Exhibit 10.15 Xxxxx Labs agreements
MANUFACTURING AND DISTRIBUTION SERVICES
BINDING TERM SHEET
The Manufacturing and Distribution Services Binding Term Sheet (the "Term
Sheet") is made this May __, 2003 (the "Effective Date"), by and among Xxxxx
Labs, Inc., a [corporation] organized under the laws of Taiwan ("Xxxxx"),
Emergency Filtration Products, Inc., a Nevada corporation ("EFP"), and solely
with respect to Sections II(6), III(2), III(3), III (4), IV, V(3) and VI below,
Chan, Xxxxxxxxxxx and Associates, Inc., a Nevada corporation ("CCA"), pursuant
to which Xxxxx will be the exclusive worldwide manufacturer of EFP's 2H
Nano-Enhanced Surgical Mask and other masks using related technology, and will
provide certain marketing and distribution services to EFP in connection with
the distribution of such mask products in the Asia territory (the "Distribution
Transaction").
The parties contemplate that this Term Sheet will be superceded and
replaced by a definitive written agreement covering the Distribution Transaction
consistent with the material terms of this Term Sheet and reasonably acceptable
to the parties, but if such an agreement is never drafted or entered into then
this Term Sheet shall remain a binding agreement among the parties.
I. Manufacturing
1. Mask Product: EFP's 2H Nano-Enhanced Surgical Mask, and any
other mask products designed for human use which
utilizes the Intellectual Property (as defined in
Section III.2.(e) below) incorporated into the 2H
Nano-Enhanced Surgical Mask (each such mask
referred to herein as a "Nano Mask"). EFP will
provide Xxxxx with the design and manufacturing
specifications for the Nano Mask prior to the
start of fabrication of the Nano Mask samples so
that Xxxxx has sufficient time to timely fabricate
such samples, and Xxxxx will be required to
fabricate no more than five (5) sample Nano Masks
for EFP approval (which shall not be unreasonably
withheld).
2. Exclusive Rights: EFP hereby grants Xxxxx exclusive worldwide rights
to manufacture and fabricate the Nano Masks during
the term of this Term Sheet. EFP agrees not to
assign, license or transfer any rights in or to
the Intellectual Property incorporated in the Nano
Mask which could in any way conflict with,
restrict or limit Xxxxx'x exclusive rights granted
under this Term Sheet, without the written consent
of Xxxxx. Xxxxx will be permitted to subcontract
or engage third-parties to fabricate and
manufacture the Nano Masks.
3. Orders: Xxxxx agrees to fabricate and manufacture the Nano
Mask pursuant to a written purchase order, which
shall be subject to acceptance by Xxxxx. Each
purchase order will contain (i) the number of Nano
Mask units to be manufactured (which, unless
otherwise approved by Xxxxx, shall be no less than
5,000 units) , (ii) any changes to the
specifications for the particular Nano Mask(s)
subject to the order, and (iii) whether Xxxxx is
being engaged by EFP to provide Distribution
Services (as defined below) with respect to such
the Nano Masks. Prior to acceptance of a purchase
order, Xxxxx will provide EFP with (a) an estimate
of the Manufacturing Cost (as defined in Section
I.4 below) or the Non-Distributed Mask Cost (as
defined in Section I.4 below) for Nano Masks
covered by the order, (b) the estimated completion
date of the order, and (c) payment in full for any
costs and charges related to the set-up of the
manufacturing of the Nano Masks (such as molds,
die casts and other miscellaneous costs) incurred
by Xxxxx. Any changes or modifications to an
accepted purchase order (including changes to the
specifications of the Nano Mask) shall be in
writing and approved by EFP and Xxxxx. Prior to
acceptance of a purchase order, EFP will either
deposit cash with Xxxxx, or establish a standby
letter of credit in favor of Xxxxx from a bank and
with terms reasonably acceptable to Xxxxx in an
amount equal to no less than [50%] of the
estimated Manufacture Cost (as defined below) or
the Non-Distributed Mask Cost (as defined below)
for such order (the "Order Deposit"). The Order
Deposit will be denominated in U.S. Dollars. Xxxxx
will manufacture the Nano Masks substantially
consistent with the specifications approved by EFP
(subject to any approved change orders). Title to
the Nano Masks and the risk of loss shall pass to
EFP upon completion of the fabrication and
manufacturing of such Nano Masks at the Xxxxx or a
third-party subcontractor facilities.
4. Purchase Price: For each Nano Mask (A) which is a Distributed Mask
(as defined below), EFP will pay Xxxxx an amount
equal to the cost to Xxxxx of designing,
fabricating and manufacturing for the particular
type of Nano Mask being manufactured, including
any costs of third-parties engaged by Xxxxx
related to the manufacturing of the Nano Masks,
and any cost increases resulting from any change
orders or modifications to the specifications
("Manufacture Cost"), and (B) which is not a
Distributed Mask, EFP will pay Xxxxx one hundred
and twenty-five percent (125%) of the Manufacture
Cost of such mask (the "Non-Distributed Mask
Cost"). Xxxxx will maintain records regarding the
Manufacture Costs and the Non-Distributed Mask
Costs of the Nano Masks, and EFP will have the
right upon reasonable advance notice during
business hours to review such records.
5. Payment Terms: For Nano Masks for which Xxxxx has not
been engaged to provide Distribution Services, EFP
shall pay Xxxxx the Non-Distributed Mask Cost for
such masks within 30 days of completion of the order.
For Nano Masks for which Xxxxx has been engaged to
provide Distribution Services, EFP shall pay Xxxxx
the Manufacture Cost for such masks within three (3)
days of receipt of payment by EFP from the customer
purchasing such Nano Masks; provided that in any case
payment of the Manufacture Cost of the order shall be
made by EFP no later than [60] days of completion of
the order.
II. Distribution Services
1. Distribution Services:EFP hereby engages Xxxxx to provide, either
directly or through third-parties, the following distribution and
marketing related services to EFP with respect only to the
distribution, sale and marketing of the Nano Masks (the "Distributed
Masks"), in the Asian Territory (as defined below) (the "Distribution
Services"): (i) Xxxxx will arrange for and oversee inventory and
storage of the Distributed Masks following completion of manufacturing
and prior to shipment to the customer, (ii) in consultation with EFP,
Xxxxx will arrange for and oversee shipping and transport of the
Distributed Masks to customers in the Asian Territory (including,
arranging for logistics support and custom clearance of shipments),
(iii) Xxxxx will, in consultation with EFP, identify customers in the
Asian Territory, assist EFP in qualifying such customers and, upon
request of EFP and at its expense, conduct credit checks on potential
customers, approach jointly identified customer prospects in the Asian
Territory, and process customer orders (including on behalf of EFP,
customer order tracking, responding to customer inquiries, invoicing
customers on behalf of EFP, collection of customer invoices and
processing of customer payments and product returns), and (iv) Xxxxx
will manage jointly agreed upon marketing and promotion efforts of the
Distributed Masks in the Asian Territory. As a part of providing
Distribution Services to EFP, Xxxxx will invoice each customer in the
Asian Territory for the Nano Masks purchased by such customers promptly
upon shipment of the applicable Nano Mask order. EFP will promptly send
Xxxxx any orders forms, or customer leads or inquiries for, a customer
in the Asian Territory, and will promptly advise Xxxxx in writing of
the receipt of any payments from customers in the Asian Territory. Any
customer payments received by Xxxxx in respect of the sale of any
Distributed Masks will be held by Xxxxx on behalf of EFP and promptly
paid over to EFP (which payment shall be made no later than the
fourteenth (14th) day of the month after the month in which Xxxxx
received the customer payment); provided that Xxxxx will have a right
to deduct and set-off from such payments any unpaid amounts due Xxxxx
for the Non-Distributed Mask Cost, the Manufacture Cost, the
Distribution Services Fee (as defined below), and the Margin Fee (as
defined below). EFP shall directly pay the expenses and cost of
insurance, and shipping and logistics relating to distribution of any
Distributed Masks in the Asian Territory will paid directly by EFP, but
EFP retains the right to pass on such expenses and costs to customers
of the Distributed Masks.
2. Asian Territory:For purposes of this Term Sheet, the term "Asian
Territory" shall mean all of the countries comprising Asia and the
Middle East, including, but not limited to, China, Hong Kong, South
Korea, Taiwan, Singapore, Thailand, Malaysia, India, Pakistan, Israel,
Philippines, and Vietnam.
3. Distribution Service
Fee:In exchange for Xxxxx'x agreement to provide the Distribution
Services to EFP, EFP will pay Xxxxx a fee equal to the lesser of (i)
the costs to Xxxxx of providing the Distribution Services, or (ii) [5]%
of Customer Unit Selling Price (as defined below) (the "Distribution
Service Fee"). For purposes of this Term Sheet, "Customer Unit Selling
Price" shall mean per unit purchase price for each Distributed Mask
charged by EFP to its customers in the Asian Territory (as reflected on
the applicable customer invoice). Xxxxx agrees to obtain the prior
approval of EFP (which shall not be unreasonable withheld) with respect
to any advertising or promotional activity relating to the Nano Masks
which would reasonably be expected to cost greater than 5% of the
Customer Unit Selling Price.
4. Margin Fee:In addition to Distribution Service Fee, EFP will pay
Xxxxx an amount equal to [42.5]% of the Distribution Margin (as defined
below) (the "Margin Fee"). For purposes of this Term Sheet,
"Distribution Margin" shall mean with respect to each Distributed Mask
an amount equal to the difference of (a) the Customer Unit Selling
Price, and (b) the sum of (i) per unit Manufacture Cost of such
Distributed Mask, plus (ii) the Distribution Service Fee.
5. Xxxxx Fee Payments: Payment of the Distribution
Service Fee and the Margin Fee shall be made in U.S.
Dollars, and will be due and payable within three (3)
days of receipt of payment by EFP (or by Xxxxx on
behalf of EFP) of amounts due in respect of
Distributed Masks; provided that in any case payment
of the Distribution Service Fee and the Margin Fee
shall be made by EFP no later than [60] days of the
date of the invoice relating to such Distributed
Mask. The risk of customer bad debt or non-payment
[and returns] shall rest entirely with EFP.
6. CCA Services: EFP and Xxxxx both acknowledge and agree that CCA
has been engaged by EFP to provide certain
management and advisory services related to the
Distribution Transaction as requested by EFP from
time to time; provided that during the term of
this Term Sheet such services shall not exceed ten
(10) hours in any given week or one hundred twenty
(120) hours in any three month period (the "CCA
Services"). In exchange for CCA's agreement to
provide the CCA Services, EFP will pay CCA a fee
equal to [15]% of the Distribution Margin (the
"CCA Fee"). Payment of the CCA Fee will be made in
U.S. Dollars, and will be due and payable promptly
(but in no event later than the fourteenth (14th)
day of the month after the month in which EFP (or
Xxxxx on behalf of EFP) received the customer
payment of amounts due in respect of Distributed
Masks; provided that in any case payment of the
CCA Fee shall be made by EFP no later than [60]
days of the date of the invoice relating to such
Distributed Masks.
7. Customer Reports: Xxxxx agrees to maintain written
records of behalf of EFP of (i) customer orders for
Distributed Masks, (ii) customer invoices and
xxxxxxxx for Distributed Masks sold such customers,
and (iii) payment receipts from customer in respect
of such invoices. No more than once per calendar year
will EFP have the right upon reasonable advance
notice during business hours to review the above
records.
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III. Representations, Warranties and Covenants
1. By Xxxxx: Xxxxx hereby makes the following representations and
warranties to EFP, as of the date of this Term Sheet:
(a) Good Standing and Due Authorization and Authority. Xxxxx is a
[corporation] duly organized, validly existing and in good standing
under the laws of Taiwan, and has all requisite [corporate] power and
authority to carry on its business as now conducted. All [corporate]
action on the part of the Xxxxx'x board of directors and shareholders
necessary for the authorization, execution, delivery of, and the
performance of all obligations of the Xxxxx'x under this Term Sheet
has been taken, and is in full force and effect. Xxxxx has full legal
right, power and authority to enter into and perform its obligations
under this Term Sheet, and this Term Sheet has been executed on behalf
of Xxxxx by a duly authorized officer of Xxxxx.
(b) Enforceability. This Term Sheet when executed and
delivered by Xxxxx will constitute valid and legally
binding obligation of Xxxxx, enforceable in
accordance with its respective terms, except as may
be limited by (i) applicable bankruptcy, insolvency,
reorganization or others laws of general application
relating to or affecting the enforcement of
creditors' rights generally, and (ii) the effect of
rules of law governing the availability of equitable
remedies.
(c) No Conflict. The execution and delivery of this
Term Sheet by Xxxxx, and the performance of Xxxxx'x
obligations under this Term Sheet, will not conflict
with, or (with or without notice or lapse of time, or
both) result in a termination, breach, default,
impairment or violation of (i) any provision of
Xxxxx'x charter documents or other governance
document of Xxxxx, (ii) any agreement, contract,
lease, loan or other obligation of Xxxxx or by which
Xxxxx is bound, or (iii) of any judgment, order,
writ, decree, or foreign, federal or state law,
statute, rule or regulation applicable to Xxxxx or by
which it is bound.
(d) Required Consents. All consents, approvals,
orders or authorizations of, or registrations,
qualifications, designations, declarations or filings
with, any foreign federal, state or local
governmental authority or any other person or entity
on the part of Xxxxx required in connection with the
execution and delivery of this Term Sheet by Xxxxx,
and the performance of all obligations of its under
this Term Sheet have been taken and are in full force
and effect.
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2. By EFP: EFP hereby makes the following representations and
warranties to Xxxxx and CCA, respectively, as of the
date of this Term Sheet:
(a) Good Standing and Due Authorization and Authority. EFP is a Nevada
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada, and has all requisite corporate power and authority to
carry on its business as now conducted. All corporate action on the part of the
EFP's board of directors and shareholders necessary for the authorization,
execution, delivery of, and the performance of all obligations of the EFP's
under this Term Sheet has been taken, and is in full force and effect. EFP has
full legal right, power and authority to enter into and perform its obligations
under this Term Sheet, and this Term Sheet has been executed on behalf of EFP by
a duly authorized officer of EFP.
(b) Enforceability. This Term Sheet when executed and
delivered by EFP will constitute valid and legally
binding obligation of EFP, enforceable in accordance
with its respective terms, except as may be limited
by (i) applicable bankruptcy, insolvency,
reorganization or others laws of general application
relating to or affecting the enforcement of
creditors' rights generally, and (ii) the effect of
rules of law governing the availability of equitable
remedies.
(c) No Conflict. The execution and delivery of this
Term Sheet by EFP, and the performance of EFP's
obligations under this Term Sheet, will not conflict
with, or (with or without notice or lapse of time, or
both) result in a termination, breach, default,
impairment or violation of (i) any provision of EFP's
Articles of Incorporation, Bylaws or other governance
document of EFP, (ii) any agreement, contract, lease,
loan or other obligation of EFP or by which EFP is
bound, or (iii) of any judgment, order, writ, decree,
or foreign, federal or state law, statute, rule or
regulation applicable to EFP or by which it is bound.
(d) Required Consents. All consents, approvals,
orders or authorizations of, or registrations,
qualifications, designations, declarations or filings
with, any foreign, federal, state or local
governmental authority or any other person or entity
on the part of EFP required in connection with the
execution and delivery of this Term Sheet by EFP, and
the performance of all obligations of its under this
Term Sheet have been taken and are in full force and
effect.
(e) EFP Intellectual Property. EFP owns all right,
title and interest in and to the Intellectual
Property (as defined below) rights incorporated into
or used in the design, fabrication or manufacture of
any Nano Mask (free of any and all claims, liens,
encumbrances, rights of third parties or
restrictions), and such Intellectual Property (i)
does not and will not infringe upon or violate any
Intellectual Property right of any third-party, and
(ii) is not subject to any liens, licenses,
obligations, encumbrances or other third-party rights
(oral or written) that could limit or adversely
affect the performance of EFP's obligations under
this Term Sheet. For Purposes of this Term Sheet,
"Intellectual Property" means all worldwide
inventions, patents, patent applications, design
rights and similar invention rights, copyrights,
copyright applications, trade secrets, know-how and
other intangible property or proprietary rights of
any kind recognized anywhere in the world under any
state or national statute or treaty or common law
right.
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(f) EFP Product Warranty. The Nano Masks will perform
as promised by EFP and as reflected in any
advertising and marketing materials prepared or
approved by EFP.
3. By CCA: CCA hereby makes the following representations and
warranties to EFP, respectively, as of the date of
this Term Sheet:
(a) Good Standing and Due Authorization and Authority. CCA is a Nevada
corporation duly organized, validly existing and in good standing under the laws
of Nevada, and has all requisite corporate power and authority to carry on its
business as now conducted. All corporate action on the part of the CCA's board
of directors and shareholders necessary for the authorization, execution,
delivery of, and the performance of all obligations of the CCA under this Term
Sheet has been taken, and is in full force and effect. CCA has full legal right,
power and authority to enter into and perform its obligations under this Term
Sheet, and this Term Sheet has been executed on behalf of CCA by a duly
authorized officer of CCA.
(b) Enforceability. This Term Sheet when executed and
delivered by CCA will constitute valid and legally
binding obligation of CCA, enforceable in accordance
with its respective terms, except as may be limited
by (i) applicable bankruptcy, insolvency,
reorganization or others laws of general application
relating to or affecting the enforcement of
creditors' rights generally, and (ii) the effect of
rules of law governing the availability of equitable
remedies.
(c) No Conflict. The execution and delivery of this
Term Sheet by CCA, and the performance of CCA
obligations under this Term Sheet, will not conflict
with, or (with or without notice or lapse of time, or
both) result in a termination, breach, default,
impairment or violation of (i) any provision of CCA's
Articles of Incorporation, Bylaws or other governance
document of CCA, or (ii) of any judgment, order,
writ, decree, or foreign, federal or state law,
statute, rule or regulation applicable to CCA or by
which it is bound.
4. Confidentiality:
(a) Definition. "Confidential Information" means: (i)
any non-public information of a party, including,
without limitation, any information relating to a
party's current and planned products and services,
technology, techniques, know-how, research,
engineering, designs, finances, accounts, procurement
requirements, manufacturing, customer lists, business
forecasts and marketing plans; (ii) any other
information of a party that is disclosed in writing
and is conspicuously designated as "Confidential" at
the time of disclosure. The obligations in Section
III(4)(b) below will not apply to the extent any
information: (i) is or becomes generally known to the
public through no breach of this Term Sheet by the
receiving party; (ii) was rightfully in the receiving
party's possession at the time of disclosure, without
an obligation of confidentiality; (iii) is
independently developed by the receiving party
without use of the disclosing party's Confidential
Information; or (iv) is rightfully obtained by the
receiving party from a third party without
restriction on use or disclosure.
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(b) Obligations. Each party will not use the other
party's Confidential Information, except as necessary
for the performance of this Term Sheet, and will not
disclose such Confidential Information to any third
party, except to those of its employees, agents,
representatives and subcontractors that need to know
such Confidential Information for the performance of
this Term Sheet. Each party will use all reasonable
efforts to maintain the confidentiality of all of the
other party's Confidential Information in its
possession or control, but in no event less than the
efforts that it ordinarily uses with respect to its
own confidential information of similar nature and
importance. The foregoing obligations will not
restrict any party from disclosing the other party's
Confidential Information or the terms and conditions
of this Term Sheet: (i) pursuant to the order or
requirement of a court, administrative agency, or
other governmental body, provided that the party
required to make such a disclosure gives reasonable
notice to the other party to enable it to contest
such order or requirement; (ii) on a confidential
basis to its legal or professional financial
advisors; or (iii) as required under applicable
securities regulations.
5. Taxes: The Non-Distributed Mask Cost, the Manufacture
Cost, the Distribution Services Fee, the Margin
Fee and the CCA Fee are exclusive of all sales,
value-added, withholding and all other taxes or
duties ("Taxes"). EFP will pay for all Taxes
assessed or incurred in connection with the
manufacture, sale, marketing and distribution of
the Nano Mask under this Term Sheet, and the
performance of the Distribution Services and the
CCA Services (except for taxes payable on Xxxxx'x
or CCA's net income). EFP will promptly reimburse
Xxxxx or CCA, as the case may be, for any Taxes
that either such party may be required pay on
EFP's behalf in connection with this Term Sheet.
IV. Term and Termination
1. Term: This Term Sheet commences on the Effective Date
and, shall remain in effect unless terminated earlier
in accordance with its terms.
2. Termination: This Term Sheet may be terminated, as follows: (i)
upon the written agreement of Xxxxx and EFP to
terminate this Term Sheet (provided that any
termination of Section III(6) will require the
written consent of CCA); (ii) by either Xxxxx or
EFP, at any time if the other party breaches any
material term of this Term Sheet and fails to cure
that breach within thirty (30) days after notice
thereof from the non-breaching party; provided
that Xxxxx may also terminate this Term Sheet, at
any time, if EFP breaches any of its payment
obligations under this Term Sheet and fails to
cure that breach within five (5) days after notice
thereof from Xxxxx; and (iii) by either Xxxxx or
EFP, if the other party becomes the subject of a
voluntary or involuntary petition in bankruptcy or
proceeding relating to insolvency, receivership,
liquidation, or composition for the benefit of
creditors; provided that CCA may voluntarily
terminate its obligations under Section II(6) of
this Term Sheet upon five (5) days written notice
to Xxxxx and EFP.
129
3. Effect of Termination: Upon the termination of this Term Sheet
(including a voluntary termination by CCA of its obligation under
Section II(6) under the preceding Section): (i) all covenants and
obligations of the parties shall terminate without liability, except
(a) EFP shall pay in accordance with this Term Sheet (1) to Xxxxx, the
Non-Distributed Mask Cost and the Manufacture Cost, as the case may be,
for any Nano Mask orders which have been completed or which are in the
process of being manufactured, and the Distribute Service Fee and
Margin Fee with respect to any Distributed Masks which have been
invoiced, and (2) to CCA, the CCA Fee with respect to any Distributed
Masks which have been invoiced; and (b) the rights and obligations of
the parties under Sections I(5), II(3), II(4), II(5), II(6)(with
respect to EFP's obligation to pay the CCA Fee), III, IV, V and VI
shall survive any termination of this Term Sheet; (ii) at Xxxxx'x
option, all purchase orders or portions thereof remaining undelivered
on the date of termination may within two (2) days be canceled; and
(iii) each party will promptly return to the other party all
Confidential Information of the other party in its possession or
control.
V. Indemnity
1. Xxxxx Indemnity: Xxxxx agrees to indemnify, defend
and hold harmless EFP, and its officers, directors,
employees, representatives, agents and attorneys (the
"EFP Parties") and CCA, and its officers, directors,
employees, representatives, agents and attorneys (the
"CCA Parties"), against any liability, damages,
expenses, and costs (including attorney's fees)
incurred by EFP or any EFP Party, or CCA or any CCA
Party, based on or arising out of any breach or
violation of any representation warranty, covenant or
obligation of Xxxxx under this Term Sheet
2. EFP Indemnity: EFP agrees to indemnify, defend and hold harmless
Xxxxx, and its officers, directors, employees,
representatives, agents and attorneys (the "Xxxxx
Parties"), and CCA and the CCA Parties, against
any liability, damages, expenses, and costs
(including attorney's fees) incurred by Xxxxx or
any Xxxxx Party, or CCA or any CCA Party, based on
or arising out of (i) any breach or violation of
any representation warranty, covenant or
obligation of EFP under this Term Sheet, (ii) any
investigation, claim or suit brought against Xxxxx
or any Xxxxx Party to the extent that it is based
upon a third-party claim that a Nano Mask
infringes or misappropriates any Intellectual
Property of any third-party, and (iii) any
investigation, claim or suit brought against Xxxxx
or any Xxxxx Party, or CCA or any CCA Party,
relating to product liability, personal injury or
death arising out of any Nano Mask.
3. Limited Damages: THE PARTIES ACKNOWLEDGE THAT XXXXX IS ACTING SOLELY
AS A THIRD PARTY MANUFACTURER AND DISTRIBUTOR OF THE NANO MASK AND THAT
EFP SHALL BE SOLELY RESPONSIBLE TO XXXXX AND TO THIRD PARTIES FOR ALL
LIABILITY, CLAIMS, DAMAGES, OBLIGATIONS AND COSTS AND EXPENSES RELATED
TO THE NANO MASK MADE OR DISTRIBUTED BY XXXXX UNDER THIS TERM SHEET. IN
NO EVENT WILL XXXXX BE LIABLE TO EFP, CCA OR ANY THIRD PARTY FOR ANY
LIABILITY, CLAIMS, OBLIGATIONS, DAMAGES, COSTS OR EXPENSES, INCLUDING
WITHOUT LIMITATION, ANY SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE OR
CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS OR
REVENUE, LOSS OF USE, LOST BUSINESS OPPORTUNITIES OR LOSS OF GOODWILL),
OR FOR THE COSTS OF PROCURING SUBSTITUTE PRODUCTS, ARISING OUT OF,
RELATING TO OR IN CONNECTION WITH THIS TERM SHEET OR THE USE OR
PERFORMANCE OF ANY EFP PRODUCTS (INCLUDING THE NANO MASKS), WHETHER
SUCH LIABILITY ARISES FROM ANY CLAIM BASED UPON CONTRACT, WARRANTY,
TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY OR OTHERWISE, WHETHER OR
NOT EFP HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE. THE
PARTIES HAVE AGREED THAT THESE LIMITATIONS WILL SURVIVE AND APPLY EVEN
IF ANY LIMITED REMEDY SPECIFIED IN THIS TERM SHEET IS FOUND TO HAVE
FAILED OF ITS ESSENTIAL PURPOSE. XXXXX MAKES NO WARRANTIES, AND
EXPRESSLY DISCLAIMS ANY WARRANTIES, REGARDING MERCHANTABILITY OF THE
NANO MASKS AND FITNESS OF SUCH MASKS FOR A PARTICULAR PURPOSE OR USE.
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4. Total Liability: XXXXX'X TOTAL LIABILITY TO EFP UNDER THIS TERM
SHEET, FROM ALL CAUSES OF ACTION AND UNDER ALL THEORIES OF LIABILITY,
WILL BE LIMITED TO THE PAYMENTS ACTUALLY RECEIVED FROM EFP UNDER THIS
TERM SHEET.
CCA'S TOTAL LIABILITY TO EFP UNDER THIS TERM SHEET, FROM ALL CAUSES OF
ACTION AND UNDER ALL THEORIES OF LIABILITY, WILL BE LIMITED TO THE
PAYMENTS ACTUALLY RECEIVED FROM EFP UNDER THIS TERM SHEET.
VI. General Provisions
1. Assignment: No party may not assign or transfer this
Term Sheet, in whole or in part, by operation of law
or otherwise, without the prior written consent of
Xxxxx and EFP, and any attempt to assign or transfer
this Term Sheet, without such consent, will be null
and of no effect. Subject to the foregoing, this Term
Sheet will bind and inure to the benefit of each
party's permitted successors and assigns.
2. Governing Law,
Venue: This Term Sheet will be governed by and construed in
accordance with the laws of the State of Delaware,
excluding its conflict of laws principles. The
parties disclaim application of the United Nations
Convention on Contracts for the International Sale of
Goods. Any legal action or proceeding arising under
this Term Sheet will be brought exclusively in the
federal or state courts located in the Northern
District of California and the parties hereby
irrevocably consent to the personal jurisdiction and
venue therein.
3. Nonexclusive: Except as expressly set forth in this
Term Sheet, the exercise by either party of any of
its remedies under this Term Sheet will be without
prejudice to its other remedies under this Term Sheet
or otherwise.
4. Notices: All notices, approvals, consents and other communications
required or permitted under this Term Sheet will be in writing and
delivered by confirmed facsimile transmission, by courier or overnight
delivery service with written verification of receipt, or by registered
or certified mail, return receipt requested, postage prepaid, and, in
each instance, will be deemed given upon receipt. All such notices,
approvals, consents and other communications will be sent to the
addresses set forth below a party's name or to such other address as
may be specified by either party to the other party in accordance with
this Section.
5. Force Majeure: No party will be responsible for any
failure or delay in its performance under this Term
Sheet (except for any payment obligations) due to
causes beyond its reasonable control, including, but
not limited to, labor disputes, strikes, lockouts,
shortages of or inability to obtain energy, raw
materials or supplies, war, terrorism, riot, or acts
of God.
6. Relationship: The parties are independent contractors
and this Term Sheet will not establish any
relationship of partnership, joint venture,
employment, franchise or agency between the parties.
Neither party will have the power to bind the other
party or to incur any obligations on its behalf,
without the other party's prior consent.
7. Amendment: This Term Sheet may be amended, or any term or provision
hereof waived, with the written consent of Xxxxx and EFP; provided that
the amendment of Sections II(6) or III(3), or the waiver of any
provision in this Term Sheet which inures to the benefit of CCA shall
also require the written consent of CCA. The failure by either party to
enforce any provision of this Term Sheet will not constitute a waiver
of future enforcement of that or any other provision.
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8. Severability:If for any reason a court of competent jurisdiction
finds any provision of this Term Sheet invalid or unenforceable, that
provision of the Term Sheet will be enforced to the maximum extent
permissible and the other provisions of this Term Sheet will remain in
full force and effect.
9. Entire Agreement: This Term Sheet, including all exhibits hereto,
constitutes the complete and exclusive understanding and agreement
between the parties regarding its subject matter and supercedes all
prior or contemporaneous agreements or understandings, whether written
or oral, relating to its subject matter.
10. Counterparts: This Term Sheet may be executed in
counterparts, each of which will be deemed an
original, but all of which together will constitute
one and the same instrument.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have executed this Term Sheet as
of the Effective Date.
EMERGENCY FILTRATION PRODUCTS, INC.
By: ____________________________
Name: _________________________
Title: __________________________
Address: ________________________
===============================
XXXXX LABS, INC.
By: ____________________________
Name: _________________________
Title: __________________________
Address: ________________________
===============================
With respect only to Sections II(6), III(2), III(3), III (4), IV, V(3) and VI,
CHAN, XXXXXXXXXXX & ASSOCIATES, INC.
By: ____________________________
Name: _________________________
Title: __________________________
Address: ________________________
===============================
[Execution Page to Manufacturing and Distribution Binding Term Sheet]
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