EXHIBIT 10.10
SUPPLY AGREEMENT
This Supply Agreement is entered into this __6th___ day of August, 2004 between
Parker-Hannifin Corporation, a corporation existing under the laws of the state
of Ohio, by and through its Fuel Cells Business Unit, with a place of business
at 95 Edgewood Avenue, New Britain, Connecticut 06051 ("Parker"), and Dyneco
Corporation, a corporation existing under the laws of the state of Minnesota,
with its principal place of business at 564 International Place, Rockledge,
Florida 32955 ("Dyneco").
In consideration of the mutual promises contained in this agreement, the parties
agree as follows:
1. Supply of Products. Dyneco agrees to purchase its requirements from Parker,
and Parker agrees to sell to Dyneco, the compressors specifically described in
Exhibit A of this agreement ("Products") during the term of this agreement and
in accordance with the terms hereof, for resale by Dyneco. Dyneco agrees to give
Parker the first right to quote on Dyneco aeration systems for non-fuel cell
application, such as ponds and golf courses, including cabinets, valves, hoses
and related components (collectively "Systems") incorporating such Products, and
shall select Parker as its supplier of such Systems if Parker demonstrates that
it can supply a system which meets Dyneco's technical requirements and pricing
that is reasonably competitive with other suppliers of such systems. Parker's
standard terms and conditions of sale, a copy of which is attached as Exhibit B,
will control the disposition of Products and Systems sold by Parker under this
Agreement, to the extent not in conflict with the terms hereof, and
notwithstanding the terms and conditions of any purchase orders by Dyneco.
2. Term and Termination. This agreement will extend for a period of ten (10)
years from the date appearing above, and will automatically renew for two
successive five (5) year periods, provided one party does not provide written
notice to the other of the intent to terminate the agreement prior to the end of
the initial period, or any successive period. Either party can also terminate
this agreement if (a) the other party materially breaches any provision of this
agreement, and the breaching party fails to cure such breach within forty-five
(45) days after receiving written notification of the breach; or (b) if the
other party files a petition in bankruptcy, is adjudicated as bankrupt, takes
advantage of the insolvency laws of any state or country, makes an assignment
for the benefit of creditors, is voluntarily or involuntarily dissolved, or has
a receiver, trustee, or other court officer appointed for its property.
3. Forecasts. Dyneco and Parker will work together to generate non-firm
forecasts of Product and System delivery requirements on a mutually agreed
basis. Dyneco will issue firm orders for Products and Systems no later than
_60__ days prior to the requested delivery date, unless otherwise agreed in
writing by Parker.
4. UniVane Trademark. Dyneco grants Parker the royalty-free, exclusive right and
license to use the mark "UniVane" on and in conjunction with the sale and
marketing of compressor and circulator products manufactured under the
"Exclusive Worldwide License Agreement" between the parties, dated May 1, 2003
("Prior Agreement"), whether such products are used in
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Products or Systems under this Agreement, or in other applications. All use of
the mark "UniVane" by Parker will inure to the benefit of Dyneco.
5. Prices. Parker will sell Products and Systems to Dyneco at Parker's standard
distributor pricing, effective on August 6, 2004, as attached as Exhibit C. All
prices pursuant to this agreement are FOB Parker's facility. Parker reserves the
right to modify prices at any time, unless otherwise provided in Exhibit C.
6. Restrictions on Parker. Nothing in this Agreement limits or restricts
Parker's right to manufacture and sell Products or Systems, or products
competing with the Products or Systems, to any entity.
7. Resolution of Disputes. Any controversy or claim arising out of or relating
to this Agreement, or the enforcement, breach, termination or validity thereof,
that cannot be resolved by good faith negotiations between the parties, shall be
settled by binding arbitration in accordance with the CPR Institute Rules for
Non-Administered Arbitration of Business Disputes in effect on the date of this
agreement. All matters submitted by the parties for binding arbitration shall be
decided by a single arbitrator agreeable to the parties involved in the
arbitration. If such parties are unable to agree upon a single arbitrator, an
arbitrator shall be appointed by the CPR Institute. Any other choice of law
clause to the contrary in this contract notwithstanding, the arbitration shall
be governed by the United States Arbitration Act, 9 U.S.C. ss. 1-16, and
judgment upon the award rendered by the Arbitrator(s) may be entered by any
court having jurisdiction thereof. The place of the arbitration shall be
Cleveland, Ohio. Insofar as the proceeding relates to patents, it shall also be
governed by 35 U.S.C. ss. 294, to the extent applicable. The arbitrator is not
empowered to award trebled, punitive or any other damages in excess of
compensatory damages, and each party irrevocably waives any claim to recover any
such damages. Judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. Each party shall pay its own attorney
fees, costs and other expenses in connection with the arbitration, as well as
one-half the cost of the arbitrator and arbitration expenses.
8. Miscellaneous. This Supply Agreement is the entire agreement between the
parties concerning its subject matter and supercedes all previous communications
between them, oral or written. Either party's waiver of any breach of this
agreement or failure to exercise any right or privilege of this agreement will
not be construed as a waiver of any term, provision, right, privilege or breach
of any other provision nor will it be deemed a waiver of any provisions of a
subsequent agreement. The parties will not change this agreement unless an
authorized representative of each party has executed such change. Any notice
that is required or permitted to be given pursuant to this agreement will be
deemed to have been sufficiently given and received if sent by facsimile
transmission or by regular mail, attention General Manager, to the address
stated above.
Parker Fax #:___860 827-2384____________
Dyneco Fax #:___321 639-6897____________
Either party may change its information for this purpose by giving written
notice to the other party in the manner above provided. Neither party will
assign or transfer any part of this
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agreement without the written consent of the other party. The laws of the State
of Ohio govern this agreement without regard to its conflicts or choice of law
provisions. Each individual executing this agreement on behalf of a party
warrants and represents that he/she has been duly authorized to execute this
agreement and that this agreement will be binding upon such party in accordance
with its terms.
Executed this 6th day of August 2004.
Parker-Hannifin Corporation
By and through its Fuel Cell Business Unit
By: /s/ Steve Burgess
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Steve Burgess
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Title: Technology Team Leader
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Dyneco Corporation
By: /s/ Thomas C. Edwards, Ph.D.
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Title: President
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Exhibit A
Description of Product:
Parker Hannifin's UniVane Compressors and Parker products related to the sale
and installation of Parker UniVane Compressors. All products utilizing the
UniVane technology.
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Exhibit B
Parker Standard Terms and Conditions of Sale
Offer Of Sale
The items described in this document are hereby offered for sale at prices to be
established by Parker Hannifin Corporation, its subsidiaries and its authorized
distributors. This offer and its acceptance by any customer ("Buyer") shall be
governed by all of the following Terms and Conditions. Buyer's order for any
item described in its document, when communicated to Parker Hannifin
Corporation, its subsidiary or an authorized distributor ("Seller'] verbally or
in writing, shall constitute acceptance of this offer.
1. Terms and Conditions of Sale: All descriptions, quotations, proposals,
offers, acknowledgments, acceptances and sales of Seller's products are subject
to and shall be governed exclusively by the terms and conditions stated herein.
Buyer's acceptance of any offer to sell is limited to these terms and
conditions. Any terms or conditions in addition to, or inconsistent with those
stated herein, proposed by Buyer in any acceptance of an offer by Seller, are
hereby objected to No such additional, different or inconsistent terms and
conditions shall become part of the contract between Buyer and Seller unless
expressly accepted in writing by Seller. Seller's acceptance of any offer to
purchase by Buyer is expressly conditional upon Buyer's assent to all the terms
and conditions stated herein, including any terms in addition to, or
inconsistent with those contained in Buyer's offer. Acceptance of Seller's
products shall in all events constitute such assent.
2. Payment: Payment shall be made by Buyer net 30 days from the date of delivery
of the items purchased hereunder. Any claims by Buyer for omissions or shortages
in a shipment shall be waived unless Seller receives notice thereof within 30
days after Buyer's receipt of the shipment.
3. Delivery: Unless otherwise provided on the face hereof, delivery shall be
made F.O.B. Seller's plant. Regardless of the method of delivery, however, risk
of loss shall pass to Buyer upon Seller's delivery to a carrier. Any delivery
dates shown are approximate only and Seller shall have no liability for any
delays in delivery.
4. Warranty: Seller warrants that the items sold hereunder shall be free from
defects in material or workmanship for a period of 365 days from the date of
shipment to Buyer, or 2,000 hours of use, whichever expires first. THIS WARRANTY
COMPRISES THE SOLE AND ENTIRE WARRANTY PERTAINING TO ITEMS PROVIDED HEREUNDER.
SELLER MAKES NO OTHER WARRANTY, GUARANTEE, OR REPRESENTA TION OF ANY KIND
WHATSOEVER. ALL OTHER WARRANTIES, INCLUDING BUT NOT LIMITED TO, MERCHANTIBILITY
AND FITNESS FOR PURPOSE, WHETHER EXPRESS, IMPLIED, OR ARIS. ING BY OPERATION OF
LAW, TRADE USAGE, OR COURSE OF DEAL ING ARE HEREBY DISCLAIMED. NOTWITHSTANDING
THE FOREGOING, THERE ARE NO WARRANTIES WHATSOEVER ON ITEMS BUILT OR ACQUIRED
WHOLLY OR PARTIALLY, TO BUYER'S DESIGNS OR SPECIFICATIONS.
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5. Limitation Of Remedy: SELLER'S LIABILITY ARISING FROM OR IN ANY WAY CONNECTED
WITH THE ITEMS SOLD OR THIS CONTRACT SHALL BE LIMITED EXCLUSIVELY TO REPAIR OR
REPLACEMENT OF THE ITEMS SOLD OR REFUND OF THE PURCHASE PRICE PAID BY BUYER, AT
SELLER'S SOLE OPTION. IN NO EVENT SHALL SELLER BE LIABLE FOR ANY INCIDENTAL,
CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND OR NATURE WHATSOEVER, INCLUDING BUT
NOT LIMITED TO LOST PROFITS ARISING FROM OR IN ANY WAY CONNECTED WITH THIS
AGREEMENT OR ITEMS SOLD HEREUNDER, WHETHER ALLEGED TO ARISE FROM BREACH OF
CONTRACT, EXPRESS OR IMPLIED WARRANTY, OR IN TORT, INCLUDING WITHOUT LIMITATION,
NEGLIGENCE, FAILURE TO WARN OR STRICT LIABILITY.
6. Changes, Reschedules and Cancellations: Buyer may request to modify the
designs or specifications for the items sold hereunder as well as the quantities
and delivery dates thereof, or may request to cancel all or part of this order,
however, no such requested modification or cancellation shall become part of the
contract between Buyer and Seller unless accepted by Seller in a written
amendment to this Agreement. Acceptance of any such requested modification or
cancellation shall be at Seller's discretion, and shall be upon such terms and
conditions as Seller may require.
7. Special Tooling: A tooling charge may be imposed for any special tooling,
including without limitation, dies, fixtures, molds and patterns, acquired to
manufacture items sold pursuant to this contract. Such special tooling shall be
and remain Seller's property notwithstanding payment of any charges by Buyer. In
no event will Buyer acquire any interest in apparatus belonging to Seller which
is utilized in the manufacture of the items sold hereunder, even if such
apparatus has been specially converted or adapted for such manufacture and
notwithstanding any charges paid by Buyer. Unless otherwise agreed, Seller shall
have the right to alter, discard or otherwise dispose of any special tooling or
other property in its sole discretion at any time.
8. Buyer's Property: Any designs, tools, patterns, materials, drawings,
confidential information or equipment furnished by Buyer or any other items
which become Buyer's property, may be considered obsolete and may be destroyed
by Seller after two (2) consecutive years have elapsed without Buyer placing an
order for the items which are manufactured using such property. Seller shall not
be responsible for any loss or damage to such property while it is in Seller's
possession or control.
9. Taxes: Unless otherwise indicated on the face hereof, all prices and charges
are exclusive of excise, sales, use, property, occupational or like taxes which
may be imposed by any taxing authority upon the manufacture, sale or delivery of
the items sold hereunder. If any such taxes must be paid by Seller or if Seller
is liable for the collection of such tax, the amount thereof shall be in
addition to the amounts for the items sold. Buyer agrees to pay all such taxes
or to reimburse Seller therefore upon receipt of its invoice. If Buyer claims
exemption from any sales, use or other tax imposed by any taxing authority,
Buyer shall save Seller harmless from and against any such tax, together with
any interest or penalties thereon which may be assessed if the items are held to
be taxable.
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10. Indemnity For Infringement of Intellectual Property Rights: Seller shall
have no liability for infringement of any patents, trademarks, copyrights, trade
dress, trade secrets or similar rights except as provided in this Part 10.
Seller will defend and indemnify Buyer against allegations of infringement of
U.S. patents, U.S. trademarks, copyrights, trade dress and trade secrets
(hereinafter 'Intellectual Property Rights'). Seller will defend at its expense
and will pay the cost of any settlement or damages awarded in an action brought
against Buyer based on an allegation that an item sold pursuant to this contract
infringes the Intellectual Property Rights of a third party. Seller's obligation
to defend and indemnify Buyer is contingent on Buyer notifying Seller within ten
(10) days after Buyer becomes aware of such allegations of infringement, and
Seller having sole control over the defense of any allegations or actions
including all negotiations for settlement or compromise. If an item sold
hereunder is subject to a claim that it infringes the Intellectual Property
Rights of a third party, Seller may, at its sole expense and option, procure for
Buyer the right to continue using said item, replace or modify said item so as
to make it noninfringing, or offer to accept return of said item and return the
purchase price less a reasonable allowance for depreciation. Notwithstanding the
foregoing, Seller shall have no liability for claims of infringement based on
information provided by Buyer, or directed to items delivered hereunder for
which the designs are specified in whole or part by Buyer, or infringements
resulting from the modification, combination or use in a system of any item sold
hereunder. The foregoing provisions of this Part 10 shall constitute Seller's
sole and exclusive liability and Buyer's sole and exclusive remedy for
infringement of Intellectual Property Rights.
If a claim is based on information provided by Buyer or if the design for an
item delivered hereunder is specified in whole or in part by Buyer, Buyer shall
defend and indemnify Seller for all costs, expenses or judgments resulting from
any claim that such item infringes any patent, trademark, copyright, trade
dress, trade secret or any similar right.
11. Force Majeure: Seller does not assume the risk of and shall not be liable
for delay or failure to perform any of Seller's obligations by reason of
circumstances beyond the reasonable control of Seller (hereinafter 'events of
Force Majeure]. Events of Force Majeure shall include without limitation,
accidents, acts of God, strikes or labor disputes, acts, laws, rules or
regulations of any government or government agency, fires, floods, delays or
failures in delivery of carriers or suppliers, shortages of materials and any
other cause beyond Seller's control.
12. Entire Agreement/Governing Law: The terms and conditions set forth herein,
together with any amendments, modifications and any different terms or
conditions expressly accepted by Seller in writing, shall constitute the entire
Agreement concerning the items sold, and there are no oral or other
representations or agreements which pertain thereto. This Agreement shall be
governed in all respects by the law of the State of Ohio. No actions arising out
of the sale of the items sold hereunder or this Agreement may be brought by
either party more than two (2) years after the cause of action accrues.
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Exhibit C
Prices of Products
The Fuel Cell Business Unit will set the UniVane Compressor prices.
[Use alternative if appropriate;
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ALTERNATIVE 1: The prices set forth on this Exhibit B will remain firm until
___________. Effective ___________, the parties will review the prices annually
and may be adjusted, effective as of each _________[date], as to future purchase
orders to reflect increases or decreases in excess of ___ percent (__%) in
Supplier's cost of ________________________, as established by the
_______________________ indicators. The parties will negotiate any changes in
prices in good faith, with the goal of fairly apportioning the change between
the parties. If the parties are unable to reach agreement concerning a price
increase, either party may, at its option, elect to terminate this agreement
without liability to the other.
ALTERNATIVE 2: At the request of either party, the parties will discuss in good
faith any price changes for Products appropriate due to market conditions,
including changes in material and labor costs. Parker will also consider in good
faith any potential manufacturing efficiencies suggested by Dyneco and will,
upon implementation of any such efficiencies, provide appropriate price
reductions to Dyneco due to any resulting cost savings. Prices may not be
increased more than one time in any twelve-(12) month period. Supplier will
provide Customer with at least sixty (60) day advance written notice of any
price increases. If the parties shall be unable to reach agreement within 60
days of such notice, either party may, at its option, elect to terminate this
Agreement without liability to the other.
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Exhibit D
Tooling
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