EXHIBIT 10.1
SUPPLY AGREEMENT
THIS SUPPLY AGREEMENT (this "Agreement") effective as of March 5,
1999, is by and between CARALOE, INC., a Texas corporation ("Seller"),
and FOR YOUR HEALTH, INC., a Washington Corporation ("Buyer"),
WITNESSETH:
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to
purchase from Seller, bulk aloe xxxx mucilaginous polysaccharide
(hereinafter referred to under the product name of "Manapol[R] Powder")
in the quantities, at the price, and upon the terms and conditions
hereinafter set forth; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the parties hereto agree as
follows:
1. Term. The term of this Agreement shall commence on March 5,
1999, and shall end at midnight on March 4, 2001 unless further extended
or sooner terminated as provided herein (such term, as extended, herein
called the "Term"). The Term (including each one-year extension of the
Term) shall be extended automatically for an additional one-year period,
provided that, at least thirty (30) days prior to the end of the Term,
Seller and Buyer mutually agree in writing on the quantity and price of
Manapol[R] Powder to be sold by Seller and purchased by Buyer hereunder
during such additional one-year period. At least sixty (60) days prior
to the end of the Term, Seller and Buyer shall commence good faith
negotiations to determine and agree upon such quantity and price for such
additional one-year period. If the parties are unable to so agree on
such quantity and price, this Agreement shall terminate effective at the
end of the current Term. Nothing contained in this Paragraph 1 shall be
deemed to (i) obligate the parties to agree upon such quantity and price,
(ii) obligate a party to negotiate with the other party regarding such
quantity and price if such other party is then in breach of or in default
under this Agreement or (iii) limit the rights to the parties under
Paragraph 8 hereof.
2. Territory. Buyer is permitted to market agreed upon products
containing Manapol[R] Powder in the United States. The use of the
Manapol[R] Powder trademark is, however, covered by the separate
Trademark licensing agreement entered into by the parties hereto.
3. Purchase License. Buyer agrees that all Manapol[R] Powder
purchased by it hereunder shall be used only as an additive in human or
animal health food products manufactured by or for Buyer that are
intended for sale to the ultimate consumer in the United States. Such
food products are herein called "Buyer Products".
4. Quality. Seller warrants to Buyer that all Manapol[R] Powder
sold by Seller pursuant to this Agreement will conform to the quality
specifications set forth in Exhibit A to this Agreement. EXCEPT AS
PROVIDED IN THIS PARAGRAPH 4, THERE ARE NO WARRANTIES OR REPRESENTATIONS
OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES
OF MERCHANTABILITY, FITNESS AND FITNESS FOR A PARTICULAR PURPOSE, MADE
WITH RESPECT TO THE MANAPOL[R] POWDER TO BE SOLD HEREUNDER, AND NONE
SHALL BE IMPLIED BY LAW.
5. Deliveries. Buyer shall instruct Seller from time to time
during the Term, by placing a purchase order with Seller reasonably in
advance of the date Buyer desires Manapol[R] Powder to be delivered to it
hereunder, (i) as to the quantities of Manapol[R] Powder to be delivered
to Buyer, (ii) as to the specific date of delivery, (iii) as to the
specific location of delivery and (iv) as to the carrier or particular
type of carrier for such delivery. During the Term, Buyer shall provide
Seller (a) on a yearly basis a nonbinding forecast of Buyer's minimum and
maximum aggregate delivery requirements for Manapol[R] Powder for such
period, and (b) on a quarterly basis a forecast acceptable to Seller
(which shall be binding on Buyer) of Buyer's minimum and maximum delivery
requirements for Manapol[R] Powder for each month of the next three (3)
month period. The quantities of Manapol[R] Powder ordered by Buyer
pursuant to this Agreement from time to time shall be spaced in a
reasonable manner, and Buyer shall order such quantities in accordance
with Buyer's binding forecasts. In no event shall Seller be required to
deliver to Buyer in any three-month period a quantity of Manapol[R]
Powder in excess of 125% of the maximum delivery requirement for such
period set forth in the binding forecast for such period accepted by
Seller. Deliveries of Manapol[R] Powder shall be made by Seller under
normal trade conditions in the usual and customary manner being utilized
by Seller at the time and location of the particular delivery. The
Manapol[R] Powder delivered to Buyer hereunder shall be packaged in
suitable containers to be determined by the Seller. All deliveries of
Manapol[R] Powder to Buyer hereunder shall be made by Seller F.O.B. at
the facilities of Seller or its affiliates.
6. Price. All Manapol[R] Powder to be purchased by Buyer under
this Agreement shall be purchased by it, at a price as outlined in
Exhibit B. All prices listed in Exhibit B may be changed by the Seller
at any time, provided that the Seller shall provide the Buyer with thirty
(30) days written notice in advance of all such price changes. Buyer
shall bear all freight, insurance and similar costs, and all sales taxes,
with respect to such purchases. The purchase price of Manapol[R] Powder,
together with all related freight, insurance and similar costs, and sales
taxes, shall be paid by Buyer to Seller within thirty (30) days after the
date of invoice.
7. Confidentiality. In the performance of Seller's obligations
pursuant to this Agreement, Buyer may acquire from Seller or its
affiliates technical, commercial, operating or other proprietary
information relative to the business or operations of Seller or its
affiliates (the "Confidential Information"). Buyer shall maintain the
confidentiality, and take all necessary precautions to safeguard the
secrecy, of any and all Confidential Information it may acquire from
Seller or its affiliates. Buyer shall not use any of such Confidential
Information for its own benefit or for the benefit of anyone else. Buyer
shall not publicly disclose the existence of this Agreement or the terms
hereof without the prior written consent of Seller.
8. Force Majeure. Seller shall not have any liability hereunder
if it shall be prevented from performing any of its obligations hereunder
by reason of any factor beyond its control, including, without
limitation, fire, explosion, accident, riot, flood, drought, storm,
earthquake, lightning, frost, civil commotion, sabotage, vandalism,
smoke, hail, embargo, act of God or the public enemy, other casualty,
strike or lockout, or interference, prohibition or restriction imposed by
any government or any officer or agent thereof ("Force Majeure"), and
Seller's obligations, so far as may be necessary, shall be suspended
during the period of such Force Majeure and shall be cancelled in respect
of such quantities of Manapol[R] Powder as would have been sold hereunder
but for such suspension. Seller shall give to Buyer prompt notice of any
such Force Majeure, the date of commencement thereof and its probable
duration and shall give a further notice in like manner upon the
termination thereof. Each party hereto shall endeavor with due diligence
to resume compliance with its obligations hereunder at the earliest date
and shall do all that it reasonably can to overcome or mitigate the
effects of any such Force Majeure upon its obligations under this
Agreement.
9. Rights Upon Default.
(a) Seller's Rights Upon Default. If Buyer (i) fails to purchase
the quantities of Manapol[R] Powder specified for purchase by Buyer
hereunder, (ii) fails to make a payment hereunder when due or (iii)
otherwise breaches any term of this Agreement, and such failure or breach
is not cured to Seller's reasonable satisfaction within five (5) days (in
the case of a failure to make a payment) or thirty (30) days (in any
other case) after receipt of notice thereof by Buyer, or if Buyer fails
to perform or observe any covenant or condition on its part to be
performed when required to be performed or observed, and such failure
continues after the applicable grace period, if any, specified in the
Agreement, Seller may refuse to make further deliveries hereunder and may
terminate this Agreement upon notice to Buyer and, in addition, shall
have such other rights and remedies, including the right to recover
damages, as are available to Seller under applicable law or otherwise.
If Buyer becomes bankrupt or insolvent, or if a petition in bankruptcy is
filed by or against it, or if a receiver is appointed for it or its
properties, Seller may refuse to make further deliveries hereunder and
may terminate this Agreement upon notice to Buyer, without prejudice to
any rights of Seller existing hereunder or under applicable law or
otherwise. Any subsequent shipment of Manapol[R] Powder by Seller after
a failure by Buyer to make any payment hereunder, or after any other
default by Buyer hereunder, shall not constitute a waiver of any rights
of Seller arising out of such prior default; nor shall Seller's failure
to insist upon strict performance of any provision of this Agreement be
deemed a waiver by Seller of any of its rights or remedies hereunder or
under applicable law or a waiver by Seller of any subsequent default by
Buyer in the performance of or compliance with any of the terms of this
Agreement.
(b) Buyer's Rights Upon Default. If Seller fails in any material
respect to perform its obligations hereunder, and such failure is not
cured to Buyer's reasonable satisfaction within 30 days after receipt of
notice thereof by Seller, Buyer shall have the right to refuse to accept
further deliveries hereunder and to terminate this Agreement upon notice
to Seller and, in addition, shall have such other rights and remedies,
including the right to recover damages, as are available to Buyer under
applicable law or otherwise. Any subsequent acceptance of delivery of
Manapol[R] Powder by Buyer after any default by Seller under this
Agreement shall not constitute a waiver of any rights of Buyer arising
out of such prior default; nor shall Buyer's failure to insist upon
strict performance of any provision of this Agreement be deemed a waiver
by Buyer of any of its rights or remedies hereunder or under applicable
law or a waiver by Buyer of any subsequent default by Seller in the
performance of or compliance with any of the terms of this Agreement.
10. Disclaimer and Indemnity. Buyer shall assume all financial and
other obligations for Buyer Products, and Seller shall not incur any
liability or responsibility to Buyer or to third parties arising out of
or connected in any manner with Buyer Products. In no event shall Seller
be liable for lost profits, special damages, consequential damages or
contingent liabilities arising out of or connected in any manner with
this Agreement or Buyer Products. Buyer shall defend, indemnify and hold
harmless Seller and its affiliates, and their respective officers,
directors, employees and agents, from and against all claims,
liabilities, demands, damages, expenses and losses (including reasonable
attorneys' fees and expenses) arising out of or connected with (i) any
manufacture, use, sale or other disposition of Buyer Products, or any
other products of Buyer, by Buyer or any other party and (ii) any breach
by Buyer of any of its obligations under this Agreement.
11. Equitable Relief. A breach by Buyer of the provisions of
Paragraph 3(b) shall cause Seller to suffer irreparable harm and, in such
event, Seller shall be entitled, as a matter of right, to a restraining
order and other injunctive relief from any court of competent
jurisdiction, restraining any further violation thereof by Buyer, its
officers, agents, servants, employees and those persons in active concert
or participation with them. The right to a restraining order or other
injunctive relief shall be supplemental to any other right or remedy
Seller may have, including, without limitation, the recovery of damages
for the breach of such provisions or of any other provisions of this
Agreement.
12. Survival. The expiration or termination of the Term shall not
impair the rights or obligations of either party hereto which shall have
accrued hereunder prior to such expiration or termination. The
provisions of Paragraphs 3, 7, 9, 10 and 11 hereof, and the rights and
obligations of the parties thereunder, shall survive the expiration or
termination of the Term.
13. Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of
Texas.
14. Succession. Neither party hereto may assign or otherwise
transfer this Agreement or any of its rights or obligations hereunder
(including, without limitation, by merger or consolidation) without the
prior written consent of the other party; provided, however, that Seller
may assign any of its rights or obligations hereunder to any affiliate of
Seller. Subject to the immediately preceding sentence, this Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns.
15. Entire Agreement. This Agreement constitute the entire
agreement between the parties hereto relating to the matters covered
hereby The terms of this Agreement shall prevail over any inconsistent
terms contained in any purchase order issued by Buyer and acknowledgment
or acceptance thereof issued by Seller. No modification, waiver or
discharge of this Agreement or any of its terms shall be binding unless
in writing and signed by the party against which the modification, waiver
or discharge is sought to be enforced. This Agreement is separate from
and unrelated to any other agreement between the parties hereto and has
been entered into for separate and independent consideration, the
sufficiency of which is hereby acknowledged by the parties.
16. Notices. All notices and other communications with respect to
this Agreement shall be in writing and shall be deemed to have been duly
given when delivered personally or when duly deposited in the mails,
first class mail, postage prepaid, to the address set forth below, or
such other address hereafter specified in like manner by one party to the
other:
If to Seller: Caraloe, Inc.
0000 Xxxxxx Xxxx Xxxx
Xxxxxx, Xxxxx 00000
Attention: President
If to Buyer: For Your Health, Inc.
00000 Xxxx Xxxxxxx, X.X.
Xxxxxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxx
17. Interpretation. In the event that any provision of this
Agreement is illegal, invalid or unenforceable as written but may be
rendered legal, valid and enforceable by limitation thereof, then such
provision shall be deemed to be legal, valid and enforceable to the
maximum extent permitted by applicable law. The illegality, invalidity
or unenforceability in its entirety of any provision hereof will not
affect the legality, validity or enforceability of the remaining
provisions of this Agreement.
18. No Inconsistent Actions. Each party hereto agrees that it will
not voluntarily undertake any action or course of action inconsistent
with the provisions or intent of this Agreement and, subject to the
provisions of Paragraph 8 hereof, will promptly do all acts and take all
measures as may be appropriate to comply with the terms, conditions and
provisions of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the day and year first
above written.
CARALOE, INC.
By: /s/ Xxxx Xxxx
General Manager
FOR YOUR HEALTH, INC.
By: /s/ Xxxxxxx X. Xxxx
President
EXHIBIT A
FOR YOUR HEALTH, INC.
MANAPOL[R] POWDER PRODUCT SPECIFICATION
PRODUCT DESCRIPTION
PRODUCT: Manapol[R] Powder
CODE: C-200
SOURCE: Aloe barbadensis Xxxxxx
USES: The pure, stabilized Manapol[R] Powder is suitable for use
in pharmaceutical and beverage formulations
SPECIFICATION SHEET
Test Specification Method
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Appearance Fine white to beige
powder
Complex > = $30 HPLC(SEC)
Carbohydrates
(wt. %)
Water, wt.% < = 14% TGA
Residue on Ignition < = 16% TGA
wt.%
Microbiological Meets USP Standard USP
Purity
Fiber, wt.% < = 60% TGA
Solubility approx. 240 Gel Point CARN
Gelization
pH Not Adjusted CARN
Fiber Enriched CARN
Viscosity (cP) approx. 40 CARN
4 mg/ml solution
Total Acid Value approx 0.7 CARN
(As Malic Acid)
EXHIBIT B
FOR YOUR HEALTH, INC.
PRICING SCHEDULE
FOR MANAPOL[R] POWDER
Quantity Prices
1 to 25 kg $1,600.00 / kg
26 to 50 kg $1,500.00 / kg
51 to 100 kg $1,400.00 / kg
Terms are Net 30 days with approved credit F.O.B., Irving, Texas
All pricing is subject to change with 30 days written notice.
