SUPPLY AND DISTRIBUTION AGREEMENT
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This Agreement is entered into this 8th day of July, 1998, by and
between SafeScience, Inc., a Nevada corporation, having its principal place of
business at 00 Xx. Xxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxxxxx 00000
("SAFS"), and Delta-Omega Technologies, Inc., a Colorado corporation, having its
principal place of business at 000 Xxx Xxxx, Xxxxxxxxx, Xxxxxxxxx 00000 (DOTK).
WHEREAS DOTK is in the business of manufacturing and marketing high
performance, specialty cleaning products; and whereas SAFS has developed a
worldwide marketing network for environmentally sound products, and SAFS wishes
to have worldwide rights to market various of DOTK's products;
NOW THEREFORE, do the parties agree as follows:
I. DEFINITIONS
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A. "Agreement Products" shall mean those products of DOTK as set forth
on Appendix A hereto, as may be amended from time to time by mutual agreement of
the parties.
B. "Consumer Market" shall mean those channels of trade which convey
goods to end users who are individual consumers, and shall specifically include
wholesalers, retailers and other resellers, to the extent that said wholesalers,
retailers and resellers are engaged in commerce conveying said goods to
consumers. Consumer markets shall specifically exclude industrial, governmental
and institutional end users.
II. THE GRANT
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A. DOTK hereby grants to SafeScience, the exclusive, worldwide right to
market Agreement Products to the consumer market.
B. The exclusivity of the grant of rights hereunder to SAFS will be
conditioned upon SAFS meeting minimum purchase levels as set forth hereinbelow.
III. MINIMUM PURCHASE
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A. The parties hereto agree that during the first three-year term of
this Agreement, SAFS shall meet the following minimum annual purchase levels:
YEAR LEVEL
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Year 1 None
Year 2 $500,000
Year 3 $1,000,000
B. Minimums for future two-year extensions of this Agreement will be
negotiated by the parties at least six (6) months prior to the expiration of
this Agreement, or any subsequent renewal. Such negotiations shall be carried on
in good faith. If the parties are unable to reach agreement on the minimum
purchase level, the minimum level will be set at one-hundred fifty percent
(150%) of minimum purchase level for the contract year then in force, for the
entire two-year extension period.
C. In the event that SAFS fails to achieve minimum purchase levels for
two (2) consecutive years, DOTK may, at its option, and on ninety (90) days
written notice to SAFS, convert the marketing rights granted to SAFS in Section
II hereinabove to non-exclusive rights.
IV. DOTK'S OBLIGATIONS
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A. DOTK shall provide SAFS with all of its requirements for Agreement
Products on a timely basis.
B. All products supplied by DOTK hereunder shall meet all published
product specifications, and DOTK will warrant that products will meet
established safety and use parameters.
C. With regard to each Agreement Product supplied hereunder, DOTK
shall, at its expense, furnish SAFS with animal test data comprising:
Acute Oral in Rats
Acute Dermal in Rabbits
Acute Inhalation in Rats
Primary Eye Irritation in Rabbits
Primary Dermal Irritation in Rabbits
Dermal Sensitivity in Guinea Pigs
D. DOTK shall provide SAFS with customer service and technical support
as may be reasonably required, and shall maintain samples of each production lot
of Agreement Products for a minimum of two (2) years.
E. DOTK shall maintain manufacturing capability sufficient to deliver
at least one-hundred twenty-five (125%) percent of the projected monthly
delivery forecast, as communicated to it by SAFS in accord with Section V
hereinbelow.
F. Goods supplied by DOTK to SAFS hereunder shall be supplied in
packages, and labeled according to SAFS' specifications, and under trademarks
and trade dress as specified by SAFS, and SAFS shall retain all interest in said
trademarks and trade dress.
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IV. SAFS' OBLIGTIONS
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A. SAFS shall obtain all of its requirements for Agreement Products
from DOTK except that in the event that DOTK is unwilling or unable to meet
SAFS' requirements for products, as set forth in SAFS' projected monthly
delivery forecast, SAFS shall have the right to have comparable products
manufactured for it by third parties, in an amount sufficient to meet SAFS'
market requirements.
B. SAFS shall provide DOTK with an annual requirements projection
one-hundred twenty (120) days in advance of each contract year, and a monthly
rolling update during each contract year.
C. SAFS shall meet at least quarterly with DOTK management to discuss
sales and marketing programs, explore new product and market opportunities and
evaluate alliance expansion opportunities and strategies.
V. PRODUCT PRICING
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A. All prices shall be F.O.B. Broussard, Louisiana, and shall be the
lowest bulk price at which DOTK sells said Agreement Products.
B. During the term of this Agreement, the parties shall meet and
negotiate specific product prices, and arrive at fixed prices for the products
by July 1 of each calendar year. Said prices shall be subject to re-negotiation
during the annual supplied period if necessary, to respond to competitive
pricing strategies.
C. Sales terms shall be net-120 days.
VI. TERM
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A. This Agreement is effective as of the date set forth hereinabove,
and shall run for an initial term of three (3) years therefrom. Thereafter, this
Agreement shall automatically renew for subsequent two-year renewal terms,
unless either of the parties gives the other party hereto written notice, at
least ninety (90) days prior to the end of said term, of its intention to not
renew this Agreement.
B. If either of the parties hereto breaches any material provision
hereof, the other party may terminate this Agreement on sixty (60) day written
notice to the breaching party; however, should the breaching party cure said
breach within said sixty (60) day notice, this Agreement shall continue on if
said notice had not been given.
C. This Agreement shall terminate immediately upon the filing of a
Petition in Bankruptcy by either of the parties hereto.
D. Upon termination of this Agreement, all rights and obligations
established hereunder shall terminate; however, DOTK shall still be obligated to
fill any orders for Agreement Products then outstanding, and SafeScience shall
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be free to sell any Agreement Products which are in its possession, or which
shall be delivered to it by DOTK subsequent to said termination.
E. Upon termination, SAFS shall be obligated to pay DOTK for any
Agreement Products which were, or shall be supplied to it, and not previously
paid for.
VI. MISCELLANEOUS
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A. DOTK warrants that it has the right to enter into this Agreement and
to transfer the rights and privileges herein granted to SAFS, and DOTK further
warrants that it will act so as to preserve the rights herein granted.
B. The parties hereto will act to maximize the mutual value of this
Agreement.
C. This Agreement embodies the entire understanding of the parties
relating to the subject matter hereof, and may only be modified by a writing
signed by both of the parties hereto.
D. If any portion of this Agreement is held to be invalid or
unworkable, that portion will be severed form the remainder of the Agreement
which shall continue on in force.
E. Any notices given pursuant to this Agreement shall be deemed
delivered if mailed, by certified mail, return-receipt requested, to the party
to be notified at the address set forth above, or to such address as the party
being notified shall previously have designated.
F. This Agreement is entered into in the State of Massachusetts and is
to be interpreted in accord with the laws thereof.
SAFESCIENCE, INC. DELTA-OMEGA TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ X. Xxxxx, III
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Its: President Its: President
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Date: 7/9/98 Date: 7/8/98
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AGREEMENT PRODUCTS
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Agreement Products shall compromise the following products of
Delta-Omega Technologies, Inc.:
Omni-Clean Renew
Omni Wash and Wax
Omni Engine Clean
Omni-Clean SD
Omni-Hand Cleaner
SAFESCIENCE, INC. DELTA-OMEGA TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ X. Xxxxx, III
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Its: President Its: President
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Date: 7/9/98 Date: 7/8/98
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