ECOSCIENCE CORPORATION
EXHIBIT 10.57
Agreement between Agro Dynamics, Inc. and Grodania A/S, dated
September 29, 1997, with certain confidential material omitted
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THIS AGREEMENT (the "Agreement") is dated September 29, 1997 and made
BETWEEN
(a) AGRO DYNAMICS INC. (hereinafter referred to as the "Distributor"), 00 Xxxxx
Xxxxx, Xxxx Xxxxxxxxx, Xxx Xxxxxx 00000, XXX, duly organized and existing
under the laws of the state of Delaware a subsidiary of EcoScience
(hereinafter referred to "ECS"), 10 Xxxxx Court, duly organized and
existing under the laws of the state of Delaware;
(b) GRODANIA A/S, registration number A/S 104.022, Xxxxxxxxxx 000, 0000
Xxxxxxxxxx, Xxxxxxx, duly organized and existing under the laws of Denmark,
(hereinafter referred to as the "Supplier").
In consideration of the mutual promises, agreements, and covenants hereinafter
set forth, it is mutually agreed as follows:
Clause 1 - Definition
Supplier is a supplier of growing substrates based on mineral wool products for
the horticultural industry/intensive greenhouse farming, sold under the
trademark GRODAN(R) (hereinafter referred to as the "Trademark") which may be
manufactured by Supplier or by other members of the Rockwool International
Group. The Agreement comprises products for growing purposes consisting of
(Confidential).
Clause 2 - Subject Matter of Agreement
2.1. Supplier hereby grants to Distributor the sole and exclusive right to sell
the Products in all of the States of the United States, including its
territories and possessions, Canada, Mexico and the Caribbean (hereinafter
referred to as the "Territory").
Distributor shall not be entitled to export the Products to areas outside
the Territory without the prior written consent from Supplier and
Distributor is obliged to make sales to a third party subject if legally
possible to export clause forbidding exports outside the Territory by such
third party.
2.2. Supplier shall not, except as provided in clause 2.3 and 2.4, export
Products into, or sell Products in the Territory except to Distributor.
Supplier will not establish any distribution in the Territory nor will it
support any distributor other than AGRO DYNAMICS INC. for sale of products
in the Territory. (Confidential).
2.3. In the event of larger projects in the Territory being handled outside the
Territory, Supplier will refer such inquiries to Distributor.
(Confidential).
2.4. (Confidential).
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It is not the intention of Supplier to actively seek direct sales in the
Territory.
(Confidential).
Clause 3 - Distributor's Obligations
3.1. Distributor shall promptly disclose to Supplier all improvements and new
ways of using the Products useful in connection with the use and sale of
the Products developed by Distributor or seen in the territory during the
term of this Agreement, whether patentable or not, and Supplier shall have
the right to make use of the same royalty free. Supplier's right to make
such use shall survive the termination of the Agreement.
3.2. All information relating to GRODAN inventions and other information
furnished by Supplier to Distributor and used by the Distributor pursuant
to this Agreement shall be deemed to be the property of Supplier and to
have been disclosed in confidence and shall be held in confidence by
Distributor. Distributor shall exert all faithful and reasonable efforts to
prevent any disclosure thereof to third parties during the term of this
Agreement and for so long thereafter as such information shall not be
generally known in the trade.
Nothing in this Clause is intended, or shall be construed to prohibit
disclosures to the adviser referred to in Clause 3.7., or to customers in
connection with the use of the Products.
3.3. Distributor shall keep Supplier currently informed about market conditions
in the Territory i.e. state of competition, pricing, activities etc.
3.4. On an annual basis, in September each year, Distributor shall give to
Supplier a plan showing the activities which Distributor will carry through
in order to expand the application of the Products in the Territory. It is
imperative that the plan contains an overall picture of status, budgets and
activities, describing the USA, Canada and Mexico separately.
3.5. Each year before the end of June and December Distributor will furnish
Supplier with a report showing the development of sales in the Territory
compared to the plan and to the corresponding period for the previous year
and a high-light of current activities.
3.6. Distributor shall endeavor to maintain the best possible co-operation with
Supplier in order to maximize sales and in order to secure that present and
potential customers are given a technical, horticultural advisory service
which will enable such customers to appreciate the full benefits connected
with the proper use of the Products and secure optimal growing results.
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3.7. Distributor shall engage fully qualified horticultural, technical advisors,
consistent with market demands and performance requirements of GRODAN.
GRODANIA A/S will implement continuous training programs for said technical
advisors.
3.8. Distributor will, with regular intervals and/or upon reasonable request
disclose to Supplier a list of all customers having purchased the Products
over the previous period. The information per customer will comprise name,
address and telephone number as well as Product(s) purchased. If available,
information about crops, acreage and applications will be added as well.
3.9. Distributor is under an obligation in the Distributors' Delivery Terms to
insert provisions securing that the Supplier cannot be met with claims for
indirect loss of any kind of product liability from sales to Peat Mixers
(buyers mixing Supplier's granulates with other products and selling such
mixed products to end-users or sub-distributors). If such a limitation is
not included in the Distributor's agreement with Peat Mixers and end-users,
the Distributor may not seek reimbursement for any claims made by such Peat
Mixers and/or end-users. If, however, such limitation included in the
Distributor agreement with Peat Mixers and/or end-users is deemed
unenforceable by applicable law, the Distributor shall be entitled to seek
reimbursement from Supplier from and against any such claim from Peat
Mixers and/or end-users asserted against Distributor.
Clause 4 - Supplier's Obligations
4.1. Supplier shall give Distributor access to all information in the possession
of Supplier useful in connection with the sale and use of the Products.
Supplier shall, at his own expense, provide technical business managers in
key marketing areas as deemed necessary by the Supplier for the purpose of
rendering technical advice to Distributor and/or end-users with respect to
sale and application of the Products. All costs concerned with
Distributor's participation to be borne by Distributor. Supplier is at
liberty to pay visits to growers etc. at his own expense and without
Distributor's presence. Both parties agree that it is of great importance
to keep each other informed of customer visits. (Confidential).
4.2. Supplier shall call to the attention of Distributor any other growing
substrates for other market segments, e.g. agriculture, forestry and retail
developed by Supplier - provided they not be replacement for Products as
described under clause 1.1. - during the term of this Agreement, and
Distributor shall have the option to obtain the exclusive right to sell any
such products in the Territory during the term of this Agreement (including
any renewals hereof), provided the parties are able to agree upon terms and
conditions, including minimum purchase values which could be added to the
values as mentioned under clause 10.1., taking appropriate introduction and
evaluation times into consideration.
(Confidential).
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Clause 4.2 does not apply to Supplier's environmental diversification
projects such as Sound Absorbent Walls and Roof Greening which Supplier is
free to develop and market independently of Distributor.
If the Distributor request the Supplier to develop viable products fitting
Distributor's diversification plans, Supplier will in good faith with
active input from Distributor try to reveal whether or not such a product
can be developed. If the Supplier at the Supplier's discretion decides that
such a viable product cannot be developed, the Distributor will still be
limited in Distributor's actions according to the Agreement, of clause 11.
4.3. Supplier shall pass on to Distributor all relevant information about the
inquiries from the Territory which may reach Supplier.
4.4. Supplier warrants and represents to Distributor that this Agreement, when
executed and delivered by the parties, will under Danish law be a valid and
binding agreement, enforceable in accordance with its terms. Likewise,
Distributor warrants and represents to Supplier that this Agreement, when
executed and delivered by the parties will under U.S. law be a valid and
binding agreement enforceable in accordance with its terms.
4.5. (Confidential).
Clause 5 - Prices, Terms and Conditions
5.1. The Supplier has no obligation to supply from any specific location. The
parties have by way of the Agreement modified the clause Ex Works
(INCOTERMS) so that the risk of loss will pass from Supplier to Distributor
at the time where Products have been loaded on to the carrier at the
Supplier's premises in Denmark, Holland and Canada. This alteration of the
time where the risk of loss passes to Distributor has not in any other way
altered the application of the clause Ex Works (INCOTERMS). 90 days before
any change in prices can take effect Supplier and Distributor will enter
into discussions as to the level of such a change. The decision to make a
change in prices is the sole decision of the Supplier and the Supplier will
give (Confidential) days' notice before any change in prices is effected.
The notice shall state the specific prices regarding Products to be applied
after the elapse of the (Confidential) days' notice period.
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Clause 6 - Limitation Damages
6.1. Supplier is never to be held responsible for any loss which a defective
delivery might inflict on buyer or third party in connection with
application of the supplied goods. Responsibility for any form of loss of
profits as well as for any loss inflicted on buyer or third party in
consequence of delay or for any other reason is of no concern of
Supplier's. In the event of larger accounts in the Territory requiring
extra security with regard to deliveries Supplier agrees to negotiate
special conditions with Distributor, these negotiations to be carried out
in good faith and within reasonable time.
Supplier and Distributor shall both take out "Product Liability Insurance"
and Supplier and Distributor shall by way of a statement from either
party's insurance company state coverage (amounts per year and per
occurrence) and own risk of the insured.
Clause 7 - Patents and Protection of Designs
7.1. Distributor undertakes not in any way to attack directly or through third
parties the patents or other proprietary rights belonging to Supplier.
Apart from the above situation Supplier shall indemnify and hold
Distributor harmless from and against any and all claims, damages, losses,
and expenses (including reasonable attorney's fees) based upon or arising
out of any claim or determination (and the investigation thereof) that the
Products violate patents or other proprietary rights of third parties.
Supplier at its sole cost and expense may upon notice to Distributor assume
through counsel the defense of any litigation brought by a third party.
Should Supplier after having been presented with a claim or determination
as mentioned above decide to assume the defense or to discontinue legal
action already assumed, Supplier may terminate this Agreement with
Distributor and Supplier shall only be obliged to pay damages and losses
suffered by Distributor as provided in the first sentence of second
paragraph of this clause 7.1 and expenses to Distributor. Distributor as
provided in the first sentence on the second paragraph of this clause 7.1
shall in this case not be entitled to raise any claim for any other damages
or losses.
Should Distributor in this case wish to assume the defense of legal action
brought by third party Distributor shall be entitled to do so at its own
expense. Should Distributor win the legal action the Agreement shall remain
in full force and effect.
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Clause 8 - Trademark
8.1. Supplier has or shall endeavor to register the "Trademark" and Distributor
shall be entitled to use the Trademark during the term of this Agreement,
but shall not be entitled to register or use, either during the term of
this Agreement or at any time hereafter, any xxxx or name having such
similarity to the Trademark as would be likely to cause confusion.
The Trademark and any and all good-will associated with symbolized by the
Trademark shall be the property of Supplier.
Distributor may in connection with the distribution of Products use the
name "AGRO DYNAMICS INC." or a variant thereof, all of which shall remain
the sole property of Distributor. If distribution is to be made in name of
another company this is to be approved by Supplier which shall not be
unreasonably withheld.
Clause 9 - Sub-dealers
9.1. Distributor shall not be entitled to grant any right to third parties in
the Territory to sell any of the Products, without previous written consent
of the Supplier, which shall not, however, be unreasonably withheld.
Clause 10 - (Confidential).
10.1.Distributor will, during the term of this Agreement, consistent with sound
business practice and using its reasonable efforts, sell and purchase the
maximum amount of Products practicable.
Distributor shall in consultation with Supplier and on an annual basis in
the third quarter of each calendar year, evaluate project potentials, sales
and market share targets and activities for the following calendar year
per.
1. Geographical marketing area
2. Application area
3. Product group
(Confidential).
The minimum purchase comprehends only the Products and not additional
products sold by Distributor according to clause 4.2 or 4.5.
(Confidential).
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Distributor will maintain a reasonable stock of the Products in the
Territory, the quantity to be agreed upon by both parties acting reasonably
and in good faith. Supplier will maintain a reasonable level of product
quality and delivery service.(Confidential).
(Confidential).
10.2. (Confidential).
10.3.Distributor's obligation to purchase the Products shall be excused if
Distributor's or Supplier's failure to perform is due to force majeure,
war, fire, flood, severe weather, accident, strike, delay in
transportation, order of a court or governmental agency, or other causes -
including but not limited to a new or current supplier buying market share
reasonably beyond the control of the party failing to perform.
Clause 11 - Limitations
11.1.During the term of this Agreement Distributor shall not, directly or
indirectly, deal in or produce any products competing with the Products or
any other directly or indirectly competing product in any market segment
including - but not limited to - products for retail, forestry and
agriculture. Any other growing media is regarded as a competitive product,
unless otherwise is agreed to in writing which agreement shall not be
unreasonably withheld by Supplier.
Upon termination of this Agreement whatever the reason might be, both
parties are mutually committed not to pass on any confidential information
having been given by the other party.
Clause 12 - Duration and Termination
12.1.This Agreement shall commence January 1, 1998 and continue until December
31, 2000.
The Agreement substitutes a former agreement entered into between Supplier
and Distributor signed on November 12, 1992 with effect of January 1, 1993.
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This Agreement shall automatically be extended for successive one (1) year
terms unless either party by at least (Confidential) prior written notice
to the other given during the then current term elects reasonably and in
good faith to terminate this Agreement at the end of the then current term.
This Agreement may also be terminated as elsewhere in this Agreement
expressly provided. Any termination of this Agreement as provided anywhere
herein shall not effect any rights or claims of any party arising prior to
such termination.
00.0.Xx the event that either Supplier or Distributor determines during the
original or any extended term of this Agreement to construct or acquire and
operate in the Territory greenhouses or other facilities utilizing the
Products, it will advise the other.
12.3.Either party may terminate the Agreement if the other party fails to
perform any material obligation according to the Agreement. As an example
of a material obligation a reference can be made to clause 12.5.
If a material obligation under the Agreement is not being complied with,
the nondefaulting party can forward a demand to the defaulting party
stating that a non-compliance has occurred and the nature of such
non-compliance. The defaulting party must be given a 2 weeks' notice from
receipt of the demand in order to remedy the breach. If the defaulting
party has not remedied the breach within this time limit, the
non-defaulting party can terminate the Agreement with immediate effect.
In the event that Distributor shall become insolvent, or go bankrupt, or
shall be placed under the control of a receiver, liquidator, or committee
of creditors, or in the event of a judicial or voluntary liquidation of
Distributor, this Agreement may be terminated by the Supplier with
immediate effect.
12.4. (Confidential).
In the event that Distributor shall become insolvent, or go bankrupt, or
shall be placed under control of a receiver, liquidator, or committee of
creditors, or in the event of a judicial or voluntary liquidation of
Distributor, this Agreement may be terminated by the Supplier with
immediate effect.
12.5.(Confidential).
00.0.Xx the event that Supplier decides to completely abandon sales and
distribution of the Products in the Territory for financial, environmental
or other reasons, Supplier may at this sole discretion terminate this
agreement with three (3) months prior written notice.
Clause 13 - Law Applicable
13.1.This Agreement shall be deemed to have been made in Denmark, and Danish
law shall apply to all disputes about its proper interpretation and
application.
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Clause 14 - Settlement of Disputes
14.1.Any disputes arising under this Agreement shall be settled in accordance
with the "Rules of Procedure of the International Court of Arbitration" in
Copenhagen.
Clause 15 - Miscellaneous
15.1 Distributor shall pay any stamp duty imposed in the Territory whereas
Supplier shall pay the Danish stamp duty if any.
15.2.Either Party shall retain one copy of this Agreement duly signed.
15.3.If any of the provisions contained in this Agreement be or come illegal,
such provisions shall be subject to re-negotiations and the remaining
provisions of this agreement shall remain in full force and effect.
15.4.Any amendments to this Agreement shall be deemed to be invalid unless made
in writing and signed by both parties.
15.5.The Distributor will accept that the Supplier transfers all his rights and
obligations to this Agreement to an "Affiliate" of the Supplier.
15.6.ECS has by co-signing this Agreement accepted the Agreement as jointly and
severally liable for all Distributor's obligations under the Agreement.
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(the Distributor) (the Supplier)
AGRO DYNAMICS INC. GRODANIA A/S
by: /s/ Xxxxxxx X. XxXxxxxx by: /s/ Xxxx Xxxxxxxx Xxxxxxxx
---------------------------------- ---------------------------
President and Chief Executive Officer Managing Director
ECOSCIENCE:
by: /s/ Xxxxxxx X. XxXxxxxx
----------------------------------
President and Chief Executive Officer
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