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Exhibit 10.11
ARC CHEMICAL DIVISION
BALCHEM CORPORATION CONTRACT NO. 100197
SUPPLY/SERVICE AGREEMENT
THIS AGREEMENT IS ENTERED INTO THIS 29TH DAY OF SEPTEMBER, 1997, BY AND
BETWEEN ARC CHEMICAL DIVISION, BALCHEM CORPORATION, X.X. XXX 000, XXXXX XXXX,
XXX XXXX, 00000, (HEREINAFTER REFERRED TO AS "SELLER"), AND XXXXXXXX MICRO
SCIENCE, INC., (HEREINAFTER REFERRED TO AS "BUYER").
IN CONSIDERATION OF THE PROVISIONS SET FORTH HEREIN, SELLER AND BUYER AGREE
AS FOLLOWS:
1. Definitions. For the purposes of this Agreement the terms "Product",
"Current Requirements", "Container", "Buyer's Location", "Specification",
"Delivery and Shipment", "Price of Product", "Transportation Costs", and "Terms
of Payment" will have the respective meanings now or hereafter set forth in
Attachment A as incorporated herein and appropriately signed or initialed and
dated by the Buyer and Seller.
2. Sale and Purchase/Location(s). Seller shall sell and Buyer shall
purchase, on the terms and conditions set forth herein, Buyer's total present
and future requirements of Product during the term of this Agreement for use at
Buyer's location(s), and if any of the operations at Buyer's location(s) are
hereafter conducted at new or expanded location(s), the then current
requirements and the future requirements of Product at such location(s) will be
supplied by Seller to Buyer and purchased by Buyer pursuant hereto. Buyer's
Current Requirements of Product are as set forth in Attachment A. Buyer shall
keep Seller informed of any estimated changes in its Current Requirements.
3. Price and Payment. Seller will invoice Buyer and Buyer will pay
Seller for Product in accordance with the price of Product and Terms of Payment
set forth in Attachment A hereto. If Buyer fails to make timely payment in
accordance with the terms of this Agreement, or Buyer's credit becomes impaired,
as set forth in paragraph 11 hereof, Seller reserves the right to:
(a) Refuse to supply Product to Buyer under any order unless Buyer pays
cash in advance with order and/or makes payment in full of all
outstanding charges; and/or
(b) At the discretion of the Seller, assess and collect from Buyer a late
charge on any delinquent balance, computed as follows: 1.5% per month
on balances over 45 days; and/or
(c) Terminate or suspend this Agreement upon thirty (30) days written
notice to Buyer, if Buyer does not rectify within a thirty (30) day
period.
Buyer shall receive no credit or refund for Product which meets the
specifications set forth in Attachment B which is delivered to Buyer but not
used.
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4. Delivery of Product: Title. Product shall be delivered by Seller in
accordance with the Delivery and Shipment provisions of Attachment A. Title and
risk of loss shall pass to Buyer F.O.B. Buyer's facility. Seller's quantity
measurements taken at Seller's facility shall govern. Except as otherwise
provided for hereunder, all drums, cylinders and other containers in which
Product is delivered are and shall remain the property of Seller and are
returnable in good condition promptly after being emptied. Buyer shall pay
demurrage charges for any such items not promptly returned within a reasonable
amount of time. (Seller's policy is demurrage after 60 days.)
Seller will:
- Endeavor, upon receipt of reasonable advance notice, to deliver to
Buyer's location(s) such quantities of Product as are necessary to
supply Buyer's requirements at such location(s). If Seller is unable
to supply gas when required, Buyer has the right to obtain Product
from another source.
Buyer will:
- Monitor the inventory of Product at Buyer's location and regularly
advise Seller of the level thereof at each such location.
- Reimburse Seller upon Seller's request, additional costs incurred if,
during Product deliveries, Seller experiences frequent delays within
Buyer's control.
- Allow deliveries to be made twenty-four (24) hours per day, seven (7)
days per week. Buyer may request that delivery be made at specified
times, and if Seller is able to do so, Buyer shall then pay all
additional expenses incurred by Seller as a result.
Deliveries which may be made during a strike or other labor disturbance
affecting Buyer shall be at Buyer's sole risk, and Buyer hereby indemnifies and
holds Seller harmless from and against all of the costs, damages, liabilities or
claims arising out of or associated with any such delivery which are not
regularly incurred by Seller in the ordinary course of normal deliveries
hereunder.
5. Specifications. All Product delivered by Seller under this Agreement
shall conform to the specification set forth in Attachment A hereto.
6. Price Adjustment. See Attachment A.
7. Taxes. Taxes imposed upon the storage, sale, transportation,
delivery, use or consumption of Product, or any other tax, howsoever denominated
and measured involving Product, shall be paid directly by Buyer, or if paid by
Seller, shall be invoiced to Buyer as a separate item and paid by Buyer to
Seller.
8. Seller's Warranty. Seller warrants that the Product delivered to
Buyer shall conform to the specification set forth on Attachment A hereto and
that at the time of delivery Seller shall have good title to and the right to
transfer such Product and that the same shall be delivered free of encumbrances
and that the drums in which the Product will be delivered will be
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appropriate for containing the Product and will be free from defects and leaks.
THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESSED OR
IMPLIED, INCLUDING WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
9. Limitation of Liability. Buyer acknowledges that there are hazards
associated with the use of the Product, that it has received Seller's current
Material Safety Data Sheet, that it understands such hazards, and that it is the
Buyer's responsibility to warn and protect its employees, independent
contractors, invitees, and others exposed to such hazards through Buyer's
storage and use of the Product. Buyer assumes all risk and liability for loss,
damage or injury to persons or to property of Buyer or the other persons arising
out of the presence of or use of the product provided such loss is not due to
Seller's negligence.
Seller's sole liability and Buyer's exclusive remedy for the non-delivery
of Product, or for the delivery of Product not conforming to the specification
(and which Seller does not elect to replace with conforming Product) shall be
limited to the purchase price of the quantity of Product. In no circumstances
shall Seller be liable, whether in contract or tort or otherwise, for any
incidental or consequential damages, including loss of use, loss of work in
process, down time or loss of profits.
In the case of non-delivery of Product, Seller is liable for [ * ] of
difference between the purchase price of the Product, if the Seller had
supplied, and the price actually paid by the Buyer for the Product from another
source.
Buyer will receive documents from Seller, including Seller's Material
Safety Data Sheet and any revision thereof, containing safety and health
information pertaining to Product, and Buyer will incorporate such information
into Buyer's safety program.
Each party hereby agrees to indemnify and hold the other party, its
affiliates and their respective employees, officers and directors harmless from
any actions, lawsuits, demands, claims, losses, expenses, costs, including but
not limited to legal fees, and damages, arising from the injury, illness or
death of the indemnifying party's employees while engaged in any activities
related to the Product(s) supplied by Seller under this Agreement, unless such
claims are incurred by any of them arising out of the other party's negligence
or its breach of its obligations hereunder.
10. Force Majeure. Neither party hereto shall be considered in default
in the performance of its obligations hereunder (other than its obligation to
make any payment of money hereunder), or be liable in damages or otherwise for
any failure or delay in performance which is due to strike, lockout, concerted
act of worker's or other industrial disturbance, fire, explosion, flood or other
natural catastrophe, civil disturbance, riot or armed conflict, whether
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*Confidential Treatment requested; material filed separately with Commission.
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declared or undeclared, curtailment, shortage, rationing or allocation of normal
sources of supply of labor, materials, transportation, energy, or utilities,
machinery or equipment breakdown, abnormal transportation, energy, or utilities,
machinery or equipment breakdown, abnormal demand, lack of transportation or
distribution equipment, accident, Act of God, delay of Seller's suppliers,
subcontractors, or vendors, sufferance of or voluntary compliance with acts of
government and government regulations (whether or not valid), embargoes or any
other similar or dissimilar cause which is beyond the reasonable control of the
party affected.
Neither party hereto shall be required to make any concession or grant any
demand or request to bring to an end any strike or other concerted act of
worker's.
Either party affected by an event described in this paragraph shall,
promptly upon learning of such event and ascertaining that it has or will affect
its performance hereunder, give notice to the other party, stating the nature of
the event, its anticipated duration and any action being taken to avoid or
minimize its effect.
Seller may during any period of shortages prorate the Product among its
various customers.
11. Impairment of Credit. The following activities make an impairment of
credit: any action that is brought by or against Buyer under any present or
future bankruptcy or insolvency laws seeking any reorganization, arrangement,
readjustment, liquidation, dissolution or similar relief with respect to Buyer,
or Buyer makes any assignment for the benefit of creditors, or a receiver is
appointed for Buyer, or Buyer shall fail to make payments in accordance with the
terms of this Agreement, or, Buyer's credit has been impaired.
12. Claims. Buyer shall inspect Product immediately after Product
arrives at Buyer's location(s). Buyer's failure to give notice of any claim
within thirty (30) days after the arrival of Product at Buyer's location(s)
shall constitute an unqualified acceptance by Buyer of such Product and a waiver
of Seller's claims in respect thereof.
13. Assignment. This Agreement shall be binding upon the parties and
their heirs, administrators, executors, acquirers, successors, and assignees of
either party.
14. Notice. Any notices, unless otherwise provided herein, will be in
writing. Any notice by letter under this Agreement will be deemed given on the
date such correspondence is posted.
15. Applicable Law. This Agreement is to be interpreted in accordance
with the laws of the State of New York as in effect for agreements made and
performed in New York.
16. Term. This Agreement will be in effect October 1, 1997 and will
continue in effect for a period of seven (7) years.
17. Prior Agreement. This Agreement supersedes any prior agreement or
agreements between Buyer and Seller for delivery of Product to Buyer's
Location(s), but this Agreement shall not be construed as a renunciation or
discharge of any claim in damages for an antecedent breach.
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18. Entire Agreement. This Agreement supersedes any prior agreement
between the parties relating to the delivery of Product. No modification or
waiver of, or addendum to this Agreement shall bind Seller unless expressly set
forth in writing and signed and accepted by an authorized representative of
Seller.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the dates above.
Submitted by: Xxx Xxxxxx
TITLE: Sales & Marketing Mgr., Arc Chemical
DATE: September 25, 1997
BUYER'S ACCEPTANCE: SELLER'S ACCEPTANCE:
XXXXXXXX MICRO SCIENCE, INC. ARC CHEMICAL DIVISION
BALCHEM CORPORATION
BY: /s/ Xxxxx X. Xxxx BY: /s/ Xxxx X. Xxxxx
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TITLE President TITLE: President
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DATE: 10-30-97 DATE: 10-29-97
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ATTACHMENT A
ARC CHEMICAL DIVISION BALCHEM CORPORATION
INDUSTRIAL GAS SUPPLY AGREEMENT
IN THE AGREEMENT, CONTRACT NO. 1000197 AND DATED THE 29TH DAY OF SEPTEMBER, 1997
PRODUCT MEANS: Drummed 100% Ethylene Oxide
BUYERS LOCATION(S) MEANS: Total requirements for Customer location(s) in US and
Canada
SPECIFICATION MEANS: See attached Specification sheet (Attachment B)
CURRENT REQUIREMENTS MEANS: As required by Customer for location(s)
CONTAINER MEANS: 400 pound DOT Spec Packaging 5P drums
DELIVERY AND SHIPMENT MEANS: as required
PRICE OF SHIPMENT IS: [ * ]
TRANSPORTATION COSTS ARE: Included in the price of the product, FOB Buyer
TERMS OF PAYMENT MEANS: Net 30 days
REMARKS:
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BUYER SELLER
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XXXXXXXX MICRO SCIENCE, INC. ARC CHEMICAL DIV. BALCHEM CORP.
ACCEPTED ACCEPTED
BY: /S XXXXX X. XXXX BY: /S/ XXXX X. XXXXX
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TITLE: PRESIDENT TITLE: PRESIDENT
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DATE: 10-30-97 DATE: 10-29-97
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* Confidential Treatment requested; material filed separately with the
Commission.
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ATTACHMENT "B"
ARC CHEMICAL DIVISION BALCHEM CORPORATION
X.X. XXX 000, XXXXX XXXX, XX 00000 - TEL. 000-000-0000; FAX 000-000-0000
PURCHASE SPECIFICATIONS
ETHYLENE OXIDE
Specification Limits
1. Acidity 20 PPM by weight, maximum, calculated as ascetic
acid. This is equivalent to 0.019 mg KOH per mg.
sample.
2. Aldehydes 30 PPM by weight, maximum, calculated as acetaldehyde.
3. Carbon Dioxide 50 PPM by weight, maximum.
4. Water 25 PPM by weight, maximum.
5. Residue 0.005 gm. Per 100 ml., maximum.
6. Color 10 maximum.
platinum-cobalt, Sunoco
APHA, BASF
7. Suspended Matter Substantially free.
8. Ethylene Oxide 99.9%, minimum.
(Purity by difference)
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[ * ]+
_______________________
* Confidential Treatment requested; material filed separately with the
Commission.
+ One page omitted.
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