Exhibit 10.7
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALES AGREEMENT is make and entered into as of the 26th
Day of August, 1998, by and between GINSITE MATERIALS, INC., a Florida
Corporation headquarters at 0000 X. Xxxxxxx Xxxx., Xxxxxxxxxx, Xxxxxxx 00000
(Seller) and ECO MARINE MATERIALS, INC., headquartered at 0000 Xxxxxxxxxx Xxxx.,
Xxxx Xxxx Xxxxx, Xxxxxxx 00000 (Buyer).
RECITALS:
A. Seller is in the business of manufacturing and supplying, among other
things, Ginsite for use in the construction and marine industries.
B. Seller produces a type of coating material it currently markets under
the label Ginsite.
C. Buyer is also in the business of manufacturing and supplying certain
products for use in the construction and marine industries.
D. Buyer has developed specific applications as set forth on Exhibit A
attached hereto (the Foam Marine Application) which is not currently covered by
Seller's marketing and sales efforts.
E. Buyer desires, under the terms and conditions of this Agreement, to (i)
purchase Ginsite Marine Formula under the label Ginsite (the Product), (ii)
repackage the Product under the Buyer's own label and market it in both domestic
and foreign markets for use in composite Foam Marine Applications, and (iii) use
the product in the manufacture of two (2) products to be marketed under the
labels ECO Marine Resin A and ECO Marine Resin B, the ECO Marine Materials, Inc.
new Relabeled Product.
NOW, THEREFORE, in consideration of the premises, the mutual covenants and
conditions herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Sale of product: Marketing Restrictions.
(A) Except as otherwise provided herein, Seller agrees to sell
to Buyer, and Buyer agrees to purchase from Seller, Ginsite Marine Formula.
Buyer or its agents will repackage Ginsite under the Buyer's label (the
Relabeled product), and Buyer will use the Product to manufacture the Foam
Marine Product. Buyer or its agents will market and sell the Relabeled Product
in both foreign and domestic markets for use only in the Foam Marine
Applications. Buyer or its agents will not promote or market the Relabeled
Product for use in any application or manner covered by Seller's marketing or
sales efforts, including but not limited to, the specific applications set forth
on Exhibit B attached hereto.
(B) Seller agrees that it will not develop or promote in any
foreign or domestic market products designed or intended to compete with the
Foram Marine Application nor will it market or sell the Foam Marine Application
product to persons or entities other than the Buyer. Notwithstanding anything to
the contrary herein, this Agreement shall not limit in any manner the ability of
Seller to manufacture, market and sell Ginsite Marine Formula to any other
persons or entities for use in applications other than the Foam Marine
Application. (C) Buyer is requested to maintain adequate insurance to cover the
new labled product liability; or otherwise. Buyer is subject to inspections by
the Seller to insure product integrity and quality control.
2. Quantity Requirements:
Buyer shall place an initial order of fifty (50) gallons of
Ginsite Marine Formula upon execution of this Agreement and within the first
year a minimum order of five thousand (5,000) gallons. The Buyer shall order a
minimum of three thousand (3,000) gallons of the Ginsite Marine Formula per
month the second year. There will be a six month review of the monthly
performance at which time this amount may be adjusted accordingly. Buyer is
required to perform in accordance with this agreed schedule which may only be
adjusted upon approval by the Seller.
3. Purchase Price.
The purchase price (the Purchase Price) for Ginsite Marine
Formula sold during the first six months of the term of this Agreement shall be
set forth on Exhibit C attached hereto. The Seller may increase the Purchase
Price during each subsequent six month period of the term of this Agreement
based on (i) the increase in price to Seller of the raw materials required to
manufacture Ginsite Marine Formula or on (ii) increased container costs. In no
event, however, shall any such increase in the Purchase price exceed ten percent
(10%) of the Purchase Price during the preceding year. Seller shall notify the
Buyer in writing ninety (90) days in advance of any such price increase.
4. Payment and Delivery:
For all orders for Ginsite Marine Formula payment shall be
according to the following schedule:
A. Fifty percent (50%) of total invoice with order
B. Twenty-five percent (25%) of total invoice upon delivery by
the Seller C. The balance of any invoice shall be due within
thirty (30) days form delivery by Seller
All sales will be on a Cash with Order basis until a credit line is established
for the Buyer. The Seller reserves the right to revoke any credit extended at
the Seller's sole discretion. In addition, in the event (i) that one or more
payment is past due, (ii) of the institution by or against Buyer of proceedings
under any bankruptcy, insolvency, reorganization or similar laws, or (iii)
Seller otherwise3 deems itself insecure, then Seller may elect to ship only a
prepayment basis or take other measures to ensure prompt payment. Invoices not
paid within thirty (30) days of the invoice date will have one and one-half
percent (1-1/2) per month finance charge assessed against the unpaid balance
from the date of the invoice until the date of payment.
5. Shipment:
All shipments of Ginsite Marine Formula shall be made FOB the
Seller's manufacturing plant and liability for loss or damage in transit, or
thereafter, shall pass to the Buyer upon Seller's delivery of Ginsite Marine
Formula to a common carrier for shipment. The Buyer shall bear all costs of
transportation and insurance.
6. Inspection by Buyer:
Buyer shall test each shipment of Ginsite Marine Formula within
one (i) Week of delivery to assure that the material meets the specifications
and quality standards set forth on Exhibit D attached hereto (the
Specifications). Seller agrees that it will maintain strict process and quality
control standards, and its records related to such standards will be made
available to the Buyer in the event of a quality dispute upon the request of the
Buyer.
7. Warranty:
Seller offers a LIMITED WARRANTY on its product Ginsite Marine
Formula as per Exhibit D attached hereto.
8. Indemnification:
The Buyer agrees to hold the Seller free and harmless from any
and all claims, damages, and expenses of every kind or nature whatsoever (a)
arising from act of the Buyer; (b) as a direct or indirect consequence of
termination of this Agreement in accordance with its terms; or (c) arising from
acts of third parties in relation to the sale of Ginsite Marine Formula to the
Buyer under this Agreement, including, but not limited to execution of liens and
security interests by third parties with respect to any such products.
9. Confidentiality:
(A) During the term of this Agreement, Buyer agrees not to
disclose or cause to be disclosed to any third party the know-how or other trade
secrets of proprietary information in manufacturing Ginsite Marine Formula that
is not generally known to Seller's competitors (all such information provided to
Buyer is hereinafter collectively referred to as "Seller Confidential
Information". Seller Confidential Information shall not include any information
that the Seller has voluntary disclosed to the public, or that has been
independently developed by others, or that otherwise enters the public domain
through lawful means. The Seller Confidential Information constitutes
confidential and privileged information which is the property of the Seller.
Buyer covenants, during the term of this Agreement, and such two year (2) period
following the termination of this Agreement that such Seller Confidential
Information remains confidential, not to publish or disclose any Seller
Confidential Information without prior written consent of Seller, which consent
may be freely granted or withheld. Buyer agrees that the Seller Confidential
Information shall be used solely by Buyer in connection with the obligation
hereunder and for no other purpose.
(B) During the term of this Agreement, Seller agrees not to
disclose or cause to be disclosed to any third party the applications that Buyer
has developed for the Foam Marine Application that is not generally known to
Buyer's competitors (all such information provided to Seller is hereinafter
collectively referred to as Buyer Confidential Information. Buyer Confidential
Information shall not include any information that Buyer has voluntarily
disclosed to the public, or that has been independently developed and disclosed
by others, or that otherwise enters the public domain through lawful means. The
Buyer Confidential Information constitutes confidential and privileged
information which is the property of the Buyer. Seller covenants, during the
term of this Agreement, and such two year (2) period following the termination
of this Agreement that such Buyer Confidential Information without prior written
consent of Buyer, which consent may be freely granted or withheld. Seller agrees
that the Buyer Confidential Information shall be used solely by Buyer in
connection with the obligations hereunder and for no other purpose.
10. Intellectual Property:
Buyer acknowledges and agrees that all proprietary rights in
Ginsite Marine Formula and the process for manufacturing said product are and
shall remain at all times with the Seller. Buyer further acknowledges and agrees
that nothing in this Agreement creates in or gives to Buyer any right or license
whatsoever in or to any proprietary rights or information of Seller except the
right to offer Relabeled Product for sale and to use Ginsite Marine Formula in
accordance with this Agreement.
11. Relationship of the Parties:
This Agreement does not create a relationship of principal or
agent, master and servant, employer and employee, or franchisor and franchisee
between the employer and employee between the parties, and the parties are not
joint venturers or partners of each other. Buyer and Seller agree that neither
party is authorized to make any arrangement, contract or representation on
behalf of the other, or to create any obligation, either express or implied, on
behalf of the other
12. Law and Jurisdiction:
This Agreement shall be governed by the internal laws of the
State of Florida, without regard for choice of law considerations.
13. Successors and Assigns:
This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, transferces and assigns,
whether by merger, consolidation or otherwise, as well as associated and allied
companies of the parties.
14. Waiver/Breach:
The waiver or breach of any term or condition of this Agreement
shall not be deemed to constitute the continuing waiver of the same or any other
term or condition. The breaching party shall be liable to the other party for
all costs, including reasonable attorney's fees, of enforcing any provision of
this Agreement.
15. Notices:
Any notice or communication required or permitted hereunder
(other than Administrative Notice) shall be in writing and shall be sent by
certified mail, return receipt requested, postage prepaid and addressed to the
addresses set forth below or to such changed address as any party entitled to
notice shall have communicated in writing to the other party. Notices and
communications to the Seller shall be sent to:
GINSITE MATERIALS, INC.
0000 XXXX XXXXXXX XXXX.
XXXXXXXXXX, XX 00000
Any notice and communications to the Buyer shall be sent to:
ECO MARINE MATERIAL, INC.
0000 XXXXXXXXXX XXXX.
XXXX XXXX XXXXX 00000
16. Term:
the initial term of this Agreement shall commence on the date set
forth above and subject to the provision of Paragraph 17 hereof, shall continue
in effect for a period of one year. Thereafter, the term of this Agreement shall
automatically renew for additional terms of one (1) year, unless Buyer provides
Seller with written notice of its decision not to renew this Agreement not less
than sixty (60) days prior to the expiration rate.
17. Right to Terminate:
(A) Either party may terminate this Agreement upon thirty (30)
days written notice to the other party in the event the Buyer ceases to use
Ginsite Marine Formula for the benefit of its customers in the ordinary course
of its business.
(B) If at any time during the term of this Agreement either party
breaches or defaults under the terms of this Agreement and such breach or
default continues unremedied for more that thirty (30) days after written notice
thereof is delivered to the b reaching or defaulting party by the other party,
then such other party may terminate this Agreement by giving written notice to
the breaching or defaulting party.
(C) If at any time during the term of this Agreement (i) either
party admits an inability to pay its debts, (ii) either party ceases to function
as a going concern, (iii) either party ceases to conduct its operations in the
ordinary course of business, (iv) a receiver for either party is appointed, or
(v) either party otherwise takes advantages of any insolvency, bankruptcy,
moratorium or similar laws or an involuntary proceeding under any such laws is
initiated against either party and such involuntary proceeding is not dismissed
within ninety (90) days after it is initiated, then the other party may
terminate this Agreement by giving written notice thereof to the party with
respect to which any such event has occurred.
(D) If at any time during the term of this Agreement the
performance of this Agreement by either party is delayed by a force majeure
event described in paragraph 20 hereof for a period of longer than one hundred
twenty (120) days, the other party may terminate this Agreement by giving
written notice thereof to the party whose performance has been delayed.
18. Effect of Termination:
Upon any termination or expiration of this Agreement, all of the
rights and obligations of the parties hereunder shall end immediately, except
that the provisions of this Agreement shall continue to apply with respect to
(1) all product purchased and sold pursuant to the provisions hereof, and (2)
all provisions herein relating to confidentiality.
19. Mediation; Arbitration:
If a dispute arises out of or relates to this Agreement, or the
breach thereof, and if such dispute cannot be settled through negotiation, the
parties agree first to try in good faith to settle the dispute by mediation
under the Commercial Mediation Rules of the American Arbitration Association,
before resorting to arbitration, litigation, or some other dispute resolution
procedure. In the event such mediation does not result in a suitable resolution
of such dispute then any controversy, claim or cause of action arising out of or
relating to this Agreement, shall be settled by binding arbitration by three (3)
arbitrators in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, and judgment upon the award rendered by the
Arbitrator(s) may be entered in any court having jurisdiction thereof. The
arbitrators shall have power to grant equitable remedies in addition to imposing
monetary damages. The arbitration shall include (I) a provision that the
prevailing party in such arbitration shall recover its costs of the arbitration
and reasonable attorneys' fees from the other party, and (ii) the amount of such
costs and fees. Any such mediation or arbitration shall be held in the State of
Florida. Any cause of action arising out of or related to this Agreement not
submitted to arbitration within three (3) years after such cause of action has
accrued shall be deemed barred, notwithstanding any longer statue of limitations
period available at law.
20. Force Majeure:
No party hereto shall be liable for delay or failure to perform
any obligations hereunder (other than the payment of money) if such delay or
failure arises out of causes beyond its reasonable control and without its fault
or negligence, including, but not limited to, labor disputes and strikes, wars,
riots, insurrection, piracy, and civil commotion, federal, state or municipal
action, statute, ordinance, regulations, rule or order, fire, earthquake, floods
or other unusually severe weather, accidents, nuclear radiation, embargoes,
epidemics, shortages of power or any act of God. Any party seeking excuse for
delay or failure to perform on the basis of this provision shall promptly notify
the other party hereto upon learning of any event which may result in any delay
or failure to perform. In addition, the affected party shall make every effort
to eliminate and/or correct the effect of such condition or event as completely
and rapidly as is reasonably possible. In such case, the time of delivery or
performance shall be deferred until force majeure event as provided in this
paragraph.
21. Severability:
Any provision of this Agreement which is invalid, prohibited or
unenforceable in any jurisdiction shall, s to such jurisdiction, be ineffective
to the extent of such invalidity, prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such invalidity,
prohibition or unenforceability in any such jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
22. Paragraph Headings:
All paragraph headings contained herein are for convenience or
reference only and are not intended to define or limit the scope of any
provision of this Agreement.
23. Entire Agreement:
This Agreement contains the final, complete and exclusive
statement of the agreement between the parties with respect to the transactions
contemplated herein and all prior written agreements and all prior and
contemporaneous oral agreements with respect to the subject matter hereof are
merged within. This Agreement may not be amended, supplemented or modified (or
any right or power granted hereunder waived) except by a written instrument
signed by the parties hereto.
24. Counterparts:
This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same agreement.
25. Authority:
Seller and Buyer each represent and warrant to the other that is
has the power and authority to enter into this Agreement and that the execution
of this Agreement and the performance of its obligations and duties hereunder
does not and will not constitute a breach or violation of its organizational
documents or bylaws or a violation of any agreement, instrument, order,
judgment, law, rule or decree by which it is bound or to which it or its assets
are subject.
26. Applicable Law:
This Agreement shall be construed and performed in accordance
with the laws of the State of Florida.
IN WITNESS WHEREOF, the parties have executed this Agreement.
ATTEST: GINSITE MATERIALS, INC.
/S/ X.X. Xxxxx By /s/ Xxxxxx Xxxxxxxx
--------------- ---------------------------
ATTEST: ECO MARINE MATERIALS, INC.
/S/ X.X. Xxxxx By /s/ Xxxxx Xxxxxxx
-------------- ---------------------------
President
EXHIBIT A
FOAM MARINE APPLICATION:
PRODUCT NAME USE MARKETS PACKAGING
ECO Marine Resin A+B Styrene & urethane Marine Industry One (1) Gallon
Foam Coating Five (5) Gallon
ECO Marine Resin Bulk Manufacturing Marine Industry 55 Gallon Drums
3,000 Gallon bulk
--------------------------------------------------------------------------------
Eco Marine Resin A+B Use as styrene and/or urethane coating or bonding agent
in Field application
ECO Marine Resin Bulk Use as styrene and/or
urethane coating or bonding agent for Making
panels, blocks and ancillary items
manufactured
--------------------------------------------------------------------------------
Foam Marine Application is the application of Ginsite under a new product label:
ECO Marine Resin A+B/bulk - a new light weight, high strength composite
construction material - to newly designed boats manufactured by ECO Marine
Materials, Inc. and other products so listed:
Styrene foam logs and shapes Metal extrusions Floating docks Platform
Barges Starship Marine (newly designed boats) Sea wall components
EXHIBIT B
GINSITE MATERIALS INC.
The following applications are currently recommended and marketed by
Ginsite Materials, Inc.:
Construction Industry:
Ginsite seals: Exterior Walls
Roofs: Flat
Cement barrel roof tiles
Asphalt tiles
Pool decks
Poles
Sidewalks
Stepping Stones
Pavers
Walkways
Drywall/gypsum
Floor tiles
Masonry coating
Cement block
Masonry repairs
Cement
Wood coating
Styrfoam
Marine Industry:
Boats
Fiber Glass
Aluminum hulls
Steel hulls
Wooden
Bouys
Docks
Decks
EXHIBIT C
PRICING:
The following pricing will remain in effect for six (6) months from the
date of this Agreement. All pricing is subject to change as outlined in the
terms of this Agreement
Product: Ginsite Marine Formula
Packaging: Five (5) Gallon container Five (5) Gallon container
Mfg. Location 0000 X. Xxxxxxx Xxxx. 0000 X. Xxxxxxx Xxxx.
Xxxxxxxxxx, Xxxxxxx 00000 Xxxxxxxxxx, Xxxxxxx 00000
Minimum order: Per Agreement Per Agreement
FOB Prices: Gallons Price Gallons Price
1 to 50,000 $22.00 1 to 10,000 $42.00
50,001 to 100,000 21.00 10,000 plus 40.00
100,001 to 500,000 20.00
500,001 to 1 million+ 18.00
EXHIBIT D
To be supplied by Seller
