Exhibit 10.4
EXCLUSIVE SALES AND MARKETING AGREEMENT
This Exclusive Sales and Marketing Agreement (hereinafter called
“Agreement”), to be effective as of this 1
st day of April, 2008 (hereinafter the “Agreement
Date”), is by and between Marine Life Sciences, LLC (the
“PRODUCER”), a limited liability company organized
under the laws of the state of Nevada and having its principal
place of business at 2157 Lincoln Street, Salt Lake City, Utah
84106 and ForeverGreen International, LLC, a limited liability
company organized under the laws of Utah and having its principal
place of business at 972 North 1430 West, Orem, Utah USA
(hereinafter, referred to as “CUSTOMER”). This
Agreement supersedes and replaces in their entirety, without
prejudice, any and all other agreements or contracts between the
parties.
WITNESSETH:
WHEREAS
A.
PRODUCER is the owner of the exclusive license
of the Subject Product as defined below;
B.
PRODUCER is willing and able to grant an
exclusive world-wide right to market and sell the Subject
Product to the CUSTOMER on the terms set forth herein;
C.
CUSTOMER desires to obtain said exclusive right
to market and sell the Subject Product in the multi level
marketing industry, as further defined in this Agreement.
NOW, THEREFORE, for and in consideration of these
premises and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto
expressly agree as follows:
1.
DEFINITIONS AS USED HEREIN
1.1
The term “Subject Product” shall
mean the processed marine phytoplankton known as Alpha-3 CMP,
which includes the Tom Harper story and marketing materials
related to the Tom Harper story, as well as any subsequent
improvements thereto.
1.2
The term “APPROVED Product” shall mean any present
CUSTOMER products containing the Subject Product as an ingredient
including without limitation CUSTOMER’S current
products referred to as FrequenSea™, FrequenSea™ tarter
Shots and SecreSea™ Youth Serum, SecreSea™ Hydrating
Cream, SecreSea™ Scrub and SecreSea™ Mineral Mask as
well as any additional CUSTOMER Product(s) containing the Subject
Product(s) as approved in the future by the PRODUCER. Initial
APPROVED product list is attached here as exhibit B and will be
from time to time be amended with new approved products.
1.3
For the purposes of this Agreement, a Unit of
APPROVED Product is defined as 1200 mg of Subject Product.
1.4
The term “Multi-Level Marketing” shall mean the form of
marketing, also called Network Marketing, in which individuals are
associated with a parent company as independent contractors, also
known as Members or distributors, to market products and are
compensated based on their sales of products by earning
commissions, bonuses or rebates. Typically, commissions are
earned on sales to the end user or consumer who may be a customer
or a distributor/Member that buys the product at a wholesale price
for personal consumption.
1.5
The term “Territory” shall mean and
include the entire world.
1.6
The term “Product Units Sold” shall mean the total
amount of APPROVED Product Units sold, not limited to but,
including demonstration, samples, market giveaways or promotions
for or on behalf of the CUSTOMER in each calendar month.
1.7
he term “Products Produced” shall
mean the total amount of APPROVED Product units produced in each
calendar month.
1.8
the term “the Parties” shall mean
CUSTOMER and PRODUCER.
2. GRANT OF RIGHT
2.1
The PRODUCER hereby grants to the CUSTOMER the exclusive right to
market, sell and offer for sale throughout the Territory through
Multi-Level Marketing the Subject Product. The CUSTOMER
warrants that the Subject Product will be used as an ingredient in
the APPROVED Products. The CUSTOMER covenants and agrees to
purchase the Subject Product exclusively from the PRODUCER.
3.
MARKETING
3.1
CUSTOMER shall use reasonable efforts, as defined herein, to effect
the sale of APPROVED Products by means of Multi-Level Marketing in
markets in the Territory as soon as practicable.
3.2
PRODUCER and CUSTOMER have agreed to a sampling program to help
promote and market the APPROVED Products. CUSTOMER may
purchase a quantity up to ten percent (10%) of the previous
calendar quarter purchases of the Subject Product for the sole
purpose of sampling. PRODUCER will provide a discounted rate as
detailed in Exhibit A.
3.3
CUSTOMER and PRODUCER will communicate in writing regarding any
future or improved products which must be approved by the PRODUCER
prior to any new products being introduced by the CUSTOMER or
improvements made to APPROVED products to ensure a combined
effort to exploit such new APPROVED Product(s).
3.4
CUSTOMER shall provide written notice to PRODUCER when product
orders are placed by CUSTOMER to PRODUCER in the form of a purchase
order.
3.5
CUSTOMER will provide to PRODUCER written notice of all existing
and new product registrations in both the United States and
foreign countries regarding APPROVED Products within ten (10)
days of the execution of this Agreement or the receipt of new
product registrations. PRODUCER will provide to CUSTOMER written
notice of all existing and new Product registrations in both the
United States and foreign countries regarding Subject Product
within ten (10) days of the execution of this Agreement or the
receipt of new Subject Product registrations. CUSTOMER and
PRODUCER will coordinate all product registrations involving the
Subject Product in the U.S.A. and all foreign countries to advance
the Parties mutual interests.
3.6 PRODUCER shall be the exclusive and
sole manufacturer of the Subject Product for the CUSTOMER.
3.7 The PRODUCER shall have the right to review
and approve CUSTOMER’s plans to expand its sales and
marketing of APPROVED Product(s) in any and all foreign markets
outside of the existing CUSTOMER markets of the United States,
Canada, Mexico, Australia, New Zealand, Singapore, Japan and the
European Union. Prior to the official opening of any foreign market
by CUSTOMER, CUSTOMER shall disclose to PRODUCER the
CUSTOMER’s plan and other material information relating to
any proposed expansion of marketing the APPROVED Product. If
PRODUCER objects to any aspect of CUSTOMER’s proposed
expansion plan, it shall communicate said objection(s) to CUSTOMER.
The Parties agree to use their best efforts to reach a
mutually satisfactory agreement relative to any and all
objections.
3.8
PRODUCER will share with and distribute to CUSTOMER appropriate
data regarding the Subject Product including but not
limited to research results, clinical and laboratory
projects, published research articles or papers, and Subject
Product licenses or registrations with government agencies.
4.
PAYMENTS AND REPORTS
4.1 CUSTOMER shall pay to the
PRODUCER for each kilogram of the Subject Product mount
commensurate with the Bulk Pricing Schedule attached hereto as
Exhibit A.
4.2 All payments required under
this agreement for the months of April 1, 2008 to March 31, 2009
shall be made by the CUSTOMER to the PRODUCER as follows:
Within sixty (60) days from the arrival date of shipment of SUBJECT
Product to CUSTOMER’s manufacturer, CUSTOMER shall pay to
PRODUCER fifty percent (50%) of the total payment due.
Within ninety (90) days from the arrival date of shipment of
SUBJECT Product to CUSTOMER’s manufacturer, CUSTOMER shall
pay to PRODUCER the remaining ( 50%) percent of the total payment
due.
Payment terms for the remaining contract years shall be set by the
mutual agreement of the Parties. Payment terms will reflect the
payment history of the CUSTOMER. If the CUSTOMER makes a payment in
full to the PRODUCER within the first sixty (60) days from the
arrival date of a shipment of SUBJECT Product to CUSTOMER’S
manufacturer, PRODUCER’S will give CUSTOMER a discount equal
to two percent (2%) of the total amount due to the PRODUCER.
4.3 Each month a written
statement of the Product Units Sold and Product(s) Produced during
such calendar month shall be prepared and shall be sent to the
PRODUCER. The CUSTOMER will work out an arrangement with all
manufacturers of products containing the “Subject
Product” to allow for verification of Products Produced. All
accounting statements will be sent on a monthly basis to the
PRODUCER’s representative Greg Popp at 2157 South Lincoln
Street, Salt Lake City, Utah 84106. All payments to PRODUCER
will be made to and sent to Marine Life Sciences at 2157 South
Lincoln Street, Salt Lake City, Utah 84106.
4.4 Should the CUSTOMER fail to make
any payment whatsoever due and payable to the PRODUCER hereunder at
the time it is due, it shall be deemed an event of default as
provided for under Paragraph 11.3.
4.5 All payments due hereunder shall
be paid by check or bank wire payable in United States of America
currency to PRODUCER, or to the account of PRODUCER at such bank as
PRODUCER may from time to time designate by notice to CUSTOMER.
4.6 In the event that any
payments due hereunder is not made when due, the payment shall
accrue interest beginning on the tenth day following the due date
thereof, calculated at the rate of prime plus two percent per
annum. If any payments are past due for a period in
excess of thirty days from the payment due date, the interest rate
shall increase to 18% per annum for the entire amount of any unpaid
balance. Each payment shall be applied firstly to
past due interest and secondly on account of the principal amount
due and owing. Each payment when made shall be accompanied by
interest accrued to the date of payment. The payment and
acceptance thereof shall not negate or waive the right
of PRODUCER to seek any other remedy, legal or equitable, to which
it may be entitled because of the delinquency of any payment.
5. RECORDS AND
INSPECTION
5.1 CUSTOMER shall maintain or cause
to be maintained a true and correct set of records pertaining to
the production of the PRODUCT Produced. During the term of
this Agreement, should any disagreement arise as to the amount of
Subject Product used to produce an APPROVED Product, the Parties
shall mutually appoint an independent accountant to perform an
audit of the CUSTOMER’s records during ordinary business
hours. In all cases where the audit reveals that
product’s produced do not contain the agreed amounts of
Subject Product it shall be deemed an event of default as described
in paragragh 11.3 herein. CUSTOMER may correct said default
by using the agreed upon amount of SUBJECT PRODUCT in subsequent
products produced and paying an amount to producer equal to the
shortfall amount of Subjec
