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EXHIBIT 10.3
MEMORANDUM OF AGREEMENT
made and entered into by and between
SASOL CHEMICAL INDUSTRIES (PTY) LTD
a company incorporated under the laws of
the Republic of South Africa, having its
registered office at 0 Xxxxxxx Xxxxxx, Xxxxxxxx,
0000 Xxxxxxxx xx Xxxxx Xxxxxx
(hereinafter referred to as SASOLCHEM)
and
JLM MARKETING INCORPORATED
a company incorporated under the laws of the
State of Delaware, United States of America,
having its registered office at
0000 Xxxxxx Xxxxx Xxxxxxx, XXXXX, XX 00000
Xxxxxx Xxxxxx of America
(hereinafter referred to as JLM)
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WHEREAS SASOLCHEM is a producer of ACETONE, hereinafter referred to as the
PRODUCT;
WHEREAS SASOLCHEM desires to export the PRODUCT to JLM for the marketing
of the PRODUCT in the USA and Canada; and
WHEREAS JLM is willing to purchase the PRODUCT from SASOLCHEM for the
marketing of the PRODUCT in the USA and Canada.
NOW, therefore, the parties have agreed as follows:
1 SALE AND PURCHASE
SASOLCHEM hereby agrees to sell the PRODUCT to JLM and JLM agrees to
purchase the PRODUCT from SASOLCHEM. Product supplied to JLM in
terms of this Agreement shall only be marketed by JLM in the USA and
Canada. JLM agrees not to sell the PRODUCT into any other market
unless prior approval is obtained from SASOLCHEM.
2 DURATION
This Agreement shall become effective on 1 July 1992 and shall
continue on an evergreen basis until terminated by either party by
giving 6 (six) months' written notice of termination to the other
party. No such notice of termination shall, however, be given so as
to take effect before 31 December 1993.
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3 QUALITY
SASOLCHEM shall supply the PRODUCT, at the point of sale as defined
in Clause 4(a), in conformity with the specification of the PRODUCT
as set out in Annexure "A" hereto.
4 TERMS OF SALE AND PRICE
(a) SASOLCHEM shall supply the PRODUCT to JLM on a CIF USA port basis,
unless the parties mutually agree otherwise. Ownership and risk in
the PRODUCT shall pass to JLM at the inlet flange (the point of
sale) of the vessel where the PRODUCT is loaded in Durban (Incoterms
latest edition to apply).
(b) JLM shall purchase the PRODUCT from SASOLCHEM and sell it in its own
name and for its own account.
(c) Sales are to be made and invoiced by SASOLCHEM to JLM at the
provisional price for the PRODUCT as agreed between the parties for
each calendar quarter before the middle of each preceding quarter.
In case the parties do not agree on the provisional price, the final
price of the preceding calendar quarter shall be the provisional
price for the new calendar quarter.
(d) Payment for the PRODUCT shall be made by JLM to SASOLCHEM within 45
days after the Xxxx of Lading date.
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Payment of all amounts owing in terms of this Agreement shall be
made in US Dollars at such Bank in the Republic of South Africa, or
elsewhere, as SASOLCHEM may from time to time nominate, free of any
bank commission outside the Republic of South Africa, or any other
deduction whatsoever.
(e) The provisional price agreed for each calendar quarter in accordance
with Clause 4(c) shall be subject to review and adjustment by the
end of the month immediately following each calendar quarter. The
provisional price shall be weighted in accordance with the agreed
volume split between the different end-users and the different
geographic areas supplied to. In order to determine the final price
for each quarter, JLM shall advise SASOLCHEM, by means of an audited
certificate if so requested by SASOLCHEM, of JLM's selling prices of
the PRODUCT to the methyl methacrylate and solvent industries in the
USA and Canada for each quarter.
The final CIF, USA port, duty unpaid price for each quarter shall be
calculated as follows:
JLM's average delivered selling price of the PRODUCT for each
quarter,
minus actual pipeline, barge, storage and surveying costs
minus duty paid by JLM
minus finance charges for 30 days calculated at the prime bank rate
in the USA
= CIF USA port duty unpaid price.
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A commission of *** of the CIF, duty unpaid price, shall be paid to
JLM.
Any difference between the final price as calculated above and the
provisional price as determined in accordance with Clause 4(c),
shall be adjusted, ie in case the final price is higher than the
provisional price fixed for each quarter, JLM shall pay the
additional amount to SASOLCHEM and in case the final price is lower
than the provisional price for each quarter, SASOLCHEM shall pay the
amount owing to JLM. All settlements shall be effected within 15
days after the final figures have been submitted.
5 QUANTITIES
SASOLCHEM shall advise JLM during October of each year of the
quantity of the PRODUCT SASOLCHEM estimates to be available for
export to JLM during the following calendar year. JLM shall in turn
advise SASOLCHEM whether or not it expects to be able to sell the
estimated volume to the methyl methacrylate industry.
By not later than the middle of each quarter the parties shall
negotiate the actual quantities of the PRODUCT to be shipped during
the following quarter.
The quantities of the PRODUCT to be shipped each calendar year shall
be spread as evenly as possible between the four quarters.
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SASOLCHEM advises JLM that the estimated quantity available for
calendar year 1993 is 25 000 (TWENTY-FIVE THOUSAND) metric tons. The
MMA : Solvents ratio will be 30:70 for 1993. No Sasol acetone will
be supplied into the solvents distribution market in the US Gulf
during 1993. New Jersey and Wilmington will only be supplied with
acetone into the solvents distribution market.
6 SECRECY
JLM shall not reveal during the currency of this Agreement or after
its expiry or termination, the trade secrets of SASOLCHEM nor use
such secrets otherwise than for purposes of the implementation of
this Agreement.
7 APPLICABLE LAW/ARBITRATION CLAUSE
The Agreement shall be governed by English (UK) law. Any dispute
hereunder that cannot be settled amicably shall be submitted to
arbitration of the International Chamber of Commerce. The place of
arbitration shall be London.
8 LIABILITY
SASOLCHEM shall not be liable for any damage suffered by anyone as a
result of the use of the PRODUCT sold under this Agreement either in
its form as sold or in a processed form or otherwise and in
particular
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SASOLCHEM shall not be liable for consequential damage of any kind
including, but not limited to, product liability or loss of profit.
Against claims in respect of all the foregoing JLM undertakes to
fully indemnify and hold SASOLCHEM harmless, which indemnity and
holding harmless shall also encompass legal costs of any nature,
including costs as between attorney and client. Unless JLM notifies
SASOLCHEM of any claim for damages within 60 (SIXTY) days after
JLM's receipt in the USA of the PRODUCT, provided that for any cause
of damage not reasonably discoverable within such 60 day period, any
claim of damages must be made within 180(ONE HUNDRED AND EIGHTY)
days after JLM's receipt in the USA of the PRODUCT JLM has notified
SASOLCHEM that JLM has insurance coverage against liability.
9 FORCE MAJEURE
Neither of the parties shall be held liable in respect of failure to
fulfil its obligations in terms of this Agreement, when, but only
for as long as, such failure is caused by or arises from force
majeure such as, but not limited to, the lawful order of a state,
war, civil commotion, riots, insurrection, strikes, lock-outs,
fires, explosions, floods, or other like circumstances, in so far as
any of the aforementioned events is beyond its control, arises after
conclusion of this Agreement and has not been wholly or partially
caused by its negligence or that of its contractors, agents,
employees or functionaries.
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In such cases the affected party shall immediately notify the other
party of such failure and shall use its best endeavours to remove
the said circumstances with the least delay possible, so that the
contractual obligations can, as soon as possible, be fulfilled in
the manner provided for.
10 INCORRECT OR DEFECTIVE PRODUCT
Should SASOLCHEM deliver PRODUCT which does not comply with the
specification contained in this Agreement, SASOLCHEM shall replace
at SASOLCHEM'S cost, the delivered PRODUCT by the correct one or one
complying with the said specification. The parties shall jointly
decide how best to sell or dispose of PRODUCT delivered that does
not comply with the specification.
The parties shall jointly decide how best to sell or dispose of
PRODUCT by the correct one or one complying with the said
specification. The incurred selling or disposal costs shall be for
SASOLCHEM's account.
11 NOTICES AND DOMICILIUM
For all purposes arising out of this Agreement, the parties hereby
choose domicilium citandi en executandi respectively as follows:
SASOL CHEMICAL INDUSTRIES (PTY) LTD
0 XXXXXXX XXXXXX
XXXXXXXX
XXXXXXXXXXXX 0000
XXXXXXXX XX XXXXX XXXXXX
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JLM MARKETING INC.
0000 XXXXXX XXXXX XXXXXXX
XXXXX, XX 00000
XXXXXX XXXXXX OF AMERICA
Either party may from time to time change its domicilium by notice
in writing to the other party.
SIGNED AT JOHANNESBURG on this the 11th day of January 1994
WITNESSES:
1 /s/ /s/
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for and on behalf of
SASOL CHEMICAL INDUSTRIES
(PTY) LTD
2 /s/
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SIGNED AT Tampa, Florida on this the 2nd day of March 1994
WITNESSES:
1 /s/ /s/
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for and on behalf of
JLM MARKETING INC.
2 /s/
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[SASOLCHEM LOGO]
ACETONE
EXPORT SALES SPECIFICATION
(CODE NO 221/10)
SPECIFICATION
PROPERTIES UNITS LIMITS TEST METHODS
COMPOSITION
Colour (Pt Co) Xxxxx + 5 max ASTM D1209
Appearance - Clear and free of sediment
Density at 20'C kg/l 0,789 - 0,792 ASTM D1298
Water Content mass % 0,3 max ASTM D1364
Acetone mass % 99,5 min
Ethanol mass % 0,005 max
Distillation at 101,3 kPa ASTM D86
Initial Boiling Point (degree C) 55,8 min
Dry Point (degree C) 56,6 max
Acidity as CH3COOH mass % 0,002 max ASTM D1613
Residue on Evaporation mass % 0,001 max ASTM D1353
Permanganate Test
at 25(degree)C minute 90 min ASTM D1363
USES:
As a solvent in the following applications:
lacquers, lacquer thinners, liquid printing inks, nail polish removers, in
the filling of acetylene cylinders, polyester resins, bituminous paints,
PVC cloth manufacture, adhesives and explosives.
A raw material for the manufacture of:
methyl iso-butyl ketone, di-acetone alcohol, hexylene glycol and fine
chemicals
Refining of petroleum products and manufacture of grease.
SASOLCHEM
ISSUE NO: DVDW 7/92
