EXHIBIT 10(g)
XXXXXXX-GUARDIAN SERVICES CORPORATION
INVENTORY CONTROL AGREEMENT
This Agreement, made this 0xx.xxx of August 2001, by and among XXXXXXX-GUARDIAN
SERVICES CORPORATION, a Louisiana corporation, having a mailing address at 0000
Xxxxx Xxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, hereinafter called
"Xxxxxxx", and UNIVERSAL SUPPLY GROUP, INC having a mailing address at 000
Xxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 hereinafter called the "Distributor",
and GMC Sales Corp. having a mailing address at 0000 Xxxxx Xxxx Xxxx, Xxxxx 000,
Xxxxxxx, XX 00000, hereinafter called "Holder".
WITNESSETH:
Upon the terms and conditions hereinafter set forth for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Holder hereby employs Xxxxxxx to perform the services set forth herein, Xxxxxxx
hereby accepts said employment subject to the terms and provisions hereof and
the Distributor hereby agrees to certain matters in connection with such
employment.
1. The Distributor, Holder and Xxxxxxx agree:
(a) Xxxxxxx shall perform the inventory control services set forth on EXHIBIT A
hereto. In connection with Xxxxxxx' performance of its services,
Distributor shall provide to or, at Xxxxxxx' option lease to, or cause to
be provided to or leased to Xxxxxxx, upon terms reasonably imposed by
Xxxxxxx, adequate storage space for the storage of the Collateral (as
defined below). Said storage space shall be so located and constructed as
to assure the proper storing and safety of such Collateral. Xxxxxxx shall
provide an employee of Xxxxxxx (which may be a person formerly employed by
the Distributor, with the consent and cooperation of the Distributor) to
assist in the operation of the storage space. Such employee shall take
instructions only from Xxxxxxx in regard to the receipt, storage and
delivery of the Collateral. To the extent such Employee works only
part-time for Xxxxxxx and also works for Distributor, Distributor shall
indemnify and hold Xxxxxxx harmless from any and all losses, costs,
liabilities and claims relating to such employee arising out of the
employment by Distributor of such employee.
(b) All air conditioning and heating products (excluding parts)
manufactured or sold by Holder constitute the items of inventory as to
which Xxxxxxx will provide services hereunder ("Collateral").
(c) The Collateral shall be held by Xxxxxxx and released or delivered to
the Distributor only in accordance with the instructions of Holder or
Xxxxxxx acting on authority of Holder.
(d) Xxxxxxx shall be under no obligation to accept for storage any goods or
merchandise other than the Collateral specified herein. In the event
Xxxxxxx shall accept other goods or merchandise, such storage shall be as
a convenience to Distributor and solely at Distributor's risk, and
Distributor hereby agrees to indemnify and hold harmless Xxxxxxx against
all damage, risk, claim and expense which Xxxxxxx may incur or be subject
to by reason of permitting such storage, including claims made against
said goods by third parties.
(e) Distributor shall have and maintain in effect an insurance policy
underwritten by reputable insurer(s) in an amount specified by Holder and
satisfactory to Xxxxxxx, insuring the Collateral against fire, flood,
theft, robbery, public liability, employee dishonesty and other special
risks, and shall have Holder and Xxxxxxx named as co-insureds and loss
payees on such policies, and shall obtain from the insurer(s) a waiver of
subrogation rights as against Holder and Xxxxxxx under all insurance
policies.
(f) Distributor shall promptly pay to Xxxxxxx for the services rendered
hereunder and for the expenses of Xxxxxxx' field employees, the charges,
costs and expenses set forth in the Supplemental Billing Agreement between
Xxxxxxx and Distributor, a copy of which is attached hereto as EXHIBIT B.
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(g) As security for all charges, costs and expenses earned or incurred by
Xxxxxxx hereunder or under the Supplemental Billing Agreement, Xxxxxxx
shall have and is hereby granted a continuing lien on all Collateral,
which lien shall be subordinate to any lien of Holder thereon.
(h) The Distributor shall furnish to Xxxxxxx: (x) within ninety (90) days
after Distributor's fiscal year end, complete annual financial
statements prepared in accordance with general accepted accounting
principals, including balance sheet, income statement and related
notes which the Distributor warrants to be correct and to reflect
accurately the true financial condition of the Distributor; (y) within
sixty (60) days after each three month period (except the last three
month period in each fiscal year), complete financial statements
including balance sheet, income statement and related notes which the
Distributor warrants to be correct and to reflect accurately the true
financial condition of the Distributor; and (z) a copy of any audit of
the Distributor's business by a certified public accountant upon
completion thereof.
(i) Xxxxxxx is authorized by Distributor to disclose to Holder any information
in its possession relating to Distributor's financial condition or
business if Xxxxxxx, in its sole discretion, believes that Holder should
know such information in connection with its business dealings with
Distributor.
(j) Distributor shall make available to Xxxxxxx and its employees any and
all of its records which Xxxxxxx reasonably deems necessary to examine
in the course of the performance of its duties hereunder. Xxxxxxx
shall have the right to take possession of such records and related
documents in order to make copies thereof. Xxxxxxx may exercise this
right without notification to or permission of Distributor. The
Distributor shall allow Xxxxxxx unrestricted access to the
Distributor's premises during the term of this Agreement and shall
cooperate fully with Xxxxxxx in the performance of Xxxxxxx' duties
hereunder.
(k) DISTRIBUTOR WAIVES ALL COST, LOSS, EXPENSE (INCLUDING, WITHOUT LIMIT
ATTORNEYS' FEES), LIABILITY OR CLAIM AS AGAINST XXXXXXX, ITS OFFICERS,
DIRECTORS, AGENTS AND EMPLOYEES WHETHER KNOWN OR UNKNOWN, ACCRUED OR
CONTINGENT (COLLECTIVELY, "CLAIMS"), IN CONNECTION WITH THE PERFORMANCE BY
XXXXXXX OF ITS SERVICES HEREUNDER. DISTRIBUTOR FURTHER AGREES TO DEFEND,
INDEMNIFY AND HOLD XXXXXXX AND ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS
AND INSURERS HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS MADE BY PERSONS
OR ENTITIES RESULTING DIRECTLY OR INDIRECTLY FROM ANY ACTS OR OMISSIONS OF
DISTRIBUTOR AND ITS OFFICERS, DIRECTORS, EMPLOYEES, OR AGENTS, WHETHER
SUCH ACTS MAY BE CONSUMMATED DIRECTLY OR IN CONNIVANCE WITH OTHERS.
(l) DISTRIBUTOR ACKNOWLEDGES AND AGREES THAT XXXXXXX SHALL HAVE NO LIABILITY
FOR ANY COST, LOSS, EXPENSE (INCLUDING, WITHOUT LIMIT, ATTORNEYS' FEES)
LIABILITY OR CLAIM ARISING DIRECTLY OR INDIRECTLY FROM THIS AGREEMENT OR
THE PROVISION OF OR FAILURE TO PROVIDE ADEQUATE SERVICES HEREUNDER EXCEPT
TO THE EXTENT (AND ONLY THE EXTENT) THAT SUCH CLAIMS ARISE SOLELY FROM THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF XXXXXXX. DISTRIBUTOR SHALL
INDEMNIFY AND HOLD HARMLESS XXXXXXX AGAINST ANY CLAIMS, EXCEPT TO THE
EXTENT SUCH CLAIMS ARE SOLELY THE RESULT OF XXXXXXX' XXXXX NEGLIGENCE OR
WILLFUL MISCONDUCT. DISTRIBUTOR ACKNOWLEDGES THAT THIS INDEMNITY MAY
RESULT IN INDEMNIFICATION FOR XXXXXXX' OWN NEGLIGENCE.
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(m) HOLDER ACKNOWLEDGES AND AGREES THAT XXXXXXX SHALL HAVE NO LIABILITY FOR
ANY COST, LOSS, EXPENSE (INCLUDING, WITHOUT LIMIT, ATTORNEYS' FEES),
LIABILITY OR CLAIM (COLLECTIVELY "CLAIMS") ARISING DIRECTLY OR INDIRECTLY
FROM THIS AGREEMENT OR THE PROVISION OF OR FAILURE TO PROVIDE ADEQUATE
SERVICES HEREUNDER, EXCEPT TO THE EXTENT (AND ONLY THE EXTENT) THAT SUCH
CLAIMS ARISE SOLELY FROM THE NEGLIGENCE OR WILLFUL MISCONDUCT OF XXXXXXX.
HOLDER SHALL INDEMNIFY AND HOLD HARMLESS XXXXXXX, ITS OFFICERS, DIRECTORS,
AGENTS AND EMPLOYEES AGAINST ANY CLAIMS, EXCEPT TO THE EXTENT SUCH CLAIMS
ARE SOLELY THE RESULT OF XXXXXXX' NEGLIGENCE OR WILLFUL MISCONDUCT.
(n) IN THE EVENT XXXXXXX IS FOUND LIABLE FOR ANY COST, LOSS, DAMAGE OR EXPENSE
ON ANY CLAIM, XXXXXXX SHALL NOT BE HELD LIABLE FOR ANY AMOUNTS IN EXCESS
OF THE LESSER OF (i) $1,,000,000.00 (DOLLARS), (ii) THE DIFFERENCE, IF
ANY, BETWEEN (x) THE LESSER OF THE ACTUAL DISTRIBUTOR COST OF THE
COLLATERAL, AND (y) THE AMOUNTS RECOVERED UNDER PARAGRAPH 2(d) BELOW; OR
(iii) THE AMOUNT RECOVERABLE PURSUANT TO ANY APPLICABLE INSURANCE COVERAGE
MAINTAINED BY XXXXXXX. IN NO EVENT SHALL XXXXXXX BE HELD LIABLE IN
CONTRACT OR TORT FOR ANY PUNITIVE, EXEMPLARY OR SPECIAL DAMAGES.
2. Holder agrees:
(a) Holder shall furnish written instructions to Xxxxxxx and Distributor
setting forth the conditions under which Xxxxxxx may authorize the release
of Collateral for each Distributor, which will be effective only after
receipt of such instructions has been acknowledged in writing by the
President or a Vice President of Xxxxxxx.
(b) Holder shall pay Xxxxxxx' charges, fees, and expenses billed hereunder in
the event a Distributor does not.
(c) Holder shall promptly disclose to Xxxxxxx any material adverse changes or
deterioration in a Distributor's financial condition known to Holder.
(d) Holder shall utilize reasonable efforts to pursue to judgment and to
satisfy all rights and remedies against any Distributor, and all other
direct obligors, indemnitors, guarantors and insurers and all Collateral
securing its advances or payments before making or prosecuting any claim
against Xxxxxxx based upon any alleged failure of Xxxxxxx, its officers,
directors, employees or agents.
3. Additional Limitations of Liability
(a) Unless otherwise specifically agreed in writing, Xxxxxxx shall have no
responsibility for (i) the contents of boxes, packages or other sealed or
stacked containers which may be improperly marked, nor for the grade,
quality, title, care or condition of the Collateral and Xxxxxxx' personnel
shall be entitled to rely exclusively on Distributor's representations
with respect thereto, or (ii) the validity or priority of Holder's right,
title or interest to the Collateral. Xxxxxxx shall have no responsibility
for independently determining the fair market value or other actual value
of the Collateral, but shall be entitled to rely on values declared by the
Distributor and agreed by Holder or upon such other methods of valuation
contained in Holder's written instructions accepted by Xxxxxxx.
(b) Neither Xxxxxxx nor its officers, directors, employees, agents or insurers
shall be liable for the delay or failure of Xxxxxxx to perform any of its
obligations hereunder if such delay or failure is due in whole or in part
to any fire, explosion, earthquake, storm, flood, or other adverse weather
condition, accident, mechanical breakdown, strike, lockout, walkout or
labor difficulty, war, insurrection, riot, act of God, governmental order
or restriction, robbery, or other cause, whether of the same or a
different nature, which is beyond their reasonable control. Xxxxxxx will
promptly notify Holder upon notice to Xxxxxxx of any such force majeure
condition.
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4. Termination
(a) This Agreement shall continue in full force and effect for one (1) year
from the date hereof, and thereafter for successive one (1) year terms
unless any party gives to the other written notice of intention to
terminate at least sixty (60) days prior to the expiration of the then
current term. This Agreement shall be further subject to termination by
Xxxxxxx upon thirty (30) days written notice in the event that Xxxxxxx
receives a notice of cancellation or non-renewal of its insurance coverage
from its underwriters and it is unable to obtain adequate coverage at
reasonable cost. Agreement may be terminated upon notice if Distributor
materially breeches this Agreement or it's Distributor Agreement with
Holder.
(b) At any time after a notice of termination has been delivered hereunder,
Xxxxxxx shall not be obligated to accept any additional Collateral or to
issue additional inventory documents. Xxxxxxx shall be entitled to payment
of all of its charges, fees and expenses through the date of termination.
(c) If as a result of substantial or continuing non-cooperation or as the
result of interference by any Distributor with the services of Xxxxxxx or
with instructions given by Xxxxxxx to its employees, Xxxxxxx in its sole
discretion determines that the Collateral covered by its inventory
documents cannot reliably be held in the storage facility, Xxxxxxx may
arrange for the movement of such Collateral to another storage facility of
Xxxxxxx' choosing. All necessary transport storage and insurance costs
incurred by Xxxxxxx in moving and storing all such Collateral shall be
reimbursed to Xxxxxxx by the Holder should the Distributor fail to timely
pay such costs, and the Holder shall indemnify and save Xxxxxxx harmless
from any and all claims, losses and liabilities resulting directly or
indirectly from such transport and storage.
5. General Provisions
(a) This Agreement represents the entire agreement of the parties and
supersedes all prior agreements and negotiation, oral or written. No
amendment to or modification of the terms of this Agreement shall be
effective without the written consent of the parties affected thereby.
Any such consent by Xxxxxxx must be executed by its President or Vice
President. Failure of any party to strictly enforce any right
hereunder shall not serve as a waiver of similar or dissimilar rights
accruing thereafter.
(b) No person or entity other than Holder and Distributor shall have any
right to enforce the obligations of Xxxxxxx hereunder or have standing
to complain for any reason of any failure of Xxxxxxx to perform its
obligations hereunder.
(c) In the event of any dispute, disagreement, or difference over the
meaning, construction, or intent of this Agreement or of any matter of
fact, law, background circumstance, or any other matter of any kind
whatsoever, any and all such matters, without limitation, shall be
submitted at the written, mailed election of any party to binding
arbitration in Houston, Texas, in accordance with the rules of the
American Arbitration Association then in effect. Each party shall
appoint one arbitrator from the panels of arbitrators of the American
Arbitration Association and these two arbitrators shall appoint a
third arbitrator if the amount in dispute is in excess of $50,000, or,
if less then $50,000, then there will be one arbitrator selected from
the panels of arbitrators. Such appointments shall be made within 30
days after notice. The decision by the arbitrator(s), so appointed,
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shall be final and binding on the parties, and may be entered in any
court of competent jurisdiction for enforcement. The arbitrator(s) may
allocate the payment of the fees and costs of the prevailing party to
the other party or parties in such proportion as they shall deem fair
and equitable. Any party, attempting by any legal process outside of
these arbitration proceedings to set aside, modify, or interpret this
arbitration clause, shall be liable for all fees and costs, without
limitation, of the other party defending against such litigation,
irrespective of the outcome.
(d) This Agreement shall be binding upon and inure to the benefit
of the successors and assigns of the parties hereto.
(e) The Distributor and Holder shall not, without the express
prior written consent of Xxxxxxx, directly or indirectly,
offer employment to, or employ, the employees of Xxxxxxx
during the term of this Agreement or for a period of one year
following the termination hereof.
(f) This Agreement shall be governed by or construed in accordance
with the laws of the State of Texas, excluding the conflicts
of law provisions thereof.
(g) The parties recognize and acknowledge that Xxxxxxx will rely
on information and documents supplied by others (which may
include the Distributor) in preparing its reports and
performing its services hereunder and that Xxxxxxx shall have
no responsibility or liability
(h) This Agreement may be executed in any number of counterparts,
each of which shall be an original, but all of which together
shall constitute one and the same instrument.
(i) Unless changed by written notice to each party, all notices
and other communications shall be directed to a party at its
address set forth above.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed the day and year first written above.
XXXXXXX-GUARDIAN SERVICES CORPORATION
By
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President or Vice President
UNIVERSAL SUPPLY GROUP, INC.
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Distributor
By
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(Title)
GMC SALES CORP
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Holder
By
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(Title)
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