Exhibit 6.4
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PRODUCTION AGREEMENT
AGREEMENT (this "Agreement") made and entered into effective as of the 25th
day of February, 2000, by and between BIOSCIENCE, L.L.C., a New Jersey limited
liability company having an office at 000 Xxxx Xxxxxx, Xxxxxxxx 15, X.X. Xxx
000, Xxxxxxxx, Xxx Xxxxxx 00000 (hereinafter referred to as "BIOSCIENCE"), and
NUCYCLE THERAPY, INC., a New Jersey corporation, having its office at 0 Xxxx
Xxxx Xxxxx, Xxxxx X, Xxxxxxxxx Xxxxxxxx, Xxx Xxxxxx 00000 (the "NUCYCLE").
W I T N E S S E T H:
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WHEREAS, BIOSCIENCE is a newly-formed entity to engage in, among other
things, the business of developing, marketing and selling various vitamins and
nutritional supplements derived from botanicals and plants (the "Business"); and
WHEREAS, NUCYCLE is engaged in, among other things, the business of
producing raw materials to be used as vitamins and nutritional supplements; and
WHEREAS, the parties anticipate that they will develop a new private label
for the sale of vitamins and nutritional supplements to be known as BIOMINS (the
"Private Label"); and
WHEREAS, BIOSCIENCE and NUCYCLE agree that it is in their mutual interest
that NUCYCLE produce the raw materials related to the Business of BIOSCIENCE for
the Private Label, under the terms herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereby agree as follows:
1. PRODUCTS. NUCYCLE shall produce and deliver to BIOSCIENCE, and
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BIOSCIENCE shall purchase and receive exclusively from NUCYCLE, the raw
materials derived from plants to be used in the Private Label products as may be
required by BIOSCIENCE from time to time for the Business (the "Products") upon
the terms and conditions hereinafter set forth. The initial Products are set
forth on Schedule A attached hereto.
2. PRODUCT DEVELOPMENT. (a) Using the Products, NUCYCLE and BIOSCIENCE
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shall jointly develop formulas, vitamins, and/or nutritional supplements for
sale under the Private Label.
(b) Each party hereto acknowledges and agrees that upon termination of
this Agreement, all right, title and interest in and to the formulas using the
Products shall be owned by BIOSCIENCE.
3. CONFIDENTIALITY AGREEMENT. Simultaneously with and as a condition to
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the execution and delivery of this Agreement by BIOSCIENCE, MANHATTAN DRUG
COMPANY, INC., who is a member or BIOSCIENCE, and NUCYCLE are entering into that
certain Confidentiality Agreement (the "Confidentiality Agreement"), the
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terms of which are an integral part of the terms of this Agreement and are
hereby incorporated by this reference.
4. TERM. This Agreement shall be effective for a five (5) year period
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(the "Initial Term") commencing as of the date hereof (the "Effective Date"),
and for successive five (5) year periods thereafter (each a "Renewal Term"),
subject to termination by either party upon written notice to the other party
not less than one (1) month prior to the expiration of the Initial Term or any
Renewal Term thereafter, unless sooner terminated in accordance with Section 16
below. Each annual period under this Agreement is hereinafter sometimes
referred to as a "contract year".
5. DELIVERY FORECASTS.
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The parties to this Agreement acknowledge that BIOSCIENCE is unable to
forecast its delivery requirements on a monthly basis with respect to such
Products for the first contract year. BIOSCIENCE shall use its best efforts to
submit to NUCYCLE delivery forecasts for succeeding contract years.
6. ALTERNATE MANUFACTURERS. NUCYCLE and BIOSCIENCE acknowledge and agree
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that NUCYCLE shall be the exclusive producer for BIOSCIENCE of all such
Products. BIOSCIENCE shall have the right to purchase the Products from other
manufacturers designated by NUCYCLE during the term of this Agreement if NUCYCLE
is unable to, or does not desire to, produce the Products.
7. PRICE. (a) This paragraph 7(a) shall control so long as NUCYCLE or
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any of its affilitates has an ownership interest in
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BIOSCIENCE. The initial per unit prices for the Products shall be NUCYCLE's
_____________________________________________./1/ After production commences, a
list of NUCYCLE's __________________/2/ will be provided to BIOSCIENCE upon
request. NUCYCLE hereby represents that such price includes only direct costs
incurred in the production of the Products. The price per unit for each of the
Products shall change from time to time based on changes in NUCYCLE's costs of
acquiring the raw materials component of the Products, changes in labor, and
other changes in direct costs. The shipping component shall be the cost for
delivery of the Products to BIOSCIENCE's designated warehouse facility. Such
charges shall be directly paid by BIOSCIENCE or paid by NUCYCLE and reimbursed
by BIOSCIENCE.
(b) If NUCYCLE or any of its affiliates no longer owns any ownership
interest in BIOSCIENCE, then the price charged under paragraph 7(a) for the
applicable services described therein shall be its most competitive prices
charged to third parties for the quantities involved.
8. PAYMENTS. BIOSCIENCE shall directly reimburse NUCYCLE from sales its
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current prices as set forth in paragraph 7 not less often than monthly.
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/1/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
/2/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
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9. CHANGES IN SPECIFICATIONS.
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(a) BIOSCIENCE may at any time and from time to time make changes to
the Product specifications previously given to NUCYCLE. All changes in the
Product specifications shall be in writing, signed by BIOSCIENCE and, as of the
effective date specified by BIOSCIENCE (which shall be at least thirty (30) days
after the same are delivered to NUCYCLE), shall be deemed to be a part of this
Agreement.
(b) If any change in the Product specifications shall result in a
change in NUCYCLE's actual direct costs of production and manufacture,
BIOSCIENCE shall pay such increase costs as the same may be reflected from time
to time in NUCYCLE's current prices.
10. COMPLIANCE WITH LAWS. NUCYCLE shall be responsible for compliance
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with all health, environmental and other laws relating to the safe handling and
transportation of the Products until delivered to BIOSCIENCE' designated
warehouse facility.
11. WARRANTIES; REMEDIES. NUCYCLE hereby warrants and agrees that:
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(a) All Products delivered pursuant to this Agreement shall be free
from defects in materials and workmanship.
(b) NUCYCLE shall comply with all applicable Federal, State and local
laws and regulations in producing the Products hereunder, including, but not
limited to, all requirements of the
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Fair Labor Standards Act of 1938, as amended, the Equal Employment Opportunities
provisions of the Civil Rights Act of 1964, as amended, and all regulations
promulgated thereunder.
12. INSURANCE.
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(a) NUCYCLE shall, throughout the term hereof, maintain (i) worker's
compensation insurance in statutory amounts covering all of its employees, (ii)
employer's liability insurance with a minimum per occurrence limit of
______________/3/ and (iii) public liability insurance (including product
liability and "broad form" contractual liability) for injuries, including
accidental death, to any one person in an amount not less than ______________/4/
and on account of any one accident in an amount not less than ______________/5/
and for property damage in an amount not less than ______________/6/ (the
employer's liability and public liability insurance are herein referred to as
the "Liability Insurance").
________________________
/3/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
/4/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
/5/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
/6/ Pursuant to Rule 24b-2 of the Securities and Exchange Act of 1934, the
confidential material has been omitted and filed separately with the Securities
and Exchange Commission.
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(b) All insurance policies required hereunder shall be issued by
companies reasonably acceptable to BIOSCIENCE. BIOSCIENCE (and such other
companies as it may nominate) shall be, upon written request, named as
additional insured under NUCYCLE's Liability Insurance. NUCYCLE shall furnish
BIOSCIENCE with certificates of insurance which provide that BIOSCIENCE (and
such other companies as it may nominate) are named as an additional insured
under the Liability Insurance, that the Liability Insurance is primary as to any
other insurance, that the issuers of the Liability Insurance waive subrogation
against BIOSCIENCE (and its nominees), that the Liability Insurance includes
contractual liability and that all policies required hereunder cannot be
modified or cancelled without thirty (30) days advance notice being given to
BIOSCIENCE. The existence of any such insurance shall not be construed as a
limitation of NUCYCLE's liability hereunder.
13. FORCE MAJEURE.
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(a) Failure by NUCYCLE to make any delivery hereunder (or portions
thereof) when due shall not subject NUCYCLE to any liability to BIOSCIENCE if
NUCYCLE declares in writing to BIOSCIENCE that performance cannot be made due to
(i) act of God or the public enemy, fire, explosion, perils of the sea, flood,
drought, war, riot, sabotage, accident or embargo; (ii) without limiting the
foregoing circumstances, any circumstances of like or different character beyond
the reasonable control of NUCYCLE;
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(iii) interruption of or delay in transportation beyond the reasonable control
of NUCYCLE; (iv) inadequacy or shortage or failure of normal sources of supply
of materials, energy or equipment beyond the reasonable control of NUCYCLE; (v)
equipment breakdowns beyond the reasonable control of NUCYCLE; (vi) labor
trouble from whatever cause arising and whether or not the demands of the
employees involved are reasonable and within NUCYCLE's power to concede; or
(vii) compliance by NUCYCLE with any order, action, direction or request of any
governmental officer, department, agency, authority or committee thereof (any
occurrence or condition set forth in subsections (i) through (vii) above are
herein referred to as "Force Majeure").
(b) If NUCYCLE claims an excuse hereunder, NUCYCLE shall promptly
notify BIOSCIENCE in writing, specifying the reasons therefor and expected
duration thereof. NUCYCLE shall take reasonable steps to ensure resumption of
full performance hereunder as soon as reasonably possible.
14. INTANGIBLE PROPERTY; GRANT OF LICENSE.
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The parties hereby acknowledge and agree that BIOSCIENCE will own all new
trademarks and tradenames relating directly to the vitamins and nutritional
products manufactured with the Products.
15. NUCYCLE'S INDEMNITY.
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NUCYCLE shall indemnify and hold harmless BIOSCIENCE, its subsidiaries and
affiliates, and their respective officers, directors and employees
(collectively, "Indemnitees") from and
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against any and all claims, demands, causes of action, suits, proceedings,
judgments, decrees, liabilities, losses, damages and costs, including attorneys'
fees and disbursements (collectively "Claims"), which may be asserted against
any Indemnitee to the extent they arise out of, are connected with or relate to,
any and all units of the Product, whether or not for damage to property or
injury or death, including, but not limited to (a) Claims involving the
operation of NUCYCLE's facility, and (b) Claims involving any environmental,
safety or health law, regulation or order of any governmental authority.
Notwithstanding the foregoing, NUCYCLE shall not be responsible for any Claim
arising out of misuse of any Product.
16. TERMINATION.
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(a) In addition to the right of either party to terminate this
Agreement at the end of the Initial Term or any Renewal Term thereafter as set
forth in Section 4 above, either party may terminate this Agreement by written
notice to the other party if the other party (i) suspends payment of its debts
or enters into or becomes subject to insolvency, liquidation, dissolution or
bankruptcy proceedings, (ii) makes an assignment for the benefit of its
creditors, (iii) has a receiver or trustee appointed for all or a substantial
portion of its assets, (iv) seeks relief under any law for debtors' relief, or
(v) fails to comply with the terms and conditions of this Agreement in any
material respect; provided, however, that in such event, with
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respect to the events or circumstances set forth in subsection (v) above, the
party failing to comply with the terms and conditions of this Agreement in such
material respect shall be provided at least ten (10) days' prior written notice
during which it may cure the failure.
(b) Except as expressly set forth in this Agreement, termination of
this Agreement:
(i) will not affect or impair the rights, liabilities and
obligations of any party under any purchase order issued prior to the effective
date of termination, including without limitation the right of BIOSCIENCE to
sell all Products delivered to BIOSCIENCE prior to termination hereof; and
(ii) will not relieve any party of any obligation or liability
incurred under this Agreement prior to the effective date of termination.
(c) In the event of termination hereunder for whatever reason (other
than nonpayment), NUCYCLE shall, at BIOSCIENCE's option, and upon BIOSCIENCE's
request, continue to perform its obligations hereunder for a period of up to one
hundred eighty (180) days beyond the date of termination.
17. GOVERNING LAW. This Agreement shall be governed by the laws of the
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State of New Jersey, including the New Jersey adopted version of the Uniform
Commercial Code.
18. ASSIGNABILITY. This Agreement may not be assigned by either party
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without the consent of the other party, provided,
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however, that either party may assign some or all of its rights or obligations
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hereunder without the other party's consent to any person or entity controlling,
controlled by, or under common control with, the first party, or, pursuant to a
stock or asset sale, a merger or any other transaction, to any successor to all
or substantially all of the assets of any business unit of the first party
receiving the benefits of this Agreement.
19. ARBITRATION. Any dispute, controversy or claim arising out of or
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relating to this Agreement, which cannot be amicably settled, shall be finally
settled by arbitration to be held in New Jersey, in accordance with the rules of
the American Arbitration Association. Arbitration shall be before three
arbitrators, one to be selected by each of the parties and the third to be
chosen by the first two arbitrators. Each party shall be responsible for its
own expenses regarding any arbitration. The costs of the arbitration itself
shall be shared equally by the parties unless otherwise determined by the
arbitrators. Judgment upon any award may be entered in any court having
jurisdiction and shall be final.
20. NOTICES. All notices, requests, demands and other communications
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hereunder shall be in writing and shall be given to the parties at their
respective addresses set forth below and shall be sent by (i) hand delivery;
(ii) certified mail, return receipt requested, postage prepaid; (iii) a
recognized "overnight" delivery service; or (iv) telecopy. Notices sent by hand
delivery
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shall be deemed received when delivered to the address and/or person set forth
below; notices sent by certified mail shall be deemed received when accepted;
notices sent by "overnight" delivery service shall be deemed received when
delivered; and notices sent by telecopy shall be deemed received upon receipt of
confirmation of dispatch:
If to BIOSCIENCE:
BIOSCIENCE, L.L.C.
000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Mr. Xxxx Xxxxxxxx
Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
With copies to: Xx. Xxxx Xxxxxx
Pres. & CEO
NuCycle Therapy, Inc.
0 Xxxx Xxxx Xxxxx, Xxxxx X
Xxxxxxxx Xxxxxxxx, XX 00000
Telephone No. (000)000-0000
Telecopy No. (000) 000-0000
If to NUCYCLE: NUCYCLE THERAPY, INC.
Xx. Xxxx Xxxxxx
Pres. & CEO
NuCycle Therapy, Inc.
0 Xxxx Xxxx Xxxxx, Xxxxx X
Xxxxxxxx Xxxxxxxx, XX 00000
Telephone No. (000)000-0000
Telecopy No. (000) 000-0000
With copies to: Drinker Xxxxxx & Xxxxxxx, LLP
000 Xxxxxx Xxxxx
Xxxxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telephone No. (000) 000-0000
Telecopy No. (000) 000-0000
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or to such other address or telecopy number as any party may designate by
written notice in the aforesaid manner.
21. INSPECTION. BIOSCIENCE shall have the right, during normal business
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hours and upon not less than two (2) days prior notice, to inspect the books and
records of NUCYCLE as to BIOSCIENCE transactions hereunder and plants and
facilities of NUCYCLE producing BIOSCIENCE Products in order to confirm
compliance with this Agreement or to review any information provided to
BIOSCIENCE by NUCYCLE hereunder. NUCYCLE shall have the right during normal
business hours and upon not less than two (2) days prior notice, to inspect the
books and records of BIOSCIENCE as to BIOSCIENCE transactions hereunder and
plants and facilities of BIOSCIENCE producing BIOSCIENCE Products in order to
confirm compliance with this Agreement or to review any information provided to
NUCYCLE by BIOSCIENCE hereunder.
22. WAIVER. The right of either party at any time to require strict
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performance by the other party hereto of any or all of the terms and conditions
of this Agreement shall in no way be affected or impaired by prior waiver,
forbearance, or course of dealing.
23. ENTIRETY. This Agreement constitutes the entire agreement between the
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parties hereto with respect to the development, manufacture, warehouse, order
fulfillment, and supply by NUCYCLE and purchase by BIOSCIENCE of the Products,
and merges and supersedes all prior understandings and representations,
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whether oral or written, between the parties pertaining thereto. No addition,
modification or alteration of this Agreement shall be of any force or effect
whatsoever unless reduced to writing and signed by the party to be charged
thereby. Any provision appearing on any purchase order, sales order, sales
acknowledgment, purchase order release or similar document which appears to
modify, alter or add to the provisions of this Agreement, shall be null and void
and of no effect whatsoever unless acknowledged and accepted, in writing, by
both parties on said documents.
24. SURVIVAL. The obligations of the parties under Sections
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10, 13, 14, 15, 18, and 19 hereof shall survive the termination of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, as of the date and year first
hereinabove written.
BIOSCIENCE, L.L.C. NUCYCLE DRUG COMPANY, INC.
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxxxx Name: Xxxx Xxxxxx
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Title: Member Title: CEO
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