EXHIBIT 10.4
Purchase Agreement
Switch Cover Plate Providing Automatic Emergency Lighting Patent #5833350
Nutek Inc.
00000 Xxxxxxxxx Xxxx. Xxxxx 000
Xxxx Xxxxxx XX. 00000
Tel: (000) 000-0000 Fax: (000) 000-0000
Table of Contents
Table of Contents.......................................... 2
Confidentiality Statement.................................. 3
Existing Product........................................... 3
PRODUCT ................................................... 3
Purchase Agreement with Nutek Inc.......................... 3
RECITALS................................................... 3
SERVICE.................................................... 4
PRODUCT.................................................... 4
RESPONSIBILITIES........................................... 4
PAYMENT.................................................... 4
CONFIDENTIALITY............................................ 5
NON COMPETE................................................ 5
WARRANTIES................................................. 5
INTEGRATION................................................ 6
CONSTRUCTION AND JURISDICTION.............................. 6
ATTORNEY'S FEES............................................ 6
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Confidentiality Statement
The information embodied in this Purchase Agreement is strictly confidential
and is supplied on the understanding that it will be held confidentially and
not disclosed to third parties without the prior written consent of Nutek,
Inc.
Existing Product
PRODUCT
The product is the Switch Cover Plate Providing Emergency Lighting covered by
Patent number 583350
Currently, the product exists and has been Patented in the United States with
Patent Numbers 583350, the product is currently is in the prototype stage.
The molds and tooling to manufacture the product are not in existence, neither
are the tooling to manufacture the packaging for the product. Nutek Inc. is
seeking to purchase all rights, title and interest to the product.
Purchase Agreement with Nutek, Inc.
Agreement entered into this 27th day of August, 1999 by and between Electro
Static Solutions LLC, of 00000 Xxxxxxxxx Xxx, Xxxxx X-X, Xxxxxx XX 00000
hereinafter, referred to as "SELLER" and Nutek Inc. of 00000 Xxxxxxxxx
Xxxx., Xxxxx 000 Xxxx Xxxxxx XX 00000 hereinafter "PURCHASER".
RECITALS
WHEREAS, SELLER has created the Switch Cover Plate Providing Emergency Lighting
covered by Patent number 583350 the "product". SELLER has not produced the
required tooling and dies to produce the product and packaging, and
WHEREAS, SELLER seeks to manufacture and market this product which he holds all
rights, patents, title and interest to, to the general public at large; and
WHEREAS, PURCHASER has an interest and is in the business of developing,
marketing, manufacturing and the management, promotion, and financing of
companies and products, and has the management knowledge and expertise to
manufacture, promote and market the product; and
WHEREAS, PURCHASER is willing to purchase all rights, patents, title and
interest to the "product" pursuant to the following terms and conditions:
NOW, THEREFORE, in consideration of these premises and those other terms and
conditions set forth hereinafter, the parties agree as follows:
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1. SERVICE.
PURCHASER is to receive all rights, patents, title and interest to the
"product". The parties may amend and supplement this agreement from time to
time in writing under mutual agreement, and such supplement, signed by both
parties with all amendments and supplements thereto, shall be attached to this
Agreement, and made a part hereof.
2. PRODUCT.
PURCHASER will acquire and retain sole and exclusive rights to the Product, and
any and all updates and revisions, PURCHASER shall have as sole and exclusive
all the world wide rights hereinafter, referred to as the "territory", rights,
to market, and air the Product, as well as all updates and revisions, and sole
and exclusive right in the Territory to distribute the product in all media,
now or hereafter devised, including without limitation the following media:
(i) all forms of direct response television including 800/900 and similar,
telephone numbers; (ii) print media; (iii) outbound telemarketing; (iv)
package inserts; (v) catalogs; (vi) direct sales; (vii) radio; (viii) televised
shopping; (ix) credit card syndication; (x) direct mail; (xi) retail; and
(xii) seminars.
3. RESPONSIBILITIES.
PURCHASER will create infomercials with direct response phone numbers,
addresses and, if applicable, sales tax and shipping message integrated
into infomercials.
PURCHASER shall accommodate consumer payments for Product; and shall establish
and maintain or contract out for the services of 800 inbound telephone services
to take calls from customers regarding Product; and shall establish and
maintain production services in order to deliver Product to consumers; and
shall maintain continuity and customer service support programs if and when
under the circumstances determines it is appropriate; and shall establish and
maintain marketing programs through direct response media other than
television, which by way of example include but are not limited to radio,
print, catalog, and others, if and when under the circumstances it is
determined it is appropriate; and shall market the Product in retail,
professional, institutional and all other markets, if and when under the
circumstances it is determined to be appropriate; and may modify the services
it performs and perform additional services as it may determine is
appropriate under the circumstances in order to promote the Product.
4. PAYMENT.
I. PURCHASER shall receive all rights, title and interest to the product.
PURCHASER shall pay SELLER a "Royalty Payment" of Three (3%) percent of Net
Gross revenues.
II. PURCHASER to pay Six Hundred Thousand (600,000) shares of Nutek
restricted stock within 14 days of signing of agreement. This stock has a
value of $0.30 per share and represents One Hundred Eighty Thousand dollars
($180,000.00). This stock is to be restricted for a period of one (1) year.
III. PURCHASER will pay Fifty Thousand ($50,000.00) dollars once it has
completed it's due diligence on the product, this is to take no more than
thirty (30) days. The purchaser will then pay an additional Thirty Thousand
($30,000.00) dollars 30 days later, an additional Thirty Thousand ($30,000.00)
dollars 60 days later and a final cash payment of Forty Thousand ($40,000.00)
no later than 90 days after the first payment has been made. This gives a
total cash investment of One Hundred and Fifty Thousand ($150,000.00) dollars.
IV. Royalty payments will be increased by Seven (7%) percent until the
balance of the Six Hundred and Seventy Thousand ($670,000.00) still remaining
from the One Million ($1,000,000.00) dollar purchase price has been paid.
V. Royalty Payments to be made quarterly on the first day of each quarter
commencing from date of first launching of the product. PURCHASER agrees to
submit quarterly reports to SELLER and to keep SELLER informed of the number
of Products shipped and amount paid. Reports shall be submitted within
thirty (30) days of the end of each quarter. Such reports shall include the
number of Product shipped, sold and amount paid from previous quarter.
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5. CONFIDENTIALITY.
SELLER agrees to hold all information that SELLER obtains as confidential for
the purposes of this agreement. SELLER agrees not to use or disclose
confidential information to any person or entity, except as necessary under
this Agreement. Nothing herein above written shall prevent the parties from
making any disclosure which is required by law, government regulation, or rule,
or which disclosure is ordered or otherwise required by a court of competent
jurisdiction through its subpoena power or otherwise or by a state or federal
regulatory or other governmental agency.
6. NON COMPETE.
The SELLER and PURCHASER both agree that during the term of this Agreement they
shall not either directly or indirectly compete or enter into any agreement to
compete in any way with each other. The provisions of this section shall be
enforceable in a court of law or equity by an injunction or an action of
specific performance.
7. WARRANTIES.
SELLER hereby represents and warrants to PURCHASER the following:
The execution, delivery and performance of this Agreement is within SELLER's
powers and does not contravene any law or contractual restriction binding
on or affecting SELLER.
This Agreement is a legal, valid and binding obligation of SELLER enforceable
against SELLER in accordance with its respective terms.
SELLER has full right, patents, title and ownership of the Product.
PURCHASER hereby represents and warrants to SELLER the following:
PURCHASER is a corporation duly incorporated, validly existing and in good
standing under the laws of the State Nevada.
The execution, delivery and performance by PURCHASER of this Agreement is
within PURCHASER's corporate powers, has been duly authorized by all necessary
corporate or stockholder action on its part, does not contravene restriction
binding on or affecting PURCHASER or any of its properties, and do not result
in or require the creation of any lien, security interest or other charge or
encumbrance upon or with respect to any of its properties.
This Agreement is a legal, valid and binding obligation of PURCHASER
enforceable against PURCHASER in accordance with its respective terms.
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8. INTEGRATION.
This Agreement together with all exhibits amendments and supplements represents
the complete and entire Agreement between the parties hereto. This Agreement
either embodies or supersedes all prior, contemporaneous or subsequent oral
agreements, representations, understandings, and all written notations,
memoranda or correspondence of any party hereto, their agents, employees or
other related persons, related to the work contemplated in this Agreement.
9. CONSTRUCTION AND JURISDICTION.
This Agreement shall be construed and enforced pursuant to the laws of the
State of California. By affixing their signatures to this agreement, the
parties hereby submit themselves to the courts of the State of California, for
the judicial resolution of any disputes arising under the terms, interpretation
or performance of this agreement. If any one or more paragraphs in this
Agreement is found to be unenforceable or invalid, the parties agreement on all
other paragraphs shall remain valid. Non enforcement of any section of this
Agreement by either party does not constitute a waiver or consent and both
parties reserve the right to enforce this Agreement at their discretion.
10. ATTORNEY'S FEES.
In the event either party is required to retain counsel to enforce the
provisions of this Agreement or to bring legal action to enforce the provisions
of this Agreement or remedy any breaches of this Agreement, the prevailing
party in such action shall be entitled to its costs and attorney's fees
incurred in such action or procedure, whether or not an action is ultimately
filed in a court of proper agreed jurisdiction.
WHEREFORE, the parties have affixed their signatures to this Agreement the date
first above stated. Furthermore, by signing this Agreement all signature
parties acknowledge they fully understand and agree to all the terms and
conditions of this Agreement.
PURCHASER SELLER
Signature Signature
/s/ Xxxxxx X. Xxxxxxxx /s/ Xxx Xxxxxxxxx
--------------------------- --------------------------
CEO/President Nutek Inc.
/s/ Xxxxxx Xxxxxx
-------------------------
Electro Static Solutions, LLC
Date: 9/15/99 Date: 9/15/99
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