AGREEMENT OF PRODUCT DEVELOPMENT
AND FUNDING
BETWEEN
THE XXXXXXX XXXXXXX AND XXXXXX XXXXXXX FAMILY TRUST
(a Trust)
and
HUMATECH, INC.
(an Illinois corporation)
This Product Development and Funding Agreement, dated December 18, 1998, by and
between HUMATECH, INC., an Illinois corporation, ("HT"), located at 0000
Xxxxxxxxx Xxxx, Xxxx, Xxxxx 00000 and, THE XXXXXXX XXXXXXX AND XXXXXX XXXXXXX
FAMILY TRUST, a Family Trust ("EBT"), located at 000 X. Xxxxxxxx Xxxxxx, Xxxx,
Xxxxxxx 00000-0000, in consideration of the mutual promises made herein, agree
as follows.
RECITALS
WHEREAS, HT has developed a product called a Turbo Feeder(TM) which is a turbine
driven, positive displacement pump to apply and distribute liquid humic-based
fertilizers and other products.
WHEREAS, HT has applied for United States and International patents on the Turbo
Feeder(TM).
WHEREAS, HT requires additional funding to produce plastic injection molds,
finalize patents, and other related production and manufacturing costs.
WHEREAS, EBT desires to facilitate the final development and production of the
Turbo Feeder(TM).
WHEREAS, EBT desires to fund a portion of the development and expects to be paid
royalties from the long term revenues of the Turbo Feeder(TM).
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements herein contained, and for the purpose of setting forth the terms and
conditions of said development and funding, the parties hereto have agreed and
do hereby agree, and subject to the conditions hereinafter set forth, as
follows:
ARTICLE I
NOW THEREFORE, IT IS AGREED AS FOLLOWS:
Section 1. Funding
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1.1 Funding. EBT agrees to fund the development and production of the Turbo
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Feeder(TM) with a minimum $100,000 dollar investment. EBT reserves the right or
provide additional funding under the same terms and conditions of this
Agreement.
Section 2. Repayment of Funds. The repayment of the funds invested will
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come from a percentage of the Turbo Feeder(TM) gross sales (gross sales defined
---
as gross sales less freight). The funds will be paid monthly at a rate of six
(6) percent of the gross sales in the form of a royalty payment. The royalty
payment will be due and payable upon the prior months collected gross sales
receipts of the Turbo Feeder(TM) sales. A total of $450,000 will be paid to EB
from the gross sales of the Turbo Feeder(TM).
Section 3. Default of Repayment. HT shall be deemed in default if HT fails
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to make two (2) monthly royalty payments from the funds collected from Turbo
Feeder(TM) gross sales. EBT will give a 30 day default and correction notice
for the royalty payments to be made current. If payments are not current within
the 30 days, HT shall be deemed in default and EBT shall not be obligated to
give notice to a declaration of default. Upon default, EBT will own all
patents, trademarks and plastic injection molds.
Upon default, HT has the right to continue to use molds and continue to market
and sell the Turbo Feeder(TM) product line. HT will continue to pay royalties
upon Turbo Feeder(TM) product line sales.
Section 4. Right of Inspection. EBT shall have the right at all reasonable
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times during HT's business hours to inspect and audit the all financial and
operational records.
Section 5. Authorization. The execution, delivery, and performance of this
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Agreement have been duly authorized and approved by the board of directors of
HT, and this Agreement constitutes a valid and binding Agreement of HT in
accordance with its terms.
Section 6. Miscellaneous Provisions.
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6.1 Amendment and Modification. Subject to applicable law, this Agreement
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may be amended, modified, or supplemented only by a written agreement signed by
all of the parties hereto.
6.2 Notices. All notices, requests, demands, and other communications
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required or permitted hereunder will be in writing and will be deemed to have
been duly given when delivered by hand or two days after being mailed by
certified or registered mail, return receipt requested, with postage prepaid:
HumaTech, Inc.
0000 Xxxxxxxxx Xxxx
Xxxx, Xxxxx 00000
Xxxxxxx Xxxxxxx and Xxxxxx Xxxxxxx Family Trust
000 X. Xxxxxxxx Xxxxxx
Xxxx, Xxxxxxx 00000-0000
or to such other address as the parties of this agreement furnish to each other
pursuant to the above.
6.3 Attorney Fees. In the event an arbitration, suit or action is brought
--------------
by any party under this Agreement to enforce any of its terms, or in any appeal
therefrom, it is agreed that the prevailing party shall be entitled to
reasonable attorneys fees to be fixed by the arbitrator, trial court, and/or
appellate court.
6.4 Law Governing. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Texas.
6.5 Computation of Time. In computing any period of time pursuant to this
---------------------
Agreement, the day of the act, event or default from which the designated period
of time begins to run shall be included, unless it is a Saturday, Sunday or a
legal holiday, in which event the period shall begin to run on the next day
which is not a Saturday, Sunday or legal holiday.
6.6 Titles and Captions. All section title or captions contained in this
---------------------
Agreement are for convenience only and shall not be deemed part of the context
nor affect the interpretation of this Agreement.
6.7 Pronouns and Plurals. All pronouns and any variations thereof shall be
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deemed to refer to the masculine, feminine, neuter, singular or plural as the
identity of the person or persons may require.
6.8 Entire Agreement. This Agreement contains the entire understanding
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between and among the parties and supersedes any prior understandings and
agreements among them respecting the subject matter of this Agreement. Any
amendments to this Agreement must be in writing and signed by the party against
whom enforcement of that amendment is sought.
6.9 Agreement Binding. This Agreement shall be binding upon the heirs,
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executors, administrators, successors and assigns of the parties hereto.
6.10 Arbitration. If at any time during the term of this Agreement any
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dispute, difference, or disagreement shall arise upon or in respect of the
Agreement, and the meaning and construction hereof, every such dispute,
difference, and disagreement shall be referred to a single arbiter agreed upon
by the parties, or if no single arbiter can be agreed upon, an arbiter or
arbiters shall be selected in accordance with the then prevailing commercial
rules of the American Arbitration Association, and judgment upon the xxxx
rendered by the arbiter may be entered in any court having jurisdiction thereof.
6.11 Presumption. This Agreement or any Section thereof shall not be
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construed against any party due to the fact that said Agreement or any Section
thereof was drafted by said party.
6.12 Further Action. The parties hereto shall execute and deliver all
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documents, provide all information and take or forbear from all such action as
may be necessary or appropriate to achieve the purpose of the Agreement.
6.13 Parties in Interest. Nothing herein shall be construed to be to the
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benefit of any third party, nor is it intended that any provision shall be for
the benefit of any third party.
6.14 Savings Clause. If any provision of this Agreement, or the application
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of such provision to any person or circumstance, shall be held invalid, the
remainder of this Agreement, or the application of such provision to persons or
circumstances other than those as to which it is held invalid, shall not be
affected thereby.
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The Xxxxxxx Xxxxxxx and Xxxxxx Xxxxxxx Family Trust
/s/ M. Xxxxxxx Xxxxxxx. Jr. Date 12-18-98
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M. Xxxxxxx Xxxxxxx Xx., Trustee
/s/ Xxxxxx Xxxxxxx Date 12-18-98
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Xxxxxx Xxxxxxx, Trustee
HumaTech, Inc.
/s/ Xxxxx X. Xxxxxxxx Date 12-18-98
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Xxxxx X. Xxxxxxxx, President
/s/ Xxxx X. Rottweiler Date 12-18-98
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Xxxx X. Rottweiler, Chief Financial Officer
