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EXHIBIT 10.118
EXCLUSIVE PRODUCT SUPPLY AGREEMENT
This Exclusive Product Supply Agreement ("this Agreement") for high density
hydrophilic foam is made effective on the 28th day of July, 1998 ("Effective
Date") by and between Wilshire Technologies, Inc. ("WTI"), a California
corporation with a place of business at 0000 Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxx
00000 and Time Release Sciences, Inc. ("TRS"), a New York corporation with a
place of business at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx Xxxxx, Xxx Xxxx 00000.
RECITALS
WHEREAS, WTI is a manufacturer and supplier of clean room and contamination
control products used for specialized applications in the electronics and
medical device industries;
WHEREAS, TRS is a manufacturer of high density hydrophilic foam;
WHEREAS, WTI desires to purchase such hydrophilic foam material from TRS; and
WHEREAS, TRS wishes to supply WTI's requirements of the hydrophilic foam
material.
NOW THEREFORE, the parties hereto agree as follows:
1.0 DEFINITIONS.
1.1 Minimum Annual Quantity shall mean the minimum annual quantity of
the Products and the Additional Products which WTI is obligated to purchase from
TRS as set forth on Exhibit A attached hereto. The Minimum Annual Quantities of
the Product shall include purchases of the Product by TMP Technologies, Inc.
("TMP") when used by TMP in manufacturing products sold to WTI. If the price per
board foot of the Product sold to TMP is different from the price referenced in
paragraph 5.1, then the calculation of the quantity of the Product purchased by
TMP shall be based on the price paid by TMP to TRS.
1.2 Product(s) shall mean the 8.3 pound high density hydrophilic foam
product current manufactured by TRS and designated by WTI Part Numbers 3270018
and 3270056, and any products substantially similar to the Product(s).
1.3 Additional Product(s) shall mean the 5.6 pound medium density
hydrophilic foam product current manufactured by TRS and designated by WTI Part
Number 3270010.
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1.4 Specification shall mean the Product and the Additional Product
specifications attached to this Agreement as Exhibit B.
2.0 TERM.
2.1 The term of this Agreement shall be for a period of three (3) years
commencing on the Effective Date above and ending automatically at the
expiration of this period.
2.2 If WTI and TRS expressly agree in writing to renew this Agreement
prior to the foregoing expiration date, this Agreement shall continue in full
force and effect for one or more successive one (1) year renewal periods.
3.0 SUPPLY AND PURCHASE.
3.1 WTI agrees that it will purchase the Minimum Annual Quantities. In
the event that WTI fails to purchase the Minimum Annual Quantity in a particular
year, TRS shall be entitled to convert this Agreement to a nonexclusive supply
agreement (and Section 3.3 below shall be rendered null and void). Conversion to
nonexclusivity will constitute TRS' exclusive remedy for WTI's failure to
purchase the Annual Minimum Quantity in a particular year (and WTI will not be
held to any further minimum purchase requirement following such conversion).
3.2 TRS will use its best efforts to supply the Minimum Annual
Quantities and any additional quantities forecasted by WTI pursuant to Section 4
below.
3.3 TRS agrees that it will not supply the Product to any other
customer which manufactures and/or sells products for clean room and/or
contamination control markets during the term of this Agreement. TRS agrees that
it will not supply the Product to any other customer which manufactures and/or
sells products for clean room and/or contamination control markets for a period
of six (6) months following the termination or expiration of this Agreement,
provided that WTI has purchased 80% or more of the Minimum Annual Quantities in
the year immediately preceding the date of termination.
4.0 PURCHASE ORDERS/FORECASTS
During the first week of each month, WTI shall forward to TRS a three
(3) month rolling forecast of Product and Additional Product requirements
designating the quantities of the Product and the Additional Product which WTI
intends to sell in such period. Product and Additional Product requirements
scheduled for delivery in months 1 and 2 of the rolling forecast will be
considered firm orders and may not be rescheduled or canceled by WTI.
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5.0 PRICES AND PAYMENT
5.1 The price of the Product and the Additional Product will be $3.24
per board foot and $2.03 per board foot, respectively, provided that that WTI
and TRS may adjust such price during the term of this Agreement by mutual
agreement.
5.2 All payments for the Product and the Additional Product shall be
due thirty (30) days from the date of TRS' shipment to WTI.
6.0 DELIVERY/RISK OF LOSS
6.1 Delivery of all Product and Additional Product ordered by WTI shall
be made F.O.B. point of shipment. WTI shall be responsible for the payment of
all freight and insurance charges.
6.2 Title and risk of loss to the Product and the Additional Product
shall pass to WTI when TRS gives possession to the carrier at the F.O.B. point
of shipment.
7.0 TECHNICAL ASSISTANCE.
TRS shall provide technical assistance as required without additional
charge to WTI.
8.0 WARRANTIES.
TRS warrants that the Product and the Additional Product will be free
from defects in material and workmanship and conform to the Specification for a
period of six (6) months from the date of delivery. TRS HEREBY DISCLAIMS ALL
OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR PURPOSE.
9.0 CONFIDENTIALITY.
9.1 To the extent that WTI and TRS must disclose confidential
information not generally known in the industry to each other as a consequence
of the performance of this Agreement, the parties shall clearly identify such
information upon disclosure. If such disclosure is made in writing, each page
thereof containing such information shall be marked with the legend
"Confidential Information" or similar designation. If such disclosure is made
orally or visually, each party shall identify the data or material disclosed as
"Confidential Information" or similar designation at the time of disclosure, and
such oral or visual disclosure shall be reduced to writing promptly by the
disclosing party no later than thirty (30) days after disclosure. Each party
shall use such Confidential Information only for the purposes of fulfilling its
obligations under this Agreement and shall take reasonable precautions to limit
the disclosure of Confidential Information. Such
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information shall be disclosed only to those employees, agents, representatives
and suppliers having a need to know Confidential Information in connection with
their performance of this Agreement.
9.2 Neither WTI nor TRS shall be liable for disclosure or use of
Confidential Information if:
(a) the Information was known to a party prior to its receipt
of the Information from the other party;
(b) the Information became known or available to a party from
an independent third party source under no obligation of secrecy with respect
thereto;
(c) the Information became part of the public domain in any
way without breach of the Agreement; and
(d) the Information was disclosed by a party in accordance
with the written approval of the other party.
10.0 TERMINATION
Notwithstanding the provisions of Section 2, this Agreement may be
terminated immediately by written notice upon the occurrence of any of the
following events:
(i) by TRS or WTI in the event proceedings are instituted by or against
the other party in bankruptcy or under in solvency laws; or
(ii) by TRS or WTI in the event of a breach of any material term of the
Agreement by the other party and failure to cure such breach within forty-five
(45) days after such party's receipt of written notice detailing such breach.
11.0 ARBITRATION
Any and all controversies or disputes between the parties arising under
any Section of this Agreement shall be submitted to an arbitrator for final and
binding resolution in accordance with the commercial arbitration rules of the
American Arbitration Association. The site of the arbitration shall be at
Buffalo, New York and the law of the State of New York shall be applied by the
arbitrators.
12.0 INTELLECTUAL PROPERTY INFRINGEMENT
12.1 TRS shall at its own expense defend, or at its option settle, any
claim, suit or proceeding brought against WTI based on an allegation that the
Product or the Additional Product supplied hereunder constitutes a direct or
contributory infringement of any copyright, trade secret or claim of a United
States patent held by a third party.
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This obligation shall be effective only if WTI shall have made all payments then
due hereunder or if TRS is notified promptly in writing and given authority,
information and assistance for the defense of such claim, suit or proceeding. In
the event Product or Additional Product supplied by TRS hereunder become the
subject of a claim, suit or proceeding for infringement of a copyright, trade
secret or claim of a United States patent held by a third party, or in the event
of any adjudication that the Product or Additional Product so infringes, then
TRS shall at its option either (a) procure the right to continue using said
Product or Additional Product; or (b) replace it with non-infringing Product or
Additional Product; or (c) modify it so that it becomes non-infringing; or (d)
as a last resort, accept the return of the Product or Additional Product in bun
stock and refund the purchase price of all Product or Additional Product
returned in bun stock and purchased by WTI under this Agreement.
12.2 This indemnity does not apply to the following:
a. patented processes formed by the Product or the Additional
Product in conjunction with products not sold by TRS or
another product produced thereby;
b. combinations of the Product or the Additional Product with
another product not furnished hereunder unless TRS is a
contributory infringer; or
c. any settlements of a suit or proceeding made without TRS's
written consent.
13.0 LIMITATION OF LIABILITY
In no event shall WTI or TRS be liable to the other for any special,
indirect, incidental or consequential damages.
14.0 GENERAL
14.1 Force Majeure. Neither TRS nor WTI shall be liable for failure to
perform or for delay in performance due to fire, flood, strike, act or God, act
of any governmental authority, embargo or other reasonably unforeseeable cause.
In the event of delay in performance due to any such cause, the date of delivery
or time for completion will be extended by a period of time reasonably necessary
to overcome the effect of such delay.
14.2 Notices. All notices permitted or required under this Agreement
shall be sent via facsimile, certified mail or courier to the signature parties
at the addresses set forth above.
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14.3 Independent Contractor Status. Nothing contained in this Agreement
shall be construed as creating a partnership or joint venture between the
parties. The relationship of TRS to WTI shall at all times be that of an
independent contractor. Neither party to this Agreement shall have any implied
or express rights or authority to assume or create any obligations on behalf of
or in the name of the other party.
14.4 Assignment. This Agreement and the mutual obligations and duties
of the parties hereunder may not be assigned or transferred by either party
without the prior written consent of the other party to this Agreement, except
that either party may assign this Agreement in connection with a merger or the
sale of substantially all the assets of such party, provided that the assignee
is at least capable, financially and otherwise, of performing this Agreement as
the assigning party at that time.
14.5 Entire Agreement. This Agreement (including the referenced
Exhibits) contains the complete understanding of the parties with respect to the
development, manufacture and sale of the Product and the Additional Product.
This Agreement supersedes all previous agreements and understandings between the
parties with respect to the subject of the Agreement including but not limited
to the March 25, 1998 letter between Xxxx Xxxxxxx and Xxxx Xxxxxx, and may be
amended or supplemented only by another writing signed by the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives.
WILSHIRE TECHNOLOGIES, INC. TIME RELEASE SCIENCES, INC.
By: /s/ Xxxx Xxx Xxxxxx By: /s/ Xxxx Xxxxxx
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Xxxx Xxx Xxxxxx Xxxx Xxxxxx
Title: President & CEO Title: President
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Date: 7/28/98 Date: 7/29/98
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EXCLUSIVE PRODUCT SUPPLY AGREEMENT
BETWEEN WTI AND TRS DATED JULY 28, 1998
EXHIBIT A
Minimum Annual Quantities
of the Product and the Additional Product Combined (a)
(i) Year One: $ 700,000.
(ii) Year Two: $1,000,000.
(iii) Year Three: $1,300,000.
Note (a): The Minimum Annual Quantities of the Product shall include purchases
of the Product by TMP when used by TMP in manufacturing products sold to WTI.
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EXCLUSIVE PRODUCT SUPPLY AGREEMENT
BETWEEN WTI AND TRS DATED JULY 28, 1998
EXHIBIT B
Specification
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