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AGREEMENT
This agreement entered into the fifth day of July, 1999, by and between
Nutri Pharmaceuticals, Inc. (hereinafter referred to as "NPI") and Nova
Pharmaceutical Inc. (hereinafter referred to as "Nova").
RECITALS
Whereas, NPI manufactures certain quality nutrient and vitamin
products.
Whereas, Nova obtained a contract with Gold's Gym International, Inc.
(hereinafter referred to as "Gold's Gym") granting Nova the exclusive
license to manufacture, distribute and sell products using the Gold's
Gym trademark and logos along with the exclusive right to sell products
to franchisees of Gold's Gym, as well as other wholesale and retail
venues. A true and correct copy of the contract between Gold's Gym and
Nova is attached hereto and incorporated herein by this reference as
Exhibit A.
Whereas NPI and Nova are desirous of entering into an agreement whereby
NPI will exclusively manufacture all of the products which are to be
distributed in accordance with the contract between Nova and Gold's Gym
in exchange for certain favorable financing terms.
NOW THEREFORE, in consideration as set forth below, the parties hereby
enter into the following agreement for the manufacture of all products
desired or required under the contract between Nova and Gold's Gym.
1. NPI shall have the exclusive right to manufacture all products
desired or required under the contract between Nova and Gold's Gym,
NPI's exclusive right to manufacture shall continue for as long as Nova
has a contractual relationship with Gold's Gym granting Nova the
opportunity to manufacture or subcontract for the manufacturing of
nutrient and vitamin products. NPI's exclusive right shall furthermore
extend to all successor contracts vis-.-vis the parties and shall not
be limited to any particular product line.
2. Nova shall pay NPI for all products in relation to this
agreement within sixty (60) days of NPI's transmittal of products. The
parties recognize and agree that they are favorable financing terms.
3. The parties shall, in good faith, agree upon a price list for
all products required under the terms of this agreement. Said price
list shall be subject to modification for the following reasons:
a) Modification of products required in accordance with
Nova's agreement with Gold's Gym.
b) The cost and availability of raw materials.
c) The cost and availability of packaging materials.
d) Nova reserves the right to verify the costs and
availability of raw materials.
4. NPI shall also produce all necessary products for
exhibition at Gold's Gym's public relations conference to be held in
Las Vegas, Nevada from July 26, 1999, through July 30, 1999.
5. NPI shall disclose the product content as required by
existing federal, state and local laws. Although NPI shall provide
Nova with the makeup of each particular product, NPI is not required to
divulge any trade secrets, including percentages of raw materials
within any given product, to Nova or any other party.
6. NPI shall develop and administer a tracking system for products
which meets or exceeds generally accepted record-keeping practices.
7. This agreement may only be terminated for the following
reasons, and under any circumstances performance may not be terminated
prior to written notification of the following circumstance followed by
a thirty (30) day period within which to cure said circumstance:
a) Any failure of Nova to satisfy any financial
obligation NPI;
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b) Independent evidence of sub-potent product by an
independent assay exceeding a standard deviation of five percent (5%);
c) Modification of the formula of any product without
prior notice by NPI;
d) Repeated and consistent failure of NPI to met
deadlines;
e) Repeated and consistent failure of NPI to have the
capacity to satisfy orders;
f) NPI fails to maintain minimum product liability
insurance of $1,000,000 with $10,000,000 excess liability and fails to
name Nova as an additional insured party; or
g) NPI shall have the right to terminate its obligation
under this agreement in the event that Nova unreasonably withholds
consent or communication regarding any matter hereunder.
8. The terms of this agreement shall be binding on all heirs,
assigns, and legal representatives of the parties hereto.
9. This agreement constitutes the entire agreement between the
parties and any modifications to this agreement shall be in writing
executed by both parties.
10. Each of the provisions of this agreement shall be deemed
independent and severable, and the invalidity or partial invalidity of
any provision or portion thereof shall not affect the validity or
enforceability of any other provision.
11. In the event that there is any dispute as to the interpretation
or performance of this agreement, the prevailing party to such dispute
shall be entitled to its actual attorney's fees and costs in relation
thereto.
12. The undersigned are vested with the right power and authority
to bind the parties to this agreement.
Dated this fifth day of July 1999.
NPI Nova Pharmaceutical Inc.
_______________________________ _______________________________
By: By:
Its: Its:
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CONTINUING GUARANTY
For Valuable Consideration the receipt and sufficiency of which is
hereby acknowledged, the undersigned, for themselves, their heirs,
executors, personal representatives, successors and assigns
(individually called "Guarantor" and collectively called "Guarantors")
jointly and severally and in solido, hereby unconditionally guarantee
to
____________________________________________________________________
Nutri Pharmaceutical, Inc.
Its successor, endorses and assigns, (collectively called "NPI") that
_____________________________________________________________________
Nova Pharmaceutical Inc
_____________________________________________________________________
("Nova"), whose address is 00000 Xxxxxx Xxxxx, Xxxx Xxxxxxxx,
Xxxxxxxxxx 00000 shall promptly and fully perform, pay and discharge
all of its present and future liabilities, obligations and indebtedness
to NPI, whether direct or indirect, joint or several, absolute or
contingent secured or unsecured, matured or unmatured, and whether
originally contracted with or otherwise acquired by NPI (all of which
liabilities, obligations and indebtedness are herein individually and
collectively called the "Indebtedness"). This Guaranty is an absolute
and unconditional guarantee of payment and not of collectibility. The
liability of each Guarantor hereunder is not conditional or contingent
upon the genuineness, validity, sufficiency or enforceability of the
Indebtedness or any instruments, agreement or chattel paper related
thereto (collectively called "Agreements") or any security or
collateral therefore (collectively called "Security") or the pursuit by
NPI of any rights or remedies which it now has or may hereafter have.
If Nova fails to pay the indebtedness promptly as the same becomes due,
or otherwise fails to perform any obligation under any of the
Agreements, each Guarantor agrees to pay on demand the entire
Indebtedness and all losses, costs, attorneys' fees and expenses which
may be suffered by NPI by reason of the Nova's default or the default
of any Guarantor hereunder, and agrees to be bound by and to pay on
demand any deficiency established by the sale of any of the Agreements
or Security, all without relief from valuation and appraisement laws
and without requiring NPI to (I) proceed against Nova by suit or
otherwise, (ii) foreclose, proceed against, liquidate or exhaust any
of the Agreements or Security, (iii) exercise, pursue or enforce any
right or remedy NPI may have against Nova, any co-Guarantor (whether
hereunder or under a separate instrument) or any other party. Each
Guarantor agrees that: this Guaranty shall not be discharged or
affected by any circumstances which constitute a legal or equitable
discharge of a Guarantor or surety, or by the death of any Guarantor;
the record of NPI shall be received as conclusive evidence of the
amount of the Indebtedness at any time owing; one or more successive or
concurrent status suits may be brought and maintained against any or
all of the Guarantors, at the option of NPI, with or without joinder of
the Nova or any of the other Guarantors as parties thereto; such
Guarantor will not avail itself of any defense whatsoever which Nova
may have against NPI, other than full payment of the Indebtedness; and
such Guarantor will not seek a change of venue from any jurisdiction or
court in which any action, proceeding or litigation is commenced.
Each guarantor hereby waives notice of any adverse change in Nova's
condition or of any other fact which might materially increase such
guarantor's risk, whether or not NPI has knowledge of the same. Each
guarantor also hereby waives any claim, right or remedy which such
guarantor may not have or hereafter acquire against the company that
arises hereunder and/or from the performance by any guarantor hereunder
including, without limitation, any claim, remedy of NPI against Nova or
any security which NPI now has or hereafter acquires, whether or not
such claim, right or remedy arises inequity, under contract, by
stature, under common law or otherwise.
No termination hereof shall be effective until the Guarantors deliver
to NPI a written notice signed by them electing not to guarantee any
new extension of credit that may be granted by NPI to the company after
its receipt of such notice, but such notice shall not affect the
obligations of the guarantors hereunder as to any and all Indebtedness
existing at the time such notice is received. Each Guarantor hereby
waives (i) notice of acceptance hereof and notice of extensions of
credit given by NPI to Nova from time to time, (ii) presentment,
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demand, protest, and notice of non-payment or protest as to any note or
other evidence of indebtedness signed, accepted, endorsed or assigned
to NPI by Nova, (iii) all exemptions and homestead laws, (iv) any
other demands and notices required by law; and (v) any right to trial
by jury. NPI may at any time and from time to time, without notice to
or the consent of any Guarantor, and without affecting or impairing the
obligation of any Guarantor hereunder; (a) renew, extend or refinance
any part of all the Indebtedness of Nova or any Indebtedness of its
customers, or any of co-Guarantor (whether hereunder or under a
separate instrument or) or any other party; (b) accept partial payment
of the Indebtedness and apply such payments to any part of the
Indebtedness; (c) settle, release (by operation of law or otherwise),
compound compromise, collect or liquidate, in any manner, any of the
Indebtedness, any Security, or any Indebtedness of any co-Guarantor
(whether hereunder or under a separate instrument) or any other party;
(d) consent to the transfer of any Security; (e) bid and purchase at
any sale of any of the Agreements or Security; and (f) exercise any and
all rights and remedies available to NPI by law or agreement even if
the exercise thereof may affect, modify or eliminate any rights or
remedies which a Guarantor may have against Nova. Each Guarantor shall
continue to be liable under this Guaranty, the provisions hereof shall
remain in full force and effect and NPI shall not be estopped from
exercising any rights hereunder, notwithstanding (i) NPI waiver of or
failure to enforce any of the terms or conditions contained in any of
the Agreement; (ii) any release of, or failure on the part of NPI to
perfect any security interest in or foreclose, proceed against, or
exhaust, any Security; or (iii) NPI failure to take new, additional or
substitute security or collateral for the Indebtedness.
Each Guarantor agrees that NPI may bring any legal proceedings it deems
necessary to enforce any or all of such Guarantor's obligations
hereunder in the state of Nevada; and service of process may be made
upon such Guarantor by mailing a copy of the summons to such Guarantor
or at its address last known to NPI. All rights and remedies of NPI
are cumulative and not alternative. Each provision of its Guaranty is
intended to be severable. Any term or provision hereof declared to be
contrary to, prohibited by or invalid under applicable laws or
regulations shall be inapplicable and deemed omitted hereof, but shall
not invalidate the remaining terms and provision hereof.
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty on July
5, 1999.
____________________________
Xxxxx X. Xxxx
Social Security No.: ###-##-####
