Supply Agreement
 
THIS SUPPLY AGREEMENT dated as of April 20, 2007 (this “Agreement”), by and
between Alltrista Plastics Corporation d/b/a Jarden Plastic Solutions, an
Indiana corporation with its principal place of business located at 1303 South
Batesville Road, Greer, SC 29650-2750 (“Jarden Plastic Solutions”), and Innopump
Inc., d/b/a Versadial, a Nevada corporation with its principal place of business
located at 305 Madison Avenue, New York, NY 10165 (“Versadial”). Each of Jarden
Plastic Solutions and Versadial is referred to herein as a “Party” and sometimes
collectively as the “Parties”.
 
WHEREAS, Jarden Plastic Solutions is willing to sell Products to Versadial on
the terms and conditions contained in this Agreement; and
 
WHEREAS, Versadial is willing to purchase 40MM and 49MM Dual Chambered Pumps
including all versions, extensions, and/or product enhancements thereto (“40MM
and 49MM Dual Chambered Pumps”), and to purchase other products as may be added
to this Agreement by the mutual written agreement (together with the 40MM and
49MM Dual Chambered Pumps “Products”), each as described on Schedules A-D
(“Schedules), upon the terms, provisions and conditions set forth in this
Agreement.
 
NOW THEREFORE, in consideration of the covenants and agreements herein, and
other good and valuable consideration, the sufficiency of which is hereby
acknowledged, the Parties agree as follows:
 

1.  
Manufacture/Purchase Requirements Contract.

 

(a)  
During the Term (as hereinafter defined) of this Agreement, Versadial agrees to
purchase from Jarden Plastic Solutions and Jarden Plastic Solutions agrees to
sell to Versadial not less than 100,000,000 units in the aggregate of
Versadial’s 40MM and 49MM Dual Chambered Pumps, which shall be produced using
the injection molding tooling and automation equipment referred to on Schedule
A-D (the “Equipment”) and similar products as are developed under this
Agreement. During the Term (as hereinafter defined) of this Agreement, Jarden
Plastic Solutions shall have first right of refusal for any future additional
tooling for the 40MM and 49MM Dual Chambered Pumps. This right of first refusal
shall be subject to the same criteria with respect to timing and terms as the
criteria for the right of first refusal set forth in Section 8(a)(ii) hereof.
Jarden Plastic Solutions shall also sell to Versadial such other Products as may
be mutually agreed upon in writing from time to time by Versadial and Jarden
Plastic Solutions. Versadial agrees to place orders of not less then One Hundred
Million (100,000,000) units in the aggregate of the 40MM and 49 MM Dual
Chambered Pumps (the “Minimum”) during the Term of this Agreement, subject to
the manufacturing capacity of Jarden Plastic Solutions to meet that level of
production. Jarden Plastic Solutions hereby represents and warrants to Versadial
that Jarden Plastic Solutions shall be able to manufacture, in accordance with
the specifications and using the tooling and automation equipment referred to on
Schedules A-D, not less than 100,000,000 Million units in the aggregate of the
40 MM and 49 MM Dual Chambered Pumps over the Term so that it will satisfy the
Minimum and 20,000,000 units in the aggregate of the 40 MM and 49 MM Dual
Chambered Pumps annually during each rolling twelve (12) month period commencing
one (1) year after the date hereof (the “Monthly Minimum”).

 
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(b)  
Versadial shall be deemed to have satisfied its obligation to place an order, if
it places purchase orders (each a “Purchase Order”) for units within the
scheduled manufacturing capacity not less than 30 days in advance of the
delivery date of the order. All purchase orders from Versadial which comply with
the immediately preceding sentence (i.e. are within the scheduled manufacturing
capacity) shall be accepted by Jarden Plastic Solutions.

 
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2.  
Price, Invoices and Payment Terms.

 

(a)  
Price -The prices for Products is determined as specified on the Schedule A-D
and are exclusive of any and all taxes whatsoever, whether sales, use, excise or
other, whether or not same are set forth separately on invoice to Versadial;
provided no invoice shall include taxes in the nature of income taxes or
franchise taxes. If Jarden Plastic Solutions shall subsequently be required to
pay any such taxes relating to the production, sale or transportation of the
Products (other than income taxes or franchise taxes attributable to Jarden),
Versadial will reimburse Jarden Plastic Solutions for such taxes; provided that
if any such taxes paid are subsequently refunded, Jarden Plastic Solutions shall
pay to Versadial the amount of any such refund. If any of the Products are
imported into any other country by Versadial, Versadial will be responsible for
all legal, regulatory and administrative requirements associated with any
exportation and the payment of all associated duties, taxes and fees. Prices may
increase or decrease from those set forth in Schedule A-D; provided that any
such increase or decrease will only be made if there has been an actual change
in the cost of any of the components included therein (such changes limited to
the cost of the items on Schedule E, which sets forth the base unit cost of
materials, labor, and power included in the component prices set forth on
Schedules A-D), which has actually been incurred by Jarden Plastic Solutions,
based upon its third party arm’s length arrangements with the vendors of such
materials. Any such price increase or decrease, if applicable, shall be made
once every six (6) months. Subject to the foregoing, any such increase shall be
on not less than thirty (30) days prior written notice from Jarden Plastic
Solutions to Versadial, which notice shall set forth the amount of any such
price increase and such other information as Versadial may reasonably request in
order to permit Versadial to verify and audit such price change. Notwithstanding
that prices are only subject to change every six (6) months (as aforesaid),
should a catastrophic event occur which effects the then current price of resins
or the particular component parts set forth on Schedules A-E (a “Catastrophic
Price Event”), resulting in a price increase or decrease by ten percent (10%) or
more, upon not less ten (10) days prior written notice, from Jarden Plastic
Solutions to Versadial, the price of the resins or effected component shall be
increased or decreased. Any price increase or decrease, other than purchased
components, shall be limited to the actual increase or decrease in the component
of the aggregate price that has increased or decreased multiplied by the margin
factor illustrated on Schedule F attached hereto. With respect to purchased
components, any price increase or decrease shall be limited to the actual
increase or decrease in the component of the aggregate price that has increased
or decreased. Schedule E attachment shows the current purchase costs of such
components. If the audit by Versadial results in a difference of opinion as to
the proposed price increase, the Parties shall attempt for a period of ten (10)
days to resolve the difference. If the difference cannot be resolved within such
ten (10) day period, it shall be submitted to binding arbitration pursuant to
Section 31 hereof. Any such price increase that is being audited shall not be
effective, except as provided in the immediately following sentence. The price
increase or decrease shall go into effect thirty (30) days after such ten (10)
day period, if an arbitration ensues and the arbitration is not concluded within
such thirty (30) day period. If as a result of the arbitration it is determined
that the price increase was or decrease was greater than appropriate under the
terms hereof, the Party that received the excess increase or decrease shall pay
to the other Party hereto, that amount of such excess together with interest
thereon, at a rate equal to seven percent (7%) per annum (calculated on the
basis of a year of twelve (12) months of thirty (30) days) from the date the
increase or decrease went into effect until such excess is paid in full.

 
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(b)  
Invoices - Jarden Plastic Solutions shall invoice Versadial when Products are
shipped from Jarden Plastic Solution’s manufacturing facility FOB, to
Versadial’s customers or pursuant to Versadial’s direction. All payments by
Versadial on invoices shall be due forty-five (45) days following receipt of
Jarden Plastic Solutions’ invoice, except for any invoice or portion thereof
that Versadial is disputing in good faith. Should Versadial fail to pay the
undisputed portion of any invoice within forty-five (45) days of the date of the
invoice, then Jarden Plastic Solutions shall, in addition to and without
prejudice to any other remedies available to Jarden Plastic Solutions under the
Agreement, Versadial shall pay interest at the rate of 1.0% per month on any
undisputed unpaid portion of an invoice that is not paid when due (prorated for
any portion thereof, if less then a month).

 

(c)  
Indemnification and Other Payments - All other payments hereunder (regardless of
the Party making the payment), inclusive of rebates, refunds and indemnification
shall be made thirty (30) days following written presentation of the applicable
claim. If the payment is not received within such thirty (30) day period, in
addition to and without prejudice to any other remedies available to the Party
making the claim, the other Party shall pay interest at the rate of 1.0% per
month of the an amount of the claim (prorated for any portion thereof, if less
than a month). All payments between the Parties under this Agreement shall be
made in U.S. dollars.

 
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(d)  
Versadial agrees to establish a “Lock Box” or similar secure, segregated account
(“Lock Box”) with a third party bank or other third party custodian reasonably
acceptable to Jarden Plastic Solutions, which Lock Box shall be governed by the
terms of a separate agreement (the “Lock Box Agreement”), reasonably acceptable
to Jarden Plastic Solutions (which shall be a third party beneficiary thereto),
to be entered into by and between Versadial and the custodian of the Lock Box.
The Lock Box Agreement will terminate immediately when Versadial has paid all
amounts owing under the separate Amortization Agreement between Versadial and
Jarden Plastic Solutions in the form of Exhibit 1 attached hereto (the
“Amortization Agreement”). Versadial shall direct all customers to whom it sells
any of the Products or goods which incorporate the Products to remit all
payments due from such customers that specifically relate to the Products or
goods which incorporate the Products directly to the Lock Box. Versadial agrees,
and the Lock Box Agreement shall provide, that any amounts held in the Lock Box
shall be paid (i) first, to Jarden Plastic Solutions in respect of any amounts
currently due to it pursuant to this Agreement for the applicable Products for
which the payment relates, and (ii) second, only after all amounts then due and
payable to Jarden Plastic Solutions pursuant to clause (i) have been so paid, to
Versadial. Subject to the consent of Versadial’s senior lender (which consent
may or may not be given), Versadial hereby agrees to grant Jarden Plastic
Solutions a first priority security interest in the contents of the Lock Box and
to execute such further documents and take such further actions as Jarden
Plastic Solutions may reasonably request in order to record and perfect such
security interest. The security interest shall terminate when all amounts due by
Versadial pursuant to the Amortization Agreement have been paid, whereupon
Jarden Plastic Solutions shall execute such documents and take such actions as
Versadial may reasonably request in order to evidence the termination of such
security interest. Versadial also agrees to provide Jarden Plastic Solutions
access to its invoices and other payment and billing records as it may
reasonably request in order to verify the determination and allocation of
amounts distributed from the Lock Box.

 
 

3.  
Specifications/Non-Conforming Goods.

 

(a)  
Jarden Plastic Solutions represents and warrants that all Products produced by
Jarden Plastic Solutions under this Agreement shall conform to their respective
Specifications as set forth in Exhibit A hereto (the “Specifications”).

 
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(b)  
Subject to Versadial’s termination rights set forth in Section 8 hereof,
Versadial’s sole remedy for non-conforming Products or goods which incorporate
the Products (i.e. do not conform to the Specifications) shall be to receive a
credit for each nonconforming Product. Notwithstanding the foregoing, if such
non-conformance is due to the gross negligence or willful misconduct of Jarden
Plastic Solutions, Versadial shall retain, and be able to exercise, all of its
rights and remedies hereunder, and under law and in equity, with respect to such
non-conformance. Versadial shall dispose of non-conforming Product at the sole
cost and expense of Jarden Plastic Solutions, and, at Jarden Plastic Solutions’
request and, at its cost and expense, shall ship to Jarden Plastic Solutions
some or all non-conforming Products and goods for inspection by Jarden Plastic
Solutions.

 

4.  
Forecasts. Versadial will provide good faith forecasts to Jarden Plastic
Solutions at the beginning of each of calendar quarter during the Term for each
Product. Forecasts by Versadial are for Jarden Plastic Solutions’ planning
purposes only and shall not be deemed to be a binding commitment of Versadial
and/or its affiliates.

 

5.  
Order Procedure.

 

(a)  
Versadial shall place orders for Products to be supplied under this Agreement
using a Purchase Order, specifying the quantity of each type of Product ordered
and the requested delivery date. As specified above, Jarden Plastic Solutions
shall accept all order for Products that are within the schedule capacity of
Jarden Plastic Solutions and which have not less than a thirty (30) day lead
time. Unless specified otherwise in any Purchase Order, FOB Jarden Plastic
Solutions manufacturing facility shall have the meaning ascribed to it in
Incoterms 2000.

 

(b)  
Termination of Purchase Orders - Accepted purchase orders, are not subject to
termination or modification, unless they can reasonably be replaced at no
additional cost to Jarden Plastic Solutions or Versadial, depending upon which
Party purports to terminate the purchase orders.

 
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6.  
Shipment, Delivery and Title.

 

(a)  
The Products shall be delivered to Versadial and title to the Products shall
pass to Versadial FOB Jarden Plastic Solutions’ manufacturing facility located
at Reedsville, PA. After two (2) years after the date hereof, Jarden Plastic
Solutions may change the manufacturing facility to one of its other
manufacturing facilities in the continental United States, unless Jarden Plastic
Solutions sells the manufacturing facility located at Reedsville, PA prior to
such two (2) year period or there is a catastrophic event at such facility which
results in such damage or destruction to such facility to render such facility
incapable of allowing Jarden Plastic Solutions to fulfill its obligation
hereunder from such facility, in which case the change may occur earlier,
subject to the conditions specified in this Section 6(a). Any such change to a
new manufacturing facility shall be subject to the following: (i) Jarden Plastic
Solutions shall furnish Versadial with not less than ninety (90) days prior
written notice of such change whenever practicable, (ii) the new manufacturing
facility (x) shall be of comparable quality to the then existing manufacturing
facility, shall be cGMP complaint and shall have FDA regulation in effect and
(y) shall permit Jarden Plastic Solutions to satisfy all of its obligations and
agreements hereunder; (iii) shall be at no additional cost or expense to
Versadial and Jarden Plastic Solutions shall pay for all additional costs and
expenses incurred by Versadial in connection with the move (including, without
limitation, all actual costs of the move itself); (iv) shall not result in the
manufacturing process being down or not fully operative for a period of more
than four (4) weeks; and (v) Jarden Plastic Solutions shall satisfy all accepted
Purchase Orders received in accordance with the terms hereof prior to the date
of the move from the then existing manufacturing facility in accordance with the
terms hereof.

 

(b)  
Title to the Products shall pass to Versadial as specified in Section 6(a)
above. If certain of the Product(s) ordered are destroyed prior to title passing
to Versadial, Jarden Plastic Solutions shall have the right to require delivery
of the goods not destroyed or damaged; provided that Versadial’s customer whose
order has been destroyed or damaged will accept a partial shipment. Risk of loss
to the Products shall remain with Jarden Plastic Solutions until title to the
Products passes to Versadial.

 
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(c)  
If all or any portion of an order is not delivered on the delivery date(s)
acknowledged in the relevant Purchase Order, Versadial may require Jarden
Plastic Solutions to ship the order via premium means (such as air freight) at
Jarden Plastic Solution’s expense.

 

(d)  
Delivery - If no delivery schedule is specified, the order shall be filled
promptly.

 

7.  
Inspection at Destination/Rejection of Shipment. Versadial or its customer shall
inspect all Products upon delivery of the Products to Versadial’s customer or
specified in the applicable purchase order. If Products are not rejected within
fourteen (14) days of receipt they shall be deemed accepted. Acceptance of
Products shall be conclusive except as regards latent defects, or fraud, gross
negligence or willful misconduct on the part of Jarden Plastic Solutions which
amounts to fraud. Without limiting Versadial’s rights or remedies for latent
defects in Products and/or fraud (including, without limitation, with respect to
matters of products liability), all such rights and remedies being hereby
reserved, Jarden Plastic Solutions shall be responsible for all of all
reasonable costs and expenses of returning any such non-conforming Products.

 

8.  
Term and Termination.

 

(a)  
Term - This Agreement shall commence on the date first above written.

 

(i)  
Unless terminated earlier as provided herein, this Agreement shall expire on the
fifth anniversary of the date first of this Agreement (the “Term”).
Notwithstanding the foregoing, if at the end of the fifth anniversary of the
date hereof, Versadial has not issued Purchase Orders that meet the criteria
described in Section 1(a) for the Minimum , the Term of this Agreement shall be
extended until Versadial has issued such Purchase Orders for the Minimum.

 

(ii)  
Provided that no Party is in material default of its obligations hereunder and
the Agreement is still in effect, the Parties agree that at the expiration of
the Term of this Agreement, the Parties shall negotiate in good faith a renewal
of this Agreement. To the extent Versadial and Jarden Plastic Solutions do not
agree on the terms of any such renewal, Versadial shall solicit other bids for
the manufacture of the Products from third parties, subject to a right of first
refusal in favor of Jarden Plastic Solutions. Prior to entering into any
agreement with a third party, pursuant to the right of first refusal in favor of
Jarden Plastic Solutions, Versadial shall provide all of the material terms of
the third party offer it intends to accept writing to Jarden Plastic Solutions.
Jarden Plastic Solutions shall have thirty (30) days after receipt of written
notice of the material terms to accept such terms of the third party offer as
its agreement with Versadial by giving written notice to Versadial within such
thirty (30) day period. If Jarden Plastic Solutions fails to give notice of
acceptance within such thirty (30) day period, this right of first refusal will
be deemed to have expired and Versadial shall be free to enter into the
agreement with the third party.

 
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(b)  
Termination - This Agreement may be terminated as follows:

 

(i)  
This Agreement shall be terminable immediately, upon written notice by the Party
terminating this Agreement (the “Terminating Party”) to the other Party hereto:

 

(A)  
If the other Party (the “Non-Terminating Party”) dissolves or institutes
proceeding seeking relief under a bankruptcy code or similar law, or consents to
the filing against it of any petition for the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or any similar official) over such
Non-Terminating Party or all or substantially all of its assets, or permits any
such proceeding to remain undismissed for a period of forty five (45) days or
more, or makes an assignment for the benefit of creditors, or admits in writing
its inability to pay its debts as they become due, or takes any action in
furtherance of the foregoing; or

 

(B)  
Upon any default by the Non-Terminating Party under this Agreement of any
material covenant, provision or agreement set forth herein to be performed or
observed by the other party hereto (including, without limitation, any payment
obligation of a party hereunder), if such default is or cannot be cured by the
defaulting Party within thirty (30) days of receipt of written notice from the
Terminating Party of the default specifying in detail the nature of the default,
or such longer period of time.

 
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(ii)  
This Agreement may be terminated immediately by Jarden Plastic Solutions if the
Specifications for any Product are determined by a court of competent
jurisdiction to infringe upon any statutory or common law patent, copyright,
trademark or other intellectual property right of any person, entity, or party
or if the Products or Specifications are determined by a court of competent
jurisdiction to violate any applicable law.

 

(iii)  
In addition to the other grounds for termination by Versadial set forth in this
Section 8, this Agreement may be terminated at any time by Versadial in
accordance with this Section 8(iii), upon thirty (30) days prior written notice
from Versadial to Jarden Plastic Solutions without any grounds or reason;
provided that Versadial shall (x) reimburse Jarden Plastic Solutions for all
amounts owing and unpaid by Versadial hereunder through the date of termination,
(y) pay all amounts remaining to be paid under the Amortization Agreement and
(z) pay a penalty to Jarden Plastic Solutions, based upon when the termination
occurs, as follows:

 
(A) Prior to the end of year one of this Agreement
 
$
2,500,000
           
(B) After year one but prior to the end of year two of this Agreement
 

$

1,600,000
           
(C) After year two but prior to the end of year three of this Agreement
 

$

1,000,000
           
(D) After year three but prior to the end of year four of this Agreement
 

$

500,000
 

 
 
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The amount owing under clauses (x), (y) and (z) shall be placed by Versadial
with a mutually agreed to third party escrow agent who shall be directed to
release the funds from escrow concurrently with the return of the Equipment by
Jarden Plastic Solutions to Versadial (or as directed by Versadial), in good
working condition, subject to normal wear and tear, and free and clear of any
and all liens, mortgages, security interests or other encumbrances of any nature
whatsoever. The penalty set forth in this Section 8(b)(iii) shall not be
applicable to the termination of this Agreement for any other reason whatsoever
and/or pursuant to any other provision of this Agreement.
 

(iv)  
This Agreement may be terminated upon written notice from Versadial to Jarden
Plastic Solutions if Jarden Plastic Solutions fails to deliver injection molded
parts at a level of eighty-five percent (85%) of the Annual Minimum number of
parts in any rolling year starting twelve (12) months after the date of this
Agreement; provided that Versadial orders at least the Monthly Minimum in each
month of such rolling year.

 

(v)  
Versadial may terminate this Agreement as to the assembly process only, and move
the assembly process from Jarden Plastic Solutions facility if Jarden Plastic
Solutions fails to assemble 85% of the Annual Minimum number of final assemblies
in any rolling year starting twelve (12) months after the date of this
Agreement; provided that Versadial orders at least the Monthly Minimum in each
month of such rolling year.

 

(c)  
Effects of Termination - In the event that Jarden Plastic Solutions terminates
this Agreement pursuant to Sections 8(b)(i)(A), 8(b)(i)(B) or 8(b)(ii) or
Versadial terminates this Agreement pursuant to Sections 8(b)(i)(A) or
8(b)(i)(B), in addition to all rights the Terminating Party has under this
Agreement, the Terminating Party shall have the right to exercise any and all
rights and remedies available to it at law or in equity. If this Agreement is
terminated by Versadial pursuant to Sections 8(b)(iv) or 8(b)(v), (x) Versadial
shall promptly pay Jarden Plastic Solutions for all amounts due and owing to
Jarden Plastic Solutions as of the date of termination, (y) subject to
compliance by Jarden Plastic Solutions with clause (z) of this sentence,
Versadial shall continue to remain obligated for any amounts owing under the
Amortization Agreement which shall be paid as an when Products are manufactured
for Versadial, and (z) concurrently with such termination (at the cost and
expense of Jarden Plastic Solutions), Jarden Plastic Solutions shall deliver the
Equipment to Versadial (or as directed by Versadial) in good working condition,
subject to normal wear and tear and free and clear of any and all liens,
mortgages, security interests or other encumbrances of any nature whatsoever;
provided that with respect to a termination pursuant to Section 8(b)(v), the
Equipment to be returned shall be limited to the assembly tables. All rights and
remedies described herein are cumulative and the election of one remedy shall
not preclude another.

 
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(d)  
Surviving Obligations. The termination of this Agreement or expiration of this
Agreement shall not affect any other rights of either Party which may have
accrued up to the date of such termination or expiration, relieve either Party
of its obligations which remain to be paid or to be performed as of such to
termination or expiration of this Agreement. Notwithstanding the termination or
the expiration of this Agreement, the obligations of the Parties set forth in
Sections 8, 9, 11(b), 11(c), 11(d), 14, 15, 17, 19, 20, 23, 28, 29, 30, 31 and
32, shall continue in full force and effect. 

 

(e)  
Upon payment of all amounts required to be paid pursuant to the Amortization
Agreement, all right, title and interest in and to the Equipment shall
automatically be transferred to Versadial free and clear of any and all liens,
mortgages, security interests or other encumbrances of any nature whatsoever,
and Jarden Plastic Solutions shall take all such actions in furtherance of such
transfer of the Equipment to Versadial (as aforesaid), as Versadial shall
reasonably request.

 

9.  
Representations and Warranties.

 

(a)  
Mutual Representations and Warranties. Each of the Parties hereby represents and
warrants this Agreement is a legal and valid obligation binding upon such Party
and enforceable in accordance with its terms; the execution, delivery and
performance of each this Agreement by such Party does not conflict with any
material agreement, instrument or understanding, oral or written, to which it is
a Party or by which it is bound; this Agreement does not violate any law or
regulation of any court, governmental body or administrative or other agency
having jurisdiction over it; and the Party is validly organized, in good
standing, and licensed to conduct business in each jurisdiction in which the
failure to do so would have a material adverse effect on such Party; and such
Party does not need to obtain any third party consents in order to perform its
obligations hereunder.

 
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(b)  
Product Warranty. Jarden Plastic Solutions warrants that Product(s) shall (i) be
of good and merchantable quality and fit for the purpose for which they are
intended, and (ii) be free from all defects (latent or otherwise) in material
and workmanship, (iii) be free and clear of any and all liens, security
interests and other adverse claim against title and possession and (iv) be
provided to Versadial new; and (v) will conform in all respects to the
Specifications.

 

10.  
Design Work for Future Products. Versadial will offer to Jarden Plastic
Solutions any packaging product design and development projects that involve
injection molding processes undertaken related to the Products during the Term
of this Agreement concurrently with offering the work to any other entity or
person. If Versadial elects to solicit other bids on such work, Versadial shall
present the written third party offer it intends to accept in its entirety on a
right of first refusal basis to Jarden Plastic Solutions. Jarden Plastic
Solutions shall have ten (10) days to accept the work on the terms of the third
party offer by giving written notice to Versadial. If Jarden Plastic Solutions
fails to give notice of acceptance in a timely manner, the right of first
refusal for such project will be deemed to have expired.

 

11.  
Intellectual Property Ownership and Rights.

 

(a)  
Grant of License. Versadial hereby grants to Jarden Plastic Solutions a limited,
non-assignable and non-transferable license to use the Patents set forth on
Schedule G attached hereto in the United States, during the Term, in connection
with the manufacture of the Products and for no other purpose whatsoever. The
scope of such license is strictly limited as provided herein and may not be
assigned, transferred by Jarden Plastic Solutions nor may Jarden Plastic
Solutions enter into sub-license with respect thereto. This license shall
terminate upon the termination of this Agreement for any reason whatsoever.

 

(b)  
Right to Patent. Versadial represents and warrants that it has the exclusive
worldwide right, as, licensor to grant the license provided for in Section 11(a)
and the Patent does not violate or infringe the right of any third party.

 
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(c)  
Jarden Plastic Solutions shall own the worldwide right, title and interest in
and to all ideas, processes, trademarks, service marks, inventories, designs,
technologies, computer hardware and software, original works of authorship,
formulas, discoveries, patents, copyrights, copyrightable work product and other
intellectual property, conceived of, developed or created by Jarden Plastic
Solutions or Versadial during the Term hereof (the “New Intellectual Property”)
which in any way relates to any manufacturing process similar to the
manufacturing process for the injection molding components of the Products.

 

(d)  
Versadial shall own the worldwide right, title and interest in and to all New
Intellectual Property, conceived of, developed or created by Jarden Plastic
Solutions or Versadial during the Term which in any way relates to the Products
including tooling, drawings, and molds (other than the manufacturing process of
the injunction molding components). Jarden Plastic Solutions expressly waives
any right, title or interest that it may have in and to the drawings for the
molds and the tooling and acknowledges that such drawings are the sole and
exclusive property of Versadial.

 

12.  
Agreement to License. It is a condition precedent to Jarden Plastic Solutions’
obligations hereunder that Versadial shall cause Gerhard Brugger (“Brugger”) to
enter into an Agreement (“Agreement to License”) with Jarden Plastic Solutions
substantially similar to the form annexed hereto as Exhibit B and made a part
hereof or in a form acceptable to Jarden Plastic Solutions within thirty (30)
days of execution hereof.

 

13.  
Force Majeure. Except for the obligation to pay for the Products, neither Party
hereto shall lose any rights hereunder or be liable for its failure to perform
hereunder, in whole or in part, due to contingencies beyond its reasonable
control, including strikes, riots, war, fire, explosions, flood, embargo,
lockout, acts of God, injunctions, and compliance with any law, regulation or
order, whether or not valid, of the United States of America or any governmental
body or any instrumentality thereof, whether now existing or hereto created (an
“Event of Force Majeure”); provided, however, that the Parties shall use
reasonable best efforts to continue to meet their obligations for the duration
of the force majeure condition and shall use its best efforts to remedy the
Event of Force Majeure; and provided further, that the Party declaring force
majeure shall notify the other Party promptly in writing of the commencement of
the condition, the nature, and the termination of the force majeure condition.
Notwithstanding the foregoing, in no event shall either Party be required to
settle any labor dispute or disturbance.

 
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14.  
Confidentiality.

 

(a)  
Each Party shall not, directly or indirectly, under any circumstance: (i)
disclose to any other Person any Confidential Information of the other Party
hereto; (ii) act or fail to act so as to impair the confidential or proprietary
nature of any such Confidential Information; or (iii) offer or agree to, or
cause or assist in the inception or continuation of, any such disclosure or
impairment of any such Confidential Information. All Confidential Information is
and shall remain the sole and exclusive property of the party disclosing the
same the “Disclosing Party” and the receiving party (the “Receiving Party”)
shall not be deemed to be a licensee of any such Confidential Information.
Notwithstanding the foregoing, subject to compliance with Section 14(b) hereof,
a Receiving Party shall be entitled to disclose Confidential Information
pursuant to applicable law, governmental regulation or rule or securities
exchange rule, court order, subpoena or similar judicial or regulatory process.
For purposes hereof, the term “Confidential Information” shall mean any and all
of the following (regardless of the medium in which maintained or stored);
confidential or proprietary information or material that is not in the public
domain about or relating to any aspect of the transactions contemplated hereby
or any trade secrets relating to the business and/or operations of either
Versadial or Jarden Plastic Solutions, as the case may be, or that is designated
in writing as confidential at the time of disclosure, including, without
limitation, financial information and projections, research and development
plans or projects; data and reports; intellectual property strategies, the
status of any applications for patents, trademarks, tradenames, service marks,
service names, copyrights and other intellectual property rights; computer
materials such as programs, instructions, source codes, object codes and
printouts; formulas; recipes; design concepts, product-testing information;
business improvements; processes; manufacturing processes; marketing and selling
strategies; strategic business plans (whether pursued or not); budgets;
licenses; pricing, pricing strategy and cost data; information regarding
employees; the identities of customers and potential customers; the identities
of contact persons at customers and potential customers; pricing; sales terms;
service plans, methods, practices, and strategies; forecasts, know-how and other
marketing techniques; the identities of key accounts; the identities of
suppliers and contractors, and all information about those supplier and
contractor relationships such as contact person(s), pricing and other terms; and
the terms of contracts or agreements. For purposes hereof, Confidential
Information shall not include information that (i) is publicly known at the time
of its disclosure or becomes publicly known through no fault of the Receiving
Party; (ii) is lawfully received by the Receiving Party from a third party,
which to the knowledge of the Receiving Party is not bound by a confidential
relationship or a confidentiality agreement with the Disclosing Party; or (iii)
was already known by the Receiving Party hereto prior to its receipt of the
information from the other Party hereto.

 
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(b)  
If the Receiving Party is required to disclose any Confidential Information
pursuant to any applicable law, governmental rule or regulation, court order,
subpoena or similar judicial or regulatory process, before making any disclosure
the Receiving Party shall (i) give the Disclosing Party prompt written notice of
the intended disclosure, whenever practicable and legally permissible, and (ii)
to the extent practicable, cooperate with the Disclosing Party, at the
Disclosing Party’s cost and expense, if the disclosing Party seeks a protective
order or other appropriate remedy. In the event a protective order is not
obtained, or the disclosing Party waives compliance with the provisions of
Section 14, the Receiving Party intending to make the disclosure shall disclose
only that portion of the Confidential Information which such the Receiving Party
is advised by legal counsel is legally required to be disclosed.

 

(c)  
Each of the Parties acknowledges the importance of its obligations pursuant to
this Section 14 to the business and financial condition of the other Party
hereto and that the breach by such Party of this Section 14 will likely cause
the other Party irreparable harm and damages which would not be easily
calculable, and if calculable, would not provide an adequate remedy. Therefore,
the Parties agree that the non-breaching Party (in addition to its other rights
and remedies it may have at law or in equity, all of which shall be cumulative),
shall be entitled to seek injunctive or other equitable relief (without being
required to post a bond or other security or to establish irreparable harm) in
respect of any breach or threatened breach of any provision of this Section 14.

 
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15.  
LIMITATION OF LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
PARTY FOR INCIDENTAL, INDIRECT, SPECIAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE
DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST PROFITS REGARDLESS OF WHETHER A
PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

 

16.  
Insurance.

 

(a)  
During the Term, Jarden Plastic Solutions shall, at its cost, at all times
maintain standard occurrence product warranty insurance with respect to the
Jarden Plastic Solutions Products, from insurance carriers of recognized
financial standing, providing liability coverage of $5,000,000 in the aggregate
and $1,000,000 per occurrence subject to such deductibles, as are customary in
the industry. Versadial shall be named as an additional insured on such
insurance and the policy may not be amended unless Versadial is given not less
than thirty (30) days prior written notice.

 

(b)  
During the Term, Versadial shall, at its cost, at all times maintain standard
occurrence product warranty insurance with respect to the Versadial Products,
from insurance carriers of recognized financial standing, providing liability
coverage of $5,000,000 in the aggregate and $1,000,000 per occurrence subject to
such deductibles, as are customary in the industry. Jarden Plastic Solutions
shall be named as an additional insured on such insurance and the policy may not
be amended unless Jarden Plastic Solutions is given not less than thirty (30)
days prior written notice.

 

17.  
Indemnification.

 

(a)  
Indemnification by Jarden Plastic Solutions. Jarden Plastic Solutions does
hereby agree to save, protect, defend, indemnify Versadial and its shareholders,
parent, officers, directors, employees, agents, affiliates and representatives
and their respective successors and assignors (each and “Versadial Indemnified
Person”), and to hold harmless each Versadial Indemnified Person from and
against any and all costs, losses, liabilities, claims, actions, suits, damages
and expenses (including, without limitation, reasonable attorneys’ fees and
expenses) (collectively, the “Losses”) which any Versadial Indemnified Person
may incur or be obligated to pay, or for which they or any of them may become
liable or be compelled to pay in any action, suit, claim or proceeding against
any Versadial Indemnified Person, arising from, based upon or relating to (a)
breach or default in the performance or observance of any material obligation,
agreement or covenant of Jarden Plastic Solutions set forth in this Agreement on
the part of Jarden Plastic Solutions to be observed or performed, (b) any breach
of any representation or warranty made by Jarden Plastic Solutions set forth in
this Agreement, (c) any act or omission to act which constitutes gross
negligence or willful misconduct on the part of Jarden Plastic Solutions or any
of Jarden’s Specialty Plastics agents, contractors or employees with respect to
the matters covered by this Agreement, and (d) any product warranty claim which
is, in whole or in part, that relates to or based upon a claim or assertion that
the Products did not conform to the Specifications. In case any action, suit or
other proceeding is brought against Versadial Indemnified Person for which
indemnification is sought hereunder, Jarden Plastic Solutions, or within notice
from Versadial, shall defend the same at Jarden’s Specialty Plastics sole cost
and expense by legal counsel reasonably satisfactory to Versadial. Jarden
Plastic Solutions shall not settle any such claim, action, suit or other
proceeding, unless as a part thereof Versadial and each applicable Versadial
Indemnified Person receives a complete release with respect to the claims for
which indemnification have been provided.

 
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(b)  
Indemnification by Versadial. Versadial does hereby agree to save, protect,
defend indemnify and hold Jarden Plastic Solutions and its shareholders, parent,
officers, directors, employees, agents, affiliates and representatives and their
respective successors and assigns, (and a “Jarden Plastic Solutions Indemnified
Person”) and to hold harmless each such Jarden Plastic Solutions Indemnified
Person from and against any and all Losses, which Jarden Plastic Solutions
Person may incur or be obligated to pay, or for which they or any of them may
become liable or be compelled to pay in any action, claim or proceeding against
them or any of them, arising from, based upon or relating to (a) any claim by a
third Party that Jarden’s Specialty Plastics use of the Intellectual Property in
accordance with the terms of this Agreement has resulted in an infringement of
such third party’s rights, (b) a breach or default by Versadial in the
performance or observance of any material obligation, agreement or covenant of
Versadial set forth in this Agreement on the part of Versadial to be observed or
performed, (c) any breach by Versadial of any representation or warranty made by
Versadial set forth in this Agreement and (d) any product warranty claim which
does not relate to or is not based upon an allegation or claim that the Products
do not conform to the Specifications. In case any action, suit or other
proceeding is brought against any Jarden Plastic Solutions Indemnified Person
for which indemnification is sought hereunder, Versadial, on written notice from
Jarden Plastic Solutions, shall defend the same at Versadial’s expense by legal
counsel reasonably satisfactory to Jarden Plastic Solutions. Versadial shall not
settle any such claim, action, suit or other proceeding, unless as a part
thereof Jarden Plastic Solutions and each Jarden Plastic Solutions Indemnified
Person receives a complete release with respect to the claims for which
indemnification have been provided.

 
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18.  
Notice. Any notice required to be given by the Agreement shall be in writing and
sent by overnight courier, e.g., FedEx, (overnight delivery or the earliest
delivery shall be specified) or by facsimile (with confirmation of receipt) to
the persons identified below.

 
Jarden Plastic Solutions
 
Versadial
Attn: John Bailey
 
Attn: Karen Nazzareno
1303 South Batesville Road
 
305 Madison Avenue
Greer, SC 29650-2750
 
New York, NY 10165
Tel: (864) 879-8101
 
Tel:
     
With a copy to:
 
With a copy to:
     
Jarden Corporation
Attn: Senior Vice President &
General Counsel
2381Executive Center Drive
Boca Raton, FL 33431
Fax (561) 912-4224
 
Baker & McKenzie LLP
1114 Avenue of the Americas
New York, NY 10036
Attn: Martin Eric Weisberg, Esq.
Fax: (212) 310-8756

 

19.  
Expenses. Except as otherwise expressly provided in this Agreement, each Party
shall pay its/his own cost and expenses (including, without limitation,
attorneys’ fees and expenses) incurred in connection with the preparation and
negotiation of this Agreement and the consummation of the transactions
contemplated hereby.

 
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20.  
Waiver. Any waiver by a Party of any breach of or failure to comply with any
provision or condition of this Agreement by the other Party shall not be
construed as, or constitute, a continuing waiver of such provision or condition,
or a waiver of any other breach of, or failure to comply with, any other
provision or condition of this Agreement, any such waiver to be limited to the
specific matter and instance for which it is given. No waiver of any such breach
or failure or of any provision or condition of this Agreement shall be effective
unless in a written instrument signed by the Party granting the waiver. No
failure or delay by either Party to enforce or exercise its rights hereunder
shall be deemed a waiver hereof, nor shall any single or partial exercise of any
such right or any abandonment or discontinuance of steps to enforce such rights,
preclude any other or further exercise thereof, at any time whatsoever.

 

21.  
Publicity. Versadial and Jarden Plastic Solutions shall jointly plan and
coordinate all press releases and notices to third parties and all other
publicity concerning this Agreement and the transactions contemplated hereby.

 

22.  
Severability. The Parties agree that should any provision of this Agreement be
held to be invalid, illegal or unenforceable in any jurisdiction by a court of
competent jurisdiction, that holding shall be effective only to the extent of
such invalidity, illegally or unenforceability without invalidating or rendering
illegal or unenforceable the remaining provisions hereof, and any such
invalidity, illegally or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. It
is the intent of the Parties that this Agreement be enforced to the fullest
extent permitted by applicable law.

 

23.  
Entire Agreement; Amendment. This Agreement (together with the Exhibits attached
hereto which form an integral part of this Agreement) contains the entire
understanding and agreement between Versadial and Jarden Plastic Solutions
hereto with respect to the subject matter hereof, and supersedes all prior
and/or concurrent understandings and agreements, arrangements, negotiations and
understandings between Versadial and Jarden Plastic Solutions (whether written
or oral) relating to such subject, all of which are merged herein. No covenants,
representations, warranties or conditions, express or implied, whether by
statute or otherwise, other than as set forth in this Agreement have been made
by Versadial or Jarden Plastic Solutions. This Agreement may not be amended,
modified, discharged other than by an instrument in writing executed by each of
the Parties hereto. Each Party has been represented by competent legal counsel
of its choosing in connection with its negotiation of this Agreement, and
therefore, this Agreement shall be interpreted and construed as if it were
drafted jointly by the Parties.

 
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24.  
Assignment. This Agreement is not for the benefit of any third party (other than
the indemnities of a Party) and shall not be deemed to give any right or remedy
to any such third party whether or not referred to in this Agreement. Neither
Jarden Plastic Solutions nor Versadial will have the right to assign the
Agreement without the prior written consent of the other Party hereto. Subject
to the foregoing, this Agreement shall be binding upon, and inure to the
benefit, of the Parties, their successors (by merger, consolidation or other
similar transaction or a purchaser of all of the stock or other equity interests
or assets of a Party) and permitted assigns.

 

25.  
Ambiguities. Ambiguities, if any, in the Agreement shall not be construed
against any Party, irrespective of which Party may be deemed to have authored
the ambiguous provision.

 

26.  
Agency and Joint Venture. The Agreement does not in any way create the
relationship of principal and agent, joint venture or partnership between the
Parties or any other form of association which would impose on any Party
liability for the act or failure to act of the other Party or Parties; and under
no circumstances shall one Party be considered to be the agent of the other
Party. Neither Party shall act or attempt to act, or represent itself, directly
or by implication, as an agent of the other Party or in any manner assume or
create, or attempt to assume or create, any obligation on behalf of, or in the
name of, the other Party.

 
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27.  
Regulatory Requirements - Manufacturing Regulatory Matters. 

 

(a)  
Versadial shall notify Jarden Plastic Solutions of any material matter related
to the FDA and other relevant regulatory authorities and the Products and
promptly furnish complete copies of such reports to Jarden Plastic Solutions in
the English language. Versadial also shall advise Jarden Plastic Solutions of
any occurrence or information that arises out of Versadial’s manufacturing
activities which have adverse regulatory compliance and/or reporting
consequences concerning a Product.

 

(b)  
Versadial shall be responsible for handling and responding to any appropriate
governmental agency inspections with respect to the Products during the Term of
the Agreement. Jarden Plastic Solutions shall use commercially reasonable
efforts to provide to Versadial any information requested by any governmental
agency in connection with any governmental inspection related to Products where
legally permissible and practicable (as reasonably determined by Versadial based
upon consultation with Versadial’s legal counsel). Versadial shall use
commercially reasonable efforts to promptly advise Jarden Plastic Solutions of
any requests by any governmental agency for such inspections with respect to
manufacturing of Products where legally permissible and practicable (as
reasonably determined by Versadial based upon consultation with Versadial’s
legal counsel).

 

28.  
Further Actions. Each Party agrees to execute, acknowledge and deliver such
further instruments, and to do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of the Agreement.

 

29.  
Full Cooperation. Versadial shall provide immediate assistance to Jarden Plastic
Solutions in responding to any inquiry or observation from any governmental
agency, and will promptly investigate and respond to any allegation the Product
is improperly designed or has failed to perform properly.

 

30.  
Governing Law. The Agreement shall be deemed to have been made in New York, New
York, and shall be governed by and construed in accordance with the laws of the
State of New York, U.S.A. without regard to the conflict of laws principles
which would result in the application of the substantive law of another
jurisdiction.

 
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31.  
Arbitration. Any dispute or disputes arising between the Parties out of or in
connection with this Agreement (including its interpretation, closing,
execution, binding effect, amendment, breach, termination or enforcement) and
which cannot be settled through correspondence and mutual good faith
consultation of the Parties hereto, shall be finally settled by binding
arbitration to be conducted in New York, New York, in accordance with the rules
and procedure of the American Arbitration Association (the “AAA”) by a sole
arbitrator, if the Parties agree on a sole arbitrator, or by three (3)
arbitrators in all other instances if they can not so agree. The arbitration or
arbitrators, as applicable, shall be chosen in accordance with the procedures of
the AAA. The award in any such arbitration shall be conclusive and binding upon
the Parties and not subject to judicial review. Judgment upon the Award or
decision rendered by the arbitrator(s) may be made to any court of competent
jurisdiction for a judicial recognition of the award or an order of enforcement
thereof, as the case may be. The arbitrator[s] shall be authorized to award fees
and expenses (including without limitation of the costs of the arbitration any
attorneys’ fees and expenses) to the Party that prevails in the arbitration.

 

32.  
Injunctive Relief. Notwithstanding the provisions of Section 31 hereof,
preliminary injunctions, temporary restraining orders and/or any similar kind of
temporary relief actions, or actions for equitable relief to the extent
contemplated hereby shall not be resolved by arbitration pursuant to Section 31
hereof, but instead shall be resolved, and subject to the exclusive jurisdiction
of, in any court of competent jurisdiction. If furtherance of the foregoing, the
Parties hereby consents to the jurisdiction of the Federal District Court for
the Southern District of New York and the courts of the State of New York
located in New York County and agrees not to contest the jurisdiction of such
courts or to assert the venue in such courts is improper or inconvenient.

 

33.  
Effectiveness. In addition to the requirements of Section 34 hereof, this
Agreement shall only be effective if concurrently with the execution and
delivery of this Agreement, (x) the Parties execute and deliver the Amortization
Agreement and (y) JPS, Sea Change Group LLC, a New York limited liability
company, and Mr. Gerhard Brugger execute and deliver the Agreement, in the form
thereof attached hereto as Schedule G.

 
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34.  
Headings; Counterparts, etc. The section headings contained in this Agreement
are inserted for reference purposes only and shall not affect in any way the
meaning, construction or interpretation of this Agreement. Any reference to the
masculine, feminine, or neuter gender shall be a reference to such other gender
as is appropriate. References to the singular shall include the plural and vice
versa. This Agreement may be executed in two (2) or more counterparts, and by
the different Parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original, and all of which, when taken
together, shall constitute one and the same document. This Agreement may be
executed by facsimile signature which shall constitute a legal and valid
signature for purposes hereof. Any reliable reproduction of this Agreement by
reliable means shall be considered an original of this Agreement

 
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be duly
executed by an authorized representative as of the day and year first written
above.
 
Alltrista Plastics Corporation d/b/a Jarden Plastics Solutions
 
Innopump Inc., d/b/a Versadial
 
   
By: /s/ Chuck Villa
 
By: /s/Geoffrey Donaldson
 
Name: Chuck Villa
Name: Geoffrey Donaldson
Title: President
Title: President/CEO
Date: 4/20/07
 
Date: 4/27/07
 

 
[Schedules excluded as they only contain confidential pricing information.]

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