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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
Amendment No. 1
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED NOVEMBER 2, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _______________ TO ________________
Commission File Number: 0-8550
PCA INTERNATIONAL, INC.
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(Exact name of registrant as specified in its charter)
NORTH CAROLINA 56-0888429
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(State or other (I.R.S. Employer
jurisdiction of incorporation or Identification No.)
organization)
815 MATTHEWS-MINT HILL ROAD
MATTHEWS, NORTH CAROLINA 28105
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(Address of principal executive offices)
(Zip Code)
(704) 847-8011
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such report), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
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Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
COMMON STOCK, $0.20 PAR VALUE 7,876,229
- ------------------------------- ------------------------------
CLASS OUTSTANDING AT DECEMBER 2, 1997
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PCA INTERNATIONAL, INC. AND SUBSIDIARIES
I N D E X
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PAGE NO.
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Preliminary Note ................................................................. 3
PART II. OTHER INFORMATION:
ITEM 6. Exhibits and Reports on Form 8-K ................................ 3
SIGNATURES ................................................................. 4
EXHIBIT INDEX ................................................................. 5-6
</TABLE>
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PCA INTERNATIONAL, INC. AND SUBSIDIARIES
Preliminary Note
This Amendment No.1 (this "Amendment") to the Registrant's Quarterly
Report on Form 10-Q for the period ended November 2, 1997 refiles Exhibit 10(r)
and amends Item 6 of Part II and the exhibit index to indicate that certain
information has been omitted from Exhibit 10(r) pursuant to a request for
confidential treatment and that the omitted information has been separately
filed with the Securities and Exchange Commission (the "Commission").
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10(r) Sales Contract dated August 1, 1997 between PCA
International, Inc. and Agfa Division of Bayer
Corporation [certain information has been omitted
from this exhibit pursuant to a request for
confidential treatment and the omitted information has
been separately filed with the Commission pursuant to
Rule 24b-2(b)].
11 Computation of Primary and Fully Diluted Earnings
Per Common Share
27 Financial Data Schedule
(b) Reports on Form 8-K
None
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PCA INTERNATIONAL, INC.
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(Registrant)
Date: December 17, 1997 /s/ Bruce A. Fisher
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Bruce A. Fisher
Senior Vice President
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EXHIBIT INDEX
PCA INTERNATIONAL, INC.
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
INDEX PAGE
NO. DESCRIPTION NO.
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3(a) Restated Charter, as amended to date.
3(b) Bylaws of PCA International, Inc. as amended to date, incorporated by reference to Exhibit 3.4 to the
Company's Quarterly Report on Form 10-Q, Commission File No. 0-8550, for the quarter ended May 3, 1992.
4 Instruments defining the rights of security holders, incorporated by reference to Exhibit 4 to the
Company's Quarterly Report on Form 10-Q, Commission File No. 0-8550, for the quarter ended May 3, 1992.
10(a) License Agreement dated July 29, 1992, between Wal-Mart Corporation and American Studios, Inc.,
incorporated by reference to Exhibit 10.1 to American Studios, Inc. 1992 Form S-1 (Registration No. 33-
58958).
10(b) License Agreement dated May 10, 1996, between Kmart Corporation and PCA International, Inc., incorporated
by reference to Exhibit 10(b) to the Company's Quarterly Report on Form 10-Q for the quarter ended April
28, 1996.
10(d)* The 1990 Non-Qualified Stock Option Plan, incorporated by reference to Exhibit 4 to the Company's
Registration Statement on Form S-8 (Registration No. 33-36793).
10(e)* The 1992 Non-Qualified Stock Option Plan, as amended, incorporated by reference to Exhibit 4 to the
Company's Registration Statement on Form S-8 (Registration No. 33-51458).
10(f) Loan Agreement dated January 27, 1997, between PCA International, Inc., PCA Photo Corporation of Canada,
Inc., PCA Specialty Retail Photo Corporation, Inc., Photo Corporation of America, PCA National, Inc., ASI
Acquisition Corp., and NationsBank, N.A., as Agent, incorporated by reference to the Company's Schedule
14D-1 and Schedule 13-D, Amendment No. 3, dated January 27, 1997.
10(g) Loan Agreement dated February 28, 1997, between PCA International, Inc., PCA Photo Corporation of Canada,
Inc., PCA Specialty Retail Photo Corporation, Inc., Photo Corporation of America, PCA National, Inc., ASI
Acquisition Corp., and NationsBank, N.A., as Agent, incorporated by reference to Exhibit 10(g) to the
Company's Annual Report on Form 10-K for the year ended February 2, 1997.
10(i) Merger Agreement dated December 17, 1996, between PCA International, Inc., ASI Acquisition Corp., and
American Studios, Inc., incorporated by reference to the Company's Form 8-K dated January 23, 1997.
10(j) 1996 Omnibus Long-Term Compensation Plan, incorporated by reference to Exhibit 10(j) to the Company's
Quarterly Report on Form 10-Q for the Quarter ended April 28, 1996.
10(l)* Employment and Noncompete Agreement dated December 17, 1996, between Randy J. Bates and PCA International,
Inc., incorporated by reference to Exhibit 10(l) to the Company's Annual Report on Form 10-K for the year
ended February 2, 1997.
10(m)* Employment and Noncompete Agreement dated December 17, 1996, between Robert Kent Smith and PCA
International, Inc., incorporated by reference to Exhibit 10(m) to the Company's Annual Report on Form 10-K
for the year ended February 2, 1997.
10(n)* Employment and Noncompete Agreement dated December 17, 1996, between J. Robert Wren, Jr., and PCA
International, Inc., incorporated by reference to Exhibit 10(n) to the Company's Annual Report on Form 10-K
for the year ended February 2, 1997.
10(o)* Employment and Noncompete Agreement dated June 9, 1997, between John Grosso and PCA International, Inc.,
incorporated by reference to Exhibit 10(o) to the Company's Quarterly Report on Form 10-Q for the quarter
ended August 3, 1997.
</TABLE>
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<TABLE>
<CAPTION>
INDEX PAGE
NO. DESCRIPTION NO.
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10(p)* Employment and Noncompete Agreement dated June 9, 1997, between Eric Jeltrup and PCA International,Inc.,
incorporated by reference to Exhibit 10(p) to the Company's Quarterly Report on Form 10-Q for the quarter
ended August 3, 1997.
10(q)* Employment and Noncompete Agreement dated June 9, 1997, between Bruce Fisher and PCA International, Inc.,
incorporated by reference to Exhibit 10(q) to the Company's Quarterly Report on Form 10-Q for the quarter
ended August 3, 1997.
10(r) Sales contract dated August 1, 1997, between PCA International, Inc., and Agfa Division of Bayer
Corporation [certain information has been omitted from this exhibit pursuant to a request for confidential
treatment and the omitted information has been separately filed with the Commission pursuant to
Rule 24b-2(b)].
11 Computation of Primary and Fully Diluted Earnings per Common Share, incorporated by reference to Exhibit 11
to the Company's Quarterly Report on Form 10-Q for the quarter ended November 2, 1997.
27 Financial Data Schedule, incorporated by reference to Exhibit 27 to the Company's Quarterly Report on Form
10-Q for the quarter ended November 2, 1997.
</TABLE>
* Management contract or compensatory plan or arrangement required to be
filed as an exhibit.
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EXHIBIT 10(r)
Certain information has been omitted from this exhibit pursuant to a request
for confidential treatment and the omitted information has been separately
filed with the Securities and Exchange Commission (the "Commission") pursuant
to Rule 24b-2(b).
PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE A
PERIOD AND RENEWAL PROVISIONS:
This Agreement is effective as of August 1, 1997 and
contemplates purchases through January 31, 2000. The contemplated total purchase
volume over the term of this Agreement is set forth on Schedule D to this
Agreement. If this total purchase volume is not met by Buyer on or before
January 31, 2000, the term of this Agreement will automatically be extended
until this total purchase volume is met or until July 31, 2000, whichever comes
first. This Agreement is irrevocable and is to be renegotiated 180 days prior to
January 31, 2000.
TECHNOLOGY CO-OPERATION:
PCA and Agfa will continue their on-going relationship and
explore in good faith the possibility of developing future equipment
technologies and systems.
OLD CONTRACTS:
This Agreement replaces (i) the Sales Contract between PCA and
Agfa that was effective August 1, 1994 and (ii) the Sales Contract between
American Studios, Inc. and Agfa that was effective February 22, 1993, and both
will become null and void upon the execution of this Agreement.
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PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE B
SPECIAL PROVISIONS:
Buyer will receive a [information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the Commission
pursuant to Rule 24b-2(b)] percent Advertising Allowance on its U.S. paper,
film, and chemistry purchases calculated at invoice price less any discounts
taken for early payment and less any returns (based on actual purchases), for
promoting Agfa's product and name in the United States. PCA will incorporate the
Agfa product name and logo on substantially all television advertising, printed
advertising, and merchandising materials printed, such as newspapers. slicks,
banners, in-store signage, all direct mail pieces, and in-store fliers.
Buyer shall purchase [information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the Commission
pursuant to Rule 24b-2(b)] percent of its United States consumable requirements
from Seller during the contract period except that from time to time, Buyer may
purchase minimum quantities of competitive products, not to exceed [information
omitted pursuant to a request for confidential treatment, which information has
been separately filed with the Commission pursuant to Rule 24b-2(b)] percent of
Buyer's annual U.S. consumable requirements, for testing and evaluation
purposes.
Buyer agrees that in the event that this agreement is not renewed, Buyer shall
purchase color paper, film, and chemistry which is in the Seller delivery
pipeline not to exceed the normal six-month forecast of Buyer.
WARRANTIES:
All film, paper, and chemistry sold to Buyer by Seller shall conform to the
then-current quality, standards, and production specifications of Agfacolor
film, paper, and chemistry.
If, for any reason, goods sold by Seller to Buyer do not meet such requirements,
Seller agrees to replace such goods at no additional cost to Buyer, provided
that the following conditions have been met:
1. PCA shall take all reasonable efforts to save all allegedly defective and
used film, chemistry, and paper for examination and verification by
Seller;
2. All film shall be used prior to its expiration date;
3. Seller receives from PCA within ten (10) days from the date of discovery
written notice describing the nature of the defect, quantity, and emulsion
numbers involved;
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4. All inventories must be properly rotated.
Such goods shall be replaced if defective in manufacture, labeling or
packaging. EXCEPT FOR SUCH REPLACEMENT, PRODUCTS ARE SOLD WITHOUT WARRANTY
OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. SELLER OR
ANY MEMBER OF THE AGFA-GEVAERT GROUP SHALL NOT BE LIABLE FOR SPECIAL,
INDIRECT, OR CONSEQUENTIAL DAMAGES RESULTING FROM ANY GOODS SOLD, EVEN
WHERE SUCH DAMAGES ARE CAUSED BY SELLER OR ANY MEMBER OF THE AGFA-GEVAERT
GROUP.
TRADEMARKS:
1. PCA shall refer to Agfa-Gevaert, N.V. ("Agfa-Gevaert") as the
manufacturer of the products covered under this Agreement in its
advertising, literature, or otherwise, and to that effect shall refer
to and use the "AGFA" name and rhombus and applicable Agfa trademarks
(the "AGFA TRADEMARKS") in connection with the advertising, promotion,
and distribution of the products covered under this Agreement. In
advertising, promoting, and distributing the products covered under
this Agreement, PCA shall abide by AGFA's policies regarding
advertising and trademark usage as established from time to time by
AGFA, including, without limitation, the particulars of the Corporate
Design Manual, which has been provided to PCA, and as it may be
modified by Agfa from time to time. PCA shall not alter, remove or
tamper with the labeling on or of any of the products covered under
this Agreement except as specifically approved by AGFA in writing in
advance.
2. Each time a registered trademark of Agfa-Gevaert is used, PCA will print
it in between inverted commas and the words "registered trademark of
Agfa-Gevaert Leverkusen/MortzelAntwerp" shall be included with an
addendum or footnote.
3. To maintain the reputation of the AGFA TRADEMARKS, PCA shall, from time to
time as requested by AGFA, supply AGFA with specimens of its use of the
AGFA TRADEMARKS. Furthermore, PCA hereby authorizes AGFA to enter and
inspect PCA's premises and to take samples for inspection during normal
business hours at least two times in any calendar year upon prior
reasonable notice.
4. THIS AGREEMENT, INCLUDING THIS ARTICLE, IS NOT INTENDED TO GIVE AND DOES
NOT GIVE PCA ANY RIGHTS OR LICENSE WHATSOEVER IN OR TO ANY TRADEMARKS,
TRADE NAME, PATENT, COPYRIGHT, OR OTHER INTELLECTUAL PROPERTY RIGHT OF
AGFA OR OF ITS PARENT OR THEIR AFFILIATES. DURING THE TERM OF THIS
AGREEMENT AND THEREAFTER, PCA SHALL NOT CLAIM OWNERSHIP OF NOR CHALLENGE
AGFA'S OWNERSHIP OR REGISTRATION OF THE TRADEMARK AGFA, AGFA RHOMBUS, THE
TRADE NAME AGFA, OR ANY MARK OR NAME USED BY AGFA OR ITS RELATED COMPANIES
AND THEIR SUCCESSORS.
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5. Failure of PCA to comply with any provision of this Article will result in
the immediate termination of this Agreement. Upon termination of this
Agreement, PCA shall not make use of any trademarks that might be confused
in their pronunciation, matter of writing, design, or meaning, or
otherwise with trademarks belonging to AGFA or its parent or their
affiliates.
6. THIS ARTICLE STATES ALL OF THE RESPONSIBILITIES OF AGFA CONCERNING PATENT,
TRADEMARK COPYRIGHT, OR OTHER INTELLECTUAL PROPERTY INFRINGEMENT.
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PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE C
In consideration of PCA's performance of this Agreement during
its term, Agfa has granted to PCA an up-front contract allowance in the amount
of $[information omitted pursuant to a request for confidential treatment, which
information has been separately filed with the Commission pursuant to Rule
24b-2(b)] in the form of credit to existing accounts receivable owed to Agfa by
PCA; provided that, if this Agreement is terminated prior to January 31, 2000,
then the overall credit will be reduced to an amount equal to (x) $[information
omitted pursuant to a request for confidential treatment, which information has
been separately filed with the Commission pursuant to Rule 24b-2(b)] times (y) a
fraction the numerator of which is the time this Agreement actually was in
effect and the denominator of which is the total contract period, and PCA will
immediately pay to Agfa the difference between the initial total credit of
$[information omitted pursuant to a request for confidential treatment, which
information has been separately filed with the Commission pursuant to Rule
24b-2(b)] and the reduced credit as calculated above.
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PCA INTERNATIONAL INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE D
PCA projected 30-month (August 1, 1997 to January 31, 2000) purchase volume for
color paper, film, and chemistry from Seller with no relationship to allowances
given for sales, gross invoice price before cash discount and advertising, is
$[information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the Commission
pursuant to Rule 24b-2(b)].
Broken down as follows:
Color Paper $[information omitted pursuant
to a request for confidential
treatment, which information
has been separately filed
with the Commission pursuant
to Rule 24b-2(b)] *
Film [information omitted pursuant
to a request for confidential
treatment, which information
has been separately filed
with the Commission pursuant
to Rule 24b-2(b)] **
Chemistry [information omitted pursuant
to a request for confidential
treatment, which information
has been separately filed
with the Commission pursuant
to Rule 24b-2(b)] ***
TOTAL $[information omitted pursuant
to a request for confidential
treatment, which information
has been separately filed
with the Commission pursuant
to Rule 24b-2(b)]
* [information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)] sq. ft.
[information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)] rolls 10" x 1148 equivalent
** 35 mm x 30 M $[information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)] = [information omitted pursuant to
a request for confidential treatment, which information has been
separately filed with the Commission pursuant to Rule 24b-2(b)] rolls
46 mm x 30 M $[information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)] = [information omitted pursuant to
a request for confidential treatment, which information has been
separately filed with the Commission pursuant to Rule 24b-2(b)] rolls
*** Approximately [information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)]% of paper
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PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE E
PRICES AND TERMS:
COLOR PAPER: [information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the
Commission pursuant to Rule 24b-2(b)] per sq. ft. Type 8/10 or
Equivalent for remainder of period
AGFACOLOR PORTRAIT: XPS160 long roll 30M 35mm unperf. [information
omitted pursuant to a request for confidential
treatment, which information has been separately
filed with the Commission pursuant to
Rule 24b-2(b)] per roll
XPS 1 60 long roll 30M 46mm [information
omitted pursuant to a request for confidential
treatment, which information has been
separately filed with the Commission pursuant
to Rule 24b-2(b)] per roll
CHEMICAL PRICES: See attached page
TERMS: 2% 90 Net 270 Date of Invoice.
Agfa Division, Bayer Corporation, hereby acknowledges and agrees that the prices
for its goods hereunder are for goods delivered to Buyer's production facilities
in either Matthews, North Carolina or Charlotte, North Carolina, and that Agfa,
or an Agfa affiliate, is the importer of record for the goods.
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PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE E CONTINUED
CHEMICAL PRICING
[information omitted pursuant to a request for confidential
treatment, which information has been separately filed with the Commission
pursuant to Rule 24b-2(b)]
<TABLE>
<CAPTION>
Chemistry Size Description Invoice Price
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<S> <C> <C> <C>
AP-70 CDLR PT A 300 LTR Low Replenishment Developer $ [information omitted pursuant
AP-70 CDLR PT B&C 300 LTR Low Replenishment Developer to a request for confidential
AP-70 Light BL-J 6x50 LTR Light Bleach Regenerator treatment, which information has
AP-94 Light BL-J 1000 LTR Light Bleach Regenerator been separately filed with the
AP-94 Light BL-J 300 LTR Light Bleach Regenerator Commission pursuant to Rule 24b-2(b)]
AP-94 CDJ PT A Conc. 60 LTR Developer Regenerator/RA-4
AP-94 CDJ PT B Conc. 60 LTR Developer Regenerator/RA-4
AP-94 CDJ PT C Conc. 60 LTR Developer Regenerator/RA-4
AP-94 CLDR PT A 75 GAL Low Replenishment Developer/RA-4
AP-94 CDLR PT B 75 GAL Low Replenishment Developer/RA-4
AP-94 CDLR PT C 75 GAL Low Replenishment Developer/RA-4
AP-92 CDJ PT A 50 GAL Developer Regenerator/EP-2
AP-92-CDJ PT B 50 GAL Developer Regenerator/EP-2
AP-92 CDJ PT C 50 GAL Developer Regenerator/EP-2
AP-92 CDJ PT D 50 GAL Developer Regenerator/EP-2
FX Universal Fix Conc. 15 GAL Universal Fix Concentrate
AP-70 DS 1 GAL Color Developer Starter/Film
AP-92 CDS 1 GAL Color Developer Starter/EP-2
AP-94 CDS 1 GAL Color Developer Starter/RA-4
</TABLE>
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PCA INTERNATIONAL, INC.
SALES CONTRACT
DATED AS OF AUGUST 1, 1997
SCHEDULE F
A. The Sales Contract Form is hereby amended by adding the following:
This Agreement is subject to the form terms and conditions attached to
this Agreement (the "Terms and Conditions") and to the letter agreement
regarding confidentiality, dated as of August 1, 1997, all of which are
part of this Agreement.
B. The Terms and Conditions are hereby amended as follows:
1. Under the caption "General," Paragraph 3 is hereby deleted and
replaced with the following
In the event that Agfa Division, Bayer Corporation, reasonably
believes that Buyer may lack the requisite financial resources
to fulfill Buyer's obligations under this Agreement, Agfa may,
by written notice to Buyer stating the grounds therefor, have
reasonable immediate access to the financial records of Buyer
for the sole purpose of determining Buyer's creditworthiness;
in the event that Agfa's review of Buyer's financial records
causes Agfa reasonably to conclude, or Agfa otherwise
reasonably concludes, that Buyer's credit has become impaired
and that reasonable grounds for insecurity exist with respect
to the continued performance of Buyer, the parties agree in
good faith to negotiate new payment terms.
When Agfa has so concluded, it shall give written notice to
Buyer, and the date of such notice is referred to as a "Notice
Date." If the parties cannot agree on new payment terms within
ten (10) days after a Notice Date, the firm of independent
certified public accountants then regularly engaged by Bayer
Corporation shall be requested to determine what would be
reasonable payment terms under the circumstances and this
Agreement shall be deemed amended to provide for the terms so
determined by the accountants. The accountants shall be
requested to make such determination as soon as possible, but
in any event shall make such determination within twenty (20)
days after the Notice Date.
Not in limitation of the foregoing, if for any reason, other
than the failure of Agfa to reasonably cooperate in the
process described above, the payment terms have not been
amended as set forth above and/or Buyer has not come into
compliance with such amended terms within thirty (30) days
after the Notice Date, Agfa may
<PAGE> 10
on at least thirty (30) days written notice to Buyer suspend
shipments under this Agreement until the payment terms have
been deemed amended as set forth above and Buyer has come into
compliance with such amended terms. During the continuance of
any such suspension by Agfa, Buyer may purchase Reasonable
Quantities (as defined below) from other suppliers. Nothing in
this paragraph or the preceding paragraph shall limit Seller's
rights under the first paragraph of this section.
2. The "Force Majeure" provision is hereby deleted and replaced
with the following:
The non-performance of Agfa Division, Bayer Corporation, of
its obligation to deliver any merchandise ordered hereunder
shall be excused if such nonperformance is occasioned by any
strike or any other labor trouble, flood, fire, accident, or
any other casualty, act of God, war, adoption or imposition of
governmental restrictions, shortage of or inability to obtain
raw materials, damage by the elements, failure of equipment or
other cause of like or unlike nature beyond the control of
Agfa Division, Bayer Corporation. In the event of such force
majeure, Agfa Division, Bayer Corporation may, in the exercise
of reasonable discretion, discontinue shipments and/or
allocate distribution until the cause of the delay is removed.
Buyer shall have the right, without breaching this Agreement,
to purchase products from other suppliers during the period
Seller has discontinued or delayed shipments, provided that
during such period Buyer shall not purchase in excess of
Reasonable Quantities (as defined below). As used in this
Schedule F, "Reasonable Quantities" shall mean reasonable
quantities of the products covered by this Agreement based on
purchases for the associated time period in previous years,
but no more than Buyer's reasonable requirements under
then-current business conditions.
In the event that shipments are suspended or delayed for
ninety (90) days or more due to such force majeure, Buyer may
terminate this Agreement upon written notice; in such event,
the overall credit provided for in Schedule C of this
Agreement shall be reduced in accordance with Schedule C;
provided, however, that the overall credit shall not be so
reduced if the force majeure event giving rise to the
suspension of performance by Agfa consists of (i) a shortage
of raw materials that does not prevent Agfa from performance,
(ii) a governmental restriction that does not have the effect
of actually prohibiting the sale or the importation of the
goods, or (iii) any other cause that does not prevent Agfa
from performance but merely makes performance by Agfa more
expensive.
3. The "Termination" provision is hereby revised to read as
follows:
Seller reserves the right, among other remedies, to either
cancel this Agreement or suspend further deliveries under it
in the event Buyer fails to pay for any one shipment when the
same becomes due, provided that Seller has given Buyer the
2
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opportunity to cure the default for a period of thirty (30)
days after receipt of written notice from Seller.
Buyer reserves the right, among other remedies, to either
cancel this Agreement or suspend further payments under it in
the event Seller is unable (other than due to force majeure),
after notice and a reasonable opportunity to cure such
failure, to provide goods in compliance with then current
quality, standards, and production specifications of Agfacolor
film, paper and chemistry; or if Seller breaches in any
material respect any warranty or other obligation of Seller
contained in this Agreement and does not rectify such breach
after notice and a reasonable opportunity to cure such breach.
3
