PURCHASE AND SUPPLY AGREEMENT

Exhibit 10.8

PURCHASE AND SUPPY AGREEMENT

BETWEEN

HOME DIAGNOSTICS, INC.

AND

CONDUCTIVE TECHNOLOGIES

DATED February 8, 2006

CONTENTS

EXHIBITS

PURCHASE AND SUPPLY AGREEMENT

THIS AGREEMENT is made and entered into in Fort Lauderdale, Broward County, Florida, this 8th of October, 2006 by and between HOME DIAGNOSTICS, INC., a Delaware corporation with its principal place of business at 2400 Northwest 55th Court, Fort Lauderdale, FL 33309, United States of America (“HDI”) and CONDUCTIVE TECHNOLOGIES with its principal place of business at 935 Borom Road, York, PA 17404 (“CT”) (hereinafter a “party” or the “parties”).

WHEREAS, HDI develops, manufactures, assembles, sells and markets diabetes management medical devices and supplies (the “Products”);

WHEREAS, HDI desires to purchase Materials from Supplier for inclusion in HDI’s Products, on the terms and conditions of this Agreement;

WHEREAS, Supplier desires to supply Materials to HDI for incorporation into Products on the terms and conditions of this Agreement; and

WHEREAS, the parties hereto desire that HDI purchase all of its requirements for the Materials from Supplier on the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section I : Definitions

1.1 “HDI Technical Information” shall mean any and all know-how, trade secrets, information, data, formulations, practices, techniques, knowledge, skill, procedures, process and the like, and all other clinical, physical and analytical, safety, quality control or proprietary data and information relating to the manufacture and use of Materials currently or hereafter in the possession of, or developed during the term hereof by HDI or its Affiliates.

1.2 “Confidential Information” shall have the meaning set forth in Section 2.

1.3 “Legal Requirements” shall mean all laws, statutes, ordinances, codes, rules, regulations, published standards, permits, judgments, decrees, writs, injunctions, rulings, orders and other requirements of all Public Authorities.

1.4 “Materials” shall mean HDI part number (s) detailed to the specifications set forth on Exhibit A.

1.5 “Person” shall mean any natural person, corporation, firm, trust, business trust, joint venture, association, organization, company, syndicate, partnership or other business entity, or any government, or any agency or political subdivision thereof or any other form or entity not specifically listed herein.

1.6 “Product” shall mean any product(s) currently being sold or marketed by HDI that are listed in Exhibit A.

1.7 “Public Authority” shall mean any supranational, national, regional, state or local government, court, governmental agency, authority, board, bureau, instrumentality or regulatory body.

1.8 “Specification” shall mean the specification for the Materials as described in Exhibit A, as such specification may be amended from time to time, either by mutual agreement of HDI and Supplier or in response to directives issued by a relevant Public Authority in connection with the registration or marketing of the products in a particular jurisdiction.

1.9 “Third Party” shall mean any Person which is not an affiliate of any party hereto.

Section II : Term and Termination

2.1 Unless terminated sooner as hereinafter provided, this Agreement shall take effect on the Effective Date and extend for a term of three (3) years from the date hereof.

2.2 Unless terminated sooner as hereinafter provided, the parties shall negotiate in good faith to renew the terms of this Agreement six (6) months prior to the completion of the current three (3) year term for an additional 3 year period.

2.3 CT shall have the right at any time during the initial term or any renewal period hereof, by giving notice in writing to HDI, to terminate this Agreement forthwith without judicial action upon the occurrence of any of the following events:

2.4 HDI shall have the right at any time during the initial term or any renewal period hereof, by giving notice in writing to CT, to terminate this Agreement forthwith without judicial action upon the occurrence of any of the following events:

2.5 Upon the expiration or termination of this Agreement for any reason, HDI and CT shall be bound by the terms of this Agreement with respect to all orders placed by HDI within the time frame of the current forecast prior to the date of such expiration or termination date; except if impacted as per Sections 2.3 and 2.4.

Section III : Supplier Performance

3.1 Subject to Section II hereof; CT agrees to manufacture and supply, and HDI agrees to purchase, such amounts of Material for use in products developed by HDI including but not limited to the Product, as HDI may from time to time order in accordance with the terms of this Agreement.

3.2 CT shall perform the manufacturing, quality control, processing, packaging and shipping necessary to supply the Materials to HDI for incorporation into the Product, all in accordance with Specification and accordance with the terms of this Agreement.

3.3 CT shall ensure that each shipment of the Materials supplied by CT has been analyzed as required in the Specification and conforms in all respects with the Specification. CT shall further ensure through the use of audits, conducted on a regular and ongoing basis, that raw materials used by CT to manufacture the Materials comply with Specifications.

3.4 In the event that the quantities of Materials are limited due to an Event of Force Majeure (as defined in Section XII hereof), CT shall notify HDI of such shortage as soon as possible and shall take mutually agreed upon measures to ensure that HDI’s demand for Material is satisfied.

3.5 If reasonably requested by HDI, all technical records relating to the manufacturing, supply or provision of Material by or on behalf of CT shall be retained for a period of at least 2 years for the date of delivery of the Material.

3.6 All Products sold to HDI shall be free from defects in material and workmanship and shall be manufactured in accordance with applicable GMP requirements (21 CFR Part 820) and shall conform to the specifications (“Specifications”) set forth in Exhibit I.

3.7 HDI shall be responsible for all shipping and insurance expenses.

Likewise, federal, state, or municipal taxes, now or hereafter imposed on shipping the Product to HDI facilities.

3.8 CT shall maintain and adjust a minimum finished goods safety stock of 2 weeks supply not to exceed 4 weeks. Safety Stock should be determined by averaging the previous 4 weeks order history.

3.9 CT shall submit invoices to HDI for each delivery, referencing HDI’s purchase order. HDI shall be responsible for verifying that the invoiced quantities of Material match the quantities invoiced. If a discrepancy is found, HDI should notify CT with twenty (20) business days of delivery. The two parities will work together in order to resolve any discrepancies.

3.10 Notwithstanding any other provision of this Agreement, CT shall provide to HDI at least 12 months prior written notice if CT decides to cease manufacturing Material prior to the expiration of this Agreement. The 12 months prior notice is required to allow sufficient time for HDI to locate and source material from an alternate supplier. During the 12 month notice period, CT shall continue to supply Material in response to HDI’s forecast in order to meet HDI product requirements in accordance with the terms hereof and shall, at HDI’s option, sell and deliver to HDI a 12 month supply of Material (bas