Exhibit 10.1
TOLLING AGREEMENT
This TOLLING AGREEMENT (this "Agreement") is entered into as of March 16,
2007, by and between BCP Ingredients, Inc., a corporation organized under the
laws of Delaware ("Balchem"), and Chinook Global Limited, a corporation
organized under the laws of Ontario, Canada (the "Manufacturer").
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Background Statement
Balchem is in the business of manufacturing and selling feed grade choline
chloride 60% dried on cereal carrier ("CC 60%") and 70% dried on cereal carrier
("CC 70%" and, together with CC 60%, the "Products"). The Manufacturer has the
capability to manufacture, package and store the Products on behalf of Balchem.
Balchem desires to engage the Manufacturer to manufacture, package and store the
Products for Balchem, and the Manufacturer desires to manufacture, package and
store the Products for Balchem, in accordance with the specifications and
quality standards, and upon the other terms and subject to the other conditions,
provided herein. This Agreement is being entered into in connection with the
closing of the transactions contemplated in the Asset Purchase Agreement, dated
the date hereof, between the parties hereto (the "Purchase Agreement").
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Statement of Agreement
The parties agree as follows:
1. Manufacture of Products.
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(a) Generally. During the term of this Agreement, using Raw Materials (as
defined below) supplied by Balchem as contemplated in Section 2, the
Manufacturer shall manufacture and package the Products for Balchem at such
times and in such quantities as provided in written orders ("Orders") submitted
to the Manufacturer by Balchem in accordance with the terms hereof. All Products
to be manufactured hereunder shall be manufactured at the Manufacturer's
facility in Xxxxxxxxxx, Xxxxxxx, Xxxxxx (the "Facility").
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(b) Orders. Each Order shall specify the amount and type of Products
requested and the requested date for completion and delivery of Products
pursuant to the Order. No Order shall require the completion and delivery Ex
Works the Facility of Products by the Manufacturer hereunder in less than five
business days unless the order can be filled from existing finished Products
inventory. With respect to Products that are to be shipped to destinations
outside of Canada or the United States, no Order shall require the completion
and delivery Ex Works the Facility of Products by the Manufacturer hereunder in
less than ten business days. In addition, no Order or combination of Orders
shall require (i) production of Products at the Facility on more than 4 business
days per week (each, a "Manufacturing Day") or (ii) the production of more than
250,000 pounds of CC 70% or more than 1,000,000 pounds of Product in the
aggregate over any one week period.
2. Raw Materials.
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(a) Supply by Balchem. Balchem agrees to supply and arrange for the
delivery to the Facility of, at Balchem's cost and expense, all of the raw
materials required for the manufacture, and all of the supplies and other
materials required for the packaging and storage, of the Products to be produced
hereunder (the "Raw Materials"); provided that the Manufacturer and Balchem
agree to reasonably cooperate and work together to determine and forecast Raw
Materials needs and to schedule delivery of Raw Materials, which delivery
schedule shall be subject to the ultimate control of the Manufacturer. Balchem
agrees to arrange for deliveries of Raw Materials to the Facility sufficient to
maintain the minimum Raw Materials inventory levels set forth on Exhibit A;
provided, however, that during any period in which any of the Raw Materials
inventory levels at the Facility exceed the maximum Raw Materials inventory
levels set forth on Exhibit A, Balchem shall not schedule, and the Manufacturer
shall have no obligation to accept, additional deliveries of Raw Materials,
unless agreed to the contrary in writing by the parties.
(b) Specifications. All Raw Materials supplied by Balchem hereunder shall
meet the applicable specifications, if any, set forth with respect to such Raw
Materials on Exhibit B attached hereto (the "Raw Materials Specifications").
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(c) Exclusive Use. The Manufacturer shall use all quantities of Raw
Materials which Balchem supplies, or for which Balchem arranges supply,
hereunder only for the manufacture of the Products hereunder for Balchem and
shall not use any such Raw Materials for any other purpose.
3. Title; Risk of Loss. Balchem shall hold title to, have full ownership
of, and bear all risk of loss with respect to all quantities of the Products
manufactured hereunder (including work in process) and all Raw Materials
delivered to the Manufacturer by Balchem hereunder. The Manufacturer agrees and
acknowledges that the Manufacturer shall have no title to any quantity of the
Products manufactured hereunder (including work in process) or any
Balchem-supplied Raw Materials delivered to the Manufacturer. At Balchem's
request, the Manufacturer shall execute (to the extent required by the
applicable jurisdiction), deliver and record such financing statements and other
instruments as Balchem may reasonably require to evidence and perfect Balchem's
title to all quantities of the Products manufactured hereunder (including work
in process) and all Balchem-supplied Raw Materials in the Manufacturer's
possession.
4. Quality Control.
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(a) All Products delivered to Balchem pursuant to an Order shall meet the
specifications for such Products set forth on Exhibit C attached hereto (the
"Specifications").
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(b) The Manufacturer shall comply with all applicable laws and regulations
and obtain all appropriate governmental approvals pertaining to the manufacture,
packaging and storage of the Products and Raw Materials hereunder.
(c) The Manufacturer shall, upon the written request of Balchem, supply
promptly to such address as specified in Balchem's request, a reasonable
quantity of samples of Products manufactured by the Manufacturer hereunder in
order to enable Balchem to perform any quality testing it wishes to perform with
respect thereto.
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(d) The Manufacturer shall maintain appropriate records regarding the
Products and the manufacture, testing, evaluation, quality compliance and
storage thereof, including, without limitation, batch records. The Manufacturer
shall permit Balchem, upon five days' advance written notice, during regular
business hours of the Manufacturer, to inspect such records.
(e) In addition to (d) above, Manufacturer shall permit Balchem
representatives (at Balchem's sole cost and expense) to be present in order to
inspect and/or witness the manufacture of Products hereunder upon two business
days' written notice to Manufacturer's plant manager or to Xxxxxx X. Xxxxx. Such
representatives' access to the Facility shall be reasonably unencumbered during
normal business hours.
5. Delivery.
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(a) Terms. The Manufacturer shall deliver the quantities of the Products
manufactured hereunder to Balchem Ex Works (INCOTEMS 2000) the Facility at such
times as Balchem shall request during normal business hours of the Facility,
which are 8:30 a.m. to 5:00 p.m. Monday through Thursday and 8:30 a.m. to 4:00
p.m. Friday. All costs and expenses related to the loading and shipping of Raw
Materials and the shipping and delivery of finished Products hereunder shall be
exclusively borne by Balchem. Notwithstanding the foregoing, the Manufacturer
shall load or arrange for the loading of all finished Products for shipment from
the Facility, as well as the unloading of Raw Materials at the Facility.
(b) Shipment. Balchem shall arrange for shipment of the quantities of the
Products manufactured by the Manufacturer for Balchem hereunder at such times,
and to such destinations, as Balchem determines. The Manufacturer shall
cooperate with Balchem, and provide such reasonable assistance as Balchem may
reasonably request, in connection with shipment of the Products manufactured
hereunder. The Manufacturer shall use such forms as Balchem may from time to
time provide for all shipping documents for Products manufactured hereunder and
shall, in any event, cause all shipping documents for Products manufactured
hereunder to identify Balchem as the shipper of such Products.
(c) Storage. The Manufacturer shall store all inventories of finished
Products and Raw Materials at the Facility in appropriate storage vessels until
shipment. Such storage shall be at no additional charge to Balchem. The parties
shall cooperate to manage finished Products and Raw Materials inventory levels;
provided, however, that the Manufacturer may, at its sole discretion, upon
prompt notice to Balchem, suspend production of the Products during any period
in which the finished Products inventory levels at the Facility exceed the
maximum finished Products inventory levels set forth on Exhibit D.
6. Acceptance and Rejection. Balchem or a customer of Balchem (a
"Customer") shall have the right to reject any portion of the Products delivered
to Balchem or such Customer that fails to meet the Specifications; provided that
Balchem or such Customer provide the Manufacturer with written notification of
any such rejection within 60 days after delivery of the Products to Balchem Ex
Works the Facility. If the Manufacturer has not received written notice of such
rejection within such 60 day period, the Products shall be deemed to have been
accepted.
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7. Price and Payment.
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(a) Price. The price for the services provided by the Manufacturer to
Balchem hereunder (the "Service Price") shall be (i) all of the actual
reasonable costs incurred by the Manufacturer in providing the services
hereunder during the term of this Agreement (the "Costs"), plus (ii) 10% of the
Costs. For clarity, the Costs shall include, without limitation, the costs
incurred in maintaining and operating the Facility (it being acknowledged and
agreed that the Facility is being operated and maintained over the term of this
Agreement for the sole purpose of providing these services to Balchem), all
direct salaries, wages and benefits costs for employees employed at the
Facility, a fixed fee of $9,091 per month for salaries, wages and benefits costs
of employees not employed at the Facility, and reasonable third party costs
involved in providing the services described herein. Conversely, the Costs shall
not include salaries, wages and benefits costs of employees not employed at the
Facility (except for the $9,091 per month fixed fee described in the preceding
sentence), logistics costs, customer service costs and insurance coverage for
loss of Product or Raw Materials. For the purpose of determining a maximum
monthly amount of Costs, the parties agree that the Costs shall not exceed, on
an individual monthly basis, the average monthly actual costs of manufacture of
Products produced by Manufacturer at the Facility during the immediately
preceding 12 month period; provided that production of Products during such
month does not exceed the average monthly amount of Products produced by
Manufacturer at the Facility during the immediately preceding 12 month period.
In addition, with respect to plant maintenance costs, the parties agree that (i)
any individual plant maintenance or capital project over $5,000 or any three
such projects in the aggregate greater than $10,000, shall be reviewed and
approved by Balchem prior to execution thereof, (ii) the notices and other
communications in connection with such review and approval may be oral
(including by telephone) or electronic (including by e-mail), and (iii) such
approval by Balchem shall be deemed to have been granted if the project
expenditure is not expressly disapproved within 6 hours of the approval request.
(b) Invoices and Payment. Within three business days after the execution
of this Agreement, Balchem shall pay to Manufacturer the sum of $150,000 as a
deposit toward the Service Price (the "Deposit"), which shall be applied to the
last month's charges hereunder as set forth below. On or before the 5th day of
each calendar month during the term of this Agreement, the Manufacturer shall
issue an invoice to Balchem for (i) the Service Price for the services provided
hereunder during the preceding month and (ii) any applicable goods and services
tax payable pursuant to the Excise Tax Act (Canada); provided that to the extent
the full Service Price for any month is not known by the date of such invoice,
the invoice shall be based on costs known as of such date, and additional costs
for such month may be included in the invoice for future months. Each such
invoice shall contain reasonably sufficient detail to allow Balchem to determine
the composition of the Service Price set out in such invoice. Balchem shall pay
each such invoice within five business days of the date of such invoice. All
such payments shall be made by electronic transfer of immediately available
funds to an account specified by the Manufacturer. Should Balchem fail to pay
the Deposit or any invoice when due, so long as such amount remains unpaid, (x)
interest shall accrue on the unpaid amounts at a rate equal to the lesser of 1.5
percent per month or the maximum rate permitted under applicable law and (y) the
Manufacturer may, at its sole discretion, suspend production and delivery of the
Products (with Balchem remaining liable for the full Service Price during any
such suspension). The Deposit shall be applied to the invoice for the Service
Price for the last month of the term of this
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Agreement, and if the Deposit exceeds the invoice amount for such month, the
Manufacturer shall promptly refund such excess to Balchem by electronic transfer
of immediately available funds to an account specified by Balchem. On a
quarterly basis, Balchem shall have the right to audit the books and records and
invoice support documentation of Manufacturer in order to verify and confirm the
Service Price upon two business days' written notice to Manufacturer.
8. Trademarks.
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(a) License. Part 1 of Exhibit E identifies certain trademarks (the
"Balchem Trademarks") owned by Balchem. Balchem hereby grants the Manufacturer,
during the term of this Agreement, a license to affix the Balchem Trademarks to
any shipping or other documentation and to the bags or other supplies for all
quantities of the Products manufactured by the Manufacturer hereunder.
(b) License. Part 2 of Exhibit E identifies certain trademarks (the
"Manufacturer Trademarks" and, together with the Balchem Trademarks, the
"Trademarks") owned by the Manufacturer which appear on bags and other supplies
purchased by Balchem from the Manufacturer pursuant to the Purchase Agreement,
which bags and other supplies will be used in the packaging and delivery of the
Products pursuant to this Agreement. The Manufacturer hereby grants Balchem,
during the term of this Agreement, a license to use the Manufacturer Trademarks,
as they appear on such bags and other supplies, in connection with sales of the
Products to Balchem's customers.
(c) Ownership of Trademarks. Each party acknowledges that the other party
owns such other party's Trademarks, agrees that such party will do nothing
inconsistent with such ownership, and agrees that all use of the other party's
Trademarks by such party and all goodwill developed therefrom shall inure to the
benefit of such other party. Neither party shall challenge the other party's
ownership of its Trademarks, and neither party shall use or register any name,
trademark or service xxxx identical to, resembling or confusingly similar to any
of the other party's Trademarks. Each party agrees that nothing in this
Agreement shall give such party any right, title or interest in the other
party's Trademarks other than the right to use the Trademarks in accordance with
this Section 8.
9. Warranties; Limitation of Liability.
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(a) Warranties. The Manufacturer warrants that all quantities of each
Product manufactured and packaged for Balchem hereunder pursuant to an Order
shall have been manufactured and delivered in compliance with such Order and
shall comply with the Specifications for such Product.
(b) WARRANTY LIMITATION. EXCEPT AS PROVIDED IN SECTION 9(a), THE
MANUFACTURER MAKES NO WARRANTY TO BALCHEM WITH RESPECT TO ANY QUANTITY OF THE
PRODUCTS MANUFACTURED HEREUNDER, WHETHER EXPRESS OR IMPLIED, OR ARISING BY
STATUTE OR OTHERWISE IN LAW OR FROM A COURSE OF DEALING OR USAGE OF TRADE. THE
MANUFACTURER SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY,
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NON-INFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THE
PRODUCTS.
(c) Limitation of Liability. All and any liability (including any
indemnification obligation) as stipulated in this Agreement of the Manufacturer,
shall be limited in accordance with this Section 9(c). If any quantity of the
Products manufactured hereunder is found to breach any of the warranties
contained in Section 9(a), the Manufacturer's sole and exclusive obligations and
liabilities shall be limited to issuance of credit for or replacement of such
quantity that is other than as warranted, plus any freight costs related to
replacing said such quantity that is other than as warranted, plus any
reasonable costs related to the disposal of or return and storage of any such
defective Products. The Manufacturer shall not have any liabilities or
obligations under the warranties contained in Section 9(a) (i) if Balchem does
not provide the Manufacturer with written notice of the claimed breach within
the 45 day period described in Section 6, (ii) if the applicable quantity of
such Product has been damaged by anyone other than the Manufacturer, or (iii) if
the applicable quantity of such Product has defects attributable in any way to
abuse, misuse or mishandling by anyone other than the Manufacturer, including
defects attributable to defective Raw Materials that Manufacturer could not have
reasonably prevented with reasonable due diligence. The Manufacturer's maximum
aggregate liability (including any indemnification obligation) under this
Agreement whether based on breach of contract or in tort (including negligence)
under any warranty or otherwise shall in no event exceed the purchase price of
the services provided by the Manufacturer with respect to which any related
claim is made. EXCEPT FOR ANY INDEMNIFICATION OBLIGATION ARISING UNDER SECTION
10 FOR CONSEQUENTIAL DAMAGES INCURRED IN CONNECTION WITH ANY PERSONAL INJURY
CLAIMS MADE BY THIRD PARTIES, UNDER NO CIRCUMSTANCES SHALL THE MANUFACTURER BE
LIABLE TO BALCHEM FOR ANY CONSEQUENTIAL, INCIDENTAL, PUNITIVE, INDIRECT OR
SPECIAL DAMAGES, INCLUDING WITHOUT LIMITATION DAMAGE TO REPUTATION, LOST
BUSINESS OPPORTUNITIES, LOST PROFITS, MENTAL OR EMOTIONAL DISTRESS OR
INTERFERENCE WITH BUSINESS OPERATIONS, RELATED TO THIS AGREEMENT.
10. Indemnification; Insurance.
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(a) By the Manufacturer. Subject to the limitations set forth in Section
9(c), the Manufacturer shall indemnify, defend and hold Balchem harmless from
and against any and all claims, damages, liabilities, losses, judgments, awards,
settlements, orders, costs and expenses of every sort, including, without
limitation, expenses of investigation, reasonable attorneys' fees and costs of
litigation, resulting from or arising out of (i) any breach in performance by
the Manufacturer hereunder, (ii) the infringement of any patent or other
intellectual property rights of a third party with respect to the process used
by the Manufacturer to manufacture the Products, or (iii) the infringement of
any trademark rights of any third party by the appearance of any Manufacturer
Trademark on any labels or packaging materials for the Products.
(b) By Balchem. Balchem shall indemnify, defend and hold the Manufacturer
harmless from and against any and all claims, damages, liabilities, losses,
judgments, awards, settlements, orders, costs and expenses of every sort,
including, without limitation, expenses of investigation, reasonable attorneys'
fees and costs of litigation, resulting from or arising out of
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(i) any claim relating to the Products produced by the Manufacturer and
delivered to Balchem except to the extent that such claim arises out of the
failure by the Manufacturer to manufacture such Products in accordance with the
Specifications and other requirements set forth in this Agreement, (ii) any
breach in performance by Balchem hereunder or (iii) the infringement of any
trademark rights of any third party by the appearance of any Balchem Trademark
on any labels or packaging materials for the Products.
(c) Insurance. During the term of this Agreement, each party hereto shall
maintain commercial general liability insurance with per occurrence limits of
not less than CAD1,000,000 and products liability insurance with per occurrence
limits of not less than CAD1,000,000 for property damage, bodily injury or
death. Each party agrees to name the other party as an additional insured with
respect to the Products and the Facility, at no premium cost to the other party.
Each party shall provide the other party, when reasonably requested, with
certificates evidencing the existence of such insurance and providing that such
insurance will not be cancelled without at least ten days' written notice to the
other party.
11. Term and Termination.
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(a) Term. Subject to earlier termination of this Agreement in accordance
with Section 11(b) and subject to extension as provided in Section 12(d), the
term of this Agreement shall begin on the date hereof and shall end on the
one-year anniversary of the date hereof.
(b) Termination. This Agreement may be terminated prior to end of the term
set forth in Section 11(a):
(i) by mutual written consent of Balchem and the Manufacturer;
(ii) by Balchem, in its sole discretion, upon 30 days' written
notice to the Manufacturer at any time after the six-month anniversary of
the date hereof;
(iii) by Balchem upon delivery of written notice to the
Manufacturer, if the Manufacturer (A) persistently fails to supply and
deliver in a timely manner quantities of the Products required by Orders
that conform to the Specifications for such Products and with respect to
which Raw Materials are provided in a timely manner as set forth herein,
or (B) commits a material breach of this Agreement and such breach is not
cured within 30 days after Balchem gives the Manufacturer written notice
thereof;
(iv) by the Manufacturer upon delivery of written notice to Balchem,
if Balchem (A) persistently fails to supply and deliver in a timely manner
quantities of the Raw Materials, conforming to the Raw Materials
Specifications, required for the manufacturer of the Products hereunder,
(B) persistently fails to pay undisputed amounts due to the Manufacturer
hereunder in a timely manner, or (C) commits a material breach of this
Agreement and such breach is not cured within 30 days after the
Manufacturer gives Balchem written notice thereof; and
(v) by either party upon written notice to the other party, if the
other party (A) admits in writing its inability to pay its debts as they
mature, (B) makes an assignment for the benefit of any of its creditors,
(C) commences any proceeding in bankruptcy or for
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reorganization, or for the adjustment of any of its debts, and any such
proceeding is not discharged within 60 days of commencement, or (D) has a
receiver, custodian or trustee appointed for any substantial portion of
its assets, or has any proceeding commenced for its dissolution or
liquidation, and such receiver, custodian or trustee is not discharged
within 60 days of appointment or such proceeding is not discharged within
60 days of commencement.
(c) Effect of Termination. Termination of this Agreement shall not affect
any right, obligation or remedy of a party accruing prior to the effective date
of termination; provided, however, that if a party terminates this Agreement
pursuant to Section 11(b)(iii), 11(b)(iv) or 11(b)(v), such terminating party
may also elect to terminate any Order outstanding as of the effective date of
such termination by stating in the terminating party's termination notice that
the terminating party has so elected. Notwithstanding anything to the contrary
contained in this Agreement, this Section 11 and Sections 3, 8(c), 9, 10 and 12
of this Agreement shall survive any termination of this Agreement.
12. General Provisions.
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(a) Notice. Except as specifically set forth herein, any notice required
or permitted to be given under this Agreement shall be deemed to have been given
for all purposes hereunder if given in writing and delivered by hand, by
certified mail return receipt requested, by a nationally recognized express
courier service or by confirmed facsimile transmission, in each case addressed
as follows:
if to Balchem: BCP Ingredients, Inc.
x/x Xxxxxxx Xxxxxxxxxxx
00 Xxxxxxx Xxxx Xxxx
XX Xxx 000
Xxx Xxxxxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxx
President
Facsimile (000) 000-0000
Copies to:
Balchem Corporation
00 Xxxxxxx Xxxx Xxxx
XX Xxx 000
Xxx Xxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxx, General Counsel
Facsimile: (000) 000-0000
if to the Manufacturer: Chinook Global Limited
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000 Xxxx Xxxx X.,
Xxxxxx, XX., Xxxxxx
X0X 0X0
Attn: Xxxxxx X. Xxxxx CFO
Copies to:
Xxxx X. Xxxx
00 Xxxxxxxxx Xx.,
Xxxxxxxxx, XX 00000
Xxxxxxxx, Xxxxxxxx & Xxxxxx, P.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
Xxxxxxxx Xxxxx, LLP
000 Xxxxxx Xx.,
Xxxxxx, XX., Xxxxxx
X0X 0X0
Attn: J Xxxxx Xxxxxx
Facsimile: (000) 000-0000
or to such other address for a party as such party shall designate by written
notice to the other party given in accordance with this Section 12(a). Any such
notice shall be deemed to have been given upon receipt on the day of delivery
when delivered by hand, on the third business day after dispatch if sent by
certified mail, on the first business day after dispatch if sent by express
courier, when transmitted if sent by confirmed facsimile transmission on a
business day and on the first business day after transmission if sent by
confirmed facsimile transmission on a day that is not a business day.
(b) Taxes. Balchem shall be obligated to pay all, and shall not be
entitled to reimbursement from the Manufacturer for the amount of any, excise,
import, sales, use or other taxes or duties, any license fees or other charges
or increases thereof due in connection with the manufacture, packaging and
storage of the Products hereunder. Any charges for such taxes by Manufacturer
shall be net of any corresponding refunds of such taxes received by
Manufacturer.
(c) Regulatory Filings. Balchem shall fulfill all approval and reporting
requirements of applicable federal, state and provincial regulatory agencies
with respect to the sale of the Products supplied by the Manufacturer hereunder,
provided that the Manufacturer shall cooperate with Balchem in providing any
data or other information readily available to the Manufacturer concerning the
Products which will enable Balchem to secure the approvals necessary for the
Products.
(d) Force Majeure. Neither party shall be liable hereunder for any delay
in performance on nonperformance hereunder to the extent such delay or
nonperformance is caused
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by an event, occurrence, or circumstance beyond such party's reasonable control,
including fire, flood, explosion, storm, hurricane, strike, lockout or other
labor dispute, shortage of raw materials, riot, war, rebellion, accidents,
natural catastrophe or other acts of God, or acts of governmental authorities
(each, a "Force Majeure Event"). A party delaying performance or failing to
perform hereunder due to a Force Majeure Event shall (i) promptly give the other
party written notice thereof, setting forth the cause and expected duration of
any delay and (ii) take necessary actions to eliminate, cure and overcome such
cause to the extent possible and resume performance hereunder. If one or more
Force Majeure Events occur during the term of this Agreement, the term shall be
automatically extended for the period or periods during which a party's
performance is delayed or prevented by such event or events. In addition, during
the continuation of a Force Majeure Event affecting the Manufacturer, to the
extent requested by Balchem, the Manufacturer shall assist Balchem, at Balchem's
expense, in arranging for the manufacture, packaging and storage of Products by
a third party acceptable to Balchem in quantities sufficient to meet Balchem's
requirements for Products during the continuation of such event. "Force Majeure
Events" shall include, in the case of Manufacturer, the disapproval by Balchem
of a plant maintenance or capital project pursuant to Section 7(a), but the
preceding three sentences shall not apply to any such Force Majeure Event.
(e) Confidential and Proprietary Information. The parties agree not to
disclose to any third party (but specifically excluding any affiliates or
representatives of the parties) and not to use, except for the purpose of this
Agreement, any technical or commercial information of a confidential or
proprietary nature that is not generally known in the industry and that is first
made available to either of the parties by the other party or which either party
may have learned from the other party in the course of this Agreement
("Confidential Information"). Notwithstanding the foregoing, a party may
disclose any Confidential Information of the other if required by law or
judicial process; provided, the party subject to such law or process notifies
the other party and reasonably cooperates, at the other party's expense, in
efforts to prevent or limit such disclosure. This provision shall survive any
termination of this Agreement and shall continue with respect to any
Confidential Information for two years.
(f) Governing Law; Jurisdiction. This Agreement shall be governed by the
substantive laws of the State of Delaware, without regard to the conflicts of
laws principles thereof. The state and federal courts located in the Eastern
District of Michigan shall have exclusive jurisdiction over any disputes arising
under this Agreement. The United Nations Convention on Contracts for the
International Sale of Goods shall not govern this Agreement, the performance of
any obligations hereunder or any aspect of any dispute arising hereunder.
(g) Relationship Of Parties. The Manufacturer is and shall remain an
independent contractor with respect to Balchem. Neither the Manufacturer nor
Balchem shall be considered the agent of the other for any purpose whatsoever,
and neither the Manufacturer nor Balchem has any authority to enter into any
contracts or assume any obligations for the other or to make any warranties or
representations on behalf of the other. Nothing in this Agreement shall be
considered to establish a partnership or joint venture relationship between the
Manufacturer and Balchem.
(h) Amendment; Conflicting Terms. This Agreement may be amended only by
means of a writing signed by both parties hereto. The terms of this Agreement
shall control over
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any inconsistent terms contained in any form of Order, purchase order or
acknowledgement issued by either party. If any offer, acceptance, Order,
purchase order or acknowledgement contains any terms or conditions that are
inconsistent with those contained herein, such terms and conditions are hereby
rejected by both parties hereto. The parties may vary or deviate from the terms
of this Agreement with respect to any Order only by means of a writing, signed
by both parties, that expressly refers to this Agreement and states that the
terms of such Order take precedence over this Agreement.
(i) Waivers. Except as otherwise provided in this Agreement, any failure
of either party to comply with any obligation, representation, warranty,
covenant, agreement or condition herein may be waived by the other party only by
a written instrument signed by the party granting such waiver, but such waiver
or failure to insist upon strict compliance with such obligation,
representation, warranty, covenant, agreement or condition shall not operate as
a waiver of, or estoppel with respect to, any subsequent or other failure.
(j) Entire Agreement. This Agreement, including the Exhibits attached
hereto, constitutes the entire Agreement between the parties with respect to the
subject matter hereof and supersedes any prior or other agreements or
understandings between the parties with respect thereto.
(k) Severability. Any part of this Agreement held to be invalid or
unenforceable shall be deemed ineffective to the extent thereof without
affecting the validity or enforceability of any other part of this Agreement.
(l) Assignment; Third-Party Rights. Neither party may assign this
Agreement or delegate any of its obligations hereunder without the prior written
consent of the other party, which consent shall not be withheld unreasonably;
provided, however, that either party may assign this Agreement without the
consent of the other party to any purchaser of all or substantially all of the
assets of the party wishing to make such assignment. This Agreement and its
provisions are for the sole benefit of the parties to this Agreement and their
successors and permitted assigns and shall not give any person or entity any
legal or equitable right, remedy or claim.
(m) Counterparts; Execution. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The exchange of copies of
this Agreement and of signature pages hereto by facsimile or e-mail transmission
shall constitute effective execution and delivery of this Agreement, and such
copies may be used in lieu of the original Agreement for all purposes.
Signatures of the parties transmitted by facsimile or e-mail shall be deemed to
be their original signatures for all purposes.
(n) Currency; Setoff. All payments required to be made by a party
hereunder shall be made in United States Dollars and the use of the dollar sign
herein and all other references to dollars herein are references to United
States Dollars unless specifically provided otherwise herein. The parties
expressly agree that Balchem shall not be entitled to set off any amounts due by
Balchem to the Manufacturer hereunder or pursuant to any other agreement between
Balchem
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and the Manufacturer against any amounts due from the Manufacturer to Balchem
hereunder or pursuant to any other agreement between Balchem and the
Manufacturer.
(o) Interpretation. The section and subsection headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not in any way affect the meaning or interpretation of
this Agreement.
[Signatures on following page.]
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IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute and deliver this Tolling Agreement as of the date
first set forth above.
BCP INGREDIENTS, INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: President
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CHINOOK GLOBAL LIMITED
By: /s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
--------------------------------------
Title: CFO
-------------------------------------
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