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SUPPLY AGREEMENT
BY AND BETWEEN
GENERAL FELT INDUSTRIES, INC.
(as assigned to Foamex Carpet Cushion, Inc.)
AND
FOAMEX L.P.
Dated as of February 27, 1998
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TABLE OF CONTENTS
Page
ARTICLE I. PRICE, DELIVERY AND TERMS OF SALE ............................... 1
Section 1.1. Purchase of Products .................................. 1
Section 1.2. Purchase Price; Terms of Sale ......................... 1
Section 1.3. Payment of Price; Remedies ............................ 3
Section 1.4. Title; Risk of Loss ................................... 4
Section 1.5. Title and Quality of Goods ............................ 4
Section 1.6. Purchaser's Use of Products ........................... 5
Section 1.7. Certain Third Party Claims ............................ 5
Section 1.8. Force Majeure ......................................... 5
Section 1.9. Certain Services ...................................... 6
ARTICLE II. TERM ........................................................... 6
Section 2.1. Term .................................................. 6
Section 2.2. Events of Default ..................................... 6
Section 2.3. Notice of Event of Default; Lenders' Right to Cure .... 7
Section 2.4. Termination ........................................... 7
Section 2.5. Effect of Termination ................................. 8
ARTICLE III. REPRESENTATIONS AND WARRANTIES ................................ 8
Section 3.1. Mutual Representations and Warranties ................. 8
ARTICLE IV. MISCELLANEOUS PROVISIONS ....................................... 8
Section 4.1. Notices ............................................... 8
Section 4.2. Amendments ............................................ 9
Section 4.3. Parties in Interest; Third-Party Beneficiaries ........ 10
Section 4.4. Expenses .............................................. 10
Section 4.5. Entire Agreement ...................................... 11
Section 4.6. Descriptive Headings .................................. 11
Section 4.7. Counterparts .......................................... 11
Section 4.8. Governing Law; Dispute Resolution ..................... 11
Section 4.9. Construction .......................................... 12
Section 4.10. Severability .......................................... 12
(i)
SUPPLY AGREEMENT
SUPPLY AGREEMENT, dated as of February 27, 1998 (the "Agreement"),
by and between General Felt Industries, Inc., a Delaware corporation ("GFI"),
and Foamex L.P., a Delaware limited partnership ("Foamex").
WHEREAS, GFI wishes to purchase from Foamex, and Foamex wishes to
sell to GFI, finished prime, rubber and rebond carpet underlay ("Foamex Finished
Products"), trim foam, and other raw materials and supplies for rubber and
rebond carpet underlay ("Foamex Raw Materials", and together with the Foamex
Finished Products, the "Foamex Products") for use in the carpet cushion
business.
WHEREAS, Foamex wishes to purchase from GFI, and GFI wishes to sell
to Foamex, nonwoven textile fiber products ("GFI Finished Products"), trim foam,
and other raw materials and supplies ("GFI Raw Materials", and together with the
GFI Finished Products, the "GFI Products") for use in the flexible polyurethane
and advanced polymer foam business.
NOW, THEREFORE, in consideration of the premises and the mutual
representations and covenants contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I.
PRICE, DELIVERY AND TERMS OF SALE
Section 1.1. Purchase of Products.
(a) GFI shall have the option of purchasing from Foamex, and
Foamex shall sell, subject to the limitations set forth herein, to GFI
upon its reasonable request, up to 100% of GFI's total annual requirements
for Foamex Products at such time and in such amounts set forth in the
prior written request of GFI.
(b) Foamex shall have the option of purchasing from GFI, and GFI
shall sell, subject to the limitations set forth herein, to Foamex upon
its reasonable request, up to 100% of Foamex's total annual requirements
for GFI Products at such time and in such amounts set forth in the prior
written request of Foamex.
Section 1.2. Purchase Price; Terms of Sale.
(a) (i) The purchase price per unit of Foamex Finished Products
shall be the lesser of (i) Foamex's Cost
for such unit plus four and seven-tenths percent (4.7%), or (ii) the Fair
Market Value for such unit of Foamex Finished Products.
(ii) The purchase price per unit of Foamex Raw Materials
shall be the lesser of (i) Foamex's Price for such unit, or (ii) the Fair
Market Value for such unit of Foamex Raw Materials.
(b) (i) The purchase price per unit of GFI Finished Products
shall be the lesser of (i) GFI's Cost for such unit plus fifteen percent
(15%), or (ii) the Fair Market Value for such unit of GFI Finished
Products.
(ii) The purchase price per unit of GFI Raw Materials shall
be the lesser of (i) GFI's Price for such unit, or (ii) the Fair Market
Value for such unit of GFI Raw Materials.
(c) For purposes of this Agreement, "Cost" means (A) when used
with reference to the Foamex Finished Products, Foamex's variable cost
associated with the production of the Foamex Finished Products, together
with allocated overhead consistent with Foamex's historic practices, and
(B) when used with reference to the GFI Finished Products, GFI's variable
cost associated with the production of the GFI Finished Products, together
with allocated overhead consistent with GFI's historic practices. Cost
shall include, but not be limited to: (i) raw materials, (ii) labor, (iii)
packaging, (iv) shipping, and (v) allocated portions of the following: (x)
machinery and equipment, (y) occupancy, and (z) corporate overhead.
(d) For purposes of this Agreement, "Price" means (A) when used
with reference to the Foamex Raw Materials, Foamex's cost associated with
the purchase of the Foamex Raw Materials, and (B) when used with reference
to the GFI Raw Materials, GFI's cost associated with the purchase of the
GFI Raw Materials. Price shall include, but not be limited to: (i)
purchase price, (ii) freight, (iii) duty, (iv) taxes, (v) cash discounts
and (vi) volume rebates.
(e) For purposes of this Agreement, "Fair Market Value" means (A)
when used with reference to the Foamex Products, the price which a company
which is reasonably able to supply the Foamex Products on terms and
conditions no less favorable to GFI than Foamex, is willing to sell the
Foamex Products to GFI and (B) when used with reference to the GFI
Products, the price which a company which is reasonably able to supply the
GFI Products on terms and conditions no less favorable to Foamex than GFI,
is willing to sell the GFI Products to Foamex.
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Section 1.3. Payment of Price; Remedies.
(a) Except as otherwise expressly agreed to by GFI and Foamex: (i)
the payment terms for all sales shall provide for payment in full being
due within 30 days of the invoice date and (ii) all other terms of sale,
including discounts and volume rebates, shall be similar to those provided
by Foamex or GFI, as applicable, to a similarly situated third party (if
any), not affiliated with Foamex or GFI, as applicable, purchasing a
similar quantity and type of Foamex Products or GFI Products, as
applicable.
(b) (i) GFI shall pay all taxes and duties that are now or in
the future may be imposed, increased or levied on Foamex in connection
with the manufacture, sale or transportation of the Foamex Products
(except income taxes). All amounts due under the terms of this Agreement
shall be paid without regard to any right of set-off or other obligations
due and owing between the parties, except for set-off of amounts currently
due and owing under this Agreement. GFI shall pay all expenses that Foamex
may incur in connection with the enforcement of its rights under the terms
of this Agreement, including, but not limited to, expenses of collection
(including reasonable attorney's fees).
(ii) Foamex shall pay all taxes and duties that are now or in
the future may be imposed, increased or levied on GFI in connection with
the manufacture, sale or transportation of the GFI Products (except income
taxes). All amounts due under the terms of this Agreement shall be paid
without regard to any right of set-off or other obligations due and owing
between the parties, except for set-off of amounts currently due and owing
under this Agreement. Foamex shall pay all expenses that GFI may incur in
connection with the enforcement of its rights under the terms of this
Agreement, including, but not limited to, expenses of collection
(including reasonable attorney's fees).
(c) (i) If (x) GFI fails to make timely payments hereunder, or
(y) GFI has amounts due hereunder greater than $25 million and Foamex has
reason to believe GFI will not be able to meet its financial obligations
hereunder, then without prejudice to any other rights which Foamex may
have, Foamex may (i) defer shipment of Foamex Products, (ii) in the case
of clause (x), accelerate the due date on all amounts GFI owes to Foamex,
or (iii) require cash payments or a letter of credit or comparable
security for Foamex Products purchased.
(ii) If (x) Foamex fails to make timely payments hereunder,
or (y) Foamex has amounts due hereunder greater
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than $25 million and GFI has reason to believe Foamex will not be able to
meet its financial obligations hereunder, then without prejudice to any
other rights which GFI may have, GFI may (i) defer shipment of GFI
Products, (ii) in the case of clause (x), accelerate the due date on all
amounts Foamex owes to GFI, or (iii) require cash payments or a letter of
credit or comparable security for GFI Products purchased.
Section 1.4. Title; Risk of Loss.
(a) Title to, and risk of loss of, the Foamex Products shall pass
to GFI upon acceptance of the Foamex Products by GFI. As used in this
paragraph, "acceptance" shall mean the earlier of (i) payment for the
Foamex Products, or (ii) delivery of the Foamex Products as specified in
the terms of sale of Foamex.
(b) Title to, and risk of loss of, the GFI Products shall pass to
Foamex upon acceptance of the GFI Products by Foamex. As used in this
paragraph, "acceptance" shall mean the earlier of (i) payment for the GFI
Products, or (ii) delivery of the GFI Products as specified in the terms
of sale of GFI.
Section 1.5. Title and Quality of Goods.
(a) Foamex shall deliver to GFI good title to the Foamex Products
purchased hereunder, subject to no encumbrance, imperfection of title,
security interest or lien. The Foamex Products purchased hereunder shall
be "merchantable" as such term is defined in Section 2-314(2) of the
Uniform Commercial Code, and shall contain such additional warranties as
the parties may expressly agree in writing. The foregoing are the sole
warranties respecting the Foamex Products and are made expressly in lieu
of and exclude any other express or implied warranty of merchantability
and fitness for a particular purpose and all other express or implied
representations and warranties.
(b) GFI shall deliver to Foamex good title to the GFI Products
purchased hereunder, subject to no encumbrance, imperfection of title,
security interest or lien. The GFI Products purchased hereunder shall be
"merchantable" as such term is defined in Section 2-314(2) of the Uniform
Commercial Code, and shall contain such additional warranties as the
parties may expressly agree in writing. The foregoing are the sole
warranties respecting the GFI Products and are made expressly in lieu of
and exclude any other express or implied warranty of merchantability and
fitness for a particular purpose and all other express or implied
representations and warranties.
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Section 1.6. Use of Products.
(a) GFI shall have sole and exclusive responsibility for the safe
use, selection, handling and disposal of the Foamex Products. GFI shall:
(a) comply with any product information provided by Foamex at any time,
and (b) follow safe handling, use, selling, storage, transportation, and
disposal practices and instruct its employees, contractors, agents and
customers in these practices.
(b) Foamex shall have sole and exclusive responsibility for the
safe use, selection, handling and disposal of the GFI Products. Foamex
shall: (a) comply with any product information provided by GFI at any
time, and (b) follow safe handling, use, selling, storage, transportation,
and disposal practices and instruct its employees, contractors, agents and
customers in these practices.
Section 1.7. Certain Third Party Claims.
(a) Regardless of any investigation at any time made by or on
behalf of Foamex or of any knowledge or information that Foamex may have,
GFI indemnifies and agrees to fully defend, save and hold Foamex and any
of its affiliates, other than GFI and its subsidiaries, harmless if Foamex
or any of its affiliates, other than GFI and its subsidiaries, shall at
any time or from time to time suffer any damage, liability, loss, cost,
expense (including all reasonable attorneys' fees), claim or cause of
action (collectively, "Damages") arising out of or resulting from, or
shall pay or become obligated to pay any sum on account of, the use by GFI
of the Foamex Products or the inclusion of the Foamex Products in any
goods or other items sold, manufactured, or produced by GFI, other than
any Damages arising out of any defect in any Foamex Product or the gross
negligence or wilful misconduct of Foamex.
(b) Regardless of any investigation at any time made by or on
behalf of GFI or of any knowledge or information that GFI may have, Foamex
indemnifies and agrees to fully defend, save and hold GFI and any of its
affiliates other than Foamex and its subsidiaries, harmless if GFI or any
of its affiliates other than Foamex and its subsidiaries shall at any time
or from time to time suffer any Damages arising out of or resulting from,
or shall pay or become obligated to pay any sum on account of, the use by
Foamex of the GFI Products or the inclusion of the GFI Products in any
goods or other items sold, manufactured, or produced by GFI, other than
any Damages arising out of any defect in any GFI Product or the gross
negligence or wilful misconduct of GFI.
Section 1.8. Force Majeure. Each party to this Agreement shall be
excused, and no liability shall result, from
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delay or nonperformance under the terms of this Agreement directly or indirectly
caused by circumstances beyond the control of the party affected (other than
financial incapacity), including, but not limited to, acts of God, fire,
explosion, flood, war, whether declared or not, insurrection or civil disorder,
acts of, or authorized by, any Government, accident, labor trouble or shortage,
or inability to obtain material, equipment or transportation.
Section 1.9. Certain Services. The parties hereto agree that if
either party provides the other party with services which are not covered
pursuant to Section 1.1 hereof or a separate agreement, including pursuant to an
administrative services agreement, such services shall be provided at a price
equal to the fair market value of such services.
ARTICLE II.
TERM
Section 2.1. Term. The initial term of this Agreement shall be
until December 31, 2004 (the "Term") and shall thereafter continue from year to
year unless either (i) written notice of termination is given by Foamex or GFI,
as the case may be, not less than thirty (30) days nor more than sixty (60) days
prior to the end of such year, or (ii) terminated earlier in accordance with
Section 2.4.
Section 2.2. Events of Default. Each of the following with
respect to a party to this Agreement shall constitute an "Event of Default" with
respect to such party:
(a) a material breach of a representation or warranty by such
party or the failure by such party to fulfill its material obligations
under the terms of this Agreement;
(b) the failure to pay any amounts due under this Agreement;
(c) upon the entry of any decree or order for relief in respect of
such party hereto under any bankruptcy, reorganization, compromise,
arrangement, insolvency, adjustment of debt, dissolution or liquidation or
similar law, whether now or hereafter in effect, of any jurisdiction; and
(d) with respect to Foamex the occurrence of an "Event of Default"
under the credit agreement, dated as of February 27, 1998, (as such
agreement may be amended from time to time, the "Foamex Credit Agreement")
among Foamex, certain of its affiliates, the financial institutions party
thereto as "Lenders" and Citicorp USA, Inc. and The Bank of Nova Scotia as
administrative agents.
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Section 2.3. Notice of Event of Default; Lenders' Right to Cure.
(a) Upon the occurrence of an Event of Default specified in
clauses (a), (b) or (d) of Section 2.2, the party asserting the Event of
Default shall give notice of such Event of Default to the party with
respect to which such Event of Default has occurred.
(b) In addition,
(i) if the party with respect to which such Event of Default
has occurred is Foamex, notice shall also be given to the
"Collateral Agent" on behalf of the Lenders under the Foamex Credit
Agreement (the "Foamex Lenders") if such agreement is outstanding;
and
(ii) if the party with respect to which such Event of Default
has occurred is GFI or its successors, notice shall also be given to
(x) the "Collateral Agent" on behalf of the Lenders under the TFLLC
Credit Agreement (as such term is defined in Section 4.3) as the
holder of the "New GFI Note" (as such term is defined in the TFLLC
Credit Agreement) if such agreement is outstanding, and (y) the
"Collateral Agent" on behalf of the Lenders under the New GFI Credit
Agreement (as such term is defined in Section 4.3) if such agreement
is outstanding (collectively, the "New GFI Lenders").
Section 2.4. Termination. Notwithstanding Section 2.1, this
Agreement may be terminated prior to the expiration of the Term by GFI on the
one hand, or by Foamex on the other hand (the "Terminating Party"):
(a) upon the occurrence of an Event of Default described in
Section 2.2(c) with respect to the other party (the "Defaulting Party");
(b) upon the occurrence of an Event of Default described in
Section 2.2(a) with respect to the Defaulting Party, if such Event of
Default shall be continuing sixty (60) days after the later of notice
pursuant to Section 2.3(a) or (b); provided, however, that Foamex may not
terminate this Agreement pursuant to this clause (b) so long as the New
GFI Note or the New GFI Credit Agreement is outstanding;
(c) in the case of an Event of Default described in Section
2.2(b), seven Business Days after the later of (i) notice of default under
Section 2.3(a), and (ii) if required, notice of default under Section
2.3(b), if such default has not been cured either by Foamex or the Foamex
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Lenders in the case of a Foamex Event of Default or by GFI or the GFI
Lender in the case of a GFI Event of Default; and
(d) with respect to Foamex, the acceleration of amounts due under
the Foamex Credit Agreement.
Section 2.5. Effects of Termination. Upon termination of this
Agreement, this Agreement (other than Sections 1.6, 1.7, 2.5 and 4.8, which
shall survive termination and continue in full force and effect) shall
thereafter become void and have no effect, and no party hereto shall have any
liability or obligation to any other party hereto in respect of this Agreement
except for payments due or accrued on or prior to the date of termination.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
Section 3.1. Mutual Representations and Warranties. Foamex
represents and warrants to GFI and GFI represents and warrants to Foamex as
follows:
(a) It has all requisite power and authority to execute, deliver
and perform this Agreement, and the execution of this Agreement has been
duly authorized and all necessary action has been taken by it in
connection therewith.
(b) This Agreement is a legal, valid and binding obligation of it,
enforceable against it in accordance with its terms and conditions, except
as enforcement may be limited by bankruptcy, insolvency or other similar
laws affecting the enforcement of creditors' rights generally and except
that the availability of equitable remedies, including specific
performance, is subject to the discretion of the court before which any
proceeding therefor may be brought.
(c) It is not under any obligation to any party, contractual or
otherwise, that is conflicting or inconsistent in any respect with the
terms of this Agreement or that would impede the diligent and complete
fulfillment of its obligations hereunder.
ARTICLE IV.
MISCELLANEOUS PROVISIONS
Section 4.1. Notices. All notices, demands or other
communications to be given or delivered under or by reason of the provisions of
this Agreement shall be in writing and shall be deemed to have been given (a)
when delivered personally to the
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recipient, (b) when sent to the recipient by telecopy (receipt electronically
confirmed by sender's telecopy machine) if during normal business hours of the
recipient, otherwise on the next business day, (c) one (1) business day after
the date sent to the recipient by reputable express courier service (charges
prepaid) or (d) seven (7) business days after the date mailed to the recipient
by certified or registered mail, return receipt requested and postage prepaid.
Such notices, demands and other communications will be sent to the parties at
the addresses indicated below:
(a) If to GFI: General Felt Industries, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx
Facsimile No. (000) 000-0000
With a copy Xxxxxxx Xxxx & Xxxxxxxxx
(which shall 000 X. 00xx Xxxxxx
not constitute Xxx Xxxx, XX 00000
notice) to: Attention: Xxxx X. Xxxxxxx
Facsimile No. (000) 000-0000
(b) If to Foamex: Foamex L.P.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx
Facsimile No. (000) 000-0000
With a copy Xxxxxxx Xxxx & Xxxxxxxxx
(which shall 000 X. 00xx Xxxxxx
not constitute Xxx Xxxx, XX 00000
notice) to: Attention: Xxxx X. Xxxxxxx
Facsimile No. (000) 000-0000
(c) If to the GFI Lenders:
Citicorp USA, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile No. (000) 000-0000
(d) If to the Foamex Lenders:
Citicorp USA, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile No. (000) 000-0000
or to such other address as any party hereto may, from time to time, designate
in writing.
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Section 4.2. Amendments. The terms, provisions, and conditions of
this Agreement may not be changed, modified, or amended in any manner except by
an instrument in writing duly executed by all of the parties hereto.
Section 4.3. Parties in Interest; Third-Party Beneficiaries.
(a) Neither this Agreement nor any of the rights, duties, or
obligations of any party hereunder may be transferred or assigned by a
party hereto, except (i) as provided in (b) and (c) below, (ii) with the
written consent of the other party hereto, or (iii) by either party to an
affiliate or a successor to all or substantially all of such party's
business, including by General Felt Industries, Inc. to Foamex Carpet
Cushion, Inc. Subject to the foregoing, this Agreement shall be binding
upon, and inure to the benefit of the parties hereto and their respective
successors and assigns.
(b) Notwithstanding the foregoing paragraph, GFI acknowledges that
Foamex has entered into the Foamex Credit Agreement and consents to Foamex
granting a security interest to the Collateral Agent (as defined in the
Foamex Credit Agreement) in Foamex's rights under this Agreement.
(c) Notwithstanding the foregoing paragraph, Foamex acknowledges
that the proposed successor to GFI, Foamex Carpet Cushion, Inc. will enter
into two issues of indebtedness, each secured by a collateral assignment
of this Agreement: (i) the Credit Agreement (as such agreement may be
amended from time to time, the "New GFI Credit Agreement") among Foamex
Carpet Cushion, Inc., the financial institutions party thereto as
"Lenders" and Citicorp USA, Inc. and The Bank of Nova Scotia as
administrative agents, and (ii) a $70.2 million promissory note (the "New
GFI Note") in favor of Trace Foam LLC ("TFLLC"), which will in turn be
collaterally assigned to secure the term loan facility (as such agreement
may be amended from time to time, the "TFLLC Credit Agreement") among
TFLLC the financial institutions party thereto as "Lenders" and Citicorp
USA, Inc. and The Bank of Nova Scotia as administrative agents. Foamex
hereby consents to such pledge and assignments.
(d) This Agreement shall not confer any rights or remedies upon
any person or entity other than the parties hereto, the Collateral Agents
under the Foamex Credit Agreement and the New GFI Credit Agreement, and
the holder of the New GFI Note, respectively, as provided in paragraphs
(b) and (c) above and their respective permitted successors and assigns.
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Section 4.4. Expenses. Except as expressly set forth herein, each
party to this Agreement shall bear all of its legal, accounting, and other
expenses incurred by it or on its behalf in connection with this Agreement.
Section 4.5. Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to the subject matter
hereof, supersedes and is in full substitution for any and all prior agreements
and understandings between them relating to such subject matter, and no party
shall be liable or bound to the other party hereto in any manner with respect to
such subject matter by any warranties, representations, indemnities, covenants,
or agreements except as specifically set forth herein.
Section 4.6. Descriptive Headings. The descriptive headings of
the several sections of this Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
hereof.
Section 4.7. Counterparts. For the convenience of the parties,
any number of counterparts of this Agreement may be executed by any one or more
parties hereto, and each such executed counterpart shall be, and shall be deemed
to be, an original, but all of which shall constitute, and shall be deemed to
constitute, in the aggregate but one and the same instrument.
Section 4.8. Governing Law; Dispute Resolution.
(a) This Agreement shall be governed by and interpreted and
enforced in accordance with the laws of the State of New York without
giving effect to the conflict of law provisions thereof.
(b) The parties shall initially attempt to resolve by direct
negotiation any dispute, controversy or claim arising out of or relating
to this Agreement or its breach, interpretation, termination or validity
(each, a "Dispute").
(c) If the parties are not able to settle the Dispute by direct
negotiations within thirty (30) days after written notice by one party to
the other of the Dispute, either party may initiate an arbitration to
resolve the Dispute; the parties hereto agree that arbitration pursuant to
this Section shall be the sole means of resolving Disputes, and that
neither party shall commence any proceeding in any court or tribunal with
respect to a Dispute. All such Disputes shall be arbitrated in New York,
New York pursuant to the Rules of the American Arbitration Association.
The arbitrators shall be selected in accordance with the rules of the
American Arbitration Association, and shall be certified public
accountants, attorneys or other persons, in
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each case, who are experienced in the buying and selling of goods.
(d) Judgment upon any award rendered by the arbitrators may be
entered in any court having jurisdiction. The statute of limitations,
estoppel, waiver, laches, and similar doctrines, which would otherwise be
applicable in any action brought by a party shall be applicable in any
arbitration proceeding and the commencement of an arbitration proceeding
shall be deemed the commencement of an action for those purposes. The
Federal Arbitration Act shall apply to the construction, interpretation
and enforcement of this arbitration provision.
(e) No party shall be liable to pay consequential, punitive,
exemplary or incidental damages to any other party for any claims related
to or arising out of the performance or nonperformance of this Agreement.
Except as set forth in Section 1.7, Foamex's total liability for such
claims as seller of the Foamex Products is limited, at GFI's option, to
either (i) replacement or (ii) repayment of the purchase price paid for
the Foamex Products which are the subject of the claim. Except as set
forth in Section 1.7, GFI's total liability for such claims as seller of
the GFI Products is limited, at Foamex's option, to either (x) replacement
or (y) repayment of the purchase price paid for the GFI Products which are
the subject of the claim.
Section 4.9. Construction. The language used in this Agreement
will be deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction will be applied against any party.
Any references to any statute or law will also refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise.
Section 4.10. Severability. In the event that any one or more of
the provisions contained in this Agreement, shall, for any reason, be held to be
invalid, illegal or unenforceable in any respect, then to the maximum extent
permitted by law, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement. Furthermore, in lieu of any such
invalid or unenforceable term or provision, the parties hereto intend that there
shall be added as a part of this Agreement a provision as similar in terms to
such invalid or unenforceable provision as may be possible and be valid and
enforceable.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed all as of the date first set forth above.
GENERAL FELT INDUSTRIES, INC.
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
FOAMEX L.P.
By: FMXI, Inc.
Its: Managing General Partner
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxxx
+ Title: Vice President
The undersigned hereby assumes the obligations of General Felt
Industries, Inc. under this Supply Agreement.
FOAMEX CARPET CUSHION, INC.
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President
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