A)
or
8(b)(i)(B), in addition to all rights the Terminating Party has under
this
Agreement, the Terminating Party shall have the right to exercise
any and
all rights and remedies available to it at law or in equity. If
this Agreement is terminated by Versadial pursuant to Sections 8(b)(iv)
or
8(b)(v), (x) Versadial shall promptly pay Jarden Plastic Solutions
for all
amounts due and owing to Jarden Plastic Solutions as of the date
of
termination, (y) subject to compliance by Jarden Plastic Solutions
with
clause (z) of this sentence, Versadial shall continue to remain obligated
for any amounts owing under the Amortization Agreement which shall
be paid
as an when Products are manufactured for Versadial, and (z) concurrently
with such termination (at the cost and expense of Jarden Plastic
Solutions), Jarden Plastic Solutions shall deliver the Equipment
to
Versadial (or as directed by Versadial) in good working condition,
subject
to normal wear and tear and free and clear of any and all liens,
mortgages, security interests or other encumbrances of any nature
whatsoever; provided
that with respect to a termination pursuant to Section 8(b)(v), the
Equipment to be returned shall be limited to the assembly tables.
All
rights and remedies described herein are cumulative and the election
of
one remedy shall not preclude
another.
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| (d) |
Surviving
Obligations. The termination of this Agreement or expiration of this
Agreement shall not affect any other rights of either Party which
may have
accrued up to the date of such termination or expiration, relieve
either
Party of its obligations which remain to be paid or to be performed
as of
such to termination or expiration of this Agreement. Notwithstanding
the
termination or the expiration of this Agreement, the obligations
of the
Parties set forth in Sections 8, 9, 11(b), 11(c), 11(d), 14, 15,
17, 19,
20, 23, 28, 29, 30, 31 and 32, shall continue in full force and
effect.
|
| (e) |
Upon
payment of all amounts required to be paid pursuant to the Amortization
Agreement, all right, title and interest in and to the Equipment
shall
automatically be transferred to Versadial free and clear of any and
all
liens, mortgages, security interests or other encumbrances of any
nature
whatsoever, and Jarden Plastic Solutions shall take all such actions
in
furtherance of such transfer of the Equipment to Versadial (as aforesaid),
as Versadial shall reasonably
request.
|
| 9. |
Representations
and Warranties.
|
| (a) |
Mutual
Representations and Warranties. Each of the Parties hereby represents
and
warrants this Agreement is a legal and valid obligation binding upon
such
Party and enforceable in accordance with its terms; the execution,
delivery and performance of each this Agreement by such Party does
not
conflict with any material agreement, instrument or understanding,
oral or
written, to which it is a Party or by which it is bound; this Agreement
does not violate any law or regulation of any court, governmental
body or
administrative or other agency having jurisdiction over it; and the
Party
is validly organized, in good standing, and licensed to conduct business
in each jurisdiction in which the failure to do so would have a material
adverse effect on such Party; and such Party does not need to obtain
any
third party consents in order to perform its obligations hereunder.
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| (b) |
Product
Warranty.
Jarden Plastic Solutions warrants that Product(s) shall (i) be of
good and
merchantable quality and fit for the purpose for which they are intended,
and (ii) be free from all defects (latent or otherwise) in material
and
workmanship, (iii) be free and clear of any and all liens, security
interests and other adverse claim against title and possession and
(iv) be
provided to Versadial new; and (v) will conform in all respects to
the
Specifications.
|
| 10. |
Design
Work for Future Products. Versadial will offer to Jarden Plastic
Solutions
any packaging product design and development projects that involve
injection molding processes undertaken related to the Products during
the
Term of this Agreement concurrently with offering the work to any
other
entity or person. If Versadial elects to solicit other bids on such
work,
Versadial shall present the written third party offer it intends
to accept
in its entirety on a right of first refusal basis to Jarden Plastic
Solutions. Jarden Plastic Solutions shall have ten (10) days to accept
the
work on the terms of the third party offer by giving written notice
to
Versadial. If Jarden Plastic Solutions fails to give notice of acceptance
in a timely manner, the right of first refusal for such project will
be
deemed to have expired.
|
| 11. |
Intellectual
Property Ownership and Rights.
|
| (a) |
Grant
of License. Versadial hereby grants to Jarden Plastic Solutions a
limited,
non-assignable and non-transferable license to use the Patents set
forth
on Schedule G attached hereto in the United States, during the Term,
in
connection with the manufacture of the Products and for no other
purpose
whatsoever. The scope of such license is strictly limited as provided
herein and may not be assigned, transferred by Jarden Plastic Solutions
nor may Jarden Plastic Solutions enter into sub-license with respect
thereto. This license shall terminate upon the termination of this
Agreement for any reason
whatsoever.
|
| (b) |
Right
to Patent. Versadial represents and warrants that it has the exclusive
worldwide right, as, licensor to grant the license provided for in
Section
11(a) and the Patent does not violate or infringe the right of any
third
party.
|
Page
13
of 24
| (c) |
Jarden
Plastic Solutions shall own the worldwide right, title and interest
in and
to all ideas, processes, trademarks, service marks, inventories,
designs,
technologies, computer hardware and software, original works of
authorship, formulas, discoveries, patents, copyrights, copyrightable
work
product and other intellectual property, conceived of, developed
or
created by Jarden Plastic Solutions or Versadial during the Term
hereof
(the “New Intellectual Property”) which in any way relates to any
manufacturing process similar to the manufacturing process for the
injection molding components of the Products.
|
| (d) |
Versadial
shall own the worldwide right, title and interest in and to all New
Intellectual Property, conceived of, developed or created by Jarden
Plastic Solutions or Versadial during the Term which in any way relates
to
the Products including tooling, drawings, and molds (other than the
manufacturing process of the injunction molding components). Jarden
Plastic Solutions expressly waives any right, title or interest that
it
may have in and to the drawings for the molds and the tooling and
acknowledges that such drawings are the sole and exclusive property
of
Versadial.
|
| 12. |
Agreement
to License. It is a condition precedent to Jarden Plastic Solutions’
obligations hereunder that Versadial shall cause Xxxxxxx Xxxxxxx
(“Xxxxxxx”) to enter into an Agreement (“Agreement to License”) with
Jarden Plastic Solutions substantially similar to the form annexed
hereto
as Exhibit B and made a part hereof or in a form acceptable to Jarden
Plastic Solutions within thirty (30) days of execution hereof.
|
| 13. |
Force
Majeure. Except for the obligation to pay for the Products, neither
Party
hereto shall lose any rights hereunder or be liable for its failure
to
perform hereunder, in whole or in part, due to contingencies beyond
its
reasonable control, including strikes, riots, war, fire, explosions,
flood, embargo, lockout, acts of God, injunctions, and compliance
with any
law, regulation or order, whether or not valid, of the United States
of
America or any governmental body or any instrumentality thereof,
whether
now existing or hereto created (an “Event of Force Majeure”); provided,
however,
that the Parties shall use reasonable best efforts to continue to
meet
their obligations for the duration of the force majeure condition
and
shall use its best efforts to remedy the Event of Force Majeure;
and
provided further,
that the Party declaring force majeure shall notify the other Party
promptly in writing of the commencement of the condition, the nature,
and
the termination of the force majeure condition. Notwithstanding the
foregoing, in no event shall either Party be required to settle any
labor
dispute or disturbance.
|
Page
14
of 24
| 14. |
Confidentiality.
|
| (a) |
Each
Party shall not, directly or indirectly, under any circumstance:
(i)
disclose to any other Person any Confidential Information of the
other
Party hereto; (ii) act or fail to act so as to impair the confidential
or
proprietary nature of any such Confidential Information; or (iii)
offer or
agree to, or cause or assist in the inception or continuation of,
any such
disclosure or impairment of any such Confidential Information. All
Confidential Information is and shall remain the sole and exclusive
property of the party disclosing the same the “Disclosing Party” and the
receiving party (the “Receiving Party”) shall not be deemed to be a
licensee of any such Confidential Information. Notwithstanding the
foregoing, subject to compliance with Section 14(b) hereof, a Receiving
Party shall be entitled to disclose Confidential Information pursuant
to
applicable law, governmental regulation or rule or securities exchange
rule, court order, subpoena or similar judicial or regulatory process.
For
purposes hereof, the term “Confidential Information” shall mean any and
all of the following (regardless of the medium in which maintained
or
stored); confidential or proprietary information or material that
is not
in the public domain about or relating to any aspect of the transactions
contemplated hereby or any trade secrets relating to the business
and/or
operations of either Versadial or Jarden Plastic Solutions, as the
case
may be, or that is designated in writing as confidential at the time
of
disclosure, including, without limitation, financial information
and
projections, research and development plans or projects; data and
reports;
intellectual property strategies, the status of any applications
for
patents, trademarks, tradenames, service marks, service names, copyrights
and other intellectual property rights; computer materials such as
programs, instructions, source codes, object codes and printouts;
formulas; recipes; design concepts, product-testing information;
business
improvements; processes; manufacturing processes; marketing and selling
strategies; strategic business plans (whether pursued or not); budgets;
licenses; pricing, pricing strategy and cost data; information regarding
employees; the identities of customers and potential customers; the
identities of contact persons at customers and potential customers;
pricing; sales terms; service plans, methods, practices, and strategies;
forecasts, know-how and other marketing techniques; the identities
of key
accounts; the identities of suppliers and contractors, and all information
about those supplier and contractor relationships such as contact
person(s), pricing and other terms; and the terms of contracts or
agreements. For purposes hereof, Confidential Information shall not
include information that (i) is publicly known at the time of its
disclosure or becomes publicly known through no fault of the Receiving
Party; (ii) is lawfully received by the Receiving Party from a third
party, which to the knowledge of the Receiving Party is not bound
by a
confidential relationship or a confidentiality agreement with the
Disclosing Party; or (iii) was already known by the Receiving Party
hereto
prior to its receipt of the information from the other Party hereto.
|
Page
15
of 24
| (b) |
If
the Receiving Party is required to disclose any Confidential Information
pursuant to any applicable law, governmental rule or regulation,
court
order, subpoena or similar judicial or regulatory process, before
making
any disclosure the Receiving Party shall (i) give the Disclosing
Party
prompt written notice of the intended disclosure, whenever practicable
and
legally permissible, and (ii) to the extent practicable, cooperate
with
the Disclosing Party, at the Disclosing Party’s cost and expense, if the
disclosing Party seeks a protective order or other appropriate remedy.
In
the event a protective order is not obtained, or the disclosing Party
waives compliance with the provisions of Section 14, the Receiving
Party
intending to make the disclosure shall disclose only that portion
of the
Confidential Information which such the Receiving Party is advised
by
legal counsel is legally required to be disclosed.
|
| (c) |
Each
of the Parties acknowledges the importance of its obligations pursuant
to
this Section 14 to the business and financial condition of the other
Party
hereto and that the breach by such Party of this Section 14 will
likely
cause the other Party irreparable harm and damages which would not
be
easily calculable, and if calculable, would not provide an adequate
remedy. Therefore, the Parties agree that the non-breaching Party
(in
addition to its other rights and remedies it may have at law or in
equity,
all of which shall be cumulative), shall be entitled to seek injunctive
or
other equitable relief (without being required to post a bond or
other
security or to establish irreparable harm) in respect of any breach
or
threatened breach of any provision of this Section
14.
|
Page
16
of 24
| 15. |
LIMITATION
OF LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
PARTY
FOR INCIDENTAL, INDIRECT, SPECIAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE
DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST PROFITS REGARDLESS OF
WHETHER
A PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.
|
| 16. |
Insurance.
|
| (a) |
During
the Term, Jarden Plastic Solutions shall, at its cost, at all times
maintain standard occurrence product warranty insurance with respect
to
the Jarden Plastic Solutions Products, from insurance carriers of
recognized financial standing, providing liability coverage of $5,000,000
in the aggregate and $1,000,000 per occurrence subject to such
deductibles, as are customary in the industry. Versadial shall be
named as
an additional insured on such insurance and the policy may not be
amended
unless Versadial is given not less than thirty (30) days prior written
notice.
|
| (b) |
During
the Term, Versadial shall, at its cost, at all times maintain standard
occurrence product warranty insurance with respect to the Versadial
Products, from insurance carriers of recognized financial standing,
providing liability coverage of $5,000,000 in the aggregate and $1,000,000
per occurrence subject to such deductibles, as are customary in the
industry. Jarden Plastic Solutions shall be named as an additional
insured
on such insurance and the policy may not be amended unless Jarden
Plastic
Solutions is given not less than thirty (30) days prior written
notice.
|
| 17. |
Indemnification.
|
| (a) |
Indemnification
by Jarden Plastic Solutions. Jarden Plastic Solutions does hereby
agree to
save, protect, defend, indemnify Versadial and its shareholders,
parent,
officers, directors, employees, agents, affiliates and representatives
and
their respective successors and assignors (each and “Versadial Indemnified
Person”), and to hold harmless each Versadial Indemnified Person from and
against any and all costs, losses, liabilities, claims, actions,
suits,
damages and expenses (including, without limitation, reasonable attorneys’
fees and expenses) (collectively, the “Losses”) which any Versadial
Indemnified Person may incur or be obligated to pay, or for which
they or
any of them may become liable or be compelled to pay in any action,
suit,
claim or proceeding against any Versadial Indemnified Person, arising
from, based upon or relating to (a) breach or default in the performance
or observance of any material obligation, agreement or covenant of
Jarden
Plastic Solutions set forth in this Agreement on the part of Jarden
Plastic Solutions to be observed or performed, (b) any breach of
any
representation or warranty made by Jarden Plastic Solutions set forth
in
this Agreement, (c) any act or omission to act which constitutes
gross
negligence or willful misconduct on the part of Jarden Plastic Solutions
or any of Jarden’s Specialty Plastics agents, contractors or employees
with respect to the matters covered by this Agreement, and (d) any
product
warranty claim which is, in whole or in part, that relates to or
based
upon a claim or assertion that the Products did not conform to the
Specifications. In case any action, suit or other proceeding is brought
against Versadial Indemnified Person for which indemnification is
sought
hereunder, Jarden Plastic Solutions, or within notice from Versadial,
shall defend the same at Jarden’s Specialty Plastics sole cost and expense
by legal counsel reasonably satisfactory to Versadial. Jarden Plastic
Solutions shall not settle any such claim, action, suit or other
proceeding, unless as a part thereof Versadial and each applicable
Versadial Indemnified Person receives a complete release with respect
to
the claims for which indemnification have been
provided.
|
Page
17
of 24
| (b) |
Indemnification
by Versadial. Versadial does hereby agree to save, protect, defend
indemnify and hold Jarden Plastic Solutions and its shareholders,
parent,
officers, directors, employees, agents, affiliates and representatives
and
their respective successors and assigns, (and a “Jarden Plastic Solutions
Indemnified Person”) and to hold harmless each such Jarden Plastic
Solutions Indemnified Person from and against any and all Losses,
which
Jarden Plastic Solutions Person may incur or be obligated to pay,
or for
which they or any of them may become liable or be compelled to pay
in any
action, claim or proceeding against them or any of them, arising
from,
based upon or relating to (a) any claim by a third Party that Jarden’s
Specialty Plastics use of the Intellectual Property in accordance
with the
terms of this Agreement has resulted in an infringement of such third
party’s rights, (b) a breach or default by Versadial in the performance
or
observance of any material obligation, agreement or covenant of Versadial
set forth in this Agreement on the part of Versadial to be observed
or
performed, (c) any breach by Versadial of any representation or warranty
made by Versadial set forth in this Agreement and (d) any product
warranty
claim which does not relate to or is not based upon an allegation
or claim
that the Products do not conform to the Specifications. In case any
action, suit or other proceeding is brought against any Jarden Plastic
Solutions Indemnified Person for which indemnification is sought
hereunder, Versadial, on written notice from Jarden Plastic Solutions,
shall defend the same at Versadial’s expense by legal counsel reasonably
satisfactory to Jarden Plastic Solutions. Versadial shall not settle
any
such claim, action, suit or other proceeding, unless as a part thereof
Jarden Plastic Solutions and each Jarden Plastic Solutions Indemnified
Person receives a complete release with respect to the claims for
which
indemnification have been provided.
|
Page
18
of 24
| 18. |
Notice.
Any notice required to be given by the Agreement shall be in writing
and
sent by overnight courier, e.g., FedEx, (overnight delivery or the
earliest delivery shall be specified) or by facsimile (with confirmation
of receipt) to the persons identified
below.
|
|
Jarden
Plastic Solutions
|
Versadial
|
|
|
Attn:
Xxxx Xxxxxx
|
Attn:
Xxxxx Xxxxxxxxx
|
|
|
0000
Xxxxx Xxxxxxxxxx Xxxx
|
000
Xxxxxxx Xxxxxx
|
|
|
Xxxxx,
XX 00000-0000
|
Xxx
Xxxx, XX 00000
|
|
|
Tel:
(000) 000-0000
|
Tel:
|
|
|
With
a copy to:
|
With
a copy to:
|
|
|
Jarden
Corporation
Attn:
Senior Vice President &
General
Counsel
0000Xxxxxxxxx
Xxxxxx Xxxxx
Xxxx
Xxxxx, XX 00000
Fax
(000) 000-0000
|
Xxxxx
& XxXxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx
Xxxx, XX 00000
Attn:
Xxxxxx Xxxx Xxxxxxxx, Esq.
Fax:
(000) 000-0000
|
| 19. |
Expenses.
Except as otherwise expressly provided in this Agreement, each Party
shall
pay its/his own cost and expenses (including, without limitation,
attorneys’ fees and expenses) incurred in connection with the preparation
and negotiation of this Agreement and the consummation of the transactions
contemplated hereby.
|
Page
19
of 24
| 20. |
Waiver.
Any waiver by a Party of any breach of or failure to comply with
any
provision or condition of this Agreement by the other Party shall
not be
construed as, or constitute, a continuing waiver of such provision
or
condition, or a waiver of any other breach of, or failure to comply
with,
any other provision or condition of this Agreement, any such waiver
to be
limited to the specific matter and instance for which it is given.
No
waiver of any such breach or failure or of any provision or condition
of
this Agreement shall be effective unless in a written instrument
signed by
the Party granting the waiver. No failure or delay by either Party
to
enforce or exercise its rights hereunder shall be deemed a waiver
hereof,
nor shall any single or partial exercise of any such right or any
abandonment or discontinuance of steps to enforce such rights, preclude
any other or further exercise thereof, at any time
whatsoever.
|
| 21. |
Publicity.
Versadial and Jarden Plastic Solutions shall jointly plan and coordinate
all press releases and notices to third parties and all other publicity
concerning this Agreement and the transactions contemplated hereby.
|
| 22. |
Severability.
The Parties agree that should any provision of this Agreement be
held to
be invalid, illegal or unenforceable in any jurisdiction by a court
of
competent jurisdiction, that holding shall be effective only to the
extent
of such invalidity, illegally or unenforceability without invalidating
or
rendering illegal or unenforceable the remaining provisions hereof,
and
any such invalidity, illegally or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any
other
jurisdiction. It is the intent of the Parties that this Agreement
be
enforced to the fullest extent permitted by applicable
law.
|
| 23. |
Entire
Agreement; Amendment. This Agreement (together with the Exhibits
attached
hereto which form an integral part of this Agreement) contains the
entire
understanding and agreement between Versadial and Jarden Plastic
Solutions
hereto with respect to the subject matter hereof, and supersedes
all prior
and/or concurrent understandings and agreements, arrangements,
negotiations and understandings between Versadial and Jarden Plastic
Solutions (whether written or oral) relating to such subject, all
of which
are merged herein. No covenants, representations, warranties or
conditions, express or implied, whether by statute or otherwise,
other
than as set forth in this Agreement have been made by Versadial or
Jarden
Plastic Solutions. This Agreement may not be amended, modified, discharged
other than by an instrument in writing executed by each of the Parties
hereto. Each Party has been represented by competent legal counsel
of its
choosing in connection with its negotiation of this Agreement, and
therefore, this Agreement shall be interpreted and construed as if
it were
drafted jointly by the Parties.
|
Page
20
of 24
| 24. |
Assignment.
This Agreement is not for the benefit of any third party (other than
the
indemnities of a Party) and shall not be deemed to give any right
or
remedy to any such third party whether or not referred to in this
Agreement. Neither Jarden Plastic Solutions nor Versadial will have
the
right to assign the Agreement without the prior written consent of
the
other Party hereto. Subject to the foregoing, this Agreement shall
be
binding upon, and inure to the benefit, of the Parties, their successors
(by merger, consolidation or other similar transaction or a purchaser
of
all of the stock or other equity interests or assets of a Party)
and
permitted assigns.
|
| 25. |
Ambiguities.
Ambiguities, if any, in the Agreement shall not be construed against
any
Party, irrespective of which Party may be deemed to have authored
the
ambiguous provision.
|
| 26. |
Agency
and Joint Venture. The Agreement does not in any way create the
relationship of principal and agent, joint venture or partnership
between
the Parties or any other form of association which would impose on
any
Party liability for the act or failure to act of the other Party
or
Parties; and under no circumstances shall one Party be considered
to be
the agent of the other Party. Neither Party shall act or attempt
to act,
or represent itself, directly or by implication, as an agent of the
other
Party or in any manner assume or create, or attempt to assume or
create,
any obligation on behalf of, or in the name of, the other Party.
|
Page
21
of 24
| 27. |
Regulatory
Requirements -
Manufacturing Regulatory Matters.
|
| (a) |
Versadial
shall notify Jarden Plastic Solutions of any material matter related
to
the FDA and other relevant regulatory authorities and the Products
and
promptly furnish complete copies of such reports to Jarden Plastic
Solutions in the English language. Versadial also shall advise Jarden
Plastic Solutions of any occurrence or information that arises out
of
Versadial’s manufacturing activities which have adverse regulatory
compliance and/or reporting consequences concerning a Product.
|
| (b) |
Versadial
shall be responsible for handling and responding to any appropriate
governmental agency inspections with respect to the Products during
the
Term of the Agreement. Jarden Plastic Solutions shall use commercially
reasonable efforts to provide to Versadial any information requested
by
any governmental agency in connection with any governmental inspection
related to Products where legally permissible and practicable (as
reasonably determined by Versadial based upon consultation with
Versadial’s legal counsel). Versadial shall use commercially reasonable
efforts to promptly advise Jarden Plastic Solutions of any requests
by any
governmental agency for such inspections with respect to manufacturing
of
Products where legally permissible and practicable (as reasonably
determined by Versadial based upon consultation with Versadial’s legal
counsel).
|
| 28. |
Further
Actions. Each Party agrees to execute, acknowledge and deliver such
further instruments, and to do all such other acts, as may be necessary
or
appropriate in order to carry out the purposes and intent of the
Agreement.
|
| 29. |
Full
Cooperation. Versadial shall provide immediate assistance to Jarden
Plastic Solutions in responding to any inquiry or observation from
any
governmental agency, and will promptly investigate and respond to
any
allegation the Product is improperly designed or has failed to perform
properly.
|
| 30. |
Governing
Law. The Agreement shall be deemed to have been made in New York,
New
York, and shall be governed by and construed in accordance with the
laws
of the State of New York, U.S.A. without regard to the conflict of
laws
principles which would result in the application of the substantive
law of
another jurisdiction.
|
Page
22
of 24
| 31. |
Arbitration.
Any dispute or disputes arising between the Parties out of or in
connection with this Agreement (including its interpretation, closing,
execution, binding effect, amendment, breach, termination or enforcement)
and which cannot be settled through correspondence and mutual good
faith
consultation of the Parties hereto, shall be finally settled by binding
arbitration to be conducted in New York, New York, in accordance
with the
rules and procedure of the American Arbitration Association (the
“AAA”) by
a sole arbitrator, if the Parties agree on a sole arbitrator, or
by three
(3) arbitrators in all other instances if they can not so agree.
The
arbitration or arbitrators, as applicable, shall be chosen in accordance
with the procedures of the AAA. The award in any such arbitration
shall be
conclusive and binding upon the Parties and not subject to judicial
review. Judgment upon the Award or decision rendered by the arbitrator(s)
may be made to any court of competent jurisdiction for a judicial
recognition of the award or an order of enforcement thereof, as the
case
may be. The arbitrator[s] shall be authorized to award fees and expenses
(including without limitation of the costs of the arbitration any
attorneys’ fees and expenses) to the Party that prevails in the
arbitration.
|
| 32. |
Injunctive
Relief. Notwithstanding the provisions of Section 31 hereof, preliminary
injunctions, temporary restraining orders and/or any similar kind
of
temporary relief actions, or actions for equitable relief to the
extent
contemplated hereby shall not be resolved by arbitration pursuant
to
Section 31 hereof, but instead shall be resolved, and subject to
the
exclusive jurisdiction of, in any court of competent jurisdiction.
If
furtherance of the foregoing, the Parties hereby consents to the
jurisdiction of the Federal District Court for the Southern District
of
New York and the courts of the State of New York located in New York
County and agrees not to contest the jurisdiction of such courts
or to
assert the venue in such courts is improper or
inconvenient.
|
| 33. |
Effectiveness.
In addition to the requirements of Section 34 hereof, this Agreement
shall
only be effective if concurrently with the execution and delivery
of this
Agreement, (x) the Parties execute and deliver the Amortization Agreement
and (y) JPS, Sea Change Group LLC, a New York limited liability company,
and Xx. Xxxxxxx Xxxxxxx execute and deliver the Agreement, in the
form
thereof attached hereto as Schedule
G.
|
Page
23
of 24
| 34. |
Headings;
Counterparts, etc. The section headings contained in this Agreement
are
inserted for reference purposes only and shall not affect in any
way the
meaning, construction or interpretation of this Agreement. Any reference
to the masculine, feminine, or neuter gender shall be a reference
to such
other gender as is appropriate. References to the singular shall
include
the plural and vice versa. This Agreement may be executed in two
(2) or
more counterparts, and by the different Parties hereto in separate
counterparts, each of which when executed shall be deemed to be an
original, and all of which, when taken together, shall constitute
one and
the same document. This Agreement may be executed by facsimile signature
which shall constitute a legal and valid signature for purposes hereof.
Any reliable reproduction of this Agreement by reliable means shall
be
considered an original of this
Agreement
|
IN
WITNESS WHEREOF, each of the parties has caused this Agreement to be duly
executed by an authorized representative as of the day and year first written
above.
|
Alltrista
Plastics Corporation d/b/a Jarden Plastics Solutions
|
Innopump
Inc., d/b/a Versadial
|
|
By:
/s/ Xxxxx Xxxxx
|
By:
/s/Xxxxxxxx Xxxxxxxxx
|
|
Name:
Xxxxx Xxxxx
|
Name:
Xxxxxxxx Xxxxxxxxx
|
|
Title:
President
|
Title:
President/CEO
|
|
Date:
4/20/07
|
Date:
4/27/07
|
[Schedules
excluded as they only contain confidential pricing
information.]
Page
24
of 24
