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CONSIGNMENT INVENTORY AGREEMENT

THIS AGREEMENT made on this day of ______________________, 20_____, by and between XELON Corporation, a corporation incorporated under the laws of the State of California having its principal office at Camarillo, California ("XELON"), and ________________________ a company registered or corporation incorporated under the laws of the State _______________ of having its principal office at ________________________________________(Supplier"), as follows.

1. APPOINTMENT AND ACCEPTANCE -- Supplier appoints XELON to hold the attached excess/obsolete inventory list for sale/disposition by XELON’s marketing group. XELON agrees to market Suppliers excess/obsolete inventory on consignment basis. All such inventory accepted by XELON shall remain the property of Supplier until sold by XELON.
2. SERVICES – XELON will hold the consigned inventory at its warehouse, market, invoice, extend credit, and collect from customers all funds due for the listed inventory items on the attached listing. The proceeds of such sale shall be split with Supplier on a 50% basis.
3. COMPUTATION AND PAYMENT FOR ITEMS SOLD
1. Payments for goods sold are due and payable on or before the 19th of the month immediately following the month in which the goods are sold.
2. XELON will send Supplier a detailed statement showing the individual invoice activity for the previous period when the product is sold.
3. "Net Sales Value" shall mean the total price at which an order is invoiced to the customer including any increase or decrease in the total amount of the order, but excluding shipping and insurance costs, sales, use and excise taxes, testing and upgrading specifications, and handling charges, and any tariffs, duties and export fees involved in international shipments.
4. There shall be a deduction from any sums due Supplier, an amount equal to the amount previously paid should the product be defective and returned to XELON by the customer.
4. ACCEPTANCE OF ORDERS – All orders are subject to acceptance or rejection by an authorized officer of XELON and to approval by XELON's credit department. XELON shall be responsible for all credit risks and collections.
5. TERMS OF SALES – All sales shall be at prices and upon terms established by XELON, and it reserves the right to set the price of its service based on the acquisition cost. XELON shall also have the right to, at its discretion, establish, change, alter or amend the terms and conditions of an individual sale.
6. XELON’s RELATIONSHIP AND CONDUCT OF BUSINESS
1. All suppliers inventory shall be segregated and accounted for separately from other supplier’s inventories. A full accounting of such inventories will be provided upon request. All inventory items will be covered by XELON’s corporate umbrella insurance policy for loss from theft and fire.
2. XELON shall maintain a sales office in the territory and devote such time as may be reasonably necessary to sell and promote Supplier's inventory.
3. XELON will:
1. conduct all of its business in its own name and in such manner as it may seem fit,
2. pay all expenses whatever of its office and activities, and
3. be responsible for the acts and expenses of its employees.
4. Nothing in this Agreement shall be construed to constitute Supplier as the partner, employee or agent of XELON nor shall either have any authority to bind the other in any respect, it being intended that each shall remain an independent contractor responsible for its own actions.
7. TERM OF AGREEMENT AND TERMINATION -- This Agreement shall be effective on the first day of ___________, 20_____, and shall continue in force for a one (1) year period, and shall be automatically renewed for additional one (1) year periods thereafter unless terminated by written notice from either party to the other not less than thirty (30) days prior to the end of the initial or any subsequent one year term. This Agreement may also be terminated.
1. By XELON immediately upon written notice to Supplier if there is a change of fifty (50%) percent or more in the ownership or control of the Supplier’s business without XELON's written consent
2. By either party in the event of the other party's unreasonable and repeated failure to perform the terms and conditions of the Agreement.
3. By either party upon immediate written notice to the other party that it has filed or had filed against it a petition of bankruptcy (which is not dismissed within thirty (30) days after it is filed) makes an assignment for the benefit of creditors.
4. By either party when by mutual written agreement.
8. RIGHTS UPON TERMINATION -- Upon termination of this agreement for any reason, Supplier shall be entitled to:
1. Payment of its share on all suppliers inventory sales shipped prior to the date of termination.
2. Return of all consignment inventories remaining with XELON.
3. Payments referred to in this Provision 8 shall be paid on or before the l9th of the month following the month XELON receives payment for the sale(s).
9. GENERAL - - This Agreement contains the entire understanding, and shall supersede any oral or written agreements, and shall be binding upon and inure to the benefit of the parties' successors and assigns. It may not be modified in any way without the written consent of both parties. Supplier shall not have the right to assign this Agreement in whole or in part without XELON's written permission.
This Agreement contains the entire understanding, and shall supersede any oral or written agreements, and shall be binding upon and inure to the benefit of the parties' successors and assigns. It may not be modified in any way without the written consent of both parties. Supplier shall not have the right to assign this Agreement in whole or in part without XELON's written permission.
10. CONSTRUCTION OF AGREEMENT - - This agreement shall be construed according to the laws of the State of California.
This agreement shall be construed according to the laws of the State of California.
11. DISPUTES AND ARBITRATION - - The parties agree that any disputes or questions arising hereunder including the construction or application of the Agreement shall be settled by arbitration with the rules of the American Arbitration Association then in force, and that arbitration shall be held in Ventura County, California. The expense of the arbitrator be shared equally by the parties, unless the arbitrator determines that the expense shall be otherwise assessed.
The parties agree that any disputes or questions arising hereunder including the construction or application of the Agreement shall be settled by arbitration with the rules of the American Arbitration Association then in force, and that arbitration shall be held in Ventura County, California. The expense of the arbitrator be shared equally by the parties, unless the arbitrator determines that the expense shall be otherwise assessed.
12. NOTICES – – All notices, demands or other communications by either party to the other shall be in writing and shall be effective upon personal delivery or if sent by post seventy-two (72) hours after being posted via common carrier. All such notices shall be addressed as follows until such time as another address is given by notice pursuant to this Provision:
    
    To XELON:                                                                                To_________________:
    
    XELON Corporation                                                                     ____________________________________
    628 Calle Plano                                                                      ____________________________________
    Camarillo, CA 93012                                                                    ____________________________________

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