EXHIBIT 2.5.1
AMENDED AND RESTATED COMMERCIAL AGREEMENT
The Purpose of this Agreement by and between Compania Industrial de Parras, S.A.
de C.V. ("Parras"), Cone Mills Corporation ("Cone"), and Parras Cone de Mexico,
S.A. de C.V. ("JV") is to (i) terminate and supersede the prior Commercial
Agreement dated as of June 25, 1993 as well as the Commercial Agreement dated as
of July 1, 1999, and (ii) to set forth the terms under which products produced
by Parras Cone de Mexico, S.A. de C.V., will be sold and distributed.
Based on the above, Parras, Cone and JV agree as follows:
1. Parras, Cone, and JV release each other from any and all claims in
connection with the Commercial Agreement entered into between the
parties dated as of June 25, 1993 as well as with the Commercial
Agreement dated as of July 1, 1999. Parras and Cone will sell their
respective products unrestrictedly worldwide.
2. Cone shall be the exclusive seller and distributor of JV products. In
consideration for the marketing rights for the JV, Cone will pay Parras
a marketing rights fee of 3.5% (three and one-half percent) of the net
customer sales of JV product. This payment will be payable on a monthly
basis the 25th day of the second month following the month the
calculation is based upon.
3. In situations that Cone invoices the customer, the price that the JV
invoices Cone will be the estimated customer selling price for that
style for the quarter less a service fee of 12%(twelve percent). The JV
will invoice Cone on terms consistent with those given to the customer.
Said service fee will cover all expenses such as selling costs, the
marketing rights fee, product improvement, logistics, production
programming, etc. Each quarter Cone shall submit a schedule to the JV
showing actual prices. Any adjustment of the actual billings from JV to
Cone will be made 45 days following the end of the quarter with a debit
or credit memo to be issued by the JV for the difference between
estimated customer selling prices and actual prices. Parras shall be
entitled at any time to review and/or audit sales of JV products
effected through Cone. For purposes of this paragraph net sales shall
be after deductions of amounts representing: credits by JV for returned
or defective merchandise; allowances to customers, trade and other
discounts; sales, excise, value added and similar taxes levied upon
sales.
4. In situations that the JV bills the actual customer due to value added
tax considerations, Cone will be paid by JV a service fee of 12%(twelve
percent) of the net sales of JV for such customers. Said service fee
will cover all expenses such as selling costs, the marketing rights
fee, product improvement, logistics, production programming, etc. The
payment of the service fee by the JV will be payable on a monthly basis
the 25th day of the second month following the month the calculation is
based upon. For purposes of this paragraph net sales shall be after
deductions of amounts representing: credits by JV for returned or
defective merchandise; allowances to customers, trade and other
discounts; sales, excise, value added and similar taxes levied upon
sales. Cone will be responsible for credit losses to these customers.
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5. From time to time should Parras request that Cone make a sale of
production from the JV to key customers of Parras, Cone agrees to
attempt to honor such request in accordance with Paragraph 3 above.
6. Any dispute relating to this agreement shall be finally settled by
arbitration under the Rules of Arbitration of the International Chamber
of Commerce in effect on the date hereof. This agreement shall be
arbitrated in and governed and construed in accordance with the laws of
the state of New York.
7. Parras and Cone agree to honor each others trademarks and trade names
and grant to JV a non-exclusive non-assignable right to use the Parras
and Cone names as a composite.
8. Unless earlier terminated by mutual consent, this Agreement shall be
reviewed upon the third (3rd) anniversary of the date hereof, and
automatically renew with any changes to be mutually agreed to by the
parties.
IN WITNESS WHEREOF, the parties have caused their duly appointed
representatives to execute this Agreement effective as of December 12, 2000.
COMPANIA INDUSTRIAL DE CONE MILLS CORPORATION
PARRAS, S.A. DE C.V.
By: /s/ Rodolfo Garcia Muriel By: /s/ Gary L. Smith
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Name: Name: Gary L. Smith
Title: Title: Executive Vice President and
Chief Financial Officer
PARRAS CONE DE MEXICO, S.A. DE C.V.
By: /s/ Ernesto Lappe
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Name: Ernesto Lappe
Title: OP Director
