EXHIBIT 99(c)
Certain confidential information has been omitted from this Exhibit
pursuant to a confidential treatment request filed separately with the
Commission. The omitted information is indicated by the symbol "***" at each
place in the Exhibit where the omitted information appeared in the original.
PAPERBOARD SUPPLY AGREEMENT
This PAPERBOARD SUPPLY AGREEMENT (this "Agreement") is entered into
effective the 14th day of May, 1998, by and among REPUBLIC PAPERBOARD COMPANY, a
Kansas corporation (hereinafter referred to as "Republic"), REPUBLIC GROUP
INCORPORATED, a Delaware corporation ("Republic Parent"), and XXXXX XXXXXX
GYPSUM, INC., a Nevada corporation (hereinafter referred to as "Xxxxxx");
W I T N E S S E T H:
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WHEREAS, Republic is proposing to develop a new paperboard mill (the
"Project Gazelle Mill") to produce recycled gypsum-grade paperboard;
WHEREAS, potential providers of financing for the Project Gazelle Mill have
indicated that they will require Republic to have in place long-term agreements
for the sale of a substantial portion of the output of the Project Gazelle Mill
as a condition to providing such financing;
WHEREAS, Xxxxxx desires to ensure that it will have an assured supply of
paperboard on a long-term basis, and Republic desires to have Xxxxxx as a
customer on such basis;
WHEREAS, Republic has offered to Xxxxxx, pursuant to Xxxxxx'x request,
selling prices and pricing formulas designed to meet pricing proposals offered
by other current and potential suppliers competing for Xxxxxx'x business;
WHEREAS, Xxxxxx and Republic have entered into that certain letter of
intent dated April 8, 1998 in which they expressed their intent to enter into,
and outlined their rights and obligations with respect to, a long-term supply
agreement for recycled gypsum-grade paperboard;
WHEREAS, Xxxxxx and Republic desire to formalize the terms of such
agreement; and
WHEREAS, Republic Parent expects to derive substantial benefit from its
subsidiary's entry into such an agreement, and Xxxxxx requires that Republic
Parent execute and deliver any such agreement as a condition to its execution
and delivery thereof;
NOW, THEREFORE, in consideration of the foregoing, and in consideration of
the mutual covenants hereinafter contained, and of other good and valuable
consideration, the receipt and sufficiency which are hereby acknowledged, the
parties hereto agree as follows:
1. PURCHASE AND SALE OF PRODUCTS. Subject to the terms and conditions of
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this Agreement, Republic agrees to sell to Xxxxxx, and Xxxxxx agrees to purchase
from Republic, at the Selling Price (as hereinafter defined), a portion of
Xxxxxx'x recycled gypsum-grade paperboard requirements (including Creamface,
Grayback, Green-Lined, Xxxxx Sheathing, Shaftwall Liner
Green and Veneer Plaster Base paperboard) which is more specifically identified
on Exhibit A attached hereto. (Any paperboard products sold or agreed to be sold
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by Republic to Xxxxxx hereunder are referred to herein as "Products".) Products
consisting of Creamface, Grayback, Green-Lined and Xxxxx Sheathing paperboard
will be produced at the Project Gazelle Mill, except to the extent expressly
permitted hereby to be produced at another of Republic's recycled paperboard
xxxxx or as otherwise agreed by the parties. Products consisting of Shaftwall
Liner Green and Veneer Plaster Base paperboard may be produced at Republic's
recycled paperboard xxxxx other than the Project Gazelle Mill, unless otherwise
agreed by the parties.
2. PRICE AND ADJUSTMENTS.
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(a) The Selling Price for a particular order shall be computed by a
formula whereby an initial base price (the "Base Price") is
adjusted as set forth in this paragraph 2 quarterly (other than
the adjustments set forth in subparagraphs (c), (d) and (e) of
this paragraph 2, which will be made annually), or at such other
times or on such other schedule as agreed by the parties, for
changes in the cost of certain key grades of paper stock. In each
case, the selling price shall be F.O.B. the carrier at the
Project Gazelle Mill or when expressly contemplated by this
Agreement or when otherwise agreed by the parties at another of
Republic's paperboard xxxxx (the "Shipping Mill"). In the event
that Republic ships an order from a Shipping Mill other than the
Project Gazelle Mill, Republic shall equalize Xxxxxx'x freight
costs so that Xxxxxx'x freight cost is no higher or lower than it
would have been had the order been shipped from the Project
Gazelle Mill.
(b) The initial Base Prices for the Products shall be as set forth on
Exhibit B attached hereto.
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(c) As of January 1, 2001, the initial Base Prices of recycled
gypsum-grade paperboard will be adjusted upward or downward, as
the case may be, for purchases made during calendar year 2001, by
an amount per MSF computed as (i) the sum of (A)(x) the
difference between the actual average cost during the six (6)
months ended November 30, 2000, of purchased electricity per
kilowatt hour ("KWH") and the initial projected average base cost
of purchased electricity of $*** per KWH, multiplied by (y) the
actual total KWH used during such six-month period and (B)(x) the
difference between the actual average cost during such six-month
period of purchased natural gas, which includes transportation
costs and line shrinkage costs, per million British thermal units
("MMBTU") and the initial projected average base cost of
purchased natural gas, which includes transportation costs and
line shrinkage costs, of $*** per MMBTU, multiplied by (y) the
actual total MMBTU's used during such six-month period, divided
by (ii) the actual gross thousand square feet ("MSF") of
paperboard produced during such six-month period. The same
adjustments will be made to be effective each January 1,
thereafter, based on the actual costs and quantities during the
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twelve-month period ending on November 30 of the preceding year.
Xxxxxx shall have the right to review and audit the underlying
information and calculations that form the basis for any change
in price based upon this subparagraph.
(d) As of January 1, 2002 and each January 1 thereafter, each of the
initial Base Prices will be increased or decreased, as the case
may be, by an amount equal to the sum of (i) $*** per MSF
multiplied by the percentage increase or decrease in the ***
Index ***, from September 1997 to the September immediately
preceding the effective date of the adjustment, which index is
published by the United States Department of Labor, Bureau of
Labor Statistics and (ii) $*** per MSF multiplied by the
percentage increase or decrease in the*** Index *** from
September 1997 to the September immediately preceding the
effective date of the adjustment, which index is published by the
United States Department of Labor, Bureau of Labor Statistics.
(e) As of January 1, 2002 and each January 1 thereafter, the average
basis weight pounds per MSF of each grade of the Products
purchased by Xxxxxx during the preceding twelve (12) months shall
be calculated. For each one-half pound that the average basis
weight for a grade of the Products is less than the average basis
weight set forth in Exhibit C for such grade, the initial Base
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Price for such grade shall be reduced by $*** per MSF. This
provision shall apply to reductions of basis weight down to a
basis weight of *** pounds per MSF. Republic and Xxxxxx will
cooperate with each other in seeking to achieve reductions in the
basis weights of the Products. Republic and Xxxxxx each, insofar
as their own operations are involved, will diligently pursue
methods of achieving, and use commercially reasonable efforts to
achieve, reductions in basis weights of the Products, targeting
an ultimate basis weight of *** pounds per MSF by the fifth
anniversary of the Commercial Production Date. The parties will
not be deemed to have succeeded in reducing the basis weight of
the Products, and Xxxxxx shall be under no obligation to purchase
such lower basis weight Products under this Agreement, unless,
all things considered, it is economically feasible for Xxxxxx to
utilize such lower basis weight Products in Xxxxxx'x
manufacturing process. For example, if utilization of the lower
basis weight Products causes Xxxxxx to run its equipment at
slower speeds to accommodate the lower basis weight paper, such
that the loss of production offsets any benefits of a lower basis
weight, the parties will not be deemed to have succeeded in
reducing the basis weight of the Products. Republic and Xxxxxx
each will furnish the other with regular reports on the plans for
and the progress of the efforts in achieving lower basis weights.
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(f) The Selling Price for Creamface paperboard will be computed as
of the first day of each calendar quarter during the term of this
Agreement by increasing or decreasing the Base Price, as adjusted
theretofore pursuant to subparagraphs (c), (d) and (e) of this
paragraph 2, for Creamface paperboard by the sum of the positive
and negative amounts per MSF computed in (i) through (iv) below,
as follows:
(i) (A)(x) the average of the high per ton transacted prices for
***, as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Cream Face
(*** pounds/MSF), divided by (E) the number of pounds in a
short ton (2,000);
(ii) (A)(x) the average of the high per ton transacted prices for
***, as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Cream Face
(*** pounds/MSF), divided by (E) the number of pounds in a
short ton (2,000);
(iii) (A)(x) the average of the high per ton transacted prices for
***, as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Cream Face
(*** pounds/MSF), divided by (E) the number of pounds in a
short ton (2,000); and
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(iv) (A)(x) the average of the high per ton transacted prices for
***), as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Cream Face
(*** pounds/MSF), divided by (E) the number of pounds in a
short ton (2,000).
(g) The Selling Price for Grayback paperboard will be computed as of
the first day of each calendar quarter during the term of this
Agreement by increasing or decreasing the Base Price, as adjusted
theretofore pursuant to subparagraphs (c), (d) and (e) of this
paragraph 2, for Grayback paperboard by the sum of the positive
and negative amounts per MSF computed in (i) and (ii) below, as
follows:
(i) (A)(x) the average of the high per ton transacted prices for
***, as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Xxxx Back (***
pounds/MSF), divided by (E) the number of pounds in a short
ton (2,000); and
(ii) (A)(x) the average of the high per ton transacted prices for
***, as reported in the second issue of the Official Board
Markets during the immediately preceding three calendar
months, less (y) the high per ton transacted price for ***,
as reported in the second issue of the Official Board
Markets during February 1998, multiplied by (B) the assumed
percentage of the furnish to be composed of *** (***%),
multiplied by (C) the assumed ratio of tons of paper stock
required to manufacture one ton of paperboard (***),
multiplied by (D) the assumed basis weight of Xxxx Back (***
pounds/MSF), divided by (E) the number of pounds in a short
ton (2,000).
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(h) The Selling Price for Green-Lined paperboard will be computed as
of the first day of each calendar quarter during the term of
this Agreement by increasing or decreasing the Base Price, as
adjusted theretofore pursuant to subparagraphs (c), (d) and (e)
of this paragraph 2, for Green-Lined paperboard by the sum of the
positive and negative amounts per MSF computed pursuant to (f)(i)
through (f)(iv) above.
(i) The Selling Price for Xxxxx Sheathing paperboard will be computed
as of the first day of each calendar quarter during the term of
this Agreement by increasing or decreasing the Base Price, as
adjusted theretofore pursuant to subparagraphs (c), (d) and (e)
of this paragraph 2, for Xxxxx Sheathing paperboard by the sum of
the positive and negative amounts per MSF computed pursuant to
(g)(i) through (g)(ii) above.
(j) The Selling Price for Shaftwall Liner Green paperboard will be
computed as of the first day of each calendar quarter during the
term of this Agreement by increasing or decreasing the Base
Price, as adjusted theretofore pursuant to subparagraphs (c) and
(d) of this paragraph 2, for Shaftwall Liner Green paperboard by
the sum of the positive and negative amounts per MSF computed
pursuant to (f)(i) through (f)(iv) above; provided, however that
an assumed basis weight of *** pounds per MSF shall be used.
(k) The selling price for Veneer Plaster Base paperboard will be
computed as of the first day of each calendar quarter during the
term of this Agreement by increasing or decreasing the Base
Price, as adjusted theretofore pursuant to subparagraphs (c) and
(d) of this paragraph 2, for Veneer Plaster Base paperboard by
the sum of the positive and negative amounts per MSF computed
pursuant to (g)(i) through (g)(ii) above; provided, however that
an assumed basis weight of *** pounds per MSF shall be used.
(l) With respect to shipments to Xxxxxx'x Las Vegas, Nevada and
Seattle, Washington gypsum wallboard plants, the Selling Prices
for each grade of recycled gypsum-grade paperboard will be
reduced by a freight allowance, which is provided in
acknowledgment of the shipping distances from the Project Gazelle
Mill to those plants. The freight allowance will be $*** per MSF
with respect to shipments to the Las Vegas, Nevada plant and $***
per MSF with respect to shipments to the Seattle, Washington
plant. As of January 1, 2001, and each January 1 thereafter,
each of the initial freight allowances will be increased or
decreased, as the case may be, by an amount equal to such freight
allowance per MSF multiplied by the percentage increase or
decrease in the *** from September 1997 to the September
immediately preceding the effective date of the adjustment, which
index is published by the United States Department of Labor,
Bureau of Labor Statistics.
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(m) For purposes of this subparagraph (m), Effective FOB Third Party
Price ("EFTPP") is the price charged or offered in writing to a
Non-Affiliate Third Party (measured on a per/MSF basis) adjusted
to take into account any effective price reductions due to all
freight, shipping, insurance or other allowances, discounts,
rebates, price or credit considerations (as such price may be
adjusted from time to time pursuant to Republic's arrangement
with the Non-Affiliate Third Party). For purposes of this
subparagraph (m), the Western Region is defined as that portion
of North America consisting of ***; the Eastern Region is defined
as all other portions of North America. If Republic sells or
contracts to sell one hundred Tons or more of Product to a Non-
Affiliate Third Party or Parties:
(i) all or any portion of which is for delivery in the
Eastern Region at an EFTPP lower than the Selling Price,
then the Selling Price to Xxxxxx for such Product for any of
its plants shall be automatically reduced by the difference
between the Selling Price and the EFTPP (the "Adjustment
Amount"), for all subsequent Xxxxxx purchases of that
Product, up to the volume(s) sold to the Non-Affiliate Third
Party or Parties at the EFTPP;
(ii) all or any portion of which is for delivery in the
Western Region, at an EFTPP, which is lower than the average
of the Selling Price for Xxxxxx'x Las Vegas and Seattle
plants, after adjustment for the freight allowance as
described in paragraph 2(l) plus *** cents (the "Xxxxxx
Effective Western Region Price" or HEWRP), the Selling Price
for such Product to Xxxxxx for any of its plants shall be
automatically reduced by an amount equal to the difference
between the HEWRP and the EFTPP (the "Adjustment Amount")
for all subsequent Xxxxxx purchases of the Product up to the
volume(s) sold to the Non-Affiliate Third Party or Parties.
If a sale or contract to sell that would cause the pricing
mechanisms under subparagraphs (i) and (ii) above to be operative
occurs during a period that the pricing mechanism under (i) or
(ii) is in effect due to a prior sale or contract to sell with a
Non-Affiliated Third Party, then the volumes as to which such
prices would be in effect shall be purchased consecutively and
not concurrently so that at any particular time the Selling Price
would have been reduced by only one Adjustment Amount. In
addition to the foregoing, if an EFTPP is established pursuant to
a contract whose term or pricing provisions are effective for
more than *** ("Long Term Contract") the Selling Price for the
Product to Xxxxxx, regardless of volume, shall be automatically
reduced by the Adjustment Amount for all subsequent Xxxxxx
purchases of the Product so long as said EFTPP is available to
the Non-Affiliate Third Party. With respect to Long Term
Contracts, the Adjustment Amount shall be based upon the lowest
EFTPP in effect at any
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given time. The pricing mechanisms set forth in subparagraphs (i)
and (ii) above will continue in effect during the time that any
Long Term Contract is in effect such that if a sale of the kind
described in subparagraphs (i) and (ii) occurs during such time
that would cause the Selling Price for a specified volume to be
lower than the Selling Price as adjusted pursuant to the
Adjustment Amount calculated on the basis of the Long Term
Contract, the Selling Price for such specified volume would be
such lower price. This subparagraph (m) applies only to recycled
gypsum-grade paperboard Products produced at the Project Gazelle
Mill and, with respect to Shaftwall Liner Green and Veneer
Plaster Base paperboard, to such Products produced at Republic's
other paperboard xxxxx, and further shall not apply to test
quantities of less than 100 short tons done on an isolated basis
and sold to third parties to demonstrate the characteristics of
the paperboard manufactured at Republic's paperboard xxxxx.
Republic shall cause its outside auditors to certify to Xxxxxx on
an annual basis that Republic has complied with this
subparagraph.
(n) If any of the high per ton transacted prices referred to in
subparagraphs (f) and (g) above cease to be reported monthly or
if the indexes referred to in subparagraphs (d) and (l) cease to
be published, the parties shall select a similar published
statistic or index to use as the basis for making the adjustments
provided in subparagraphs (d), (f), (g), (h), (i), (j), (k) or
(l), as the case may be. If the parties cannot agree on such new
statistic or index, the parties will resolve such dispute
according to the dispute resolution procedures set forth in this
Agreement.
3. TERM.
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(a) Subject to the provisions of paragraph 12 hereof, the term of
this Agreement shall commence on the date hereof and shall
terminate on October 1, 2010, or ten (10) years after the
Commercial Production Date, whichever is later.
(b) Republic shall diligently pursue the completion of the Project
Gazelle Mill and shall use commercially reasonable efforts to
cause the Project Gazelle Mill to commence production on or
before the date that is 22 months after the date of this
Agreement. The obligation of Republic to supply, and, subject to
Exhibit A, the obligation of Xxxxxx to purchase, Products
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hereunder shall not commence until Commercial Production has been
achieved (the "Commercial Production Date"). For purposes of
this Agreement, "Commercial Production" shall mean that the
Project Gazelle Mill has produced, for two consecutive months,
paperboard meeting the quality specifications set forth in
Exhibit C, in an amount equal to or greater than thirty percent
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(30%) of the Project Gazelle Mill's planned monthly capacity.
When Republic believes that the Project Gazelle Mill has achieved
Commercial Production, it shall give written notice to that
effect to Xxxxxx
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(the "Commencement Notice"), and Xxxxxx shall not unreasonably
object to the propriety of the Commencement Notice. From the date
on which Xxxxxx receives the Commencement Notice, Xxxxxx shall
have fifteen (15) days to: (i) observe the production of paper at
the Project Gazelle Mill; (ii) observe the conversion to
wallboard of such paper at Republic Parent's wallboard facility
in Duke, Oklahoma; and (iii) test the conversion of the paper at
each of Xxxxxx'x facilities. The Vice Presidents of Production of
Xxxxxx and of Republic shall each personally observe the
production, conversion and testing under clauses (i), (ii) and
(iii) of the preceding sentence, which shall be performed by the
parties in good faith. At the end of such fifteen (15) day
testing period, the Commencement Notice shall become effective.
If Xxxxxx does not object in writing within fifteen (15) days
after the Commencement Notice becomes effective, then Commercial
Production shall be deemed to have been achieved as of the date
the Commencement Notice became effective. If Xxxxxx does object
in writing to the propriety of the Commencement Notice, then the
dispute resolution procedures of paragraph 28 shall be invoked,
and the achievement of Commercial Production shall be determined
in accordance therewith or by subsequent agreement of Republic
and Xxxxxx.
(c) Republic shall keep Xxxxxx regularly and adequately informed
regarding the construction progress of the Project Gazelle Mill
and shall provide Xxxxxx with monthly written progress reports.
If Republic is unable to cause the Project Gazelle Mill to
commence Commercial Production prior to the later of: (i) October
1, 2000 or (ii) the date that is 22 months after the date of this
Agreement, Republic shall supply Xxxxxx, at the prices
established pursuant to this Agreement, the quantity of recycled
gypsum-grade paperboard that it would otherwise be obligated to
supply under this Agreement from its other recycled paperboard
xxxxx, through purchases from recycled paperboard xxxxx owned by
third parties, or both, until such time as the Project Gazelle
Mill commences Commercial Production. Any such recycled gypsum-
grade paperboard supplied otherwise than from the Project Gazelle
Mill shall have the specifications set forth in Exhibit C hereto,
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excepting the specifications regarding basis weights. If
Republic is unable to supply the quantity and quality of Products
required by Xxxxxx under this Agreement at the prices established
pursuant to this Agreement, Republic will compensate Xxxxxx for
the additional costs reasonably incurred by Xxxxxx in obtaining
replacement paperboard. Notwithstanding the foregoing, if, by
July 1, 2001, Republic has not given the Commencement Notice,
Xxxxxx may, at its sole discretion and option, terminate this
Agreement. So long as Republic supplies paper to Xxxxxx from
xxxxx other than the Project Gazelle Mill, any adjustments to
price shall be based only upon changes in the price of furnish as
specified elsewhere in this agreement, and shall not be based
upon changes in the cost of gas, electricity, or other expenses.
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(d) During the period beginning on October 1, 2005 or the fifth
anniversary of the Commercial Production Date, whichever is
later, and ending on October 1, 2007 or the seventh anniversary
of the Commercial Production Date, whichever is later, Republic
and Xxxxxx will negotiate in good faith in an effort to agree to
a long-term extension of the initial term of this Agreement or a
further long-term supply agreement on such terms as are mutually
acceptable to each party, in its sole discretion.
(e) If: (i) Republic sells or otherwise transfers ownership or
operating control of the Project Gazelle Mill (otherwise than as
a Security Device (as that term is defined below) to obtain or
secure financing) to a party that is not an Affiliate (as that
term is defined below) of Republic such that Republic no longer
maintains a direct or indirect majority ownership interest in the
Project Gazelle Mill or is no longer, directly or indirectly, the
operator thereof, or a Change of Control (as that term is defined
below) of Republic occurs, in either case prior to the sixth
anniversary of the Commercial Production Date and (ii) Xxxxxx and
Republic (or the then current owner of the Project Gazelle Mill)
have not negotiated an extension of the initial term of this
Agreement prior to October 1, 2006 or the sixth anniversary of
the Commercial Production Date, whichever is later, then the
initial term of this Agreement shall automatically, and without
any action by Xxxxxx, Republic or the then-current owner of the
Project Gazelle Mill or any assignee of Republic's rights
hereunder, be extended for an additional five (5) years on the
same terms and conditions applicable to the initial term hereof.
Notwithstanding the foregoing sentence, Xxxxxx shall have the
right, exercisable by Xxxxxx for a period of sixty (60) days
beginning on October 1, 2006 or the sixth anniversary of the
Commercial Production Date, whichever is later, to terminate such
five-year extension by delivering a written notice of such
termination to the then-current owner of the Project Gazelle
Mill.
(f) For purposes of this Agreement,
(i) an "Affiliate" of a party shall mean any other person who
beneficially owns, directly or indirectly, a majority of the
voting securities and a majority of the equity securities of
such party or of whom a majority of the voting securities
and a majority of the equity securities are beneficially
owned, directly or indirectly, by such party;
(ii) a "Change of Control" shall be deemed to have occurred with
respect to Republic if: (A) Republic Parent, no longer
beneficially owns a majority of the voting securities and a
majority of the equity securities of Republic; (B) a merger
or consolidation of Republic Parent has been consummated
pursuant to which a majority of the voting securities and a
majority of the equity securities of the surviving or
resulting entity are not beneficially owned by the persons
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who were the stockholders of Republic Parent immediately
prior to the consummation of such merger or consolidation;
(C) a sale or transfer of all or substantially all of the
assets of Republic Parent other than to an Affiliate of
Republic Parent; (D) the stockholders of Republic Parent
have approved a plan or proposal for the liquidation or
dissolution of Republic Parent; (E) any person or group (as
defined in Rule 13d-5(b) under the Securities Exchange Act
of 1934, as amended) (other than Xxxx Xxxxxxx, his spouse,
his descendants and their spouses, trusts and estates of
which any of them are the primary beneficiaries and any
entities of which any of them are holders of a majority of
the voting securities and a majority of the equity
securities) shall become the beneficial owner of a majority
of Republic Parent's voting securities or equity securities;
or (F) during any period of two years or less individuals
who at the beginning of such period constitute the entire
board of directors of Republic Parent shall for any reason
cease to constitute a majority thereof unless the election
or nomination for election by Republic Parent's stockholders
or the appointment by the remaining directors, as
applicable, of each new director was approved by a majority
of the directors then still in office who were directors at
the beginning of the period (for purposes of this
subparagraph (f)(ii), Republic Parent shall be deemed to
include any successor thereto); and
(iii) "Beneficial ownership" shall be determined in accordance
with Rule 13d-3 under the Securities Exchange Act of 1934,
as amended.
4. PRODUCTS. Republic will supply to Xxxxxx, pursuant to this Agreement,
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Xxxxxx'x requirements (as described in Exhibit A hereto) for recycled gypsum-
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grade paperboard meeting the specifications set forth on Exhibit C hereto,
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except as otherwise expressly provided herein.
5. ORDERS AND SHIPMENT.
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(a) On or before the twentieth day of each calendar month, Xxxxxx
shall deliver to Republic its orders for the next succeeding
month specifying the grade, quantity, requested shipment date or
dates and destination of the Products being ordered. Orders for
Products, unless rightfully rejected when permitted under
commercially reasonable standards to be rejected hereunder, will
be confirmed by Republic's written acknowledgment (by fax or
otherwise), within five (5) business days after each order is
placed. All orders and all acknowledgments shall be on the forms
attached hereto as Exhibit D and Exhibit E, respectively.
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Republic may reject any orders that are not on the form attached
hereto as Exhibit D or that add any terms thereto. Xxxxxx may
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reject any acknowledgments that are not on the form attached
hereto as Exhibit E or that add any terms thereto.
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(b) Shipments of Products shall be routed as determined by Xxxxxx.
Xxxxxx shall arrange for delivery of Products and shall notify
Republic of its delivery arrangements at the time Xxxxxx places
an order for Products with Republic. Title to the Products sold
hereunder shall pass from Republic to Xxxxxx when placed F.O.B.
the carrier at the Shipping Mill, and Republic shall thereafter
be released from all responsibility and liability for any loss
of, or damage to, the Products in transit or delivery to Xxxxxx
and shall have no responsibility or liability for any delay in
delivery, provided that the Products have been properly prepared
for shipment and properly delivered F.O.B. the carrier at the
Shipping Mill. All shipping and insurance costs shall be at
Xxxxxx'x expense.
(c) Commencing on October 1, 2000 and at all times thereafter,
Republic shall maintain a minimum emergency product inventory of
*** tons, meeting Xxxxxx'x product specifications as set forth in
Exhibit C hereto, in an approximate ratio of sixty percent
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(60%) Creamface and forty percent (40%) Grayback, *** and which
inventory will be maintained at the Project Gazelle Mill and will
be paid for as ordered by Xxxxxx, in accordance with the
provisions of Paragraph 8 below.
6. QUALITY.
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(a) Each grade of the Products to be manufactured and sold by
Republic hereunder shall, within the customary commercial
tolerances of the paperboard industry for such grade and except
as otherwise expressly provided herein, meet the specifications
for such grades which are attached hereto as Exhibit C (the
---------
"Specifications"), and Xxxxxx agrees that it will accept Products
meeting the Specifications. The parties agree that, as a result
of their experience hereunder and their technical cooperation
under paragraph 9 hereof, the Specifications may be varied by
mutual agreement to fit the particular characteristics of
Xxxxxx'x machinery and products. Such Specifications, when and
as modified, shall be deemed to supersede the Specifications
attached hereto as Exhibit C, shall become part of this Agreement
---------
and are hereby incorporated by reference.
(b) Republic shall provide Xxxxxx a Certificate of Analysis with
respect to each set of rolls of the Products purchased by Xxxxxx.
The Certificate of Analysis shall be delivered to Xxxxxx no later
than the date on which the set of rolls covered thereby are
received by Xxxxxx at its gypsum wallboard facility. The
Certificate of Analysis shall certify that a sample from the set
was physically tested in accordance with testing methods accepted
by the recycled paperboard industry. The Certificate of Analysis
further shall certify that the sample in question met the
Specifications. Republic shall retain samples for six (6) months
for purposes of verification of test results.
12
(c) EXCEPT AS SPECIFIED IN THIS XXXXXXXXX 0, XXXXXXXX MAKES NO OTHER
WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE PRODUCTS SOLD
HEREUNDER AND EXPRESSLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE, EITHER EXPRESS OR IMPLIED.
7. CLAIMS.
------
(a) Xxxxxx shall make a reasonable inspection of the Products and the
Certificate of Analysis related thereto upon delivery or within
sixty (60) days thereafter. Xxxxxx shall have the right to reject
any Products that do not conform to the Specifications. If
Xxxxxx believes that any Products do not conform to the
Specifications, it shall promptly, and not later than sixty (60)
days after receipt thereof, notify Republic in writing of its
rejection of such Products for failure to conform to the
Specifications. If no such written notice is received by
Republic, pursuant to paragraph 21, within sixty (60) days after
receipt thereof, Xxxxxx shall be deemed to have accepted the
Products, except as set forth in subparagraph (b) below.
Republic may inspect any Products that Xxxxxx so rejects. Upon
verification by Republic of nonconformity of the rejected
Products to the Specifications, Republic will issue Xxxxxx a
credit memorandum for the purchase price of the non-conforming
Products and the cost of freight from the Project Gazelle Mill to
Xxxxxx'x plant. Republic will arrange for the disposition of the
non-conforming Products, at Republic's expense, in each case
within 10 business days after notice of rejection by Xxxxxx,
unless the parties agree to some other settlement of the claim in
question. If Republic disputes Xxxxxx'x rejection of such
Products, it shall promptly notify Xxxxxx in writing of such
dispute and the dispute will be determined in accordance with
subparagraph (c) hereof.
(b) If the nonconformity to the Specifications of any Products could
not be discovered through a commercially reasonably inspection
prior to their use by Xxxxxx and such use results in the
manufacture of defective gypsum wallboard, Xxxxxx shall promptly
notify Republic in writing. Republic may inspect such defective
wallboard. Upon verification by Republic that the manufacture of
the defective wallboard resulted from nonconformity to the
Specifications of the Products in question, Republic will issue
Xxxxxx a credit memorandum for: (i) the purchase price of the
non-conforming Products; (ii) the cost of freight of such
Products from the Shipping Mill to Xxxxxx'x plant; (iii)
additional Products manufactured by Republic and used by Xxxxxx
on the other side of such defective wallboard, whether or not
such additional Products conform to the Specifications; and (iv)
the cost of freight of such additional Products from the Shipping
Mill to Xxxxxx'x plant. Republic's liability under (i), (ii),
(iii) and (iv) above shall not extend to defective wallboard
manufactured after Xxxxxx has discovered, or in the exercise of
13
commercially reasonable supervision of its manufacturing
processes should have discovered, that Xxxxxx is manufacturing
defective wallboard. If Republic disputes the cause of the
manufacture of the defective gypsum wallboard, it shall promptly
notify Xxxxxx in writing of such dispute, and the dispute will be
determined in accordance with subparagraph (c) of this paragraph.
(c) Republic's technical support personnel and Xxxxxx'x gypsum plant
quality personnel shall jointly investigate any disputed
rejection of the Products and any dispute regarding a claim that
the Products caused the manufacture of defective gypsum
wallboard. If such joint investigation fails to settle the
dispute to the mutual satisfaction of both parties, it shall be
referred to the Vice President, Operations, of each party for
settlement. Any dispute that cannot be settled in accordance
with this subparagraph (c) will be determined in accordance with
paragraph 28 hereof. At Republic's request, Xxxxxx will effect
trial runs of Products that it has rejected so long as it can do
so without undue effort or expense.
(d) If a Claim (as defined below) is made by a customer, end-user or
ultimate consumer that gypsum wallboard manufactured by Xxxxxx
that contains a Product is defective and Republic has agreed, or
pursuant to subparagraph (c) and/or paragraph 28 hereof or
otherwise it has been finally determined, subject to no further
rights of appeal or reconsideration, that the failure of such
Product to meet the Specifications as of the date of sale of such
Product to Xxxxxx has caused the defect in the gypsum wallboard
asserted in such Claim and that such failure of the Product to
meet Specifications could not have been discovered through a
commercially reasonable inspection by Xxxxxx prior to shipment of
the gypsum wallboard, then in addition to the credit memorandum
issuable pursuant to subparagraph (b) above, Republic shall pay,
or reimburse Xxxxxx for, the liability of Xxxxxx to such
customer, end-user or ultimate consumer resulting from the
defective paperboard and Xxxxxx'x reasonable third party expenses
in defending against such Claim; provided, that Republic shall
not be obligated to pay, or reimburse Xxxxxx for, any such
liability unless such liability exceeds $*** with respect to any
single Claim or unless the aggregate of all such liabilities with
respect to Claims exceeds $***during any calendar year, in which
cases Republic shall be responsible for all such liabilities in
excess of such amount or amounts, as applicable. Xxxxxx shall
promptly notify Republic of any Claim as to which it intends to
seek reimbursement from Republic or which it intends to apply
against the $***limit. Xxxxxx shall, except to the extent not
reasonably practicable, afford Republic at least three business
days after such notice to inspect the defective gypsum wallboard
prior to its demolition or repair. Any authorization by Xxxxxx
of repairs shall be for the lowest commercially reasonable method
of repair. Xxxxxx shall consult with Republic regarding any
settlement of any Claim. Any such settlement not approved by
Republic
14
shall not in any way impair the ability of Republic to
dispute the amount of the settlement in connection with any claim
by Xxxxxx against Republic for a reimbursement of the related
Claim. A "Claim" means a claim that gypsum wallboard sold by
Xxxxxx was defective and that relates to a single dwelling, a
single tract of dwellings under development by the same owner or
developer, or a single structure at a commercial or multi-family
residential project.
(e) EXCEPT TO THE EXTENT OTHERWISE PROVIDED IN SUBPARAGRAPH 7(D)
ABOVE, REPUBLIC SHALL NOT BE LIABLE FOR INDIRECT, SPECIAL,
INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND WITH RESPECT TO
CLAIMS ASSERTED BY THIRD PARTIES AGAINST XXXXXX ARISING FROM
DEFECTIVE PRODUCTS OR FROM PRODUCT LIABILITY. REPUBLIC SHALL NOT
BE LIABLE FOR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
DAMAGES OF ANY KIND FOR WHICH IT OTHERWISE HAS LIABILITY FOR
LOSSES SUFFERED BY XXXXXX AS A RESULT OF A FAILURE OF PRODUCTS TO
SUCCESSFULLY CONVERT TO PRODUCE ACCEPTABLE GYPSUM WALLBOARD AT
XXXXXX'X PLANTS UNLESS XXXXXX HAS FIRST USED COMMERCIALLY
REASONABLE EFFORTS TO CONVERT THE PRODUCTS INTO GYPSUM WALLBOARD
AND SUCH COMMERCIALLY REASONABLE EFFORTS HAVE PROVEN
UNSUCCESSFUL.
8. PAYMENT.
-------
(a) Republic shall render its invoices covering shipments as soon as
practicable after each shipment. Payment terms shall be net ***
days after the date Xxxxxx receives Republic's invoice.
(b) All payments shall be made at Republic's principal place of
business or the place specified for payment on the applicable
Republic invoice.
(c) All amounts not paid within seven (7) days after the date due
hereunder shall bear interest from the date due until paid at a
rate equal to the lesser of (i) *** percent (***%) per month or
(ii) the maximum rate permitted under applicable law.
15
(d) If any invoice remains unpaid over sixty (60) days after the date
the invoice is received and the failure to pay is not based upon
a bona-fide dispute over whether the amount is owed, Republic may
suspend shipments of Products until payment has been made.
9. TECHNICAL COOPERATION.
---------------------
(a) The parties agree to use commercially reasonable efforts to
achieve efficient conversion of the Products at each of Xxxxxx'x
wallboard manufacturing operations, without creating an undue
burden or expense for either party.
(b) Technical support personnel from Republic and production and
quality management of each Xxxxxx gypsum wallboard plant shall
meet at least monthly to discuss any operating issues being
experienced by Xxxxxx that it believes to be related to the
Products and opportunities for reducing the basis weight of the
Products, so long as there are technical issues that need to be
discussed.
(c) In the event that Xxxxxx encounters difficulty converting one or
more rolls of the Products that appear to meet the Specifications
at any of its gypsum wallboard manufacturing operations, it will
promptly give Republic notice of the problems that it is
encountering. Not later than five (5) calendar days after
receipt of such notice, Republic shall send technical support
personnel to the operation experiencing difficulty. Xxxxxx shall
permit Republic access to the affected operation for purposes of
observation, sampling, testing and inspection, in cooperation
with Xxxxxx'x personnel. Xxxxxx'x facility management and
Republic's technical support personnel will mutually develop a
plan for reducing problems associated with conversion of the
Products, which plan may include, without limitation, trial
modifications to the Specifications, trial adjustments to the
operation of the gypsum wallboard production line, observations
of trials by representatives of both parties, data collection and
statistical evaluation of collected data.
10. XXXXXX'X REPRESENTATIONS AND WARRANTIES. Xxxxxx hereby makes the
---------------------------------------
following representations and warranties to Republic:
(a) All of the assets of the gypsum wallboard plants located at
Nashville, Arkansas, Las Vegas, Nevada and Seattle, Washington
referred to in Exhibit A hereto and all of Xxxxxx'x gypsum mining
---------
facilities are owned by Xxxxxx, free and clear of liens and
encumbrances (other than routine matters of record that have no
material adverse effect on their value).
(b) The net worth of Xxxxxx as of March 31, 1998, determined in
accordance with generally accepted accounting principles, exceeds
the consolidated net worth of Republic Parent as of March 31,
1998, as reflected in Republic Parent's
16
Form 10-Q for the quarter ended March 31, 1998, and no material
adverse change in Xxxxxx'x net worth has occurred since that
date.
(c) Neither Xxxxxx nor any Affiliate of Xxxxxx has any present
intention or plan to engage in the manufacture of paperboard, and
neither Xxxxxx nor any such Affiliate has received any offer to
sell, lease or otherwise convey to Xxxxxx or any such Affiliate a
paperboard mill or any interest therein, whether direct or
indirect, which offer has not been either withdrawn by the
offeror or rejected by Xxxxxx.
11. REPUBLIC'S REPRESENTATIONS AND WARRANTIES. Republic hereby makes the
-----------------------------------------
following representations and warranties to Xxxxxx:
(a) The Lawton Industrial Foundation either owns or has acquired
options to purchase land in Lawton, Oklahoma sufficient for the
construction and operation of the Project Gazelle Mill (the
"Land") and has proposed to transfer the Land to Republic.
(b) The Land has access or will have access to truck and rail
transportation and loading facilities for same that are
appropriate for the efficient operation of the Project Gazelle
Mill.
(c) Republic believes it can obtain all necessary permits, approvals,
consents, and financing necessary to allow it to construct the
Project Gazelle Mill on the Land.
(d) To Republic's knowledge and belief, after investigation, it is
feasible to construct the Project Gazelle Mill on the Land.
(e) Republic has engaged consultants and advisors, has conducted test
runs with the proposed Project Gazelle Mill technology and, on
that basis, Republic believes that the Project Gazelle Mill is
technologically feasible and can meet Xxxxxx'x needs.
(f) The Project Gazelle Mill will be constructed and outfitted
substantially in accordance with the summary descriptions
Republic has provided to Xxxxxx, subject to modifications deemed
desirable by Republic and, with regard to substantial
modifications, agreed to by Xxxxxx, as the project progresses.
(g) Republic, or its agent, has entered into letters of intent with
key vendors and contractors.
(h) Republic believes that it can meet Xxxxxx'x quantity and quality
requirements for recycled gypsum-grade paperboard, tailored to
suit the specific
17
requirements, for both processing and marketing of, and the
machinery in operation at, each of its facilities.
(i) Republic is experienced in and knowledgeable concerning the
production of recycled gypsum-grade paperboard, and acknowledges
that Xxxxxx is relying on such expertise. To Republic's
knowledge and belief, after investigation, the Project Gazelle
Mill will utilize modified gap-former and Fourdrinier technology,
which technology is current recycled paperboard production
technology to Republic's knowledge and belief, after
investigation. To Republic's knowledge and belief, after
investigation, after construction, the Project Gazelle Mill will
be viable and will be able to provide, in a timely manner,
sufficient recycled gypsum-grade paperboard to meet Xxxxxx'x
quality and quantity requirements for both processing and
marketing for its various gypsum plants within the limits of the
projected furnish requirements, energy consumption and labor
costs.
(j) Republic believes that it can obtain sufficient financing to
construct and operate the Project Gazelle Mill. Republic has
received proposals from lenders and investment bankers to lend
funds or cause the placement of debt securities sufficient to
finance the Project Gazelle Mill.
(k) Republic has reported to Xxxxxx the summary results of its "paper
trials" and engineering feasibility studies prepared by
Republic's consultants and advisors in connection with the
Project Gazelle Mill, and will continue to provide updates
thereon to Xxxxxx during the course of development of the Project
Gazelle Mill.
(l) Republic anticipates that it initially will sell up to twenty-
five percent of the capacity of the Project Gazelle Mill to its
own gypsum plant in Duke, Oklahoma.
12. OTHER COVENANTS OF REPUBLIC.
---------------------------
(a) Republic will review and become familiar with the process
requirements and unique needs of Xxxxxx'x gypsum facilities and
equipment.
(b) Republic will obtain performance guarantees and warranties from
its key vendors and contractors.
13. OTHER COVENANTS OF XXXXXX. Until the later of October 1, 2005 or the
-------------------------
fifth anniversary of the Commercial Production Date, Xxxxxx will promptly advise
Republic in writing if it or any United States Affiliate of Xxxxxx offers to
buy, lease or otherwise acquire any North American paperboard mill, or any
interest therein, whether direct or indirect.
18
14. TERMINATION. In the event of a material breach of this Agreement,
-----------
either party shall give written notice to the defaulting party of the breach and
of the non-defaulting party's intention to terminate this Agreement if the non-
defaulting party is not, within thirty (30) days from and after receipt of the
written notice of default, provided with a plan of corrective action and if
substantial efforts to cure the default in accordance with the plan have not
commenced. If such substantial efforts to cure the default as provided above
have not commenced within such thirty (30) day period, the non-defaulting party
may terminate this Agreement by sending written notice to the other party of
such termination, whereupon this Agreement shall terminate and the non-
defaulting party, subject to the terms of this Agreement, shall be entitled to
pursue any remedies provided by law. In the event the non-defaulting party
elects to terminate this Agreement, the notice of termination must be sent to
the defaulting party within five (5) days after the expiration of the thirty
(30) day period first mentioned above. The failure of any party to exercise its
option to terminate this Agreement shall not affect any other rights the party
may have in law or equity.
15. FORCE MAJEURE.
-------------
(a) In the event of an Act of God, explosion, accident, fire,
drought, flood, earthquake, tornado, hurricane, strike, labor
disturbance, insurrection, riot, war, act of a public enemy, the
acts or orders of a governmental unit, freight embargo, power or
utility shortage, or any other similar cause beyond Republic's or
Xxxxxx'x reasonable control, interfering with the production,
supply, transportation or consumption of the Products or with the
supply of raw materials or utilities used in connection therewith
(a "Force Majeure Event"), the obligation of Republic to supply,
and the obligation of Xxxxxx to purchase, Products hereunder
shall be proportionately reduced or held in abeyance for the
duration of the Force Majeure Event and the term of this
Agreement shall be extended for a period equal thereto. The
failure or inability of any one or all of Republic's advisors,
agents, consultants, designers, engineers, lenders, suppliers or
vendors to perform their contractual or other obligations to
Republic in connection with the development, construction or
operation of the Gazelle Mill shall not be considered a Force
Majeure Event. The affected party shall promptly notify the
other of any Force Majeure Event, and the expected duration of
the party's inability to perform under the terms of this
Agreement. If a Force Majeure Event results in or may reasonably
be expected to result in an inability of Republic to ship
Products for more than seven days past their scheduled shipping
dates, then Xxxxxx may purchase the Products covered by any
orders so affected by the Force Majeure Event from other
suppliers. NEITHER REPUBLIC NOR XXXXXX SHALL BE LIABLE FOR ANY
DAMAGES, DIRECT OR CONSEQUENTIAL, ARISING OUT OF ANY DELAY IN
DELIVERY OR FAILURE TO DELIVER OR ACCEPT ANY OF THE PRODUCTS SOLD
HEREUNDER IF SUCH DELAY OR FAILURE TO DELIVER OR ACCEPT IS DUE TO
A FORCE MAJEURE EVENT FOR WHICH APPROPRIATE NOTICE HAS BEEN
GIVEN.
19
(b) Any suspension or reduction of deliveries of Products under this
Agreement due to the occurrence of any Force Majeure Event shall
not invalidate or be a basis for termination of this Agreement,
and, upon the removal or termination of the Force Majeure Event
during the term of this Agreement, delivery shall be made and
taken, as the case may be, on the specified terms in effect
immediately prior to such suspension or reduction. The foregoing
notwithstanding, if Republic is unable to resume shipments of
Products from the Project Gazelle Mill within one hundred eighty
(180) days after the occurrence of a Force Majeure Event, Xxxxxx
may, in its sole discretion, terminate this Agreement, with no
further obligation to Republic.
(c) If in consequence of any Force Majeure Event, Republic's
production is partially curtailed, Republic shall limit its
reductions of shipments to its then-present customers to the same
percentage in each case.
(d) The provisions of this paragraph 15 shall not be available to any
party hereto that shall fail to use reasonable diligence to
remedy the situation and that shall fail to remove the Force
Majeure Event affecting its performance hereunder with all
reasonable dispatch, or to give timely notice of the occurrence
of the Force Majeure Event. The requirement that any Force
Majeure Event be remedied with all reasonable dispatch shall not
require the settlement of strikes or labor controversies by
acceding to the demands of the opposing party or parties.
16. MUTUAL INDEMNIFICATION. Except as otherwise expressly provided
----------------------
herein, Republic shall indemnify and hold harmless Xxxxxx and its Affiliates and
each of the heirs, executors, successors and assigns of Xxxxxx or any such
Affiliate from and against, and will pay the amount of, any loss, liability,
claim, damage, obligation, fine, proceeding and expense (including reasonable
costs of investigation and defense and reasonable attorney's fees and other
incidental costs and expenses) suffered or incurred by Xxxxxx arising from,
relating to or in connection with: (i) any breach of any representation or
warranty made by Republic in this Agreement; (ii) any breach by Republic of any
covenant or obligation of Republic in this Agreement, including any such breach
caused by the failure of any of Republic's contractors or suppliers to fulfill
their obligations to Republic in connection with the development or construction
of the Project Gazelle Mill; or (iii) any and all actions, suits, proceedings,
claims, demands, assessments, judgments, costs and expenses (including
reasonable legal fees and expenses) incident to any of the foregoing or incurred
in investigating or attempting to avoid the same or to oppose the imposition
thereof or in enforcing this indemnity. Except as otherwise expressly provided
herein, Xxxxxx shall indemnify and hold harmless Republic and its Affiliates and
each of the heirs, executors, successors and assigns of Republic or any such
Affiliate from and against, and will pay the amount of, any loss, liability,
claim, damage, obligation, fine, proceeding and expense (including reasonable
costs of investigation and defense and reasonable attorney's fees and other
incidental costs and expenses) suffered or incurred by Republic arising from,
relating to or in connection with: (x) any breach of any representation or
warranty made by Xxxxxx in this Agreement; (y) any breach by Xxxxxx of its
obligations under this Agreement; or (z) any and all actions, suits,
proceedings, claims, demands,
20
assessments, judgments, costs and expenses (including reasonable legal fees and
expenses) incident to any of the foregoing or incurred in investigating or
attempting to avoid the same or to oppose the imposition thereof or in enforcing
this indemnity.
17. BANKRUPTCY. In the event of any voluntary or involuntary bankruptcy,
----------
receivership, insolvency or reorganization proceedings involving either party or
its property, or the assignment of all, or substantially all, of the assets of
either party for the benefit of creditors, or a receiver is appointed for it or
any substantial part of its property, the other party may terminate its
obligations hereunder by giving written notice of such termination which shall
become effective upon the giving of such notice. Such right of termination
shall be in addition to, and not in lieu of, any other rights or remedies
available to the non-breaching party.
18. ASSIGNMENT.
----------
(a) This Agreement shall be binding upon and inure to the benefit of
the successors of the parties hereto but shall not be assignable
by either party without the written consent of the other party
except:
(i) subject to compliance with the other subparagraphs of this
paragraph 18, this Agreement may be assigned by operation of
law to the surviving or resulting entity in connection with
a merger or consolidation of such party;
(ii) subject to compliance with the other subparagraphs of this
paragraph 18, this Agreement may be assigned by either party
to the purchaser or transferee of substantially all the
other assets of the assigning party in connection with a
sale or other transfer of all or substantially all of the
assets of the assigning party;
(iii) subject to compliance with the other subparagraphs of this
paragraph 18, Xxxxxx may assign this Agreement to the
purchaser or transferee of all of Xxxxxx'x gypsum wallboard
manufacturing plants referenced on Exhibit A hereto (the
---------
"Xxxxxx Plants") or Xxxxxx may assign its rights under this
Agreement insofar as they relate to any Xxxxxx Plant to the
purchaser or transferee of such Xxxxxx Plant;
(iv) subject to compliance with the other subparagraphs of this
paragraph 18, Republic may assign this Agreement to a
purchaser or transferee of the Project Gazelle Mill;
(v) nothing in this Agreement shall prevent Xxxxxx or Republic
from entering into a mortgage, deed of trust, grant of a
security interest, sale and leaseback or other security
device (a "Security Device") with respect to any or all of
the Xxxxxx Gypsum Plants or the Project Gazelle Mill,
respectively, to obtain or secure financing; provided,
21
that any such Security Device shall expressly provide and
require that upon any foreclosure, taking, lease termination
or other exercise of remedies pursuant thereto, the parties
thereto shall take all such action as shall be required to
cause the person or persons owning or controlling the Xxxxxx
Gypsum Plants or the Project Gazelle Mill, as applicable,
after such exercise of remedies to assume in writing the
provisions of this Agreement insofar as they relate to the
Xxxxxx Gypsum Plant or the Project Gazelle Mill, as
applicable, owned or controlled by such person; provided,
further, that Republic shall not enter into any such
Security Device with respect to the Project Gazelle Mill
without a provision in the Security Device that obligates
the secured party to give Xxxxxx notice of any proposed
exercise of remedies affecting the Project Gazelle Mill with
respect to a default by Republic thereunder, and without
first providing such language to Xxxxxx.
(b) Notwithstanding subparagraph (a) above, in the event that Xxxxxx
shall merge or consolidate with another entity or sell or
otherwise transfer any of the Xxxxxx Plants (whether pursuant to
a sale or transfer of all or substantially all of its assets or
the sale or transfer of one or more of the Xxxxxx Plants), Xxxxxx
shall require the surviving company in such merger or any such
transferee to assume and agree to perform in writing the
provisions of this Agreement for the full term of this Agreement
(or if less than all the Xxxxxx Plants are sold or transferred,
then the provisions of this Agreement insofar as they relate to
the Xxxxxx Plants sold or transferred), and in the event that
Republic shall merge or consolidate with another entity or sell
or transfer the Project Gazelle Mill, Republic shall require the
surviving company in such merger or any such transferee to assume
and agree to perform in writing the provisions of this Agreement
for the full term of this Agreement.
(c) No such assignment or assumption of this Agreement, in whole or
in part, shall relieve the assigning party of any of its
obligations hereunder.
(d) If Republic proposes to sell, transfer or otherwise dispose of
the Project Gazelle Mill (other than pursuant to a Security
Device that complies with paragraph 18(a)(v) hereof) or merge or
consolidate with another entity or sell or transfer all or
substantially all of its assets to another person, or receives
any bona fide, firm proposal from a third party to purchase or
otherwise acquire the Project Gazelle Mill or for the merger or
consolidation of Republic into or with another entity or for the
sale of all or substantially all its assets to another person
which proposal it proposes to accept, then Republic must first:
(i) promptly inform Xxxxxx that Republic intends to so dispose of
the Project Gazelle Mill and (ii) keep Xxxxxx informed of the
progress Republic is making in disposing of the Project Gazelle
Mill. Republic shall consult with Xxxxxx concerning methods of
ensuring, and shall
22
take commercially reasonable steps to ensure, that any
disposition of the Project Gazelle Mill will not have a material
adverse effect on Xxxxxx. Nothing contained herein shall prevent
Xxxxxx, upon receipt of any such notice from Republic, from
making an offer to Republic to acquire the Project Gazelle Mill.
19. CONFIDENTIALITY.
---------------
(a) Xxxxxx and Republic acknowledge and agree that they may come into
possession of certain information about each other's operations,
either through visits to each other's facilities or through an
exchange of documents or other information, including, but not
limited to, specific designs and specifications of their
respective facilities, the speed, throughput and other
performance characteristics of their respective facilities, their
cost of production and the specifications and selling prices of
their products, all of which are confidential and proprietary
information of the respective parties (the "Confidential
Information"). Xxxxxx and Republic further acknowledge and agree
that the other would be damaged by the disclosure of the
Confidential Information to competitors or to others, and by the
use of the Confidential Information to compete with the other.
Accordingly, each of Xxxxxx and Republic agrees that it will
maintain the confidentiality of, and not disclose to persons
other than its employees with a specific need to know such
information and who have been advised of and who have agreed to
be bound by this covenant, any of the Confidential Information,
or use such Confidential Information to compete with the other.
(b) "Confidential Information" does not include information which:
(i) is or becomes generally available to the public other than as
a result of a disclosure by the receiving party, its Affiliates
or employees; (ii) was within the possession of the receiving
party, its Affiliates or employees prior to its being furnished
to such party by or on behalf of the furnishing party, provided
that the source of such information was not known by the
receiving party, its Affiliates or employees to be bound by a
confidentiality agreement with or other contractual, legal or
fiduciary obligation of confidentiality to the furnishing party
or any other party with respect to such information; or (iii)
becomes available to the receiving party on a non-confidential
basis from a source other than Republic or any of its Affiliates
or employees, provided that such source is not bound by a
confidentiality agreement with or other contractual legal or
fiduciary obligation of confidentiality to the furnishing party
or any other party with respect to such information.
Notwithstanding any other provision of this Agreement, the
Confidentiality Agreement dated March 4, 1997 between Republic
Parent and Xxxxx Xxxxxx Industries (USA) Inc. shall remain in
full force and effect. To the extent there is any conflict
between such Confidentiality Agreement and this Agreement, this
Agreement shall control.
23
(c) In the event that Xxxxxx or Republic or any of their Affiliates
or employees are requested or required (by deposition,
interrogatories, request for information or documents, subpoena,
civil investigative demand or other similar process in legal
proceedings) to disclose any of the other's Confidential
Information, the receiving party shall provide the furnishing
party with prompt written notice of any such request or
requirement so that it may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of
this Paragraph. If, in the absence of a protective order or
other remedy or the receipt of a waiver from the furnishing
party, the receiving party or any of its Affiliates or employees
are nonetheless, in the opinion of counsel, legally compelled to
disclose any Confidential Information to any tribunal or else
stand liable for contempt or suffer other censure or penalty, the
receiving party or its Affiliates or employees may, without
liability hereunder, disclose to such tribunal only that portion
of the Confidential Information which such counsel advises the
receiving party is legally required to be disclosed, provided
that the receiving party exercises its commercially reasonable
efforts to preserve the confidentiality of the Confidential
Information including, without limitation, by cooperating with
the furnishing party to attempt to obtain an appropriate
protective order or other reliable assurance that confidential
treatment will be accorded the Confidential Information by such
tribunal. The furnishing party will promptly reimburse the
receiving party for any and all costs and expenses (including
attorneys' fees and expenses) which it may suffer or incur as a
result of its compliance with this subparagraph (c) unless the
proceeding in which such disclosure is being sought results in
substantial part from a breach by the receiving party of its
obligations hereunder.
20. NON-SOLICITATION. Xxxxxx and Republic each agree that, during the
----------------
term of this Agreement and for a period of one year thereafter, it will not, and
will not permit any of its Affiliates to, directly solicit, other than through
normal advertising for employees, or knowingly hire, any former, present or
future management employee, engineer, technician or salesperson of the other;
provided, that this paragraph 20 shall not apply to any person who has not been
employed by the other party or its Affiliates for a period of at least one year.
21. NOTICES. All notices, requests or other communications hereunder
-------
shall be in writing, addressed to Republic or Xxxxxx at the following addresses:
REPUBLIC PAPERBOARD COMPANY OR REPUBLIC GROUP INCORPORATED
(for notices by personal delivery, overnight express or telecopy):
000 Xxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxx
Telecopier: (000) 000-0000
24
(for notices by registered or certified mail):
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxxx 00000-0000
Attn: Xx. Xxxxx X. Xxxxxx
with a copy to:
Xxxxx X. Xxxxxx, Esq.
. Xxxxx Xxxxxxx Rain Xxxxxxx
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telecopier: (000) 000-0000
XXXXX XXXXXX GYPSUM, INC.
00000 Xx Xxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxx
Telecopier: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxxxxx, Esq.
Xxxxxxxxx, Xxxxxxxxx & Xxxxxx
000 Xxxx X Xx., Xxx. 0000
Xxx Xxxxx, XX 00000
Telecopier: (000) 000-0000
The address of either party may be changed by giving notice in writing at any
time to the other party. Any notice to be given under this Agreement shall be
deemed duly given if: (i) delivered personally; (ii) sent by telecopy (if
followed by delivery of a hard copy by first class mail, postage prepaid); (iii)
delivered by overnight express; or (iv) sent by United States registered or
certified mail, postage prepaid. Any notice that is delivered personally, or
sent by telecopy or overnight express in the manner provided herein shall be
deemed to have been duly given to the party to whom it is directed upon actual
receipt by such party. Any notice that is addressed and mailed in the manner
provided herein shall be conclusively presumed to have been given to the party
to which it is addressed at the close of business, local time of the recipient,
on the third day after it is so placed in the mail.
22. NON-WAIVER. The failure of either party to insist in any one or more
----------
instances upon strict performance of any of the provisions of this Agreement or
to take advantage of any of its rights hereunder shall not be construed as a
waiver of any such provisions or the relinquishment of any such rights, but the
same shall continue and remain in full force and effect.
25
23. ENTIRE AGREEMENT. This Agreement (including the Exhibits hereto which
----------------
are an integral part hereof) sets forth the entire agreement between the parties
hereto with respect to the subject matter hereof, and the parties shall not be
bound by any representations or agreements which are not expressly set forth in
this Agreement.
24. AMENDMENTS. No modification, amendment or waiver of any provision of
----------
this Agreement shall be effective unless in writing signed by an authorized
officer of each of the parties hereto.
25. COUNTERPARTS. This Agreement may be executed in one or more
------------
counterparts, each of which shall for all purposes be deemed to be an original
and all of which together shall constitute one and the same instrument.
26. CAPTIONS. The captions of the various paragraphs of this Agreement
--------
are for convenience of reference only and shall not affect the interpretation of
the provisions hereof.
27. GOVERNING LAW. This Agreement shall be governed by, and construed in
-------------
accordance with, the laws of the State of Texas (other than its choice of law
principles).
28. DISPUTE RESOLUTION; MEDIATION AND ARBITRATION.
---------------------------------------------
(a) If any controversy, dispute, difference or claim between the
parties hereto shall arise concerning the performance,
enforcement or interpretation of this Agreement (collectively, a
"Dispute"), prior to the initiation of any proceedings pursuant
to any other provisions of this paragraph 28, the Dispute shall
be referred to the chief executive officers of Republic and
Xxxxxx for resolution.
(b) If a Dispute is not resolved pursuant to subparagraph (a) within
fifteen (15) business days after it is referred to the chief
executive officers of Republic and Xxxxxx, either party may by
notice to the other party require mediation of the Dispute. Each
party agrees to participate in mediation of the Dispute and will
in good faith attempt to agree upon a mediator. If the parties
are unable to agree upon a mediator within ten (10) business days
after such notice or if such Dispute shall not have been resolved
by mediation within twenty (20) business days after such notice,
then either party may file for arbitration pursuant to
subparagraph (c) below. All expenses of the mediator shall be
equally shared.
(c) If the parties to this Agreement are unable to settle a Dispute
through direct negotiation in good faith or through mediation
pursuant to subparagraphs (a) and (b) within the time period
specified therein, the Dispute shall be submitted to binding
arbitration. Except as otherwise provided herein, the
arbitration shall be conducted in accordance with the then
effective Commercial Rules of Practice and Procedure of American
Arbitration
26
Association ("AAA"). The arbitration proceedings shall take place
in Dallas, Texas.
(d) Within five (5) business days after notice from one party to the
other requesting binding arbitration, the parties shall agree on
and select one arbitrator from the AAA panel. If within such five
(5) business-day period, the parties are unable to agree upon an
arbitrator, each of them shall have five (5) business days
following the expiration of that period to select an arbitrator
from the AAA panel that is not an affiliate of a party to this
Agreement. If either party fails to timely select an arbitrator,
AAA shall make the selection for such party. Within five (5)
business days following their selection, the two selected
arbitrators shall agree upon and select a third arbitrator for
the AAA panel. The arbitrator or arbitrators, whether one or
three persons, are hereinafter called "Arbitrators." If the
parties are unable to agree on a time and place in Dallas, Texas
for arbitration, the Arbitrators shall decide the time and place.
The Arbitrators shall hear the matter within thirty (30) days
after selection and shall render a decision promptly after the
hearing. The Arbitrators shall make a final decision that, in
their judgment, (i) is consistent with, and does not add to,
subtract from, or otherwise modify, the provisions of this
Agreement or related agreements or (ii) if the subject matter of
the Dispute is not specifically addressed in this Agreement, is
determined under this Agreement consistent with the intent of the
parties as supported by evidence presented in the arbitration
proceedings. The Arbitrators shall send a signed written
statement of their decision to AAA and both parties. In awarding
damages or other remedies or relief, the Arbitrators must honor
and abide by any applicable limitations or restrictions expressed
or described in the Agreement. The Arbitrators are not empowered
to award damages in excess of compensatory damages, and each
party hereby irrevocably waives any right to recover such damages
with respect to any Dispute resolved by arbitration.
(e) To the extent permissible under Texas law, the parties agree that
the award of the Arbitrators shall be final and not subject to
judicial review. Judgment on the arbitration award may be
entered and enforced in any court having jurisdiction over the
parties or their respective assets. It is the intent of the
parties that the arbitration provisions hereof be enforced to the
fullest extent permitted by Texas law.
(f) Nothing in the foregoing arbitration provisions shall limit the
rights of the parties otherwise described in this Agreement to
obtain provisional, ancillary, or equitable remedies, such as
injunctive relief or specific performance.
(g) Each party shall pay its own expenses of arbitration and the
expenses of the Arbitrators shall be equally shared; provided,
however, if in the opinion of the Arbitrators any claim by either
party hereunder or any defense or
27
objection thereto by the other party was unreasonable and not
made in good faith, the Arbitrators may assess, as part of the
award, all or any part of the arbitration expense (including,
without limitation, reasonable attorneys' fees) of the other
party and of the Arbitrators against the party raising such
unreasonable claim, defense, or objection. Nothing herein set
forth shall prevent the parties from settling any dispute by
mutual agreement at any time.
29. SPECIFIC PERFORMANCE; INJUNCTIVE AND OTHER EQUITABLE RELIEF. Each
-----------------------------------------------------------
party hereto acknowledges that a violation or attempted violation of any of the
covenants and agreements in paragraphs 3(e), 16, 17, 18 and 19 hereof, and in
Exhibit A hereof, will cause such damage to the other party as will be
---------
irreparable, the exact amount of which would be difficult or impossible to
ascertain and for which there will be no adequate remedy at law, agrees that the
other party hereto shall be entitled as a matter of right to specific
performance and injunctive and other equitable relief in case of such violation
or attempted violation as well as any and all costs and expenses sustained or
incurred in obtaining any such equitable relief, including, without limitation,
reasonable attorneys' fees, and agrees to waive any requirement for the securing
or posting of any bond or other security in connection with the obtaining of any
such injunction or other equitable relief.
30. PUBLIC ANNOUNCEMENTS. Neither Xxxxxx nor Republic shall make, nor
--------------------
permit any Affiliate or representative to make, any public statements,
including, without limitation, any press releases, with respect to this
Agreement or the transactions contemplated thereby without the prior written
consent of the other parties hereto, except to the extent required by law or the
rules of any national securities exchange or automated quotation system on which
such party's securities are listed or traded.
31. TIME OF THE ESSENCE. With regard only to the dates specified in: (i)
-------------------
the last sentence of paragraph 3(c) hereof; (ii) the last sentence of paragraph
3(e) hereof; and (iii) the last sentence of paragraph 15(b), time is of the
essence.
32. NO JOINT VENTURE. The parties hereto have not entered into any
----------------
partnership, joint venture, agency or other such relationship by virtue of this
Agreement.
[The remainder of this page is intentionally left blank.]
28
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by the respective officers as of the date first written above.
REPUBLIC PAPERBOARD COMPANY
By: /s/ Xxxx Xxxxxxx
-------------------------------
Xxxx Xxxxxxx, Chairman of the
Board, President and Chief
Executive Officer
XXXXX XXXXXX GYPSUM, INC.
By: /s/ Xxxxxx X. Xxxx
-------------------------------
Xxxxxx X. Xxxx, President
Republic Parent shall cause Republic to perform, and hereby guarantees the
performance by Republic of, all of Republic's obligations under this Agreement.
The obligations of Republic Parent under this paragraph shall not be modified,
released, diminished or affected by: (i) any modification, amendment, waiver,
release, adjustment, indulgence, forbearance, compromise, deferral or extension
of or with respect to any obligations of Republic hereunder; (ii) any delay or
forbearance or lack of diligence by Xxxxxx in exercising its rights hereunder
against Republic; (iii) the bankruptcy, insolvency, rearrangement, adjustment,
composition, liquidation or dissolution of Republic or any action taken,
election made, preference or claim for refund asserted or sustained in any
proceeding with respect thereto; (iv) any lack of power or authority of
Republic; (v) the taking or accepting by Xxxxxx of any other security,
collateral or guaranty or other assurance by Republic of performance; or (vi)
any other action taken or omitted to be taken with respect to the covenants,
agreements and obligations of hereunder, whether or not such action or omission
prejudices Republic Parent or increases the likelihood that Republic Parent will
have to perform the obligations of Republic.
REPUBLIC GROUP INCORPORATED
By: /s/ Xxxx Xxxxxxx
--------------------------------
Xxxx Xxxxxxx, Chairman of the
Board, President and Chief
Executive Officer
29
EXHIBIT A
---------
RECYCLED GYPSUM GRADE PAPERBOARD REQUIREMENTS
The volume of recycled gypsum-grade paperboard to be purchased by Xxxxxx
and to be supplied by Republic is as follows:
(i) 7% of the recycled gypsum-grade paperboard requirements of the gypsum
wallboard plant located near Nashville, Arkansas that is currently
owned by Xxxxxx until December 31, 2000;
(ii) 95% (plus or minus 5%) of the recycled gypsum-grade paperboard
requirements of the gypsum wallboard plant located near Nashville,
Arkansas that is currently owned by Xxxxxx beginning on January 1,
2001; and
(iii) 95% (plus or minus 5%) of the recycled gypsum-grade paperboard
requirements of the gypsum wallboard plants located at or near Las
Vegas, Nevada and Seattle, Washington that are currently owned by
Xxxxxx beginning on October 1, 2000.
Prior to the Commencement Notice, Republic and Xxxxxx contemplate that test
quantities of the Products produced at the Project Gazelle Mill will be
furnished by Republic and purchased by Xxxxxx and manufactured into gypsum
wallboard. In addition, prior to the Commercial Production Date, Xxxxxx may
purchase and, if requested, Republic will supply, Shaftwall Liner Green and
Veneer Plaster Base pursuant to subparagraph (i) above from its xxxxx other than
the Project Gazelle Mill, provided that, with respect to such Products sold
prior to the Commercial Production Date, the porosity Specification shall be
determined by mutual agreement between the Vice Presidents, Operations, of
Xxxxxx and Republic.
***
If during the term of this Agreement Xxxxxx shall desire to expand the
gypsum wallboard capacity of any of its Nashville, Arkansas, Las Vegas, Nevada
or Seattle, Washington gypsum wallboard plants, Xxxxxx shall promptly notify
Republic in writing of such desire to expand capacity. Republic shall supply and
Xxxxxx shall purchase the recycled gypsum-grade paperboard requirements of such
expanded capacity at the Nashville, Arkansas, Las Vegas, Nevada or Seattle,
Washington gypsum wallboard plants on the same terms and conditions that are
specified in this Paperboard Supply Agreement.
Notwithstanding the foregoing paragraphs on this Exhibit A, the parties
anticipate that the output of the Project Gazelle Mill will be ramping up during
approximately the first twelve months of Commercial Production. During such
ramp-up period, the obligations of Xxxxxx to purchase its
requirements and Republic to sell such amounts will be adjusted proportionally
to the mutual satisfaction of both parties, to accommodate an orderly transition
of supply.
During the term of this Agreement, wallboard production technology may
change so as to make it substantially more economical to utilize paper of a kind
that is not presently commercially available and that Republic does not
contemplate producing at the Project Gazelle Mill. In such a case, Republic
agrees that it will use commercially reasonable efforts to develop the
production capacity at the Project Gazelle Mill for such paper, and Xxxxxx and
Republic will negotiate in good faith to include such paper within the ambit of
this Agreement to be sold pursuant to pricing mechanism similar to this
Agreement. During such development phase, or if Republic is unwilling or unable
to produce such paper at the Project Gazelle Mill, or if the parties cannot
reach agreement regarding such paper after negotiating in good faith, commencing
on October 1, 2004 and during the remainder of the term of this Agreement,
Xxxxxx may purchase such paper from other suppliers, and Xxxxxx'x demand for
such paper will not be considered part of Xxxxxx'x recycled gypsum-grade
paperboard requirements for purposes of this Agreement.
2
EXHIBIT B
---------
INITIAL BASE PRICES
The initial Base Prices are as follows:
------------------------------
GRADE $/MSF
------------------------------
Cream Face $ ***
------------------------------
Xxxx Back ***
------------------------------
Green-Lined ***
------------------------------
Xxxxx Sheathing ***
------------------------------
Shaftwall Liner Green ***
------------------------------
Veneer Plaster Base ***
------------------------------
3
EXHIBIT C
----------
All specifications on this Exhibit C refer to the test value to be obtained at
the Paperboard Mill at the time of manufacture. For purposes of this Exhibit C,
"NS" shall be defined to mean none specified.
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: CREAMFACE
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES)
a. *** *** ***
b. *** *** ***
c. *** *** ***
DIAMETER: (INCHES) *** *** ***
BRIGHTNESS (% REFLECTANCE @457 NM): *** ***(desired) ***
XXXXXX PLY-BOND (PSI): *** *** ***
SHEFFIELD SMOOTHNESS (SHEFFIELD UNITS): *** ***(desired) ***
APPEARANCE: ***
4
CONVERSION
PROPERTIES: ***
5
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: GREYBACK
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES)
a. ***
b. ***
c. ***
DIAMETER: (INCHES) *** *** ***
XXXXXX PLY-BOND (PSI): *** *** ***
APPEARANCE: ***
CONVERSION
PROPERTIES: ***
6
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: GREEN-LINED
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES) *** *** ***
a. *** *** ***
DIAMETER: (INCHES) *** *** ***
XXXXXX PLY-BOND (PSI): *** *** ***
SHEFFIELD SMOOTHNESS (SHEFFIELD UNITS): *** *** ***
APPEARANCE: ***
CONVERSION
PROPERTIES: ***
7
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: XXXXX SHEATHING
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES)
a. *** *** ***
b. *** *** ***
c. *** *** ***
d *** *** ***
DIAMETER: (INCHES) *** *** ***
XXXXXX PLY-BOND (PSI): *** *** ***
APPEARANCE: ***
CONVERSION
PROPERTIES: ***
8
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: SHAFTWALL LINER GREEN
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES) *** *** ***
a. *** *** ***
b. *** *** ***
DIAMETER: (INCHES) *** *** ***
XXXXXX PLY-BOND (PSI): *** *** ***
SHEFFIELD SMOOTHNESS (SHEFFIELD UNITS): *** *** ***
APPEARANCE: ***
CONVERSION
PROPERTIES: ***
9
XXXXX XXXXXX GYPSUM
PAPER SPECIFICATIONS
TYPE: VENEER PLASTER BASE
MIN. AVE. MAX.
BASIS WEIGHT: (#/MSF) *** *** ***
MOISTURE CONTENT (%): *** *** ***
CALIPER: (INCHES) *** *** ***
POROSITY: ( SECONDS) *** *** ***
WATER ABSORPTION: (XXXX)
------------------------
TOP LINER: (GRAMS) *** *** ***
(CURED) BOND LINER: (GRAMS) *** *** ***
TENSILE STRENGTH:
-----------------
MACHINE DIRECTION (#/INCH): *** *** ***
ACROSS MACHINE DIRECTION (#/INCH): *** *** ***
SATURATION: ( SECONDS) *** *** ***
WIDTH: (INCHES)
a. *** *** ***
DIAMETER: *** *** ***
XXXXXX PLY-BOND (PSI): *** *** ***
APPEARANCE: ***
CONVERSION
PROPERTIES: ***
10
EXHIBIT D
---------
XXXXXX'X REQUIRED FORM OF PURCHASE ORDER
11
[LOGO OF XXXXX XXXXXX PURCHASE ORDER
APPEARS HERE] DATE
PAGE
SUPPLIER: DELIVER TO: INVOICE TO:
--------------------- --------------------- ---------------------
Phone Phone Phone
Fax Fax Fax
--------------------- --------------------- ---------------------
-----------------------------------------------------------------------------------------------------------------------------------
CONTACT NAME BUYER PREFERRED CARRIER SHIPPING TERMS CREDIT TERMS
-----------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY QTY PART DESCRIPTION UNIT PER REQUIRED EXTENDED PRICE
CODE U/M PRICE DATE (EXCLUDING TAX)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
TOTAL LINE VALUE
XXXX OUR ORDER No. ON INVOICE AND ALL CORRESPONDENCE SALES TAX
FREIGHT
GRAND TOTAL
-------------------------------------
PURCHASING AND ADMINISTRATION MANAGER
EXHIBIT E
---------
REPUBLIC'S REQUIRED FORM OF ACKNOWLEDGMENT
12
Order Date Republic Order
MANUFACTURING FACILITY:
[LOGO OF REPUBLIC GYPSUM COMPANY
APPEARS HERE]
------------------------------------------------------------------------------------------------------------------------------------
CUSTOMER NO TERMS: F.O.B. FREIGHT CUSTOMER P.O.# SALES TERRITORY CPA # OR FORMULA REQUIRED DATE
------------------------------------------------------------------------------------------------------------------------------------
Sold Ship
to: to:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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