LADISH/XXXXX JOINT VENTURE
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This Agreement entered into the 15th day of September, 1995, by Ladish Co.,
Inc., a corporation organized and existing pursuant to the laws of the State of
Wisconsin (hereinafter referred to as "Ladish") with an office located at 0000
Xxxxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxx, 00000 and Xxxxx Metals, Inc., a
corporation organized and existing pursuant to the laws of the State of
California (hereinafter referred to as "Weber") with an office located at 00000
Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx, 00000.
WHEREAS, Xxxxxx is in the business of manufacturing and marketing forged
products of steel, titanium and superalloys for the turbine engine component
market and in the course of this business Xxxxxx has developed certain unique
and valuable technology and market presence; and
WHEREAS, Xxxxx possesses certain unique, large hydraulic press
manufacturing capacity along with the accompanying technology associated with
said capacity; and
WHEREAS, Xxxxxx and Xxxxx believe it would be mutually advantageous to
combine Xxxxxx'x technology and market presence with Xxxxx'x large hydraulic
press manufacturing capacity in order to jointly pursue the portion of the "hot
die" turbine engine component market which neither party is capable of pursuing
without the assistance of the other.
NOW, THEREFORE, based upon the mutual covenants and conditions contained
herein and the mutual benefits to be derived herefrom, the parties hereto agree
as follows:
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Xxxxxx/Xxxxx Joint Venture
Page 1
ARTICLE 1 -- CONCEPT
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The parties hereto associate themselves as joint venturers for the purpose
of combining Xxxxxx'x technology and market presence in the turbine engine
industry with Xxxxx'x large hydraulic press manufacturing capacity in order to
(i) develop a hot die manufacturing capability, (ii) solicit and secure purchase
orders for the turbine engine components produced from the aforesaid hot die
manufacturing capacity, and (iii) produce and deliver hot die turbine
components. The parties recognize and acknowledge that the actual hot die
capacity contemplated by this Agreement will be established at the Xxxxx
facility with the further understanding that certain of the pre-forging effort
including, but not limited to, raw material acquisition, modelling,
metallurgical studies and material preparation, will be conducted at a Xxxxxx
facility along with certain of the post-forging effort including, but not
limited to, machining, processing and testing. Further, the parties agree that
given the market presence of Xxxxxx in the turbine engine market, the components
the parties produce pursuant to this joint venture for the hot died turbine
engine market will be sold as a "Xxxxxx Product." The proceeds from the sale of
the Xxxxxx Products will be divided between the parties as set forth below in
Article 2 -- Proceeds. The primary responsibility for the sales and marketing
effort, as well as engineering support, for Xxxxxx Products shall rest with
Xxxxxx, provided that Xxxxx will support said effort to the extent necessary
with Xxxxx personnel along with providing reasonable customer-access to the hot
die capacity contemplated by this Agreement. It is expressly understood and
agreed between the parties that this joint venture extends only to the
performance of contracts for hot die turbine engine components and that this
Agreement shall not apply to any other or different work unless the parties so
agree in writing.
ARTICLE 2 -- PROCEEDS
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The parties hereto acknowledge and agree that due to the unique
characteristics as to material, specifications, geometry and design of each of
the type of the hot die turbine engine components to be produced and sold
pursuant to this Agreement a
precise formula cannot be established, prior to the receipt of customer
contracts, for the distribution of the proceeds from the sale of said
components. Therefore, the parties agreed to mutually develop the pricing for
the components prior to bidding on any specific contracts. These pricing
decisions will be based upon the parties' assessment of the actual costs
incurred to produce a component along with a reasonable return for each of the
parties. Should the parties be unable to agree on a proposed price for a
component prior to a bid being submitted to a customer, the parties shall not
bid on that particular product.
ARTICLE 3 -- DEVELOPMENT
------------------------
In order to successfully combine the technology and market presence of
Xxxxxx with the large hydraulic press capacity of Xxxxx to produce and market
Xxxxxx Products, it will be necessary for both parties to make a significant
investment of resources to (i) assess and develop a marketing plan and establish
customer contracts; (ii) design, engineer and implement the modifications at the
Xxxxx facility; and (iii) model and create the appropriate tooling and
procedures to form the Xxxxxx Products. Both parties hereto recognize the
commitment which is required to effectuate this Agreement and acknowledge that
timeliness is a key element in successfully bringing the joint venture
contemplated by this Agreement to fruition. During the development process each
party shall make available to the other party the appropriate personnel and
resources necessary to develop the capability contemplated by this Agreement.
ARTICLE 4 -- WARRANTY
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Neither Xxxxxx nor Xxxxx makes any representation, warranty or guarantee as
to the design of any Xxxxxx Product manufactured and/or sold pursuant to this
Agreement. The responsibility for the design and specifications of any Ladish
Product shall reside with the customer issuing the purchase order for said
product. Each party shall assume responsibility, with respect to the other
party, for the materials or workmanship which that party supplies for the Xxxxxx
Products. All other warranties,
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Xxxxxx/Xxxxx Joint Venture
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express or implied, including without limitation the implied warranties of
merchantability and fitness for a specific purpose are hereby disclaimed by both
parties hereto. In no event shall Xxxxxx or Xxxxx be liable for collateral or
consequential damages or for any other costs.
The rights and obligations contained herein are expressly and solely
between Xxxxxx and Xxxxx. Nothing contained herein is intended to create or
confer any rights or obligations upon any third parties.
ARTICLE 5 -- CONFIDENTIALITY
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Xxxxxx and Xxxxx covenant and agree that information, data and know-how
(collectively referred to as "Information") exchanged to each other pursuant to
the mutual effort contemplated by this Agreement or developed as a result of
the mutual effort contemplated by this Agreement shall be used only in
connection with and to the extent necessary under this Agreement for the
manufacture and sale of Xxxxxx Products. Except as far as it becomes necessary
for the implementation of this Agreement, both parties agree not to divulge
intentionally and to use its best efforts to prevent any third party from
obtaining or using any of the Information disclosed by the other party pursuant
to this Agreement; provided, however, that nothing in this Article shall prevent
the use or disclosure of Information which (i) was already in the other party's
possession at the time of receipt hereunder as evidenced by written documents,
or (ii) is or comes into the public domain through no fault of the other party,
or (iii) is received or acquired from a third party having the right to disclose
the Information. Notwithstanding any termination of this Agreement pursuant to
Article 9 -- Termination or the expiration of the Agreement by its terms, the
foregoing obligations as to confidentiality shall remain in place for ten (10)
years after any such termination or expiration.
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Xxxxxx / Xxxxx Joint Venture
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ARTICLE 6 - FORCE MAJEURE
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The parties hereto agree that performance of this Agreement shall be
subject to acts of God, riots, insurrections, fires, war and warlike operations,
explosions, accidents, governmental acts, acts of the public enemy, epidemics,
laws or regulations of the Government, state and federal, strikes and labor
stoppages. The foregoing provision, however shall not release either party
hereto from using its best efforts to avoid or diligently remove such
circumstances. The party excused from performance by any of the above-named
circumstances shall resume performance with utmost dispatch when such
circumstances are removed. Either party hereto claiming such excuse or delay for
non-performance, in order for it to be recognized, shall give prompt written
notice thereof to the other party hereto.
ARTICLE 7 - TERM
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The initial term of this Agreement shall be for a ten (10) year period from
the above stated effective date of the Agreement. The Agreement will then renew
for five (5) subsequent and successive five (5) year extensions. The extension
periods shall become effective upon either party giving written notice to the
other party of its intent to extend the Agreement at least thirty (30) days
prior to the expiration of the Agreement or any extension.
ARTICLE 8 - NOTICE
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Any and all notices hereunder shall be deemed effectively made, if said
notice is in written form and is deposited, postage paid, in the United States
mail system, and addressed to the respective party set forth below:
Ladish Co., Inc. Xxxxx Metals, Inc.
0000 X. Xxxxxxx Xxxxxx 00000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000 Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx Attention: Xxxx X. Xxxxx
__________________________
Ladish/Xxxxx Joint Venture
Page 5
or to such other individual as either party hereto may advise the other party
hereto in writing from time to time. A notice that would otherwise be effective
on a Saturday, Sunday or holiday shall be deemed effective at 10:00 a.m. Central
Standard Time on the next regular business day thereafter.
ARTICLE 9 - TERMINATION
-----------------------
The parties hereto mutually appreciate and acknowledge that in order to
jointly pursue the hot die turbine engine component market in an effective
manner, it will be necessary for each party to (i) incur significant capital
expenditures; (ii) commit a considerable amount of valuable employee time and
resources; (iii) disclose highly confidential information to the other party;
and (iv) jointly present a united front to the customer base for the purpose of
marketing the Xxxxxx Products. In recognition of the mutual commitment to this
effort the parties have established this Agreement of a lengthy duration as set
forth in Article 7 - Term of the Agreement. Therefore the parties agree that
this Agreement shall not be terminable during the first five (5) years of its
existence. However, in the event either party should determine it no longer
wishes to continue the joint venture after the aforementioned five (5) year
period, that party shall give the other party three hundred and sixty-five (365)
days written notice (the "Termination Period") of its intent to terminate the
joint venture. During the Termination Period the parties shall complete any
contracts for Xxxxxx Products which were accepted prior to the receipt of the
termination notice and the parties shall not accept any new orders for Xxxxxx
Products unless both parties mutually agree, in writing, that said new orders
can be completed and shipped within the Termination Period. Notwithstanding any
termination of this Agreement, or any extension thereof, the obligations of the
parties with respect to Article 5 - Confidentiality and Article 10 - Governing
Law shall not be terminated.
__________________________
Xxxxxx/Xxxxx Joint Venture
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ARTICLE 10 -- GOVERNING LAW
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This Agreement shall be interpreted and construed in accordance with the
laws of the State of Wisconsin. Prior to subjecting any dispute to the costs
and uncertainties associated with litigation, the parties hereto agree in good
faith to submit the dispute to arbitration at a neutral site pursuant to the
rules and procedures of the American Arbitration Association. In the event one
or both of the parties objects to the arbitrator's decision, any following
litigation will be venued in the United States District Court system for the
Eastern District of Wisconsin or, if sufficient criteria for federal
jurisdiction is not established, the Milwaukee Circuit Court system. Both
parties irrevocably consent to jurisdiction and venue in both forums. In any
dispute between the parties hereto, each party shall be responsible for its own
cost and expenses, including attorneys' fees, associated with said dispute.
ARTICLE 11 -- MISCELLANEOUS PROVISIONS
--------------------------------------
(a) This Agreement shall not be modified or varied by any oral
understanding or representation by either party hereto to the other before or
after the execution of this Agreement, other than by an instrument in writing of
a subsequent date signed and delivered by authorized representatives of the
parties hereto.
(b) This Agreement constitutes the entire Agreement between the parties
hereto, it incorporates by reference the June 30, 1995 Memorandum of
Understanding between the parties and supersedes all other negotiations,
discussions, representations, understandings, and agreements heretofore made
between the parties hereto with respect to the subject matter hereof.
(c) The headings contained herein are for convenience and reference only
and are not a part of this Agreement, nor shall they in any way affect the
interpretation hereof.
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Xxxxxx/Xxxxx Joint Venture
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(d) In the event any portion of this Agreement is found to be
unenforceable, the remainder of the Agreement shall continue in full force and
effect and the parities hereto shall continue to operate and abide by the
remaining, enforceable provisions of the Agreement.
(e) This Agreement and all of the provisions hereof shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns, but neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by either of the parties
hereto without the express written consent of the other party.
(f) This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective representatives as of the day and year
first above written.
XXXXXX CO., INC. XXXXX METALS, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxx X. Xxxxx
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Title: General Counsel & Secretary Title: President/CEO
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Xxxxxx/Xxxxx Joint Venture
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AMENDMENT NO. 1 TO
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XXXXXX/XXXXX JOINT VENTURE
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This AMENDMENT NO. 1 TO JOINT VENTURE (this "Agreement") is entered into as
of this 12th day of November, 1996, by and among XXXXXX CO., INC., a Wisconsin
corporation ("Ladish"), and XXXXX METALS, INC., a California corporation
("Xxxxx"). Unless otherwise specified herein, capitalized terms used in this
Amendment shall have the meanings ascribed to them by Joint Venture (as
hereinafter defined).
RECITALS
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WHEREAS, Xxxxxx and Xxxxx have entered into that certain Xxxxxx/Xxxxx Joint
Venture dated as of September 15, 1995 (as amended, supplemented, restated or
otherwise modified from time to time, the "Joint Venture"); and
WHEREAS, Xxxxxx and Xxxxx wish to amend the Joint Venture to provide for a
mechanism to bid on hot die turbine engine components; and
WHEREAS, Xxxxxx and Xxxxx wish to establish a procedure for the sharing of
the profits which results from the sale of Xxxxxx Products which are produced
pursuant to the Joint Venture;
NOW THEREFORE, in consideration of the mutual execution hereof and other
good and valueable consideration, the parties hereto agree as follows:
SECTION 1. Amendments to the Joint Venture
-------------------------------
Article 2 - Proceeds of the Joint Venture is amended and supplemented as
follows:
(a) Prior to Xxxxxx submitting a bid for turbine engine components to be
made pursuant to the Joint Venture. Xxxxx shall provide Xxxxxx with a cost per
piece to process the components (the "Xxxxx Cost"). Xxxxxx incorporate the
Xxxxx Cost
into the proposed selling price for Xxxxxx Products proposed pursuant to the
Joint Venture. On orders which Xxxxxx successfully wins and ships Xxxxxx
Products, Xxxxxx shall reimburse Xxxxx for the Xxxxx Costs within five (5)
business days of Xxxxxx'x receipt of payment for the Ladish Products.
(b) At the end of each fiscal quarter (March 31, June 30, September 30 and
December 31) Xxxxxx shall review each order for Xxxxxx Products shipped and paid
for during that quarter to determine the profitability of each order. Within
thirty (30) days of the end of each quarter, Xxxxxx shall provide Xxxxx with a
statement listing the profitability of orders based upon Xxxxxx'x total cost for
said orders for Xxxxxx Products shipped and paid for during that quarter. Xxxxx
shall than have twenty (20) days to audit or contest Xxxxxx'x assessment of
profitability for any given order (the "Audit Period"). Providing no issue is
raised during the Audit Period, the parties will be presumed to have agreed to
Xxxxxx'x assessment of the profitability of orders for Xxxxxx Products. For
those orders for Xxxxxx Products which result in a net profit, Xxxxxx shall
equally share said profit with Xxxxx. Xxxxxx shall make this profit-sharing
payment to Xxxxx the first business day following the expiration of the Audit
Period.
(c) Xxxxxx and Xxxxx recognized and agree that warranty claims and other
events post-shipment can materially alter the presumed profitability of any
given order. Should such an occurrence take place with respect to Xxxxxx
Products after the profitability assessment and profit-sharing payment in
paragraph (b) above, Xxxxxx and Xxxxx agree to reassess the profitability of any
such order and should an order earlier considered to be profitable no longer be
so, Xxxxx shall promptly return any profit-sharing associated with said order.
SECTION 2. Reference to and Effect Upon the Joint Venture
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(a) Except as specifically amended above, the Joint Venture shall remain
in full force and effect and is hereby ratified and confirmed.
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Amendment No. 1 to
Xxxxxx/Xxxxx Joint Venture
Page 2
(b) The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of either party under the
Joint Venture. Upon the effectiveness of this Amendment, each reference in the
Joint Venture to "this Agreement", "hereunder", "hereof", "herein" or words of
similar import shall mean and be a reference to the Joint Venture as amended
hereby.
SECTION 3. Governing Law
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This Amendment shall be governed by and construed in accordance with the
internal laws of the State of Wisconsin.
SECTION 4. Headings
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Section headings in this Amendment are included herein for convenience of
reference only and shall not constitute a part of this Amendment for any other
purposes.
SECTION 5. Counterparts
------------
This Amendment may be executed in any number of counterparts, each of which
when so executed shall be deemed an original but all such counterparts shall
constitue one and the same instrument.
SECTION 6. Effectiveness
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This Amendment shall become effective upon the receipt of executed original
signature pages to the Amendment by Xxxxxx and Xxxxx.
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Amendment No. 1 to
Xxxxxx/Xxxxx Joint Venture
Page 3
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed in duplicate by their respective representatives as of the day and year
first above written.
XXXXXX CO., INC. XXXXX METALS, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxx X. Xxxxx
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Title: V.P. & Secretary Title: President/CEO
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Amendment No. 1 to
Xxxxxx / Xxxxx Joint Venture
Page 4
