EXHIBIT 10.4
CONFIDENTIAL TREATMENT REQUESTED
(* * * DENOTES REDACTED TEXT)
SUPPLY AGREEMENT
----------------
This Supply Agreement is made and entered into as of the Commencement Date
described in Section 1.6 below by and among Bio-Lab, Inc., a corporation
organized and existing under the laws of the State of Delaware (the "Seller") ,
South Central Pool Supply, Inc., a corporation organized and existing under the
laws of the State of Delaware (the "Buyer") and, for the purpose described in
Section 11.11, SCP Pool Corporation, a corporation organized and existing under
the laws of the State of Delaware ("SCP").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Buyer has, contemporaneously with the execution of this
Agreement, entered into an agreement (the "X-X Agreement") to purchase certain
assets of The X-X Network, Inc., a Delaware corporation which is a wholly owned
subsidiary of Seller ("X-X"); and
WHEREAS, as a condition to the sale of the X-X assets to Buyer, the parties
hereto agreed to enter into this Agreement;
WHEREAS, contemporaneously with the X-X Agreement, Buyer and Seller have
entered into an Agreement (the "Alliance Agreement") whereby Seller will
purchase certain assets of Alliance Packaging, Inc., a Delaware corporation and
a wholly owned subsidiary of SCP ("Alliance"); and
WHEREAS, Buyer is a wholly-owned subsidiary of SCP and SCP is entering into
this Agreement for the limited purpose described in Section 11.11 as an
inducement to Seller to enter into this Agreement;
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein and to comply with the conditions of closing set
forth above and other good and valuable consideration, the receipt, adequacy and
sufficiency of which is hereby acknowledged, the parties hereto covenant and
agree as follows:
ARTICLE I.
----------
Definitions
-----------
1.1 Affiliate. "Affiliate" of Buyer shall mean any entity controlled by
---------
either SCP or Buyer. "Affiliate" of Seller shall mean an entity controlled by
either Great Lakes Chemical Corporation, a Delaware corporation and ultimate
parent corporation of Seller, or Seller. "Control" for purposes of this Section
1.1 shall mean the possession, directly or indirectly, of the power to direct
the management and policies of an entity whether through the ownership of voting
securities, contract or otherwise.
1.2 Branded Products. "Branded Product" shall mean any swimming pool
----------------
chemical product that is manufactured or sold by a party other than Seller,
Buyer or their respective Affiliates or Subsidiaries and is marketed under a
brand name (other than a customer private label brand sold exclusively to such
customer) that is not owned by or licensed to Seller, Buyer or their respective
Affiliates or Subsidiaries.
1.3 Buyer Group. "Buyer Group" shall mean, at any time, the Buyer and each
-----------
of Buyer's Affiliates and Subsidiaries at such time.
1.4 Calender Quarter. "Calendar Quarter" shall mean each consecutive
----------------
period of three (3) months beginning on January 1st, April 1st, July 1st and
October 1st during a Calendar Year.
1.5 Calendar Year. "Calendar Year" shall mean, in the case of the first
-------------
year of this Agreement, that period from the date of this Agreement through
December 31, 1996. Thereafter, the term "Calendar Year" shall mean each
successive twelve (12) month period commencing on January 1, 1997 and ending the
next succeeding December 31, except that in the event this Agreement terminates
or expires on any day other than December 31, then the last "Calendar Year"
shall mean that period from the end of the preceding Calendar Year to such date
of termination or expiration.
1.6 Commencement Date. "Commencement Date" shall mean the earlier to occur
-----------------
of (i) the Closing Date of the Alliance Agreement or (ii) November 1, 1996, if
there has been no Closing under the Alliance Agreement prior to such date for
any reason other than Seller's default thereunder. If there is no Closing under
the Alliance Agreement due to Seller's default thereunder or mutual agreement of
Buyer and Seller, there shall be no Commencement Date and this Agreement shall
be void.
1.7 Excluded Products. "Excluded Products" shall mean those products
-----------------
described in Exhibit 1.7 or products designated as such following the date
hereof pursuant to Sections 2.4(e), 3.4 or 6.3(b).
1.8 FIFRA. "FIFRA" shall mean the Federal Insecticide, Fungicide and
-----
Rodenticide Act, as amended.
1.9 Force Majeure. "Force Majeure" shall mean and include any circumstance
-------------
to the extent beyond the reasonable control of the party so affected, including
without limitation, the following: any act of nature or public enemies,
explosion, fire, storm, earthquake, flood, drought, perils of the sea, the
elements, casualty, breakdown of plant, strikes, lock-outs, labor troubles,
shortage of product or raw materials, riots, sabotage, embargo, war (whether or
not declared or whether or not the United States of America is a participant),
governmental laws, regulations, orders, or decrees, the refusal of a required
governmental license, or seizure; in each case for reasons other than the
adverse financial condition of the party so affected.
1.10 "Licensed Alliance Products." "Licensed Alliance Products" shall mean
--------------------------
any Alliance Product which was marketed or sold by Alliance prior to the
Commencement Date using the Licensed Property (as defined in Section 7.1), the
Registrations (as defined in Section 9.3(a)) or the Product Information (as
defined in Section 9.4(a).
-2-
1.11 Products. The products more particularly described in Exhibit 1.11
--------
and which are not Excluded Products shall be referred to as the "Alliance
Products". "Additional Products" shall have the meaning described in Section
2.2. The Alliance Products, any Additional Products or any substitute products
purchased by Buyer pursuant to Section 9.6(b) purchased by Buyer from Seller
hereunder are hereinafter collectively referred to as the "Products".
1.12 Subsidiary. "Subsidiary" shall mean, with respect to either Buyer or
----------
Seller, any corporation, partnership, association or other business entity of
which (i) if a corporation, a majority of the total voting power of shares of
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such party or one or more of the other
Subsidiaries of such party or a combination thereof, or (ii) if a partnership,
association or other business entity, a majority of the partnership or other
similar ownership interest thereof is at the time owned or controlled, directly
or indirectly, by such party or one or more Subsidiaries of such party or a
combination thereof. For purposes hereof, a party or parties shall be deemed to
have a majority ownership interest in a partnership, association or other
business entity if such a party or parties shall be allocated a majority of
partnership, association or other business entity gains or losses or shall be or
control the managing director or general partner of such partnership,
association or other business entity.
1.13 Territory. "Territory" shall mean all of the United States, Canada
---------
and Mexico and each of their respective territories and possessions.
1.14 "US EPA". "US EPA" shall mean the United States Environmental
--------
Protection Agency.
ARTICLE II.
-----------
Quantity
--------
2.1 Requirements.
------------
(a) Seller hereby agrees to sell to Buyer, and Buyer for itself and on
behalf of the Buyer Group agrees to purchase from the Seller during each
Calendar Year of this Agreement:
(i) at least * * *% of the requirements of the Buyer Group for
all Alliance Products as a group; and
---
(ii) at least * * *% of the requirements of the Buyer Group for
each Alliance Product denoted with an asterisk (*) on Exhibit 1.11.
----
(b) The "requirements of the Buyer Group" for purposes of subparagraph (a)
above shall mean and include the total aggregate requirements of the Buyer Group
for the Alliance Products, or in the case of subparagraph (a)(ii), any
particular Alliance Product, for resale by any member of the Buyer Group within
the Territory. Purchases of Alliance Products by any member of the Buyer Group
for resale outside the Territory shall not be subject to the provisions of
subparagraph (a) above (but shall be subject to the provisions of Section 2.2).
The requirements of the Buyer Group
-3-
shall be measured by dollar volume of total purchases during each Calendar Year
of all Alliance Products as a group for purposes of subparagraph (a)(i) above.
The requirements of the Buyer Group for each Alliance Product subject to the
provisions of subparagraph (a)(ii) above shall be measured by unit volume rather
than dollar volume.
(c) Exhibit 2.1(c) contains examples for illustration purposes only
concerning the application of the aggregate and Product-specific purchase
obligations of the Buyer Group described in subparagraphs (a)(i) and (ii) above.
2.2 * * * Sell Additional Product.
-----------------------------
(a) While this Agreement is in effect, if any member of the Buyer Group
wishes to purchase worldwide (i) any swimming pool chemical products of a type
offered for sale by Seller (other than Alliance Products for resale within the
Territory) or (ii) Alliance Products for resale outside of the Territory (any
products within the description of (i) or (ii) above shall be referred to
hereinafter as "Additional Products"), Seller shall have a right * * * to become
and remain the Buyer Group's supplier of any such Additional Products on the
terms and conditions provided in this Agreement. Excluded Products and Branded
Products (except for "Competing Branded Products" as described in Section
2.2(c)) shall not be considered as Additional Products.
(b) In each instance in which a member of the Buyer Group desires to
purchase any Additional Products, Buyer shall notify Seller of the details of
such desired purchase, including quantities and delivery dates. * * *
(c) The right * * * described in subsection (a) and (b) above shall not
apply to Excluded Products or Branded Products except for any Branded Product
containing as its primary active ingredient any of the chemicals described in
Exhibit 2.2(c) ("Competing Branded Products"). The right * * * described in
subsection (a) and (b) above shall apply to Competing Branded Products only to
the extent that the total dollar volume of the combined purchases of Competing
Branded Products by the Buyer Group in a Calendar Year from suppliers other than
Seller exceeds * * *% of the total dollar volume of the combined purchases of
all Products by the Buyer Group from Seller during the preceding Calendar Year.
All purchases by the Buyer Group of Competing Branded Products in excess of such
* * *% threshold in any Calendar Year shall be considered purchases of
Additional Products and shall be fully subject to the provisions of subsection
2.2 (a) and (b) above.
(d) Any member of the Buyer Group purchasing an Additional Product from
Seller pursuant to 2.2(b) shall purchase * * *percent (* * *%) of its
requirements for such Additional Product from Seller until the October 1
effective date of the first Annual Forecast (as defined in Section 2.3) to
include such Additional Product, after which the Buyer Group's purchase
requirements for such Additional Product shall be governed by the provisions of
Section 2.1 as if such Additional Product were an Alliance Product thereunder.
2.3 Forecasts.
---------
(a) On or before August 1 of each Calendar Year, Buyer shall submit to
Seller a forecast of the Buyer Group's estimated purchases of Product from
Seller for the twelve-month period beginning October 1 of such Calendar Year and
ending on September 30 of the succeeding Calendar
-4-
Year. Such forecast shall be broken down by month and the estimated quantity of
Product to be purchased during each month shall be identified by individual
product code (the "Annual Forecast"). Buyer shall update the Annual Forecast
from time to time as necessary to reflect anticipated changes in the Buyer
Group's requirements, and at minimum, shall update the Annual Forecast each
Calendar Quarter beginning January 1, 1997. The Buyer shall deliver its initial
Annual Forecast hereunder within 30 days following the Closing Date under the B-
L Agreement.
(b) The parties understand and acknowledge that it may not be possible for
Seller, in all instances, to accept Buyer's proposed Annual Forecast or updates
due to product shortage or capacity limitations. Within thirty (30) days
following submission by Buyer of any Annual Forecast or updated forecast,
Seller shall notify Buyer whether Seller is able to accept such Annual Forecast
or update. If Seller fails to notify Buyer of Seller's acceptance or rejection
of such Annual Forecast or update during such 30-day period, such Annual
Forecast or update shall be deemed accepted by Seller. (Any such Annual
Forecast or update accepted or deemed to have been accepted by Seller in
accordance with the foregoing shall be referred to hereinafter as an "Accepted
Forecast"). In the case of any Annual Forecast, such Annual Forecast shall be
deemed automatically to be an Accepted Forecast as to each Product listed on
such Annual Forecast, to the extent the forecast quantity of such Product is
less than or equal to * * * % of the amount of such Product purchased by Buyer
from Seller during the twelve (12) month period immediately preceding the month
in which such Annual Forecast is submitted to Seller. To the extent the
forecast quantity of any Product on such Annual Forecast exceeds such * * * %
threshold, Seller may reject the proposed Annual Forecast as to such excess
quantity only, in accordance with this subparagraph (b) and subparagraph (c)
below. In the case of any update to an Accepted Forecast, Seller's discretion
to reject such update shall be limited to rejection of quantities of Product in
excess of the quantities of Product forecast on the Accepted Forecast to which
such update applies.
(c) Subject to the limitations on Seller's discretion to reject Annual
Forecasts and updates as provided in subsection (b) above, if Seller notifies
Buyer that it cannot accept an Annual Forecast or update, Seller shall specify
in such notice the amount and type of Product that Seller believes it will be
able to supply and the amount and type of Product that Seller believes it cannot
supply. Such Annual Forecast or update shall be deemed an Accepted Forecast to
the extent (but only to the extent) of the Product Seller indicates it will be
able to supply. With respect to any quantity of Product that Seller indicates
it cannot supply (the "Shortfall"), members of the Buyer Group may,
notwithstanding the provisions of Section 2.1, purchase the Shortfall from other
suppliers until the end of the period covered by the Annual Forecast or update
to which such Shortfall relates. Purchases of Shortfall quantities of Product by
the Buyer Group from other suppliers pursuant to the preceding sentence shall
not be counted as purchases of Product for purposes of determining Buyer's
compliance with its obligations under Section 2.1. Seller shall have no
liability or obligation to supply quantities of Product in excess of, or in any
respect different from, any Accepted Forecast; however, Seller may in its
discretion agree to supply such Product to the extent it has available capacity,
subject to Seller's other customer commitments.
(d) Notwithstanding anything in this Section 2.3 to the contrary, to the
extent any Annual Forecast or update contains Products which the Seller
reasonably believes to be Noncompliant Products (as defined in Section 9.6), the
Seller shall promptly notify Buyer of the basis for such belief and may reject
such Annual Forecast or update with respect to any such Noncompliant Products,
and may offer substitute Products in lieu thereof as provided in Section 9.6.
-5-
(e) Buyer shall use commercially reasonable efforts in good faith to
provide accurate Annual Forecasts and updates; however, the parties understand
and acknowledge that it may not be possible for Buyer, in all instances, to
purchase the forecasted quantities.
2.4 Force Majeure.
-------------
(a) Seller shall not be liable for its failure to produce, transport or
deliver Products, or to otherwise perform its obligations hereunder, if such
failure is due to an event of Force Majeure. Similarly, Buyer shall not be
liable for its failure to purchase Products or to otherwise perform its
obligations hereunder if such failure is due to an event of Force Majeure;
provided, however, that an event of Force Majeure shall not suspend or otherwise
affect Buyer's obligations to pay for purchased Product as provided herein. Any
party suffering an event of Force Majeure shall use all commercially reasonable
efforts to remove such cause or causes with reasonable dispatch and shall
promptly notify the other party of the existence of the event of Force Majeure,
and the expected delays and the estimated effect upon performance to result
therefrom. The requirement that any Force Majeure be remedied using all
commercially reasonable efforts shall not require the settlement of strikes or
labor controversies by acceding to the demands of the opposing party or parties.
(b) Should an event of Force Majeure require Seller to allocate Product,
Seller shall do so on a basis so that the Buyer Group receives its pro rata
share based upon the percentage the then-current Accepted Forecast for Product
purchases bears to Seller's estimate of its total requirements for product to
all of its customers (including the Buyer Group) during such period. Any
Product deliveries omitted hereunder due to either party's failure to perform
its obligations hereunder due to an event of Force Majeure, shall be omitted
from this Agreement and the contracted quantity shall be so reduced for the
applicable contract period.
(c) Within 14 days following the occurrence of an event of Force Majeure
affecting Seller, Seller shall provide Buyer with notice of such event and
Seller's good faith estimate of the scope and duration of such event. Seller
shall thereafter provide Buyer with periodic reports at intervals of no less
than 30 days, regarding Seller's progress in remedying such event of Force
Majeure and any changes in Seller's estimate of its duration.
(d) If, due to an event of Force Majeure, Seller cannot deliver Product to
the Buyer Group in quantities specified in the then-current Accepted Forecast,
and Buyer reasonably and in good faith determines that, in order to secure a
supply of such Product or substitute product sufficient to cover its forecasted
requirements, it must commit to an alternate supplier of such product or
substitute product for a fixed term, Buyer may do so, provided that:
(i) the Buyer Group must continue to purchase from Seller, subject
to Section 2.1, the quantity of such Product that Seller is able
to deliver while such event of Force Majeure continues;
(ii) Buyer must advise Seller in advance in writing of Buyer's
intention to enter into such alternate supply arrangement, * * *
and
(iii) such alternate supply arrangement shall not extend more than * *
* following the date that such event of Force Majeure is likely
to be remedied according
-6-
to Seller's then-current estimate, provided, however, that if
the end of such * * * period would fall between * * * and * * *
during any Calendar Year, such alternate supply arrangement may
extend until * * * of such Calendar Year. Seller shall not,
however, unreasonably withhold, delay or condition its consent
to an alternate supply arrangement for a longer term if such
term is reasonably required to prevent Buyer's business from
being materially adversely affected.
(e) In the event Seller's good faith estimate of the scope and duration of
an event of Force Majeure indicates that Seller will be unable, due to such
event of Force Majeure, to supply any particular Product for more than twelve
(12) consecutive months in quantities equal to those forecast in the Accepted
Forecast in effect at the inception of such event of Force Majeure, then upon
notice from Buyer to Seller, such Product shall cease to be a Product hereunder
and shall become an Excluded Product hereunder. If in fact Seller is unable
due to such event of Force Majeure to supply such Product for such period of
twelve (12) consecutive months, regardless of Seller's estimate, at the end of
such twelve (12) month period, upon notice from Buyer to Seller, such Product
shall become an Excluded Product hereunder. In addition, if Seller's estimate
indicates that Seller will be unable, due to such event of Force Majeure, for a
period of more than * * * to supply at least * * * percent (* * *%) in the
aggregate of all Products (measured by dollar volume) required by the Buyer
Group as determined according to the Accepted Forecast in effect at the
inception of such event of Force Majeure, Buyer may terminate this Agreement
upon written notice to Seller. If in fact Seller is unable due to such event of
Force Majeure to supply for such period of * * * at least * * * percent (* * *%)
in the aggregate of all Products (measured by dollar volume) required by the
Buyer Group as determined according to the Accepted Forecast in effect at the
inception of such event of Force Majeure, regardless of Seller's estimate, at
the end of such * * * period, Buyer may terminate this Agreement upon written
notice to Seller.
2.5 Purchase Orders. All sales and purchases under this Agreement shall be
---------------
made upon written purchase orders, in the form attached as Exhibit 2.5 or in a
form otherwise mutually agreed upon, sent by Buyer to Seller. At the request of
either party, Buyer and Seller shall cooperate to implement an electronic data
interchange system for processing Buyer's orders with Seller, provided the same
can be accomplished at a reasonable cost to each party. All purchase orders
shall specify the type and quantity of Products to be delivered, the location of
delivery and Buyer's preferred date of delivery, and shall reference this
Agreement as containing all relevant terms and conditions applicable thereto.
To accomplish efficiencies and cost savings, in cases where Product orders are
less than full truckload quantities, Seller shall have the right to delay
shipment up to five (5) business days until sufficient orders can be
consolidated into truckload quantities. In case of a conflict between any of
the terms contained in a written purchase order (including the terms reflected
on Exhibit 2.5) and any of the terms of this Agreement, the terms of this
Agreement shall control. No additional terms or conditions of sale other than
those contained in this Agreement shall be effective unless approved in writing
by an authorized officer of Buyer and Seller. Unless Buyer and Seller otherwise
agree in writing, Buyer shall act as agent for each member of the Buyer Group
with respect to all purchases of Products hereunder; provided, however, that if
Seller agrees to sell directly to any member of the Buyer Group other than
Buyer, the terms and conditions of this Agreement shall apply to such sale, as
if such member of the Buyer Group were Buyer hereunder. References to "Buyer"
in this Agreement shall include reference to members of the Buyer Group to the
extent such members of the Buyer Group are purchasers of Product.
-7-
2.6 Audit. Seller shall have the right to appoint an independent firm of
-----
certified public accountants from among the "Big Six" accounting firms, so long
as said accounting firm has no current or prior affiliation with Seller other
than performance of audits pursuant to this Section 2.6 or Section 3.1(d), for
the limited purpose of verifying that Buyer is complying with its obligations
under Section 2.1 and Section 2.2. Upon thirty (30) days prior written notice
to Buyer and upon the auditor's execution of an appropriate confidentiality
agreement, such certified public accounting firm shall be given access to the
Buyer Group's books, records and accounts, and such other information as they
may reasonably require for the limited purpose of verifying Buyer's compliance
with its obligations under this Agreement. Fees and expenses incurred in
connection with such verification shall be paid 50% by Seller and 50% by Buyer,
and such audits shall not occur more than once each calendar year. Seller's
right to cause such audit shall survive for a period of six (6) months following
any expiration or termination of this Agreement.
2.7 Repurchase of Discontinued Product. If Buyer discontinues purchases of
----------------------------------
a Product that was included on the then-current Accepted Forecast, Seller may,
upon notice to Buyer, require that Buyer purchase all of Seller's remaining
inventory of such Product (but not to exceed the amount forecast for purchase
through the remainder of the period covered by the then-current Accepted
Forecast) at the then-effective price for such Product. A Product shall be
deemed "discontinued" for purposes of this Section 2.7 at the time (i) Buyer
notifies Seller in writing that such Product is being discontinued by Buyer or
(ii) upon notice by Seller to Buyer, if Buyer's purchases of such Product during
the preceding Calendar Year were less than 50% of the amount provided in the
last Accepted Forecast for such Product for the preceding Calendar Year. If any
member of the Buyer Group resumes purchases of such Product after any
discontinuance, such purchases shall, at Seller's option, be subject to the
provisions of Section 2.1, if such Product was an Alliance Product, or Section
2.2, if such Product was an Additional Product. In the case of a Product
discontinuance based upon notification from Buyer as provided in (i) above, the
Buyer will complete such repurchase in accordance with the schedule set forth in
the then-current Accepted Forecast. In the case of a Product discontinuance
based upon notification from Seller as provided in (ii) above, Buyer will
complete such repurchase within sixty (60) days following Seller's notice.
ARTICLE III.
------------
Price and Payment
-----------------
3.1 Price.
-----
(a) The "initial price" for the Alliance Products shall be as set forth in
Exhibit 3.1(a). Such "initial price" shall remain in effect through December
31, 1996; thereafter said "initial price" shall be subject to adjustment as
provided in subparagraph (b) below.
(b) On January 1, 1997, the "initial price" for the Alliance Products as
set forth in Exhibit 3.1(a) shall be adjusted up or down to reflect all changes
in Seller's cost since May 1, 1996 according to the formula described in Exhibit
3.1(b). The price for Alliance Products shall thereafter be adjusted quarterly
based upon the formula described in Exhibit 3.1(b). Seller shall provide notice
to Buyer of any such price adjustment, with such adjustments to take effect with
respect to any orders for Product received by Seller after the date of such
notice.
-8-
(c) (i) Notwithstanding the initial prices described in subsection 3.1(a)
or any adjustments to such prices pursuant to subsection 3.1(b), Buyer's
purchase price for any particular Product shall not in any event exceed the * *
* Price applicable to such Product for the Calendar Year in which Seller
receives Buyer's purchase order for such Product. The "* * * Price" of a
particular Product for purposes of Buyer's purchases of such Product during a
particular Calendar Year shall be * * * a Qualified Purchaser for such
Product * * * the same Calendar Year; provided, however that the * * *
Price for such Product shall apply to purchases of Product by Buyer only up to
the quantity of such Product purchased by the Qualified Purchaser during such
Calendar Year at the * * * Price. Any purchases of such Product by Buyer during
such Calendar Year in quantities in excess of the quantity of such Product
purchased by the Qualified Purchaser during such Calendar Year at the * * *
Price, shall be at the then-applicable regular price of such Product as
determined according to subsections 3.1(a) or 3.1(b) (or such other, higher * *
* Price as may also apply according to the foregoing criteria based upon Product
purchases by a different Qualified Purchaser or by the same Qualified Purchaser
at a higher price).
(ii) A "Qualified Purchaser" for purposes of this subparagraph 3.1(c) shall
mean any party who purchases from Seller at least $* * * worth of the Product
in question (based upon Seller's invoice price after adjustment for any rebates,
allowances, discounts or returns) during the Calendar Year in which Buyer
submits the purchase order for purchase of Product eligible for * * * Price
pricing pursuant to subsection 3.1(c)(i).
(iii) When comparing the prices to be charged to Buyer with those charged to
a Qualified Purchaser, an appropriate adjustment will be made, if necessary, to
reflect any shipping charges included in the sales price to either Buyer or the
Qualified Purchaser, so that the prices to be compared are F.O.B. the Seller's
manufacturing or distribution facility for such Product, and the prices to be
compared shall not include any taxes paid or reimbursed by Buyer or the
Qualified Purchaser with respect to such purchases of Product. In any case where
Seller invoices a Qualified Purchaser for shipping at less than arms length
market rates, the amount of any discount from such market rates shall be
deducted from the Product purchase price charged to such Qualified Purchaser for
purposes of comparing the prices of Product charged to Buyer with the price
charged to such Qualified Purchaser.
(iv) If an adjustment to the purchase price of Product is required pursuant
to this subparagraph 3.1(c), Seller shall make such adjustment and shall note
the adjustment on the Product invoice.
(v) In the event (A) a Qualified Purchaser purchases product at a * * *
Price after the date of any Buyer purchase of such Product during a Calendar
Year or (B) Buyer becomes entitled * * * to a * * * Price for Product based upon
purchases of Product by a Qualified Purchaser who did not qualify as such under
subsection (ii) above until after Buyer's purchase of such Product, Seller shall
adjust Buyer's price of such previously purchased Product retroactively to the
extent necessary to comply with subsection (i) above by providing Buyer a credit
towards the purchase of Product equal to the amount of such adjustment, and
Seller shall promptly notify the Buyer of such credit.
(vi) In the event Seller fails for any reason to adjust Buyer's price for
Product in accordance with this subparagraph 3.1(c), Seller's liability with
respect to such failure shall be
-9-
limited to providing Buyer with a credit towards the purchase of Product in an
amount equal to the difference between the price actually paid by Buyer and the
amount Buyer would have paid had Seller adjusted the purchase price as required
hereunder. Seller shall not in any event be liable for failure to adjust the
purchase price for Product pursuant to this subparagraph 3.1(c) unless Buyer
shall have given Seller notice of such failure within 18 months following the
date Buyer purchased the Product in question.
(vii) Seller's sales of Seller's "Omni", "Guardex" or "Chloryte" brand
products (collectively, "Omni Products") to other customers of Seller shall be
deemed a sale of any Product sold in the same form and having substantially the
same chemical composition as such Omni Product ("Equivalent Product") at the
price charged to such customer for purposes of determining (i) whether such
customer qualifies as a Qualified Purchaser and (ii) the * * * Price to Buyer of
such Equivalent Product, if the customer purchasing such Omni Products qualifies
as a Qualified Purchaser. Omni Products shall not, however, be deemed Products
hereunder, and the terms of this subsection 3.1(c) shall not apply in any
respect to the prices charged by Seller to Buyer for Omni Products. Buyer and
Seller have entered into a separate Supply Agreement with respect to Omni
Products, the terms of which shall govern exclusively the purchase and sale of
Omni Products between Buyer and Seller.
(d) Buyer shall have the right to appoint an independent firm of certified
public accountants from among the "Big Six" accounting firms, so long as said
accounting firm has no current or prior affiliation with Buyer other than
performance of an audit pursuant to this subsection 3.1(d) or Section 2.6, for
the limited purpose of verifying (i) the accuracy of any adjustments to the
price of Alliance Products pursuant to subsection 3.1(b), (ii) Seller's
compliance with subsection 3.1(c) and (iii) the accuracy of Seller's allocation
of taxes to be reimbursed by Buyer pursuant to subsection 3.3(b). Upon 30 days
prior written notice to Seller and upon execution by the auditors of an
appropriate confidentiality agreement, such certified public accounting firm
shall be given access to Seller's books, records and accounts, and such other
information as they may reasonably require for the limited purpose of verifying
Seller's adjustments to the price of Alliance Products. Fees and expenses
incurred in connection with such verification shall be paid 50% by Buyer and 50%
by Seller, and such audits shall not occur more frequently than once during each
Calendar Year in which an adjustment to price is made; provided, however, that
if there are three or more price adjustments pursuant to subsection 3.1(b) in a
Calendar Year, Buyer may conduct two such audits during such Calendar Year.
Buyer's right to cause such audit shall survive for a period of six (6) months
following any expiration or termination of this Agreement.
(e) The price for Additional Products shall be determined according to the
procedures described in Section 2.2.
3.2 Inspection of Facilities. Buyer shall have the right to appoint up to
------------------------
six (6) representatives to inspect Seller's production facilities for Products
for the limited purpose of verifying Seller's compliance with all regulatory
requirements and product specifications applicable to such production. Such
inspections shall not exceed two (2) inspections per Calendar Year. Upon
Buyer's reasonable request, Seller shall provide samples of Licensed Alliance
Products sold to other customers pursuant to Section 7.1. Such inspections
shall be conducted during regular business hours with Seller's personnel present
and in a manner that does not cause unreasonable disruption to Seller's
production processes or business.
-10-
3.3 Taxes. (a) Seller shall add to the invoice price of all Products, an
-----
amount equal to any tax now in effect or hereafter levied, with respect to the
manufacture, sale, use or delivery of the Products and imposed by law at the
point of sale or delivery of such Products (other than taxes based upon the
income of Seller), including but not limited to, sales tax, use tax, retailer's
occupational tax, gross receipts tax, and value added tax, in each case to the
extent payable by the Seller or required to be collected by Seller.
(b) All taxes now or hereafter imposed or levied with respect to the
manufacture, sale, use or delivery of the Products (other than taxes based upon
the income of Seller), which are required to be paid or collected by Seller and
which are not imposed by law at the point of sale or delivery of Products,
including but not limited to ad valorem tax, mill tax or environmental tax,
shall be paid by Seller and reimbursed by Buyer. Seller will periodically
calculate any allocation of such taxes to the Products purchased by Buyer and
will prepare a separate invoice to Buyer for reimbursement of such taxes.
Notwithstanding the foregoing, with respect to any tax imposed annually upon
Seller's entire inventory of Products to be purchased by Buyer at a particular
location, if on the date such taxes are assessed at such location, Seller is
holding in inventory Products to be purchased by Buyer in quantities in excess
of * * *% of forecast annual requirements of the Products in question according
to the Accepted Forecast in effect on the date such taxes are assessed, then
Buyer shall have no obligation to reimburse the Seller for such taxes imposed on
the Products held in Seller's inventory in excess of such * * *% of Buyer's
forecast annual requirements for such Products.
3.4 Price Controls. If Seller is prevented from changing any price in
--------------
effect for any Product by any governmental law, order, regulation or ruling,
then at Seller's option and upon sixty (60) days notice from Seller to Buyer,
such Product shall become an Excluded Product.
3.5 Payment. Payment terms shall be net thirty (30) days from the date of
-------
receipt of invoice except for early buy terms as set forth in Exhibit 3.5.
Unless otherwise directed by Buyer, payments received from Buyer for purchases
hereunder shall be applied by Seller to Buyer's oldest then existing monetary
obligations to Seller for purchases made hereunder. Unless Seller agrees in
writing to an extension of time, all invoices not paid within thirty (30) days
shall accrue interest at the lower of the highest legal rate under applicable
law or 1.5% per month. Payment for all sales shall be made in U.S. Dollars.
ARTICLE IV.
-----------
Title and Risk of Loss; Return of Product
-----------------------------------------
4.1 Title, Shipment and Risk of Loss. Products shall be shipped to the
--------------------------------
destination specified by Buyer. The price of Alliance Products shall include
shipping costs anywhere within the Territory. The price of Additional Products
shall include shipping costs only to the extent agreed by Seller pursuant to
Section 2.2. Title and risk of loss of the Products shall pass to Buyer upon
delivery to the destination specified by Buyer. All Products shipped to Buyer
under this Agreement which are subject to the Hazardous Materials Transportation
Act shall be packaged and transported in accordance with regulations established
from time to time by the United States Department of Transportation.
-11-
4.2 Acceptance of Goods. All claims with respect to any Products
-------------------
delivered to Buyer must be made within the time periods specified in Section
6.3. Buyer shall be deemed to have irrevocably accepted all Products except
where notice is duly given in accordance with Section 6.3.
4.3 Return of the Products. Returns of Product will be accepted only if
----------------------
Buyer shall have notified Seller of a claim with respect to such Products within
the time periods specified in Section 6.3. Unless the Products are the subject
of governmental order or other directive (in which case Buyer and Seller shall
comply with such order or directive), Seller shall notify Buyer following
receipt of Buyer's notice whether Buyer should (i) return the Products to Seller
(and, if so, the address to which the Products should be returned), or (ii)
dispose of the Products. All related reasonable costs of repackaging and
reshipping properly returned Products shall be paid by Seller, by a credit to
Buyer or otherwise. Seller shall be responsible for charges incurred in
disposing of the Products provided such disposal is in accordance with
applicable regulatory requirements and Seller has approved in writing the
method and manner of disposal and the costs to be incurred in such disposal. If
the method, manner and costs of disposal are not approved by Seller, Buyer shall
return the Products to Seller at Seller's expense in the manner described above.
No rejection of Products by Buyer shall be deemed rightful, and no acceptance of
Products shall be deemed justifiably revoked by Buyer, except in accordance with
the provisions of Article VI.
ARTICLE V.
----------
Term
----
5.1 Term. Unless terminated sooner as expressly permitted by Sections
----
2.4(e), 5.2 or 5.3, this Agreement shall be in full force and effect for an
initial term of five (5) years beginning on the Commencement Date and will
continue thereafter for successive renewal periods of three (3) years each
unless and until terminated by either party at the end of the five (5) year
initial term or at the end of any three (3) year renewal period upon at least
two (2) years prior written notice.
5.2 Events of Default by Buyer. Buyer shall be in default if any one or
--------------------------
more of the following events shall happen:
(i) Buyer shall fail to pay any amount due hereunder and such
failure is not cured within fifteen (15) days after receipt of Seller's written
notice; or
(ii) Buyer shall fail to perform or comply with any of the other
material terms or conditions of this Agreement for reasons other than an event
of Force Majeure and such failure, if curable, shall continue without cure for a
period of thirty (30) days after written notice thereof from Seller to Buyer; or
(iii) Filing by Buyer of a voluntary petition of bankruptcy or a
voluntary petition or answer seeking reorganization, rearrangement or
readjustment of its debts, or any relief under any bankruptcy or insolvency act
or law, now or hereafter existing, or any agreement by Buyer indicating consent
to, approval of, or acquiescence in, any such petition or proceeding; or
(iv) The application by Buyer or the consent or acquiescence of
Buyer in the appointment of a receiver or trustee for all or a substantial part
of any of its properties or assets; or
-12-
(v) The making by Buyer of a general assignment for the benefit of
creditors; or
(vi) The admission of Buyer in writing of its inability generally to
pay its debts as they mature; or
(vii) The filing of an involuntary petition against Buyer seeking
reorganization, rearrangement, or readjustment of its debts or for any other
relief under any bankruptcy or insolvency act or law, now or hereafter existing,
or the involuntary appointment of a receiver or trustee for Buyer for all or a
substantial part of its property or assets, or the issuance of a warrant of
attachment, or execution of similar process against a substantial part of the
property of Buyer and the continuance of such for ninety (90) days undismissed
or undischarged.
5.3 Events of Default by Seller. Seller shall be in default if any one or
---------------------------
more of the following events happen:
(i) Seller shall fail to perform or comply with any of the material
terms or conditions of this Agreement, for reasons other than an event of Force
Majeure, and such failure, if curable, shall continue without cure for a period
of thirty (30) days after written notice thereof from Buyer to Seller; provided,
however, that Buyer's sole remedy for Product claims shall be as provided in
Article VI, and Seller shall not be deemed to be in breach of this Agreement for
purposes of this Section 5.3 so long as Seller satisfies or is disputing in good
faith any claim of Buyer under Article VI; or
(ii) The filing by Seller of a voluntary petition of bankruptcy or a
voluntary petition or answer seeking reorganization, rearrangement, or
readjustment of its debts, or any relief under any bankruptcy or insolvency act
or law, now or hereafter existing, or any Agreement by Seller indicating consent
to, approval of, or acquiescence in, any such petition or proceeding; or
(iii) The application by Seller or the consent or acquiescence of
Seller in the appointment of a receiver or trustee for all or a substantial part
of any of its properties or assets; or
(iv) The making by Seller of a general assignment for the benefit of
creditors; or
(v) The admission of Seller in writing of its inability generally
to pay its debts as they mature; or
(vi) The filing of an involuntary petition against Seller seeking
reorganization, rearrangement or readjustment of its debts or for any other
relief under any bankruptcy or insolvency act or law, now or hereafter existing,
or the involuntary appointment of a receiver or trustee for Seller for all or a
substantial part of its property or assets, or the issuance of a warrant of
attachment, or execution of similar process against a substantial part of the
property of Seller and the continuance of such for ninety (90) days undismissed
or undischarged.
5.4 Remedies Upon Default. Upon the occurrence of any event of default
---------------------
(as defined in this Article V), and during the continuance thereof, the non-
defaulting party, at its option, and without prejudice to other lawful remedies
which may be available, may elect to terminate this Agreement upon thirty (30)
days' prior written notice. This Agreement may be terminated prior to
-13-
the expiration of the then-current term only in the event of a default under
Sections 5.2 and 5.3 or pursuant to Section 2.4(e) under the circumstances
described therein. Upon termination of this Agreement for any reason prior to
expiration of its then-current term, Buyer shall, within thirty (30) days
following such termination, purchase from Seller at then-applicable prices, all
Products in Seller's inventory which conform to Seller's limited warranty
provided in Section 6.1 and which have been produced by Seller based upon any
Accepted Forecast, unless such Products are the subject of (i) regulatory action
caused by Seller's acts or omissions that could reasonably be expected to impair
Buyer's ability to resell such Products to its customers in the normal course of
Buyer's business, or (ii) regulatory action not caused by Seller's acts or
omissions which by its terms prevents Seller from transferring such Products to
Buyer. In the case of regulatory action of the type specified in (ii) above, the
Buyer shall pay Seller the full purchase price for the Products subject to such
regulatory action and shall pay Seller reasonable storage costs until such
Products may be transferred to Buyer, or shall pay disposal costs if such
Products cannot be transferred to Buyer within 180 days following the date of
termination.
5.5 Survival. In the event this Agreement expires or terminates for any
--------
reason, each party will continue to abide by the provisions hereof which
expressly or by reasonable implication contemplate survival, except where
continuance would violate regulatory requirements or otherwise be unlawful. The
termination of this Agreement shall not prejudice any rights under this
Agreement which may have accrued up to and including the date of termination.
ARTICLE VI.
-----------
Warranty
--------
6.1 Limited Warranties of Buyer and Seller.
--------------------------------------
(a) Seller warrants exclusively to Buyer, with respect to each Product
sold to Buyer hereunder, that, subject to any exceptions that may arise from
time to time with respect to such Product due to any breach of Buyer's
warranties in Section 6.1(b) or Article IX, Buyer's noncompliance with its
obligations thereunder or Buyer's disclosure to Seller of exceptions to the
representations and warranties in Section 6.1(b) or Article IX (and only for
such time and in only such jurisdictions as any such exception applies), such
Product sold hereunder shall (i) conform to all applicable federal, state and
local statutes (other than warranties implied by operation of Uniform Commercial
Code Sections 2-314 or 2-315, or any state counterpart to such provisions),
regulations and implementing guidelines and (ii) shall meet any specifications
on Exhibit 6.1 which are applicable to such Product, and all amendments and
modifications thereto which Buyer and Seller may agree upon in writing in
relation to such Product or, in the absence of such specifications applicable to
such Product, that such Product shall conform to generally accepted industry
standards for such Product. Seller further warrants that Seller shall convey
good and merchantable title to Buyer and that all Products shall be delivered
free and clear of any lien or encumbrance.
(b) Buyer acknowledges that the Licensed Alliance Products and all
labeling and packaging thereto will be manufactured, labeled and sold by Seller
using the Licensed Property (as defined in Section 7.1), the Registrations (as
defined in Section 9.3(a)) and the Product Information (as defined in Section
9.4(a)). Buyer warrants to Seller that (i) except as disclosed in writing by
Buyer to Seller prior to the Commencement Date, the Licensed Property,
Registrations, and Product
-14-
Information issued to and/or owned by Buyer in connection with the Licensed
Alliance Products will, throughout the term of this Agreement, conform to all
applicable federal, state and local statutes (other than warranties implied by
operation of Uniform Commercial Code Sections 2-314 or 2-315, or any state
counterpart to such provisions) or regulations or implementing guidelines, and
in the absence of such statutes, regulations or implementing guidelines, conform
to generally accepted industry standards for the Licensed Alliance Product in
question; (ii) except as disclosed in writing by Buyer to Seller prior to the
Commencement Date, each Licensed Alliance Product which qualifies as a pesticide
under FIFRA is and throughout the term of this Agreement shall be lawfully
registered and in compliance with all requirements of FIFRA and state pesticide
laws; (iii) Alliance has, prior to the Commencement Date, consistently produced
each Licensed Alliance Product according to all specifications described in
Exhibit 6.1 applicable to such Licensed Alliance Products, subject to normal and
customary industry allowances for nonconforming Product; and (iv) other than the
Registrations, the Licensed Property, the Product Information (all of which
shall have been provided to Seller on or prior to the Commencement Date) and
matters in the public domain, no proprietary rights, proprietary technology,
proprietary equipment or proprietary know-how was required by Buyer to produce
consistently any Licensed Alliance Products prior to the Commencement Date
according to the specifications described in Exhibit 6.1 applicable to such
Licensed Alliance Product,
6.2 DISCLAIMER. THE WARRANTY PROVIDED IN SECTION 6.1(A) ABOVE IS
----------
EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES OF SELLER, EXPRESS OR IMPLIED,
INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE,
WHETHER PERTAINING TO THE PRODUCT OR THE CONTAINERS CONTAINING THE SAME AND
WHETHER ARISING BY LAW, CUSTOM, CONDUCT, OR USAGE OR TRADE, AND THE RIGHTS AND
REMEDIES PROVIDED IN SECTIONS 6.3 AND, TO THE EXTENT APPLICABLE, IN SECTION
6.5, ARE EXCLUSIVE IN LIEU OF ALL OTHER RIGHTS AND REMEDIES. IN NO EVENT SHALL
THE SELLER BE LIABLE FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
NOR SHALL ANY WARRANTY BE CONSTRUED AS A CONDITION.
6.3 Claims. (a) Except with respect to third party claims subject to
------
indemnification pursuant to Section 6.5 below, Buyer's sole and exclusive remedy
with respect to any claims of Buyer relating to Product including, but not
limited to, any short quantity of or damage to Product or Product not in
conformity with Seller's limited warranty in Section 6.1(a) shall be, at the
option of Seller, replacement of such Product or a credit or refund for the
purchase price of such Product. Any claim for damaged or short quantities of
Product shall be made within thirty (30) days following delivery of such
Product. Any claim for nonconforming Product shall be made within thirty (30)
days after Buyer becomes aware of such nonconformity. All Product claims other
than for damaged, short quantity or nonconforming Product shall be made within
thirty (30) days of when Buyer becomes aware of such claims. Failure to give
notice within such time and in such manner shall be deemed a waiver of any claim
that Buyer may have against Seller with respect to such Product. All claims
under this Article VI shall be subject to Seller's verification of the validity
of Buyer's claims.
(b) Notwithstanding the provisions of subsection (a) above, if, during any
ninety (90) day period while this Agreement is in effect, 25% or more of any
particular Product delivered by Seller
-15-
to Buyer during such 90 day period fails to conform to Seller's warranty
applicable to such Product in Section 6.1 (a "90 Day Failure"), within thirty
(30) days after Buyer becomes aware of such 90 Day Failure, Buyer may give
written notice to Seller of such 90 Day Failure specifying in reasonable detail
the affected Product and the nature of the nonconformities affecting such
Product ("Probation Notice"). If, during the twelve (12) month period following
Seller's receipt of any Probation Notice, Seller commits a second 90 Day Failure
with respect to the same Product which was the subject of such Probation Notice,
at Buyer's option and upon written notice from Buyer to Seller within sixty (60)
days following the end of the 90 day period in which Seller committed the second
90 Day Failure, the Product that was the subject of such 90 Day Failures shall
become an Excluded Product hereunder.
6.4 Product Suitability. Determination of the suitability of any Product
-------------------
for the uses and applications contemplated by Buyer, its customers and others
shall be the sole responsibility of Buyer. Any suggestions or recommendations
made by Seller concerning uses or applications of any Product are believed to be
reliable, but Seller makes no representation with respect to the results to be
obtained since the conditions of the use and application by Buyer and others are
beyond Seller's control.
6.5 Indemnification by Seller. Seller agrees to indemnify, save harmless
-------------------------
and defend Buyer and each member of the Buyer Group and each party controlling
any member of the Buyer Group (as "control" is defined in Section 1.1), from and
against all suits, actions, legal proceedings, claims, demands, damages, costs,
reasonable expenses and attorneys' fees, to the extent caused by, arising from,
incident to, connected with or growing out of (i) claims made against Buyer by
third parties (including without limitation governmental authorities) alleging
harm to third parties or violations of statute or regulation, in each case to
the extent caused by or relating to the failure of any Products to conform with
the warranty provided in Section 6.1(a) above, (ii) Seller's breach of Seller's
obligations under Sections 7.1 and 7.2 hereof, and (iii) Seller's violations of
statute or regulation in connection with any supplemental registration
arrangement as described in Section 9.6(b), but in the cases of each of (i),
(ii) and (iii) above, specifically excepting those matters which are the subject
of Section 6.6 below. With respect to the matters subject to indemnification
pursuant to (i) and (iii) above, such indemnification shall apply only to direct
damages, costs and expenses incurred by Buyer in connection with such matters
and shall not apply to indirect damages, consequential damages, lost profits,
injury to goodwill or similar harm suffered or alleged by Buyer as a result of
any such matters. To the extent the indemnity of Seller in (i) above applies to
claims brought by US EPA under FIFRA, and except with respect to finished goods
inventory purchased by Seller pursuant to the Alliance Agreement, such indemnity
shall constitute a "guarantee" under FIFRA (S) 12(b), to the extent provided in
that Section.
6.6 Indemnification by Buyer. Buyer agrees to indemnify, save harmless
------------------------
and defend Seller, and its Subsidiaries and Affiliates and any party controlling
Seller or its Subsidiaries or Affiliates (as "control" is defined in Section
1.1), and each of them, from and against all suits, actions, legal proceedings,
claims, demands, damages, costs, reasonable expenses and attorneys' fees, to the
extent caused by, arising from, incident to, connected with or growing out of
(i) Buyer's breach of Buyer's warranties or obligations under Sections 6.1(b) or
Article IX, (ii) the purchase, sale, handling, storage, packaging, repackaging,
advertising, promotion or use of the Products by Buyer or any third party, or
(iii) Buyer's breach of Buyer's obligations under Sections 7.3 or 11.5, or (iv)
Buyer's violations of statute or regulation in connection with any supplemental
registration
-16-
arrangement as described in Section 9.6(b), but in case of each of (i), (ii),
(iii) or (iv) above, specifically excepting those matters which are the subject
of Section 6.5 above . With respect to the matters subject to indemnification
pursuant to (ii) and (iii) above, the foregoing shall apply only to direct
damages, costs and expenses incurred by Seller in connection with such matters
and shall not apply to indirect damages, consequential damages, lost profits,
injury to goodwill or similar harm suffered or alleged by Seller as a result of
any such claims.
ARTICLE VII.
------------
Technology License; Patents and Trademarks
------------------------------------------
7.1 Grant of License. Subject to the terms and conditions of this
-----------------
Agreement, Buyer hereby grants to Seller a nonexclusive, nontransferable right
and license during the term of this Agreement to use: (i) the trademarks
"Regal," "EZ Clor" and "Clear Choice"' and (ii) such other trademarks and
patents, technology, confidential information, trade secrets and other
intellectual property as shall be necessary for Seller to manufacture and sell
the Alliance Products hereunder but, in any case, excluding Patent No. 5251656
entitled "Dual Chemical Feeder" (collectively, the "Licensed Property"). Seller
may use such right and license only for the purpose of making, packaging and
selling Licensed Alliance Products to the Buyer Group, to the customers
specifically identified on Exhibit 7.1 and any other customers the parties may
agree to in writing. Seller shall not sublicense any of its rights to the
Licensed Property hereunder to any party (other than to Seller's Subsidiaries
and Affiliates solely for the uses specified in the preceding sentence). Any
sublicense by Seller without such consent shall be void. Any agreement for the
sale of Licensed Alliance Products to the customers listed in Exhibit 7.1 and
any other customers agreed upon by Seller and Buyer, shall prohibit assignment
of such customer's rights to purchase Licensed Alliance Products under such
agreement without the consent of Buyer. A change of control of such customer
shall be deemed an assignment for purposes of the preceding sentence.
7.2 Ownership and Protection. All right, title and interest in and to the
------------------------
Licensed Property shall inure to the benefit of, and shall be solely vested in
Buyer. Seller acknowledges and agrees that Buyer owns the Licensed Property and
any patents and registrations therefor. Seller shall not at any time file any
application for patents or for registration with the United States Patent and
Trademark Office, or with any other governmental entity for the Licensed
Property. Subject to Buyer's obligations under Section 7.3, Buyer shall have
the sole right to determine whether or not any action shall be taken on account
of any such infringement, misappropriation or imitation. Seller shall not
institute any suit or take any action on account of any such infringement,
misappropriation or imitation without first obtaining the written consent of
Buyer to do so. Seller agrees that it is not entitled to share in any proceeds
received by Buyer (by settlement or otherwise) in connection with any formal or
informal action brought by Buyer, or other entity.
7.3 Preservation of Licensed Property. While this Agreement remains in
---------------------------------
effect, Buyer shall use commercially reasonable efforts to preserve, protect and
defend the Licensed Property to the extent necessary to enable Seller to
manufacture and sell the Licensed Alliance Products as contemplated in this
Agreement. Without limiting the foregoing, Buyer shall prepare and file at
Buyer's expense, any renewals, continuations, extensions or oppositions
necessary or reasonably appropriate to preserve and protect Buyer's rights in
such Licensed Property, and shall take appropriate action against any party
infringing or threatening to infringe upon the Buyer's rights to
-17-
the Licensed Property to the extent the Buyer becomes aware of same and such
infringement or threatened infringement is reasonably likely to impair or damage
Seller's ability to manufacture or sell the Licensed Alliance Products as
contemplated hereunder. Seller agrees to provide the Buyer with notice of any
infringement upon Buyer's rights with respect to the Licensed Property of which
Seller becomes aware.
7.4 Indemnification Against Infringement. Buyer shall indemnify and save
------------------------------------
Seller, its Subsidiaries and Affiliates, and any party controlling Seller, its
Subsidiaries or Affiliates (as "control" is defined in Section 1.1), harmless
from all costs, including reasonable attorneys fees, damages, liabilities and
expenses, arising out of any claim, action or suit brought against Seller based
upon an allegation that the Licensed Property or the use thereof in connection
with the Licensed Alliance Products infringe any US patents, trademarks or
other third party property rights including logos, trademarks or other
information contained on the packaging for the Licensed Alliance Products.
Seller shall promptly notify Buyer of any such claim against Seller and Buyer
shall have the obligation to assume the defense of any such claims.
ARTICLE VIII
------------
Safety and Health Communications
--------------------------------
Buyer will furnish to Seller for all of the Licensed Alliance Products,
Material Safety Data Sheets covering the Licensed Alliance Products that include
health, safety and other hazardous communication information on the Licensed
Alliance Products and the raw materials used in their manufacture in compliance
with the Occupational Safety and Health Administration's Hazard Communication
Standard and any other applicable laws. Seller will furnish the same type of
information to Buyer for all Products other than the Licensed Alliance Products.
Seller will also furnish to Buyer such other health or safety information
respecting the Products as Seller delivers to its other customers for the
Products. Buyer and Seller will disseminate appropriate health and safety
information to all persons including, but not limited to, their respective
employees, contractors and customers, as is necessary to comply with applicable
laws.
ARTICLE IX
----------
Environmental Registrations
---------------------------
9.1 Maintenance of the Federal Registrations. During the term of this
----------------------------------------
Agreement and any extension thereof, Buyer shall use commercially reasonable
efforts to maintain in good standing all federal pesticide product registrations
for the Alliance Products currently held or hereafter acquired by any member of
the Buyer Group under FIFRA, each of which current registrations is listed on
Exhibit 9.1 attached hereto (the "Federal Registrations"). Pursuant thereto,
Buyer shall use commercially reasonable efforts to comply with all requirements
and fulfill all obligations imposed under FIFRA and by the US EPA as necessary
to maintain the Federal Registrations in good standing, including, but not
limited to, by (i) complying with all requirements and applicable changes in
labeling and other aspects of each Federal Registration, as required under FIFRA
or by US EPA; (ii) paying in a timely fashion all applicable US EPA registration
fees for the Federal Registrations; and (iii) procuring and submitting in a
timely fashion any data required by US EPA, as set forth more fully in Section
9.3 herein.
-18-
9.2 Maintenance of the State Registrations
--------------------------------------
(a) Registrations. During the term of this Agreement and any extension
-------------
thereof, Buyer shall maintain in good standing and in compliance with applicable
law, subject to the assistance of Seller as set forth in Section 9.2(b) herein,
all state pesticide product registrations for the Alliance Products currently
held by any member of the Buyer Group, and any additional state registrations
for the Alliance Products procured by any members of the Buyer Group
(collectively, the "State Registrations").
(b) Obligations of Seller: Subject to Buyer complying with its
---------------------
obligations in Section 9.2(c), Seller shall assist Buyer in Buyer maintaining in
good standing the State Registrations by using commercially reasonable efforts
to undertake the following actions: (i) promptly reviewing any documents
provided by Buyer with regard to the State Registrations; (ii) promptly
informing Buyer of any facts, circumstances, legal or regulatory developments
known to Seller that may affect the Registrations; and (iii) timely preparing,
and forwarding for signature and submission by Buyer, any forms or other
documents that must be submitted to state regulatory authorities to satisfy
requirements known to Seller to maintain the State Registrations; provided,
however, that the obligations of Seller under this Section 9.2(b) shall not
apply to any State Registrations obtained to implement a "supplemental
distribution" arrangement between any member of the Buyer Group and any
distributor as authorized under US EPA regulations currently codified at 40 CFR
152.132.
(c) Obligations of Buyer: Buyer shall undertake all commercially
--------------------
reasonable actions necessary to cause Seller to assist Buyer in maintaining the
State Registrations as set forth in Section 9.2(b). Such action shall include,
but not necessarily be limited to (i) providing Seller, promptly after the date
of this Agreement, a copy of all files and other supporting documentation in
possession of any member of the Buyer Group relating to each Registration, with
the exception of any supporting registration data, other than product chemistry
data, owned by the members of the Buyer Group; (ii) promptly forwarding to
Seller a copy of any document received from, and informing Seller of any
discussions with, any state regulatory authority regarding any Registration;
(iii) promptly informing Seller of any facts, circumstances, regulatory or legal
developments known to any member of the Buyer Group that may affect the
Registrations, including, but not limited to, any anticipated or pending
amendments of, or requirements applicable to, the Federal Registrations; (iv)
executing and submitting in a timely manner any form or other document received
from Seller that must be submitted to state regulatory authorities to maintain
the Registrations; and (v) procuring and submitting in a timely fashion any data
required by any state regulatory authority, as set forth more fully in Section
9.3 herein.
(d) Responsibility for State Registration Fees and Discontinuation Fees.
-------------------------------------------------------------------
(i) As part of its obligation to maintain the State Registrations
in good standing, Buyer shall, except as the parties otherwise agree pursuant to
Section 9.2(e) herein, pay in a timely fashion all applicable state registration
fees for the State Registrations, provided, however, that Seller shall promptly
reimburse Buyer for all such fees paid by Buyer during each Calendar Year up to
a maximum of $* * *.
-19-
(ii) Buyer shall pay in a timely fashion any and all state
discontinuation or termination fees imposed by any state regulatory authority
with respect to the State Registrations, provided, however, that Seller shall
promptly reimburse Buyer for any such fee imposed as a direct result of any
action or inaction of Seller in violation of its obligations under Section
9.2(b) herein. Except as provided in the preceding sentence, Buyer shall be
solely responsible for any discontinuation or termination fee imposed for State
Registrations, including but not limited to termination fees caused by any
member of the Buyer Group (A) amending the Confidential Statement of Formula for
any Alliance Product, (B) changing the brand name of any Alliance Product, (C)
transferring ownership of any State Registration or Federal Registration to
another entity, or (D) changing the corporate name of Alliance.
(e) Additional State Registrations to Support Sales by Seller. In the
---------------------------------------------------------
event that Seller wishes to sell one or more Licensed Alliance Products directly
to a third-party customer not set forth on Exhibit 7.1 located in a state for
which no State Registration currently exists for said product or products, and
Buyer consents to such sale pursuant to Section 7.1 and Section 9.4(b) herein,
Buyer shall obtain and maintain State Registrations for said Products as
necessary to permit such sales by Seller. In such event, Buyer and Seller shall
agree as to the appropriate allocation of responsibility for the payment of
state registration fees for the additional State Registrations.
9.3 Data Rights and Obligations.
---------------------------
(a) If the US EPA or other federal or state regulatory authority requires
the submission of additional data to support any of the Federal Registrations or
State Registrations ("Registrations"), Buyer shall generate or otherwise procure
the data at its own expense and submit the data in a timely fashion to the
pertinent regulatory authority or authorities, provided, however, that if Seller
has already generated the same data, or is required to generate the same data on
the same or earlier timetable to support the registration of products owned by
Seller and intends to generate such data, then Seller shall notify Buyer of such
intention and, upon the timely request of Buyer, submit the required data to the
pertinent regulatory authorities, in lieu of Buyer, and shall designate such
data as being in support of one or more named Alliance Products as well as
Seller's products. Upon receipt of US EPA Master Record Identifier Numbers
("MRIDs") for such data, or any state equivalent, Seller shall promptly transmit
such MRIDs or state data identification numbers to Buyer. Any data submitted by
Buyer pursuant to this Section 9.3(a) shall be the sole property of Buyer, and
Buyer shall retain all rights to compensation and/or cost sharing payments from
third parties that rely on the data pursuant to FIFRA (S) 3(c)(1)(F) and (S)
3(c)(2)(B). Likewise, any data submitted by Seller pursuant to this Section
9.3(a) shall be the sole property of Seller and Seller shall retain all rights
to compensation and/or cost sharing payments from third parties pursuant to
FIFRA (S) 3(c)(1)(F) and (S) 3(c)(2)(B).
(b) The use of Seller's data by Buyer as provided in Section 9.3(a) herein
is authorized hereunder only for the term of this Agreement and any extension
thereof. Any use of Seller's data by Buyer after the termination of this
Agreement must be accompanied by the issuance of an offer to pay compensation,
to the extent required by FIFRA, or addressed by separate arrangement between
the parties.
-20-
9.4 Manufacture and Sale of the Alliance Products by Seller
-------------------------------------------------------
(a) Buyer, for itself and the Buyer Group, hereby authorizes Seller to
formulate, package and label (hereinafter "manufacture") the Alliance Products
in accordance with the Registrations. Pursuant thereto, Buyer shall provide
Seller, on the date of this Agreement, a copy of the current US EPA-approved
Confidential Statement of Formula, labeling, material safety data sheets and
packaging specifications for each Registration, along with any other documents
or information necessary to manufacture the Alliance Products in accordance with
the Registrations (the "Product Information"). Buyer shall thereafter timely
inform Seller of any anticipated or pending amendments of or changes to the
Federal Registrations in order to provide Seller with a commercially reasonable
time to implement such amendments or changes in the manufacture of the Alliance
Products.
(b) Buyer hereby authorizes Seller to sell the Licensed Alliance Products
manufactured by Seller pursuant to Section 9.4(a) herein to any member of the
Buyer Group and to the third-party customers listed on Exhibit 7.1 hereto.
Seller may sell to third-party customers not listed in Exhibit 7.1 only as
provided in Section 7.1. In such event, Buyer and Seller shall negotiate in
good faith an agreement as to the appropriate terms and conditions under which
such sales by Seller shall be made.
9.5 Registration Warranties. Buyer warrants that Buyer, the Buyer Group,
-----------------------
or a member thereof is the lawful owner of the Registrations and that, (except
as disclosed in writing by Buyer to Seller prior to the Commencement Date) the
Registrations are, as of the date of this Agreement, (a) in good standing with
US EPA and all pertinent state regulatory authorities and in full compliance
with all applicable requirements under FIFRA and state pesticide law; and (b)
not subject to any pending federal or state administrative or judicial actions
for cancellation or suspension of any Registration. Buyer further warrants that
the information that it shall provide Seller pursuant to Section 9.4(a) shall
comply with all applicable legal restrictions and requirements necessary to
manufacture the Alliance Products in accordance with the Registrations, FIFRA,
state pesticide laws and US EPA Registrations and that Buyer shall take all
commercially reasonable action necessary, during the term of this Agreement and
any extension thereof, to maintain the Registrations in good standing and in
compliance with all requirements of FIFRA, state pesticide laws and US EPA.
9.6 Noncompliant Registrations.
--------------------------
(a) With respect to all items of Registration noncompliance as disclosed
by Buyer to Seller in writing prior to the Commencement Date which may arise
from time to time while this Agreement is in effect, Buyer acknowledges that
such noncompliance may limit or preclude Seller's manufacture or sale of any
Licensed Alliance Product subject to such Registrations ("Noncompliant
Products"). To the extent Buyer requires any Noncompliant Product (including
Noncompliant Products previously forecast on an Accepted Forecast) and Seller
reasonably determines it cannot manufacture or sell such Noncompliant Product,
for so long as such noncompliance continues and in each jurisdiction affected by
such noncompliance, Seller shall have the right upon notice to Buyer to
substitute in lieu of such Noncompliant Product, such other product of Seller as
Seller deems the closest functional equivalent of such Noncompliant Product.
Buyer may thereupon cancel any pending orders for such Noncompliant Product, but
may not purchase a substitute for such Noncompliant Product from another
supplier except in accordance with Section 2.1 (in the case of
-21-
a substitute which is an Alliance Product) or Section 2.2 (in the case of a
substitute which is not an Alliance Product), as the case may be.
(b) In the event Seller reasonably determines it cannot produce a
Noncompliant Product as provided in subsection (a) above, upon request by Buyer
and agreement between Buyer and Seller as to a price for such substitute Product
(which shall thereafter be subject to adjustment as provided in Section 3.1(b),
Seller shall prepare and file with US EPA a statement authorizing "supplemental
distribution" by Buyer of a substitute product sold by Seller under Seller's
FIFRA registration with respect to such substitute product pursuant to US EPA's
"supplemental distribution" provisions currently codified at 40 C.F.R.
(S)152.132. Such supplemental distribution statement shall authorize Buyer to
sell such substitute Product of Seller under the trademarks "Regal", "EZ-Clor"
and/or "Clear Choice." Seller shall maintain such supplemental distribution
statement on Buyer's behalf only for such time as is necessary for Buyer, using
reasonable commercial efforts, to remedy the Registration noncompliance
affecting such Noncompliant Product, or for such additional time as Buyer shall
request so long as such arrangement does not impose upon Seller, in Seller's
reasonable judgment, an excessive economic or administrative burden, except that
Seller may terminate the supplemental distribution arrangement, upon 60 days
prior notice to Buyer, if Seller decides, in its discretion, to allow or effect
the cancellation or suspension of the supplemental distribution registration for
the substitute product because of unreasonable regulatory requirements imposed
by US EPA, or for other reasonable cause. Nothing herein shall impose upon
Seller the obligation to maintain for any reason or for any period of time any
FIFRA registration of Seller underlying any such supplemental distribution
arrangement, which maintenance or non-maintenance shall be at Seller's absolute
discretion. Seller shall give Buyer at least 60 days notice of termination of
any such Seller FIFRA registration. In connection with any supplemental
distribution of Seller's products as described above, Buyer shall obtain and
maintain at Buyer's sole expense all state and local pesticide registrations
required for Buyer to distribute and sell such substitute products under such
supplemental distribution arrangement, and Buyer shall pay at its sole expense
all state pesticide registration and discontinuation fees associated with such
pesticide registrations. For so long as Buyer is purchasing any such substitute
product under such supplemental distribution agreement, the Seller's FIFRA
Confidential Statement of Formula for such substitute product shall constitute
the applicable warranty specification for such Product for purposes of Section
6.1(a).
ARTICLE X
Confidentiality
---------------
10.1 Confidentiality Obligations of Seller. Seller shall treat as
-------------------------------------
confidential and prevent unauthorized duplication or disclosure of any
confidential information concerning the business, affairs or the goods of Buyer
(including without limitation any confidential information acquired pursuant to
Section 7.1) which Seller may acquire during the course of its activities under
this Agreement and shall not use any of such confidential information for any
purpose other than in furtherance of Seller's obligations under this Agreement.
In addition, Seller shall use commercially reasonable efforts to prevent any
such disclosure by any and all of its employees or representatives outside the
scope of employment of such employees' and representatives' employment or
engagement with Seller. Seller agrees that except for such disclosure as is
required by law, the terms of this Agreement shall be deemed confidential
information for purposes of this Section 10.1.
-22-
10.2 Confidentiality Obligations of Buyer. Buyer shall treat as
------------------------------------
confidential and prevent unauthorized duplication or disclosure of any
confidential information concerning the business, affairs or the goods of Seller
which Buyer may acquire during the course of its activities under this Agreement
and shall not use any of such confidential information for any purpose other
than in furtherance of Buyer's obligations under this Agreement. In addition,
Buyer shall use commercially reasonable efforts to prevent any such disclosure
by any and all of its employees or representatives outside the scope of
employment of such employees' and representatives' employment or engagement with
Buyer. Buyer agrees that except for such disclosure as is required by law, the
terms of this Agreement shall be deemed confidential information for purposes of
this Section 10.2.
10.3 Survival of Confidentiality Obligations. The obligations of
---------------------------------------
confidentiality provided in this Agreement shall survive for a period of five
(5) years after the expiration or termination of this Agreement for any reason;
provided, however, that with respect to any item of confidential information
which is a trade secret under applicable law, the obligations of confidentiality
hereunder shall survive the expiration of such five (5) year period and remain
in full force and effect for so long as the applicable confidential information
remains a trade secret under applicable law.
ARTICLE XI
Miscellaneous
-------------
11.1 Waivers and Consents. All waivers and consents given hereunder shall
--------------------
be in writing. No waiver by any party hereto of any breach or anticipated breach
of any provision hereof by any other party shall be deemed a waiver of any other
contemporaneous, preceding or succeeding breach or anticipated breach, whether
or not similar, on the part of the same or any other party. Except as otherwise
provided herein, time is of the essence in this Agreement.
11.2 Notices.
-------
(a) All notices and other communications hereunder shall be in writing,
and shall be deemed to have been given only if and when (i) personally delivered
or (ii) three (3) business days after mailing, postage prepaid, by first class
certified or registered air mail, or (iii) sent by prepaid cable, telegram,
telex, or telecopy, addressed in each case as follows:
(b) If to Buyer to:
SCP Pool Corporation
000 Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: X.X. Xxxxxx
Telecopier: 000-000-0000
with a copy, except to purchase or sales orders and billing matters,
in like manner to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
-23-
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telecopier: 000-000-0000
(c) If to Seller to:
Bio-Lab, Inc.
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopier: 000-000-0000
with a copy, except for purchase or sales orders and billing matters,
in like manner to:
Great Lakes Chemical Corporation
P. O. Box 0000
Xxxxxxx 00 X.X.
Xxxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telecopier: 000-000-0000
and
Xxxxx, Xxxxxxxx & Xxxxxxx
Xxxxx 0000, Xxxx Xxxxx
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Telecopier: 000-000-0000
Both Seller and Buyer may change the address(es) for the giving of notices and
communications and/or copies thereof, by written notice to the other party in
conformity with the foregoing.
(d) If Buyer or Seller should come under any requirement to notify
federal, state or local authorities of any spill or other event involving the
Products, the notifying party shall report such incident to the other party to
this Agreement as soon as possible after notifying such authorities.
11.3 Headings. The Article and Section headings contained in this
--------
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
11.4 Governing Law. The interpretation and construction of this Agreement,
-------------
and all matters relating hereto, shall be governed by the internal laws of the
State of Georgia.
11.5 Parties in Interest. This Agreement shall not be assigned by either
-------------------
party without the prior written consent of the other party, such consent not to
be unreasonably withheld. Subject to the foregoing restriction, this Agreement
shall inure to the benefit of, and be binding upon, the
-24-
parties hereto and their respective successors and assigns. This Agreement shall
be binding upon each member of the Buyer Group to the extent of such member's
respective obligations hereunder, and Buyer hereby represents and warrants to
Seller that Buyer has full power and authority to bind each member of the Buyer
Group by Buyer's execution of this Agreement.
11.6 Arbitration. Any controversy or claim arising out of or relating to
-----------
this contract, or the breach thereof, shall be settled by arbitration in
Atlanta, Georgia in accordance with the Commercial Arbitration Rules of the
American Arbitration Association. Any judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.
11.7 Counterparts. This Agreement may be executed in two or more
------------
counterparts, all of which taken together shall constitute one and the same
instrument.
11.8 Entire Agreement. This Agreement, including all schedules and
----------------
exhibits annexed hereto (each of which is incorporated herein by reference),
contains the entire understanding of the parties hereto with respect to the
subject matter contained herein or therein.
11.9 Amendments. This Agreement may not be changed orally, nor shall any
----------
modification of this Agreement be affected by the use of purchase orders
(including but not limited to the purchase order shown on Exhibit 2.5),
acknowledgments, acceptances or other forms at variance with or in addition to
the terms and conditions herein. This Agreement may be changed only by a
written agreement signed by Buyer and Seller.
11.10 Severability. In case any provision in this Agreement shall be held
------------
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof will not in any way be affected or impaired
thereby.
11.11 SCP Guaranty. SCP hereby guaranties the payment and performance of
------------
the obligations of Buyer hereunder. SCP hereby expressly waives diligence,
presentment, demand of payment, protest and notices whatsoever, and any
requirement that Seller exhaust any right, power or remedy or proceed against
Buyer under this Agreement or any other Agreement or instrument referred to
herein, or against any other party under any guarantee of, or security for, any
obligations of Buyer under this Agreement. The obligations of SCP hereunder are
absolute and unconditional and, to the fullest extent permitted by applicable
law, irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor.
-25-
IN WITNESS WHEREOF, Buyer and Seller have caused their corporate names to
be hereunto subscribed, under seal, by their respective duly authorized
officers, all as of the day and year first above written.
"BUYER"
SOUTH CENTRAL POOL SUPPLY, INC.
By: Xxxxxx X. Xxxxxx
--------------------------------
Title: Chairman
--------------------------
Date: 9/26/96
---------------------------
"SCP"
SCP POOL CORPORATION
FOR THE LIMITED PURPOSES DESCRIBED
IN SECTION 11.11
By: Xxxxxx X. Xxxxxx
--------------------------------
Title: Chairman
--------------------------
Date: 9/26/96
---------------------------
"SELLER"
BIO-LAB, INC.
By: Xxxxx X. Xxxxx
--------------------------------
Title: President
--------------------------
Date: 9/26/96
---------------------------
-26-
Exhibit 1.7
EXCLUDED PRODUCTS
1. Any swimming pool products marketed or sold prior to or following the
Commencement Date under the following brand names (regardless of whether such
products would otherwise meet the definition of Alliance Products described in
Exhibit 1.11) except products which: (i)(A) were not purchased by Buyer during
------
the twelve (12) month period from September 1, 1995 through August 31, 1996 or
(B) were not being marketed or sold prior to the Commencement Date and (ii)
---
contain as their primary active ingredients , any of the ingredients listed on
Exhibit 2.2(c). Products which meet both criteria (i) and (ii) in the preceding
sentence shall be treated as Competing Branded Products for purposes of Section
2.2(c).
Pittclor
Refresh
Feron
Tub of Gold
Fix-A-Leak
Sun
Pristine Blue
Bio-Dex
Applied Biochemists
GLB
Quantum Biochemical
Robarb Inc
Leisure Time
Yellow Out
Jonas
Jack's Magic
New Water
Sustain
Xxxxxxxx
Xxxx
Natural Chemistry
Proteam Products
Sea-Klear
Lo-Chlor
United Chemical
Deskum
GPS
All Pure
Pool Aid
2. Any product containing Poly Hexamethalyne Biguanide (PHMB) as the
primary active ingredient.
3. Any products purchased by Buyer from Pro-Packaging, Inc. through March
of 1997. Products purchased by Buyer from Pro-Packaging, Inc. after March of
1997 shall not be Excluded Products.
4. All Omni Products (as defined in Section 3.1(c)(vii)). Buyer and
Seller acknowledge that the Buyer and Seller have entered into a separate
agreement with respect to the purchase and sale of Omni Products, the terms of
which shall govern exclusively the parties' respective rights and obligations
with respect to Omni Products.
Exhibit 1.11
ALLIANCE PRODUCTS
*1. Any products containing cyanuric acid as a primary active ingredient in
the product forms (e.g., sticks, tablets, pucks, granulated product,
etc.) described in Exhibit 3.1(a).
*2. Any products containing trichloroisocyanuric acid as a primary active
ingredient in the product forms (e.g., sticks, tablets, pucks, granulated
product, etc.) described in Exhibit 3.1(a).
*3. Any products containing sodium dichloroisocyanuric acid dihydrate or
sodium dichloroisocyanuric acid as a primary active ingredient in the
product forms (e.g., sticks, tablets, pucks, granulated product, etc.)
described in Exhibit 3.1(a).
*4. Any products containing lithium hypochlorite as a primary active
ingredient in the product forms (e.g., sticks, tablets, pucks, granulated
product, etc.) described in Exhibit 3.1(a).
*5. Any products containing bromine compounds, as a primary active
ingredient, including but not limited to bromochlorodimethylhydantoin and
sodium bromide in the product forms (e.g., sticks, tablets, pucks,
granulated product, etc.) described in Exhibit 3.1(a).
6. The other products described by product name on Exhibit 3.1(a).
NOTE: Products marked with an asterisk (*) above are those subject to the
provisions of Section 2.1(a)(ii)
Exhibit 2.1(c)
EXAMPLES OF APPLICATION OF PURCHASE REQUIREMENTS
FOR ILLUSTRATION PURPOSES ONLY
EXAMPLE 1: Buyer buys from Seller * * *% of its Calendar Year requirements
---------
of all Alliance Products as a group (including the five Alliance Products marked
with an asterisk on Exhibit 1.6). During the same Calendar Year, Buyer buys at
least * * *% of its requirements of each of the five individual Alliance
----
Products marked with an asterisk on Exhibit 1.6.
RESULT: Buyer has complied with Section 2.1 by satisfying the
------
requirements of both Section 2.1(a)(i) and 2.1(a)(ii). Buyer has satisfied
---- ---
Section 2.1(a)(i) by buying at least * * *% of its Calendar Year requirements
for Alliance Products as a group, and it has satisfied Section 2.1(a)(ii) by
buying at least * * *% of its Calendar Year requirements for each individual
----
Alliance Products marked with an asterisk on Exhibit 1.6.
EXAMPLE 2: Buyer buys from Seller * * *% of its Calendar Year requirements
---------
for all Alliance Products as a group, but during the same Calendar Year buys
from Seller only * * *% of its requirements for cyanuric acid.
RESULT: Buyer is not in compliance with Section 2.1, since Buyer must
------
comply with both Section 2.1(a)(i) and 2.1(a)(ii). Buyer satisfied Section
----
2.1(a)(i); Buyer did not satisfy Section 2.1(a)(ii), however, since cyanuric
acid is marked with an asterisk on Schedule 1.6.
EXAMPLE 3: Buyer buys from Seller * * *% or more of its Calendar Year
---------
requirements for each of the five products marked with an asterisk on Exhibit
1.6, but during the same Calendar Year buys from Seller only * * *% of its
requirements of all Alliance Products as a group (including the five products
marked with an asterisk on Exhibit 1.6).
RESULT: Buyer is not in compliance with Section 2.1. Buyer has satisfied
------
the requirements of Section 2.1(a)(ii) by buying * * *% or more of its
requirements for the five products marked with an asterisk on Exhibit 1.6. Buyer
has not, however, satisfied the requirements of Section 2.1(a)(i), since it
failed to purchase at least * * *% of its requirements of Alliance Products as a
group.
Exhibit 2.2(c)
ACTIVE CHEMICAL COMPOUNDS PRESENT IN
COMPETING BRANDED PRODUCTS
Trichloroisocyanuric Acid
Sodium Dichloroisocyanuric Acid Dihydrate
Sodium Dichloroisocyanuric Acid
Bromochlorodimethylhydantoin
Lithium Hypochlorite
Exhibit 3.1(a)
INITIAL PRICING
See initial pricing list attached.
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
====================================================================================================================================
Trichloroisocyanuric Acid:
3" Tabs (8 oz. Tab)
230 3" Tab (8 oz. Tab) 1 39 39 *** ***
------------------------------------------------------------------------------------------------------------------------------------
231 3" Tab (8 oz. Tab) 8 4 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
232 3" Tab (8 oz. Tab) 4 8 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
233 3" Tab (8 oz. Tab) 2 16 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
234 3" Tab (8 oz. Tab) 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
235 3" Tab (8 oz. Tab) 1 50 50 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
236 3" Tab (8 oz. Tab) 1 100 100 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
369 3" Tab (8 oz. Tab) 1 250 250 *** ***
------------------------------------------------------------------------------------------------------------------------------------
Trichloroisocyanuric Acid:
3" Tabs (8 oz. W Tab)
112 3" Tab (8 oz. W Tab) 1 39 39 *** ***
------------------------------------------------------------------------------------------------------------------------------------
374 3" Tab (8 oz. W Tab) 8 4 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
375 3" Tab (8 oz. W Tab) 4 8 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
376 3" Tab (8 oz. W Tab) 2 16 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
377 3" Tab (8 oz. W Tab) 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
378 3" Tab (8 oz. W Tab) 1 50 50 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
379 3" Tab (8 oz. W Tab) 1 100 100 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
367 3" Tab (8 oz. W Tab) 1 250 250 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
1298 3" Tab (8 oz. W Tab) 1 300 300 *** ***
------------------------------------------------------------------------------------------------------------------------------------
Trichloroisocyanuric Acid:
1" Tabs
363 1" Tabs 8 4 32 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
141 1" Tabs 4 8 32 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
142 1" Tabs 2 16 32 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
279 1" Tabs 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
285 1" Tabs 1 50 50 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
1429 1" Tabs (Repl. Cart) 4 4 16 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
Page 1
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
--------------------------------------------------------------------------------------------------------------------------
420 1" Tabs (Universal cart.) 4 4 16 *** ***
--------------------------------------------------------------------------------------------------------------------------
159 Feeder Pac, CA(R-3AF) 4 4 16 *** ***
--------------------------------------------------------------------------------------------------------------------------
1433 Feeder Pac, CA(FITS S2) 4 4 16 *** ***
--------------------------------------------------------------------------------------------------------------------------
1797 Time Release Canister 6 5 30 *** ***
--------------------------------------------------------------------------------------------------------------------------
TRICHLOROISOCYANURIC ACID:
Sticks
297 Sticks - Rectangle 8 4 32 *** ***
--------------------------------------------------------------------------------------------------------------------------
218 Sticks - Rectangle 4 7 28 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xxxxxx - Xxxxxxxxx 0 00 00 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xxxxxx - Xxxxxxxxx 0 00 00 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xxxxxx - Xxxxxxxxx 0 00 00 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
147 Sticks - Round Shape 1 25 25 *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xxxxxx - Xxxxx Xxxxx 0 00 00 *** ***
--------------------------------------------------------------------------------------------------------------------------
1798 Sticks - Round Shape 1 250 250 *** ***
--------------------------------------------------------------------------------------------------------------------------
TRICHLOROISOCYANURIC ACID:
Granular Trichlor
714 Granular Trichlor 12 2 24 *** ***
--------------------------------------------------------------------------------------------------------------------------
251 Granular Trichlor 1 25 25 *** ***
--------------------------------------------------------------------------------------------------------------------------
SODIUM DICHLOROISOCYANURIC ACID:
Dy- Chlor II
221 Dy-Chlor II 12 2 24 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
222 Dy-Chlor II 8 4 32 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
223 Dy-Chlor II 4 8 32 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xx-Xxxxx XX 0 00 00 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xx-Xxxxx XX 0 00 00 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
226 Dy-Chlor II 1 45 45 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
000 Xx-Xxxxx XX 0 00 00 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
1571 Dy-Chlor II 1 300 300 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------
Page 2
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
------------------------------------------------------------------------------------------------------------------------
Balancers
(Cyanuric Acid:)
1725 Stabilizer (Cyanuric Acid) 12 1.75 21 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
242 Stabilizer (Cyanuric Acid) 8 4 32 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1491 Stabilizer (Cyanuric Acid) 4 9 36 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
241 Stabilizer (Cyanuric Acid) 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
213 Stabilizer (Cyanuric Acid) 1 45 45 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
392 Stabilizer (Cyanuric Acid) 1 100 100 *** ***
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
123 pH Minus 12 3 36 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
124 pH Minus 8 7 56 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
864 pH Minus 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
126 pH Plus 12 2 24 *** ***
------------------------------------------------------------------------------------------------------------------------
127 pH Plus 8 5 40 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
128 pH Plus 4 12 48 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
865 pH Plus 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
636 Alkalinity Up (Box) 6 4 24 *** ***
------------------------------------------------------------------------------------------------------------------------
130 Alka Plus 8 5 40 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
131 Alka Plus 4 10 40 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
637 Alkalinity Up (Box) 4 10 40 *** ***
------------------------------------------------------------------------------------------------------------------------
505 Alka Plus 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1314 Calc. Increaser 8 4 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1315 Calc. Increaser 4 9 36 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
503 Calc. Increaser 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
Lithium Hypochlorite
260 Power Shock 24 1 24 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
287 Litho Shock 12 2 24 *** ***
------------------------------------------------------------------------------------------------------------------------
256 Lithium 8 4 32 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
Page 3
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
------------------------------------------------------------------------------------------------------------------------
257 Lithium 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
118 Lithium 1 45 45 *** ***
------------------------------------------------------------------------------------------------------------------------
Oxy-Klear
674 Oxy-Klear 24 1 24 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
188 Oxy-Klear 12 2.5 30 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
189 Oxy-Klear 8 5 40 *** ***
------------------------------------------------------------------------------------------------------------------------
401 Oxy-Klear 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
402 Oxy-Klear 1 50 50 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
Cal-Hypo Shock
528 Shock Out 65% 24 1 24 *** ***
------------------------------------------------------------------------------------------------------------------------
267 Shock Out 65% 4 8 32 *** ***
------------------------------------------------------------------------------------------------------------------------
269 Shock Out 65% 1 25 25 *** ***
------------------------------------------------------------------------------------------------------------------------
Bromine Compounds
1439 Bromine 8 2 16 *** ***
------------------------------------------------------------------------------------------------------------------------
1436 Bromine 8 4 32 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1445 Bromine 1 25 25 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1440 Bromine 1 50 50 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
Algaecide
* Sodium Dichloroisocyanuric Acid:
714 Gran. Algae Out * 12 2 24 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
251 Gran. Algae Out * 1 25 25 *** ***
------------------------------------------------------------------------------------------------------------------------
1092 Gran. Algae Out * 1 50 50 *** ***
------------------------------------------------------------------------------------------------------------------------
000 Xxxxxxxxx 00 (Xxxxx) 0 00 00 *** *** *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
000 Xxxxxxxxx 00 (Xxx) 1 4 4 *** ***
------------------------------------------------------------------------------------------------------------------------
000 Xxxxxxxxx 00 (Xxxxx) 0 00 00 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------
1801 Econocide (Quart) 1 12 12 *** ***
------------------------------------------------------------------------------------------------------------------------
Page 4
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
--------------------------------------------------------------------------------------------------------------------------------
1802 Econocide (Gal) 4 1 4 *** ***
--------------------------------------------------------------------------------------------------------------------------------
1803 Algaecide 4 1 4 *** ***
--------------------------------------------------------------------------------------------------------------------------------
705 Algaecide 30% (Quart) 1 12 12 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
133 Algae Prevent (Quart) 1 12 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
150 Algae Prevent (Gal) 1 4 4 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
170 Conc. Algaecide (Quart) 1 12 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
132 Algaezone + (Quart) 1 12 12 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
1211 Silver Algaecide (Quart) 1 12 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
ACCESSORIES
1163 Stain Out 1 12 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
180 Flocking Agent 8 6 48 *** ***
--------------------------------------------------------------------------------------------------------------------------------
745 Drop Out Floc 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
1704 Super Klear 1 12 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
134 Metal Out 1 12 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
1496 New Super Floc 1 12 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
157 Xxxxxxx Xxxxxx (Quart) 1 12 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
302 Xxxxxxx Xxxxxx (Gal) 1 4 4 *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
102 Shimmer N Shine 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
103 Super Shimmer N Shine 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
104 Super Shimmer N Shine 24 1 24 *** ***
--------------------------------------------------------------------------------------------------------------------------------
160 Shimmer N Shine 18 1 18 *** ***
--------------------------------------------------------------------------------------------------------------------------------
111 Knock Off - Tile Clnr 12 1 12 *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
706 Filt. Clnr/Degr. 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
1800 Filter Cleaner 12 1 12
--------------------------------------------------------------------------------------------------------------------------------
105 Stain Stop 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
106 Acid Wash Assist 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
109 Stain Barrier 1 45 45 *** ***
--------------------------------------------------------------------------------------------------------------------------------
1475 Power Quest 12 1 12 *** *** *** ***
--------------------------------------------------------------------------------------------------------------------------------
169 Defoamer 12 1 12 *** ***
--------------------------------------------------------------------------------------------------------------------------------
Page 5
SCP PRICING
CLEAR CLEAR E-Z E-Z
REGAL REGAL CHOICE CHOICE CLOR XXXX
XX NET CASE PER LB CASE PER LB CASE PER LB
PC# DESCRIPTION QTY LBS WTG PRICE PRICE PRICE PRICE PRICE PRICE
------------------------------------------------------------------------------------------------------------------------------------
1705 Enzall 12 1 12 *** *** *** ***
------------------------------------------------------------------------------------------------------------------------------------
590 Cover Cleaner 12 1 12 *** ***
------------------------------------------------------------------------------------------------------------------------------------
Winter Kits
1183 Winter Kit 12K Gal 1 20.2 20.2 *** ***
------------------------------------------------------------------------------------------------------------------------------------
1145 Winter Kit 24K Gal 1 26.7 26.7 *** ***
------------------------------------------------------------------------------------------------------------------------------------
652 Winter Kit 15K Gal 9 4.7 42.3 *** ***
------------------------------------------------------------------------------------------------------------------------------------
653 Winter Kit 22.5K Gal 9 6 54 *** ***
------------------------------------------------------------------------------------------------------------------------------------
TERMS: Net 30 days or as agreed
FREIGHT: Prepaid destination - Continental U.S.
Pricing assumes truckload orders or combination truckload quantities
of approximately 38,000 pounds.
Clear Choice may be shipped Dealer Direct, 10,000 pounds minimum, in
truckload combination orders.
Pricing effective through 12/31/96.
-------------------
Effective: 9/25/96
-------------------
Page 6
Exhibit 3.1(b)
PRICE ADJUSTMENT FORMULA
The initial prices shown in Exhibit 3.1(a) shall be adjusted as provided in
Section 3.1(b) as follows:
Prices will be adjusted on a per-Product basis based on the increase or
decrease in the cost of each of the following components: raw materials,
packaging/labels, direct labor and freight, in each case based upon the cost of
such component in relation to total Product cost and in each case according to
the following:
---------------------------------------------------------------------------
COMPONENT CHANGE IN RESULTING CHANGE IN
SELLER'S COST PRODUCT PRICE
---------------------------------------------------------------------------
Raw materials Actual cost per unit of * * *
(See Note 1) measure (pound, gallon, etc.)
---------------------------------------------------------------------------
Packaging and labels Actual cost per item * * *
---------------------------------------------------------------------------
Direct labor Actual cost per hour * * *
---------------------------------------------------------------------------
Freight Actual cost per unit of * * *
measure (pound, gallon, etc.)
---------------------------------------------------------------------------
NOTES:
1. For raw materials manufactured by Seller (e.g., trichloroisocyanuric acid
and bromochlorodimetrylhydantoin), the cost adjustment for such raw material
shall be based upon * * * rather than upon the * * *.
Exhibit 3.5
BUYER GROUP EARLY BUY PROGRAM
ORDER PERIOD: October of each Calendar Year through February 28 of the next
Calendar Year
PRICING: Price effective on date of order pursuant to Section 3.1
MINIMUM ORDER: Buyer will use best efforts to combine as truckload-single
destination or combined destinations (approximately 38,000
pounds). Minimum order is $10,000.
PAYMENT TERMS: SNOWBELT (see attached map)
--------
50% of invoice price due on June 10 the Calendar Year following
order date (if order placed October-December) or on June 10 the
Calendar Year of order date (if order placed January-February);
the balance due 30 days thereafter.
SUNBELT (see attached map)
-------
50% of invoice price due on May 10 the Calendar Year following
order date (if order placed October-December) or on May 10 the
Calendar Year of order date (if order placed January-February);
the balance due 30 days thereafter.
SELLER SHALL BE PROVIDED MAXIMUM FLEXIBILITY IN SCHEDULING DELIVERY OF EARLY BUY
ORDERS.
[Attached map shows the United States with a line which follows the southern
border of Maryland, West Virginia, Ohio, Indiana, Illinois, Missouri, Kansas,
Colorado and Utah, continues through Nevada at the same lattitude as the Utah
border, travels north along the eastern border of California and travels west
across California at approximately the same lattitude as the northern border of
Missouri]
Exhibit 6.1
PRODUCT SPECIFICATIONS
1. Each Licensed Alliance Products which is a pesticide under FIFRA shall
conform to the then-currently US EPA approved Confidential Statement of
Formula for such Licensed Alliance Product. Each Licensed Alliance Product
which is not a pesticide under FIFRA shall conform to the manufacturing
formula of such Licensed Alliance Product delivered by Buyer to Seller
prior to the Commencement Date.
2. All Products shall meet or exceed net weights or net volumes specified
on packaging./1/
3. All Products shall be free of foreign matter./1/
4. Tablet Specifications:
---------------------
(a) Tablet weight for tablet Products:
(i) One inch tablets within 14-17 grams; and
(ii) Three inch tablets within 222-233 grams.
(b) Tablet hardness for tablet Products:
(i) One inch tablets between 45-55 PSI/2/; and
(ii) Three inch tablet between 175-222 PSI/3/.
(c) All wrapped tablet Products shall be sealed to the extent necessary to
fully contain the tablet.
(d) Tablet Products shall have clean, white, smooth surface free of
breaking and chipping other than normal breaking and chipping due to
shipping and handling within standard industry limits.
5. All Products shall conform to applicable federal, state and local statutes
and implementing regulations and guidelines (other than warranties implied
by operation of Uniform Commercial Code Sections 2-314 or 2-315 or any
state counterpart to such provisions).
_________________________
/1/ Weight variances and presence of foreign matter subject to governmental
requirements and standard industry tolerances.
/2/ As measured by PTC instrument model 409, Type D, ASTMD-2240.
/3/ As measured with AMTEK instrument, Mansfield and Green Division.
Exhibit 7.1
PERMITTED CUSTOMERS FOR ALLIANCE PRODUCTS
1. Xxxxxxxx/Houston
2. Xxxxxxxx/Tidewater
Exhibit 9.1
FIFRA REGISTRATIONS
EXHIBIT 9.1
FIFRA REGISTRATIONS
EPA *
OLYMPIC KLEAR OUT 42177-2
------------------------------------------------------------------------
OLYMPIC ALGAECIDE 7 1/2% 42177-3
------------------------------------------------------------------------
OLYMPIC DY-CLOR 42177-5
------------------------------------------------------------------------
OLYMPIC SWIM TABS 42177-6
------------------------------------------------------------------------
OLYMPIC CONCENTRATED ALGAECIDE 40X 42177-7
------------------------------------------------------------------------
OLYMPIC ALGAECIDE 20 42177-9
------------------------------------------------------------------------
XXXX XXXXX XXXXXX ALGAECIDE 40 42177-12
------------------------------------------------------------------------
XXXX XXXXX XXXXXX GUARD PLUS 42177-13
------------------------------------------------------------------------
OLYMPIC LTM 42177-14
------------------------------------------------------------------------
OLYMPIC POWER SHOCK 42177-15
------------------------------------------------------------------------
OLYMPIC DYCHLOR II 42177-16
------------------------------------------------------------------------
OLYMPIC CHLORINATING TABLETS 1" 42177-17
------------------------------------------------------------------------
OLYMPIC CHLORINATED TABLETS 3" 42177-18
------------------------------------------------------------------------
OLYMPIC ALGAECIDE 42177-19
------------------------------------------------------------------------
XXXX XXXXX XXXXXX ALGAECIDE 42177-20
------------------------------------------------------------------------
OLYMPIC CHLOR-O-SHOCK 42177-21
------------------------------------------------------------------------
OLYMPIC UNIVERSAL CHLORINATOR CARTRIDGE 42177-22
------------------------------------------------------------------------
OLYMPIC SKIMMER STICKS 42177-23
------------------------------------------------------------------------
OLYMPIC HYPO-CHLOR 125 42177-25
------------------------------------------------------------------------
OLYMPIC GRANULAR - 90 42177-26
------------------------------------------------------------------------
XXXX XXXXX XXXXXX PREP 42177-30
------------------------------------------------------------------------
EPA REG.$
---------------------------------------------------------
XXXX XXXXX XXXXXX GUARD 42177-31
---------------------------------------------------------
OLYMPIC ALGAECIDE 60 42177-32
---------------------------------------------------------
OLYMPIC ALGAECIDE 30 42177-33
---------------------------------------------------------
OLYMPIC ALGAECIDE 10 42177-34
---------------------------------------------------------
OLYMPIC ALGAE PREVENTOR 42177-35
---------------------------------------------------------
OLYMPIC POLY ALGAECIDE 50 42177-38
---------------------------------------------------------
OLYMPIC REST ASSURE WATERBED CONDITIONE 42177-39
---------------------------------------------------------
OLYMPIC BLACK ALGAECIDE 42177-40
---------------------------------------------------------
OLYMPIC ALGAEZONE PLUS 42177-44
---------------------------------------------------------
OLYMPIC SPA ALGAECIDE 42177-45
---------------------------------------------------------
XXXX XXXXX XXXXXX SHOCK 42177-49
---------------------------------------------------------
XXXX XXXXX XXXXXX ALGAECIDE 20 42177-51
---------------------------------------------------------
OLYMPIC POOL CHLOR 65 42177-53
---------------------------------------------------------
OLYMPIC SPA SHOCK 42177-54
---------------------------------------------------------
OLYMPIC SPA LITHO-CHLOR 42177-55
---------------------------------------------------------
OLYMPIC POWER SHOCK PLUS 42177-58
---------------------------------------------------------
OLYMPIC GRANULAR ALGAE OUT 42177-67
---------------------------------------------------------
