1
EXHIBIT 10(c)
JOINT MARKETING AGREEMENT
This Joint Marketing Agreement is made between Sii CHEMTECH, a business
unit of XXXXX INTERNATIONAL, INC., a Delaware corporation ("CHEMTECH"), with its
principal place of business at 0000 XX Xxxxxxx 00 Xxxx, Xxxxxxxxx, Xxxxxxxxx
00000 and UNITED ENERGY CORPORATION, a Nevada corporation ("UNRG"), with its
principal place of business at 000 Xxxxxxxxxxx Xxxxxxx #00, Xxxxxxxx, XX 00000,
and becomes effective on the 1st day of March, 2000 ("Effective Date").
RECITALS
UNRG desires to obtain sales of the oil and gas well production
enhancement products which it manufactures and which are more fully described in
this Agreement.
UNRG also has various oil and gas industry contacts and has received
inquiries leading to industry oil servicing projects.
CHEMTECH represents that it has experience and expertise in the servicing
of oil and gas xxxxx and related equipment such as pipelines and flowlines, and
also sells various chemical treatment products to the oil and gas industry; and
The parties wish to form a joint marketing agreement on the terms set out
below providing for the sales of their respective products and for compensation
to UNRG for its oil servicing introductions and to CHEMTECH for its marketing
and servicing activities in connection with such venture.
In consideration of the foregoing and the mutual promises contained
herein, the parties agree as follows:
1. PLAN AND PURPOSE:
The parties anticipate that from time to time UNRG will develop projects
in the oil and gas industry which involve the use of UNRG's KH-30 paraffin
dispersant and other oil field chemical treatment programs. CHEMTECH is in the
business of providing oil field services and, in particular, chemical treatment
programs. The parties wish to structure an arrangement which will make best use
of the capabilities and products of each to their mutual benefit. Each of the
parties expects to provide chemical treatment products to this marketing
arrangement for use and/or resale. UNRG is to receive a fee for projects it
develops for the arrangement and CHEMTECH will receive a servicing fee for that
portion of the project which involves providing a service all as more fully set
out below. As used in this Agreement, "Products" mean all items of both parties
separately listed in APPENDIX A. From time to time, the parties may add or
delete individual items from the list.
2
2. RELATIONSHIP OF THE PARTIES:
a. This Agreement shall not be construed as creating any partnership, joint
venture, association or other entity. It is the intent of the parties that the
relationship is solely that of parties with contractual commitments to one
another as expressly set forth in this Agreement; that their rights and
obligations with respect to one another will be solely those expressed in this
Agreement; that neither party shall be the agent of the other for any purpose
under this Agreement; and that the liabilities and obligations of the parties
incurred in connection with this Agreement shall be separate.
The joint marketing arrangement will be specifica1ly limited to the products
listed on Appendix A and to the oil servicing contacts listed on Appendix B and
will be in addition to the other activities of each of the parties.
c. This Joint Marketing Agreement shall be non-exclusive.
d. The primary marketing and assembling of project proposals ("Proposals") to
the oil servicing contacts listed on Appendix B (collectively "Customers") of
the Products and services to be offered by the parties pursuant to this
Agreement shall be completed with CHEMTECH personnel and with UNRG personnel.
Either party shall have the right to initiate the drafting of any Proposals, but
any such Proposals mentioning the involvement of the other party or proprietary
technology or information of the other party shall be approved in writing by
such other party prior to the time that the Proposal is submitted to the
Customer.
3. SALES PURSUANT TO JOINT MARKETING AGREEMENT:
As stated above, UNRG is to receive a fee for projects it develops for the
arrangement and CHEMTECH will receive a servicing fee for that portion of the
project which involves providing a service. The parties agree that the
compensation set forth in APPENDIX C will apply to any sales pursuant to this
Joint Marketing Agreement.
4. DURATION AND TERMINATION:
a. Subject to Paragraph 4.b. below, this Agreement shall expire on March 1,
2003. Renewal may be only by a writing signed by both parties. Either party may
cancel this Agreement at any time, without liability and without prejudice to
any other right or claim arising under this Agreement, if the other party
materially breaches this Agreement. Material breaches shall include, but not be
limited to:
1. Failure of the joint marketing arrangement to make timely payment for
Products delivered or services rendered;
3
2. Making an assignment in favor of creditors, voluntarily filing in
bankruptcy, becoming insolvent or failing to dispel reasonable questions
concerning a party's financial integrity.
3. Failure of the joint marketing arrangement to timely exploit a contract
opportunity presented by a party.
4. Failure by the joint marketing arrangement to pay any service fee or
introduction fee to a party.
The party seeking to terminate shall give the other party written
notice of that party's breach, and the party receiving the notice shall have
thirty (30) days to correct the breach. If it fails to correct the breach within
thirty (30) days, this Agreement may then be terminated.
b. The term of this Agreement shall automatically be extended for such
period of time as may be required to perform or complete any projects or
contracts entered into or undertaken prior to the expiration of such term
("Unfinished Projects"). Within thirty (30) days prior to the expiration of this
Agreement, if either party believes that it will be necessary for the Agreement
to be extended to permit the performance or completion of any Unfinished
Projects, such party shall give written notice thereof to the other party
specifying the Unfinished Projects, the obligations thereunder that remain to be
completed, and an estimate of the amount of time required for such completion.
Following such notice, the term of the Agreement shall be extended with respect
to the Unfinished Project(s) identified therein to the extent necessary to
complete the remaining unsatisfied obligations within the estimated time frame
specified in such notice, unless within ten (10) days after receipt of such
notice the recipient sends a written response to the other party noting any
exceptions that it may have to the scope or term of the Unfinished Project. Any
resulting disagreement between the parties regarding the extension of the Term
pursuant to this Paragraph 4.b. shall be resolved in accordance with Paragraph
15 below.
5. PRICES, TERMS OF SALE AND PAYMENT:
Prices for Products will be as set forth in Appendix C. Sales will be
F.O.B. each party's nearest distribution center. Freight will be prepaid and
billed on the invoice. Federal, state, city or other taxes will be added to the
invoice, where applicable.
b. Invoices will be due within thirty (30) days of the invoice date. In
the event the joint marketing arrangement does not pay amounts owed when due, a
party in its sole discretion and in addition to any other right or remedy
granted by law to this Agreement, may protect its interest by:
4
1. Refusing to deliver Products until all sums owed have been paid.
2. Delivering only on a cash on delivery (C.O.D.) basis; or
3. Delivering on other secured terms satisfactory to such party.
6. INVENTORY:
Each party shall establish and maintain an inventory of Products
reasonably adequate to serve the joint marketing arrangement's customers.
7. OTHER COMPENSATION TO THE PARTIES:
See Appendix C.
8. WARRANTY:
a. Each party warrants that for a period of thirty (30) days from the date
of delivery to the joint marketing arrangement, the Product will:
1. Be uniform in formulation and will conform to the statements, if
any, made in technical literature in current distribution by a party at the time
of shipment;
2. Be free of title defects.
THERE ARE NO OTHER WARRANTIES, EXPRESSED OR IMPLIED, IN CONNECTION WITH
THE SALE OF ANY PRODUCT OR SERVICE BY A PARTY, INCLUDING ANY IMPLIED WARRANTIES
OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE.
b. The joint marketing arrangement is not authorized to extend any other
warranties to its customers with respect to Products. The joint marketing
arrangement agrees to honor all other warranties it gives to its customers and
to indemnify and save harmless each party from all expenses, cost or liability,
including attorneys' fees arising from a claim or action based, in whole or in
part, on such other warranties.
c. Any service rendered will be in a good and workmanlike fashion and in
accordance with industry standards.
CLAIMS, REMEDIES, LIABILITY AND INSURANCE:
5
a. The joint marketing arrangement's exclusive remedy for breach of the
foregoing warranties shall be limited to replacement of the non-conforming
Product or its value. Each party's sole liability for non-conforming Products
will be, at the option of such party, replacement on a no-charge basis or a
credit issued for the invoice cost of the non-conforming Products. Despite a
claim, the joint marketing arrangement shall promptly pay for all conforming
Products. IN NO EVENT WILL A PARTY BE RESPONSIBLE FOR ANY SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES.
b. Notice of non-conforming Products must be made promptly to a party in a
writing which states the nature of the non-conformity and is accompanied by
samples of the Product.
c. An action for breach of any provision of this Agreement or with respect
to any Product must be commenced within one (1) year after the cause of action
has accrued.
d. If a party sells Products to the joint marketing arrangement after the
expiration or termination of this Agreement, Paragraphs 8 and 9 shall continue
to apply to all such sales.
e. Each party hereto (for purposes of this Paragraph 9, the "indemnitor")
agrees to defend, indemnify, release and hold harmless the other party hereto,
its affiliates and subcontractors, and each of them (for purposes of this
Paragraph 9, the "indemnitee") with respect to any and all claims, liabilities,
costs and expenses, including court costs and reasonable attorneys' fees
(collectively, "Claims") for:
1. Personal injury (including death arising therefrom) to any and all of
the indemnitee's personnel or the personnel of its affiliates or subcontractors;
and
2. Damage to or loss of property (including, without limitation, plant,
equipment, tools and other property owned, rented or hired) of indemnitee, its
affiliates and its and their subcontractors, and the personnel of the
indemnitee, its affiliates and subcontractors;
howsoever caused, including without limitation the simple negligence or strict
liability (whether statutory or by operation of law) of the indemnitee, but
excluding all Claims resulting from the gross negligence or willful misconduct
of the indemnitee.
f. Each indemnitor agrees to defend, indemnify, release and hold harmless
each indemnitee with respect to any and all claims, liabilities, costs and
expenses, including court costs and reasonable attorneys' fees, for personal
injury (including death arising therefrom) and damage to or loss of property
(including, without limitation, plant, equipment, tools and other property
owned, rented or hired) of any third party (other than indemnitee) to the
extent caused by the negligence of indemnitor, its affiliates and
subcontractors.
6
g. CHEMTECH shall be responsible for insurance coverage as related to its
property and equipment, personnel and other liabilities hereunder. UNRG shall be
responsible for insurance coverage as related to its property and equipment,
personnel and other liabilities hereunder. Each party hereto agrees to cause its
respective underwriters and insurers to waive subrogation against the other
party hereto, its affiliates and subcontractors.
10. INSTRUCTIONS:
Each party will provide the joint marketing arrangement with written
technical and service instruction relating to the use of the Products and may,
at a party's option provide field instruction.
11. SERVICE OBLIGATIONS:
The joint marketing arrangement shall be responsible for providing
complete and satisfactory service and technical advice to its customers for
Products sold by the venture.
12. SUPPLY:
Each party will use its best efforts to maintain a supply of Products
reasonably adequate to fill orders of the joint marketing arrangement on a
timely basis.
13. FORCE MAJEURE:
No party to this Agreement will be held liable for a delay or failure in
performance due to the occurrence of a contingency, the non-occurrence of which
was a basic assumption of this Agreement, including, but not limited to, a
party's failure to deliver because of resource or raw material shortages,
strikes, or other matters beyond its control. If these occur, a party may, in
its sole discretion, allocate Products among its customers.
14. CONFIDENTIALITY:
Because of this Agreement and previous dealings, each party may learn
information which is confidential and proprietary to the other, including
without limitation information concerning the Products of each party. The
parties agree to keep all such information confidential until the information
becomes public, the relationship between the parties has been ended for six (6)
months or the party who initially possessed the information agrees in writing to
its disclosure, whichever happens first. Each party further agrees that it will
not attempt to analyze or otherwise determine the chemical composition of the
Products and that it will not manufacture and/or sell the Products
7
(other than its own) in competition with the joint marketing arrangement. This
provision will survive the termination of this Agreement.
15. MEDIATION/ARBITRATION:
a. At such time as the representative of either party determines that a
dispute or disagreement has arisen under this Agreement that cannot reasonably
be expected to be resolved through negotiations between the representatives, the
party whose representative has reached that conclusion shall have the right to
send written notice to the other party requesting the chief executive officers
of each party to begin to meet within five (5) days from the date of such notice
for purposes of attempting to resolve the dispute. If such notice is sent, the
chief executive officers of each party shall have their first meeting at a
mutually acceptable location within five (5) days from the date of such notice
in an effort to resolve the dispute and disagreement, but if such dispute is not
resolved within ten (10) days from the date of the notice, then the parties may
proceed to attempt to resolve the dispute pursuant to Paragraph l5.b.
b. If a dispute or controversy arises under this Agreement and the parties
are unable to resolve the dispute pursuant to Paragraph 15.a., either party may
request by written notice to the other party and to the Judicial Arbitration and
Mediation Services ("JAMS") (or similar mediation service of a similar national
scope if JAMS no longer then exists) that JAMS appoint an independent mediator,
who shall serve as mediator for all purposes hereof. CHEMTECH and UNRG shall
each pay an equal proportion of the cost of the mediator's services, in advance
upon request by the mediator or any party. Within ten (10) days after
appointment of the mediator, the mediator shall schedule a meeting among the
parties and the mediator for the purpose of mediating the dispute. If the
parties do not resolve the dispute within thirty (30) days after appointment of
the mediator, mediation shall be terminated and either party may then submit the
dispute for resolution by binding arbitration pursuant to Paragraph 15.c.
hereof.
c. Within thirty-five (35) days after the appointment of the mediator, if
the dispute that was submitted to mediation has not been resolved, either party
may initiate arbitration pursuant to the Commercial Arbitration Rules (the
"Rules") of the American Arbitration Association (the "AAA") by sending written
notice of the initiation of such arbitration to AAA in accordance with the
Rules, and contemporaneously sending a copy of such notice to the other party.
Thereafter, such arbitration shall proceed in accordance with the Rules. The
substantive laws of the State of New York (excluding conflict of laws
provisions) shall apply to such arbitration which shall be held in New
York/Chicago/Houston.
NOTICES:
a. All correspondence, notices, demands or other communications which
under the terms of this Agreement are required to be served or delivered shall
be in
8
writing and may be served or delivered personally or by facsimile addressed to
the parties as follows:
CHEMTECH, a business unit of
Xxxxx International, Inc.
0000 XX Xxxxxxx 00 Xxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Block
Phone: (000) 000-0000
Fax: (000) 000-0000
UNITED ENERGY CORPORATION
000 Xxxxxxxxxxx Xxxxxxx #00
Xxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
17. MISCELLANEOUS:
a. The joint marketing arrangement is not an agent or employee of either
party and agrees to make no statement or representation, orally or otherwise,
which could be so construed. The joint marketing arrangement also agrees that no
commitment or representation made by its servants, representatives, agents or
employees shall bind either party. The joint marketing arrangement agrees to
indemnify and save each party harmless from any cost or expense, including
attorneys' fees, occasioned by such an unauthorized commitment, representation
or warranty.
b. The joint marketing arrangement will not use advertising, signs and
other forms of communication with the party's name, brands, logos or Products
without prior written approval from such party.
c. The waiver by either party of enforcement of any provision of this
Agreement shall not be a waiver of subsequent breach of the same or other
provision.
d. This Agreement shall be binding on the parties hereto, their respective
successors and assigns. This Agreement is not assignable by either party without
prior written consent of the other.
e. This Agreement may not be modified or renewed orally, and no
modification or waiver of any provision herein shall be valid unless in writing
and signed by the party against whom enforcement is sought.
9
f. This Agreement shall be construed and applied in accordance with the
laws of the State of New York, including its Uniform Commercial Code, but not
its conflicts of law rules.
g. Unless otherwise provided, notice required by law or this Agreement
shall be given by Certified Mail to the address shown in this Agreement.
h. Paragraph numbers and titles are inserted for ease of reference and
shall not affect the interpretation or performance of this Agreement.
i. If one or more of the provisions of this Agreement are determined to be
unenforceable or invalid, the remaining provisions shall remain in full force
and effect.
j. NO PARTY TO THIS AGREEMENT SHALL BE LIABLE FOR SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES FOR ANY CLAIM ARISING UNDER THIS AGREEMENT OR FROM
PERFORMANCE OR FAILURE OF PERFORMANCE DUE HEREUNDER.
17. INTEGRATION:
This Agreement constitutes the entire agreement between the parties and
supersedes and cancels all previous oral and written contracts.
IN WITNESS WHEREOF, each party has caused its duly authorized officer to
execute this Agreement.
Sii CHEMTECH, business unit of UNITED ENERGY CORPORATION
XXXXX INTERNATIONAL, INC.
By: /s/Xxxxx X. Block By: [illegible]
------------------------------ -------------------------------------
Title: Director Title: Pres
-------------------------- ----------------------------------
Date: March 28, 2000 Date: 4/11/2000, 2000
--------- ----------
10
APPENDIX A
Products of UNRG Price to Joint Marketing Arrangement
--------------------------------------------------------------------------------
KH-30 See Appendix C
Products of CHEMTECH Price to Joint Marketing Arrangement
--------------------------------------------------------------------------------
ALL PRODUCTION CHEMICALS See Appendix C
This APPENDIX A is incorporated into the JOINT MARKETING AGREEMENT between the
undersigned dated as of the date first written above.
Sii CHEMTECH, business unit of UNITED ENERGY CORPORATION
XXXXX INTERNATIONAL, INC.
By: [SIG] By: [SIG]
--------------------------- -----------------------------
00
XXXXXXXX X
OIL SERVICING CONTACTS
Pemex
Proaltec
International Research & Development (IRD)
12
APPENDIX C
COMPENSATION
As indicated in the Joint Marketing Agreement, each of the parties expects to
provide chemical treatment products to this marketing arrangement for use and/or
resale. The product pricing will be mutually agreed upon on a case by case basis
for the chemicals indicated in Appendix A.
In addition, UNRG is to receive a fee for projects it develops for the
arrangement, which is to be:
UNRG will receive 10% of Gross Profit on the sales of the CHEMTECH
products listed in APPENDIX A for each project. UNRG will continue to receive
10% of Gross Profit of any repetitive production chemical sales for these
projects carried out by the arrangement or by CHEMTECH for customers introduced
by UNRG for one year extended by the mutual consent of both parties.
CHEMTECH will receive a servicing fee for that portion of the project which
involves providing a service as follows:
CHEMTECH will receive $750/day for our Project Coordinator and $550/day for the
Application Specialist plus all travel expenses. In addition, CHEMTECH will
receive a mutually agreed upon percentage of the revenue on each project, to be
decided on a case by case basis.
