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Exhibit 10.13
DISTRIBUTION AND LICENSE AGREEMENT
THIS AGREEMENT is entered into this 28th day of July, 2000, by and between J. R.
SIMPLOT COMPANY, hereinafter referred to as "SELLER", having its principal place
of business at 999 Main Street, Suite 1300, Boise, Idaho 83702, and ECO SOIL
SYSTEMS, INC., hereinafter referred to as "ECO SOIL", and having its principal
place of business at 10740 Thornmint Road, San Diego, California, 92127.
RECITALS
A. ECO SOIL has developed, and is engaged in, the manufacture and
sale of certain proprietary products for use in turf grass
industry.
B. SELLER has a distribution network to sell materials to the
turf grass industry.
C. ECO SOIL desires to grant, and SELLER desires to obtain an
exclusive right to market, sell and distribute products as
hereinafter set forth.
COVENANTS AND CONDITIONS
NOW, THEREFORE, in consideration of the mutual covenants and conditions herein
contained, the parties agree as follows:
ARTICLE I: DEFINITIONS
Section 1. PRODUCTS. "Products" shall mean all products formulated or
sold by ECO SOIL. SELLER will use ECO SOIL as its principal supplier in Products
ECO SOIL provides (see Appendix A).
Section 2. TERM. "Term" shall mean the period commencing from the date
hereof, and continuing for a period of five (5) years, upon review at the end of
each year, unless terminated by either party.
Section 3. TERRITORY. "Territory" shall mean the golf course, and
institutional turf grass maintenance industries in designated territories.
Territories shall be added at the agreement of both parties. (Territories - see
Appendix B)
ARTICLE II: EXCLUSIVE APPOINTMENT
Section 1. APPOINTMENT. ECO SOIL hereby appoints SELLER, for the Term
hereof, and SELLER hereby accepts an exclusive appointment to sell, market and
distribute the Products within the designated Territory. In the furtherance of
such appointment, ECO SOIL agrees to sell Products only to SELLER for use in
designated Territory and SELLER agrees to purchase only from ECO SOIL its full
requirements, except as noted below, for Products comparable to Products covered
herein. The private label slow release nitrogen liquid fertilizers are only
produced for the Northeastern
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United States. If Eco Soil produces similar products in other regions, they may
be considered for inclusion in this agreement.
Section 2. IMPROVEMENTS. During each annual period in which the
Agreement is in effect, the parties shall disclose anticipated development work
for the next coming term. Both parties shall, without charge, promptly make
available to one another any technical information relating to protocols,
applications or improvements to Products.
Section 3. SPECIAL RESERVATION. ECO SOIL specifically reserves the
right to sell its product line, in any manner in which it shall deem
appropriate, other than as limited pursuant to the terms of this Agreement, to
any distributors, outlets, or ultimate users, outside of the designated
exclusive territory.
ARTICLE III: PARTIES' PERFORMANCE
A. ECO SOIL PERFORMANCE
Section 1. RISK OF LOSS. Delivery shall occur and risk of loss shall
pass to SELLER when the Products are received at SELLER'S warehouse location
(FOB Destination).
Section 2. MEETS SPECIFICATIONS. ECO SOIL warrants that the Product
complies in all respects with the specifications, or amendments thereto, at the
time of each such delivery and is subject to the established warranty on the
Products. ECO SOIL shall not be liable to SELLER for any consequential damages
or for loss, damage or expense directly or indirectly arising from the use of
Product, or from any other cause. ECO SOIL shall provide SELLER with proof of
product liability, with limits acceptable to SELLER, which names SELLER as a
covered party. ECO SOIL specifically disclaims any liability for Products
altered in any way after leaving its control.
Section 3. PRODUCT AVAILIBILITY. ECO SOIL agrees to maintain sufficient
inventories and sources of supply of the Products to satisfy SELLER'S product
delivery requirements. If ECO SOIL is unable to satisfy SELLER'S product
delivery requirements, as a result of vendor credit restrictions, poor vendor
relationships or any other reason, then ECO SOIL will allow SELLER to source
similar products from other suppliers.
Section 4. SALES PROTECTION. ECO SOIL agrees that it will not enter
into any exclusive distribution arrangement with any other distributor or dealer
and further agrees not to enter into any arrangement with any other distributor
or dealer in the designated territory for the Products during the Term of this
Agreement, without SELLER'S prior approval (which shall not be unreasonably
withheld), provided SELLER is in full compliance with the terms and obligations
herein appertaining.
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Section 5. TRAINING AND SUPPORT. ECO SOIL agrees to supply all training
and support necessary to SELLER to effectively sell and service the equipment in
SELLER'S designated territory, and will have the right to train the sales force
on ECO SOIL'S product lines for no less than ten (10) business days per year.
Seller will also encourage ECO SOIL personnel ride-along's with SELLER'S sales
force. SELLER shall complete all ECO SOIL provided training programs, and shall
develop a working knowledge of all written materials provided by ECO SOIL, and
ECO SOIL, in its sole discretion, shall determine what is necessary for SELLER
to demonstrate and market the Proprietary Products effectively and efficiently
to customers.
B. SELLER'S PERFORMANCE
Section 1. SALES. In consideration of its appointment herein, SELLER
agrees that it will use commercially reasonable efforts to promote demand for,
and sales of, Products, that it will maintain an adequate inventory of products,
and will provide monthly progress reports.
Section 2. PURCHASE ORDER AND QUOTAS. SELLER agrees that to maintain
the exclusivity of this agreement it will provide Seller with a Purchase Order
for $4.9 million at Wholesale Price, of Fresh Pack product to be delivered to
Turf Partner locations over a 24-month period commencing on the Closing Date as
defined by the First Amendment to Amended and Restated Asset Purchase Agreement
dated June 9, 2000, in the form attached hereto as Appendix C. Seller further
agrees to bi-yearly quotas for other proprietary products based upon prior sales
history. If the quotas are not achieved, SELLER may lose its exclusivity or
license to sell ECO SOIL Products.
Section 3. SALES RESTRICTIONS. SELLER understands and agrees that it is
expressly prohibited from selling to, offering to sell to, or soliciting sales
from anyone outside the Territory.
Section 4. OTHER RESPONSIBILITIES.
a. Periodic and timely progress reports (at least
monthly) concerning new business prospects, potential
orders.
b. During the term of this agreement, the SELLER agrees
not to offer representation to other manufacturers of
competitive equipment, or offer for sale other
competitive products.
c. The SELLER shall not sell or transport ECO SOIL'S
Product out of the assigned territory without express
(prior) written approval.
d. SELLER shall provide adequate space in their
warehouses for necessary ECO SOIL equipment and
parts.
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e. SELLER shall not transmit, sell, convey, disclose, or
allow to be disclosed ECO SOIL'S prices provided to
SELLER in connection with this Agreement to anyone
other than its employees who have a need to know such
prices in connection with this Agreement, and SELLER
shall require its employees to comply with this
obligation and shall be responsible to ECO SOIL for
any breach or noncompliance by such employees.
f. ECO SOIL may provide to SELLER, at its sole
discretion, marketing materials regarding ECO SOIL'S
Products. SELLER shall not alter or modify such
marketing materials in any manner whatsoever. SELLER
hereby acknowledges that ECO SOIL has claimed, or may
claim, sole and exclusive copyright protection with
respect to such marketing materials, and SELLER shall
take no action or make no omission which is in any
way inconsistent with ECO SOIL'S claim of copyright
protection with respect to such items.
g. ECO SOIL shall have the right to review and approve,
in its sole discretion, any and all marketing and
other materials used by SELLER regarding the
promotion, marketing and / or resale of any ECO SOIL
products.
h. SELLER shall obtain, retain and provide to ECO SOIL,
upon ECO SOIL'S request, any market data and customer
information that ECO SOIL determines is reasonably
required to conduct its business.
Section 6. ASSIGNMENT AND DELEGATION. Any transfer or assignment of the
rights of SELLER under this agreement shall be null and void unless approved, in
writing, by ECO SOIL, prior to such transfer or assignment.
C. MUTUAL PERFORMANCE
Section 1. NON-DISCLOSURE. Each party, recognizing that it or its
agents or employees may obtain knowledge of confidential matters, trade secrets,
and techniques or other expertise developed by the other, agrees that it will
take all reasonable steps, at its sole expense, to protect said confidential
information, and that no party will divulge said confidential information at any
time, unless required by order of court, other than disclosures contemplated by
the terms of this Agreement, without prior written consent of the other party.
Section 2. RESULTS. Each party agrees to promptly make available to one
another any and all results in development and experimentation with the Products
and further agrees not to publish the other party's results without first having
obtained written approval of the party providing the results, which shall not be
unreasonably withheld.
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Section 3. REPRESENTATIVE OF WARRANTIES. Each of the parties hereto
represents and warrants as follows:
a. It is duly organized and existing and in good
standing under the applicable law and has the
requisite authority to carry on its business as
presently conducted.
b. It has all requisite legal and corporate power to
execute and deliver this Agreement and to carry out
and perform its obligations under the terms of this
Agreement, including all appendices hereto.
c. All corporate actions on the part of the party, its
directors, stockholders or partners necessary for
performance of its obligations hereunder, have been
duly and validly taken.
d. This Agreement constitutes a valid and binding
obligation, enforceable in accordance with its terms,
as to the party.
e. It is not, and will not, by entering into and
performing this Agreement and the obligations
contemplated herein, be in violation of any term of
its charter documents, or in any material respect be
in violation of or in default as to any other
agreement, judgment or decree by which it is bound,
and to the best of its knowledge is not, and will not
by entering into and performing this Agreement, be in
violation of any applicable order, statute, rule or
regulation.
ARTICLE IV: COST AND PAYMENT TERMS.
Section 1. PRICES. All retail prices shall be as set forth in Appendix
A, which is attached hereto and incorporated herein by this reference. No prices
shall be changed except upon thirty (30) days written notice, and shall be
effective only for orders received after said thirty (30) day period. Wholesale
price to SELLER will be at 70% of retail price (Wholesale Price) and SELLER
commits to pay 10% of retail price to sales force in the form of sales
commissions.
Section 2. PAYMENT.
a. All payments to ECO SOIL shall be in U.S. dollars,
payable 30 days from date of invoice or shipment,
whichever occurs later, or in such other form of
payment as may be agreed to from time to time by the
parties. Finance terms, extended dating, payment
incentive, etc., may be issued from time to time from
ECO SOIL.
b. SELLER shall place orders with ECO SOIL in writing
(including electronic mail or fax) with reasonable
lead times
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necessary to facilitate manufacture and shipping, and
no shipments shall be made except upon a specific
SELLER purchase order.
Section 3. FORECASTS. To assist ECO SOIL in efficiently scheduling its
manufacturing, at least thirty (30) days prior to the start of each calendar
quarter, SELLER shall provide ECO SOIL a good faith quarterly forecast of
Products anticipated to be purchased. For the period commencing 7/1/2000, and
ending 12/31/2000, however, the forecasts shall be provided monthly.
Section 4. CREDIT. SELLER'S credit shall be subject to ECO SOIL'S
continuing approval. In the event that SELLER should be delinquent in the
payment terms set forth herein, or otherwise negotiated, ECO SOIL may thereupon
demand advance payment, satisfactory security, or an acceptable guarantee for
prompt payment from SELLER, or in addition to all of the above remedies, or
following notice to SELLER and a period of sixty days for SELLER to remedy
delinquencies, or elect to unilaterally rescind this Agreement.
Section 5. GENERAL TERMS AND CONDITIONS. Notwithstanding any terms and
conditions that may appear on or be contained in SELLER'S purchase orders or
other documents of SELLER, all purchases hereunder shall be governed by the
terms and conditions so contained in contravention hereof, shall not be deemed
applicable.
Section 6. RETURNS. Unless ECO SOIL shall have authorized or permitted
the return of any Products, ECO SOIL shall not be obligated to accept from
SELLER any Products, nor to make any exchange or to credit SELLER therefore.
ARTICLE V: TERMINATION
Section 1. DEFAULT. The parties recognize that prompt and full
compliance with the terms of this Agreement are essential, and the failure to
perform hereunder may be deemed a material breach of this Agreement creating in
the non-breaching party the right to treat the Agreement in default. Upon such
default and after sixty (60) days notice of default and the failure of the
defaulting party to remedy the default within such period, this Agreement may be
deemed terminated by the non-defaulting party, such party then having the right
to pursue such further remedies as it may deem appropriate, at law or otherwise.
In the event of termination, this Agreement shall remain applicable to any order
for Products which SELLER has previously placed and which have been accepted by
ECO SOIL. In the event of termination of this Agreement, SELLER shall promptly
return to ECO SOIL all samples, descriptive literature, or other materials
pertaining to Products, then remaining in its possession.
ARTICLE VI: MISCELLANEOUS PROVISIONS
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Section 1. NOTICES. Any and all notices provided herein shall be in
writing and delivered personally or sent by registered or certified mail with
return receipt requested, and confirmed by telegraph, telex, or fax to the other
party at the address herein above set forth, or at such other address as shall
be designated from time to time by the parties. Notice shall be deemed to be
effective upon personal service or transmittal of telegraph, telex or fax or
upon the date of receipt indicated on the postal proof of delivery, whichever
date is earlier.
Section 2. AMENDMENTS. This instrument contains all of the agreements,
understanding, representations, conditions, warranties, and covenants made
between the parties hereto. Unless set forth herein, neither party shall be
liable for any representations made, and all modifications and amendments hereto
must be in writing and signed by both parties.
Section 3. AUTHORITY TO ENTER INTO THE AGREEMENT. Each of the parties
represents that it has full power and authority to enter into this Agreement.
Section 4. WAIVER. The failure of either party at any time to require
performance by the other party of any provision hereof shall not affect in any
way, the right to require such performance at any time thereafter. Nor shall a
waiver by either party of a breach of any provision hereof be taken or held to
be a waiver of the provision itself.
Section 5. SEPARABILITY. Each of the terms of the Agreement is
exclusive and the invalidity of one or more terms shall not void or make
voidable any other terms of the Agreement.
Section 6. COSTS OF DEFAULT. The parties agree that in the event of a
default of a term or condition of this Agreement. The defaulting party shall be
liable for reasonable attorney's fees and costs in the event of engagement of
legal counsel to represent the non-defaulting party's interest.
Section 7. INTEGRATION. This Agreement constitutes the entire agreement
between the parties hereto pertaining to the subject matter hereof and
supersedes all prior and contemporaneous agreements, understanding, negotiations
and discussions, whether oral or written, of the parties, and there are no
warranties, representations or agreements among the parties in connection with
the subject matter hereof except as set forth or referred to herein.
Section 8. BINDING EFFECT AND ASSIGNMENT. This Agreement shall inure to
the benefit of and bind the parties' successors, assigns, transferees, and
representatives.
Section 9. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same document.
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Section 10. FORCE MAJEURE. The obligations of either party hereunder
shall be excused by reason of fire, explosion, or flood, or other actions of the
elements, strikes, labor disputes however caused, accidents, acts of public
enemies, lawful rules and regulations or orders of any court or any civil or
military authority, loss or shortage of raw materials, supplies, or energy
sources or failure of usual means of supply and any other causes beyond the
reasonable control of any of the parties. In the event that any of the parties
are prevented by any of the contingencies of the type set forth in this
subparagraph, said party shall be free of all liability, as would otherwise be
determined by the requirements of this Agreement, but only for so long as the
circumstances of force majeure exist. For any cause whatsoever, whether or not
beyond the control of ECO SOIL or SELLER, liability of either for failure or
delay in performance shall not include consequential damages.
Section 11. DISCLAIMER OF AGENCY. This Agreement shall not constitute
either party the legal representative or agent of the other, nor shall either
party have the right or authority to assume, create, or incur any liability or
any obligation of any kind, express or implied, against or in the name of or on
behalf of the other party in any manner.
Section 12. INTERPRETATION. The validity, interpretation, and
performance of this Agreement shall be controlled by and construed under the
laws of the state of California, U.S.A., the state in which this Agreement is
accepted.
Section 13. ASSIGNMENT. The rights and obligations under this Agreement
may not be assigned by either party to any person, firm or corporation without
the prior written consent of the other party first obtained. Any attempted
assignment without such other party's consent shall be null and void. Except as
limited by the preceding sentence, this Agreement shall be binding upon and
inure to the benefit of the parties hereto, their successors and assigns.
Section 14. HEADINGS. Paragraph headings are not to be considered part
of this Agreement and are included solely for convenience, and are not intended
to be full or accurate descriptions of the content thereof.
Section 15. TIME OF ESSENCE. Time is of the essence in this Agreement,
and the failure of either party to promptly pay when due any and all payments,
or perform any and all obligations required herein, may be treated by the other
party as a material breach of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the date above appearing.
J. R. SIMPLOT COMPANY
999 Main Street, Suite 1300 By: ________________________
Boise, Idaho 83702 Its: ________________________
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ECO SOIL SYSTEMS, INC.
10740 Thornmint Road By: ________________________
San Diego, CA 92127 Its: ________________________
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APPENDIX "A", PAGE 1
(To exclusive Distribution Agreement between Turf Partners / J. R. Simplot, and
Eco Soil Systems)
PRODUCTS
RECHARGE: 1 ACRE = $420.00, 3 ACRES = $840.00 (see wholesale price on pg. 3)
REOPEN: 1 ACRE = $420.00, 3 ACRES = $840.00 (see wholesale price on pg. 3)
REMOVE: 1 ACRE = $590.00, 3 ACRES = $1,180.00 (see wholesale price on pg. 3)
ROOT REVIVE: 1 ACRE $590.00, 3 ACRES - $1,180.00 (see wholesale price on pg. 3)
XPO: 1-2 ACRES $3,000.00 PER ACRE, 3+ ACRES $1,500.00 PER ACRE (see wholesale
price on pg. 3)
DELIMINATE: $190.00 PER 2.5 GALLONS (wholesale $150.00)
ECO LEX: 2.5 GALLONS = $37.00 (wholesale $30.00), 55 GALLONS = $748.00
(wholesale $650.00)
ECO K+ 1-0-23, (2 X 2.5) SIZE 2.5 GALLONS: 1-4 CASES = 39.00, 5+ CASES = $37.00
(wholesale $28.00) ECO CALEX 1-0-0, 8% CA, (2 X 2.5) SIZE 2.5 GALLONS: 1-4 CASES
$45.00, 5+ CASES $40.00 (wholesale $33.00) ECO POWERMIX 45, 7-32-6, (2 X 2.5)
SIZE 2.5 GALLONS: 1-4 CASES $42.00,
5+ CASES $40.00 (wholesale $32.00)
ECO MICRO MIX PLUS, 5-0-0, (2 X 2.5) SIZE 2.5 GALLONS: 1-4 CASES $39.00,
5+ CASES $37.00 (wholesale $27.00)
ECO MAG, 0-0-0, (2 X 2.5) SIZE 2.5 GALLONS: 1-4 CASES $39.00, 5+ CASES $37.00
(wholesale $25.00)
ECO SIL, 0-0-2, SIZE 2.5 GALLONS: 1-4 CASES $39.00, 5+ CASES $37.00
(wholesale $30.00)
12-2-12, 50% SRN, SIZE 5 GALLONS: 1-4 CASES $63.50, 5+ CASES $60.00 (wholesale
$45.00) 12-2-12, 50% SRN, SIZE 30 GALLONS: 1-4 CASES $352.50 (wholesale $250.00)
18-3-6, 50% SRN, SIZE 5 GALLONS: 1-4 CASES $63.50, 5+ CASES $60.00 (wholesale
$45.00) 18-3-6, 50% SRN, SIZE 30 GALLONS: 1-4 CASES $352.50 (wholesale $250.00)
0-0-25, 17% S, SIZE 2.5 GALLONS: 1-4 CASES $27.00, 5+ CASES $26.25 (wholesale
$18.00) 0-0-25, 17% S, SIZE 30 GALLONS: 1-4 CASES $297.00 (wholesale $220.00)
CLEANRACK: $45,000.00
SOLUJECT: $14,500.00
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CALJECT: $14,000.00
SMARTWASHER: $1,795.00 + $605.00 FOR OZZY JUICE
APPENDIX "A", PAGE 2
<TABLE>
<CAPTION>
COLORANTS: SUGGESTED RETAIL WHOLESALE
---------------- ---------
<S> <C> <C> <C>
T. P. Green 2.5 gal. 70.50 49.35
T. P. Darken 2.5 gal. 75.00 52.50
Accuracy gallon 34.50 24.15
Appearance gallon 37.25 26.08
Appearance whettable 149.00 104.30
WETTING AGENTS:
Rely 5 gal. 295.00 206.50
30 gal. 1560.00 1092.00
40 lb. bag 65.00 45.50
Rewet 5 gal. 176.25 123.38
30 gal. 945.00 661.50
40 lb. bag 65.00 45.50
Brilliance 5 gal. 315.00 220.50
30 gal. 1770.00 1239.00
Syringe 55 gal. 770.00 539.00
</TABLE>
SPECIALTY PRODUCTS:
2 Cycle Oil 12 oz. 1.98 1.39
Nutra Wash Tank Cleaner quart 8.00 5.60
T. P. Non-Ionic Surfactant 16.00 11.20
Terminator Foam Suppressant gallon 26.00 18.20
Ball Wash Concentrate gallon 11.00 7.70
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APPENDIX "A", PAGE 3
FRESHPACK WHOLESALE FEES:
RECHARGE: 1 ACRE = $294.00, 3 ACRES = $588.00
REOPEN: 1 ACRE = $294.00, 3 ACRES = $588.00
REMOVE: 1 ACRE = $413.00, 3 ACRES = $826.00
ROOT REVIVE: 1 ACRE $413.00, 3 ACRES - $826.00
XPO: 1-2 ACRES $2,100.00 PER ACRE, 3+ ACRES $1,050.00 PER ACRE
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APPENDIX B
TURF PARTNER WAREHOUSE FACILITIES
<TABLE>
<CAPTION>
WAREHOUSE ADDRESS RADIUS OF SERVICE/MILES
----------------- -----------------------
<S> <C>
1 24800 N. Industrial Dr.
Farmington Hills, MI 120
------------------------------------------------------------------------
2 4867 and 4869 Duck Creek Rd
Cincinnati, OH 45227 100
------------------------------------------------------------------------
3 12840 Ford Dr.
Fishers, IN 120
------------------------------------------------------------------------
4 10103 Production Court
Louisville, KY 40299 100
------------------------------------------------------------------------
5 10730 Thornmint Rd.
San Diego, CA 60
------------------------------------------------------------------------
6 42-200 State Street, Ste. A
Palm Desert, CA 50
------------------------------------------------------------------------
7 4701 W. Jefferson Street
Phoenix, AZ State of AZ
------------------------------------------------------------------------
8 2386 East Walnut Ave
Fullerton, CA 60
------------------------------------------------------------------------
9 15 Londonderry Rd.
Londonderry, NH 125
------------------------------------------------------------------------
10 2476 William Flynn Highway
Butler, PA 100
------------------------------------------------------------------------
11 3101-3109 Espresso Way
York, PA 100
------------------------------------------------------------------------
12 4300 Eubank Road
Richmond, VA 23231 120
------------------------------------------------------------------------
13 525 North Enterprise Dr.
Aurora, IL 60506 120
------------------------------------------------------------------------
14 851 47th Street
Wyoming, MI 120
------------------------------------------------------------------------
15 115 Railroad Street
Warners, NY 13164 100
------------------------------------------------------------------------
16 One Maple Terrace
Three Rivers, MA 01080 equipment storage only
------------------------------------------------------------------------
17 94 Triangle Street
Danbury, CT 100
------------------------------------------------------------------------
18 914 Williams Ave.
Grandview Heights, OH 43212 100
------------------------------------------------------------------------
19 2001-2019 County Road C-2
Roseville, MN 55113 120
------------------------------------------------------------------------
</TABLE>
<PAGE>
APPENDIX C
ALL PURCHASE ORDERS ISSUED BY J. R. SIMPLOT COMPANY ("BUYER") TO THE
UNDERSIGNED SELLER WILL BE SUBJECT TO THE FOLLOWING TERMS AND
CONDITIONS WHICH MAY NOT BE VARIED OR ADDED TO EXCEPT BY A WRITING
SIGNED BY BUYER'S DULY AUTHORIZED REPRESENTATIVE
1) TIME IS OF THE ESSENCE - Time is of the essence of this contract.
Delivery shall not be deemed to be completed until all goods have been
actually received and accepted by Buyer, notwithstanding any agreement
to pay freight, express or other transportation charges.
2) SELLER'S REPRESENTATIONS AND WARRANTIES - Seller expressly warrants and
represents as follows:
a) All goods covered by Purchase Orders are free of defects in
material and workmanship, conform to applicable
specifications, drawings, samples and descriptions, are of
merchantable quality and are suitable for Buyer's intended
purposes.
b) The goods covered by the Purchase Orders are owned by the
Seller and will be delivered free and clear of all claims,
liens, encumbrances and penalties.
c) No part of the goods covered by Purchase Orders are subject to
any actual or claimed trademark, patent or copyright
infringement.
d) All goods, wrappers and containers covered by Purchase Orders
shall bear markers and labels and be manufactured and
distributed in compliance with the following:
i) all applicable United States federal, state and
municipal laws, rules and regulations, including
without limitation the Fair Labor Standards Act, the
Federal Food, Drug and Cosmetic Act, the Fair
Purchase and Labeling Law, the Occupational Safety
and Health Act and the Toxic Substances Control Act;
ii) all applicable Canadian federal, provincial and
municipal laws, rules and regulations, including
without limitation the Employments Standards Act, the
Federal Food and Drug Act, the Environmental Act or
such similar legislation.
e) Equal Employment Clause - If applicable to Seller, Seller
guarantees compliance with the provisions of Executive Order
11246 of the United States of America pertaining to
nondiscrimination in employment. Under Section 203: Paragraphs
A and B, of the Executive Order, Seller agreed to file
compliance reports with the appropriate federal agency, and on
request to supply Buyer with copies of the compliance reports
and any other information necessary to demonstrate compliance.
Seller also guarantees compliance with Section 503 of the
Rehabilitation Act of 1973 relating to employment of the
handicapped, and the rules, regulations and relevant orders of
the Secretary of Labor issued pursuant to the Act. Seller
shall also comply with the Veterans Era Vietnam Readjustment
Act of 1974, as amended, and if applicable, Seller shall take
all required affirmative action on behalf of disabled veterans
and veterans of the Vietnam Era to employ and advance in
employment these qualified veterans. If applicable to Seller,
Seller guarantees compliance with all provisions of the Human
Rights Legislation pertaining to nondiscrimination in
employment.
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The foregoing warranties and representations shall survive
Buyer's acceptance of and payment for the goods covered by
Purchase Orders.
3) BUYER'S RIGHT TO REFUSE GOODS - Buyer reserves the right to refuse any
goods and to cancel all or any part of the outstanding order if there
is a material adverse market event that affects the commercial
viability of the product.
4) INDEMNIFICATION - Seller agrees to indemnify, defend and hold Buyer,
its officers, agents and employees, harmless from any and all
liability, loss, damage or expense which Buyer may suffer as a result
of claims, demands, costs or judgments against it involving Seller's
activities related to Purchase Orders or any failure by Seller to
comply strictly with the warranties stated in Section 2 above or
otherwise to fully and timely discharge its obligations under the
Purchase Orders. This indemnity shall include the expense of any
defense, including attorney's fees, and shall be in addition to any
other remedies provided by law.
5) ENTIRE AGREEMENT - The Purchase Orders and these terms and conditions
contain the entire agreement of the parties. They may not be modified
or terminated orally, and no claimed modification, termination or
waiver shall be binding on Buyer unless in writing signed by a duly
authorized representative of Buyer. NO MODIFICATION OR WAIVER SHALL BE
DEEMED EFFECTED BY SELLER'S ACKNOWLEDGMENT OR CONFIRMATION CONTAINING
OTHER OR DIFFERENT TERMS.
6) PACKING - Unless otherwise specified, (i) all packing and crating by
Seller shall be in compliance with carriers' tariffs and in suitable
containers for protection in shipment and storage, and (ii) the price
or prices shall include all charges for Seller's packing, crating,
transportation, and insurance to Buyer's point of delivery.
7) CHANGES - Buyer may at any time by written notice and without notice to
sureties or assignees make changes within the general scope of a
Purchase Order in any one or more of the following: (i) drawings,
designs, or specifications; (ii) method of shipping or packing; (iii)
place of inspection, acceptance, or point of delivery; and (iv)
delivery schedule. Should any such change increase or decrease the cost
of, or the time required for the performance of a Purchase Order, an
equitable adjustment may be requested by Seller or Buyer in the price,
delivery schedule or both. Seller shall submit any claim for such
adjustment in writing to Buyer within thirty (30) days from the date of
such change. Nothing contained in this clause shall relieve Seller from
proceeding without delay in the performance of Purchase Orders as
changed.
8) CONFIDENTIALITY OF BUYER'S DATA - Seller shall not, without prior
written consent of Buyer, use or disclose any data, designs or other
information belonging to or supplied by or on behalf of Buyer, except
in the performance of orders for Buyer. Upon Buyer's request, such
data, designs or other information and any copies thereof shall be
returned to Buyer. Where Buyer's data, designs or other information are
furnished to Seller's suppliers for procurement of supplies by Seller
for use in performance of Buyer's orders, Seller shall insert the
substance of this provision in its orders.
9) TERMINATION
For Seller's Failure to Perform. Buyer may terminate a Purchase Order, in whole
or in part, without liability to Seller; (i) if deliveries are not made at the
time or in the quantities specified (whether for force majeure reasons or
otherwise); (ii) in the event of a breach of any of the other terms or
conditions hereof; (iii) in the event Seller becomes insolvent, or makes a
general
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assignment for the benefit of creditors, or files or has filed against it a
petition in bankruptcy or for reorganization, or pursues any other remedy under
any other law relating to the relief of debtors, or in the event a receiver is
appointed for Seller's property or business.
b) Right to Audit. Buyer shall have the right to audit all elements of
any termination claim and Seller shall make available to Buyer on
request all books, records and papers relating thereto at Buyer's
offices at Buyer's option.
c) Force Majeure. Neither party shall be liable to the other (i) for
defaults due to causes beyond its control and without its fault or
negligence, including acts of God, government priorities, fires,
strikes, lockouts, floods, epidemics, riots, wars, power shortages,
embargoes, delays in transportation or car shortages, or (ii) because
of the inability due to causes beyond its control and without its
negligence to obtain necessary labor, materials, or components.
Notwithstanding the foregoing, if Seller's default is caused by the
default of a subcontractor or supplier, such default by Seller shall
not be excusable under this Article unless it arises out of causes
beyond the control of both Seller and the subcontractor or supplier and
without the fault by the negligence of either of them, and the supplies
or services to be furnished by the subcontractor or supplier are not
obtainable from other sources in sufficient time to permit Seller to
meet the required delivery schedule.
10) DEFAULT - In the event Seller defaults in the performance of any term
of this agreement, Buyer shall have all rights and remedies available
at law or in equity.
11) CHOICE OF LAW; DISPUTE RESOLUTION - This agreement shall be governed by
and interpreted in accordance with the substantive laws of the State of
Idaho without regard to conflicts of law rules or principles and
excluding the U.N. Convention on the International Sale of Goods. The
parties agree that any dispute under a Purchase Order entered into
hereunder shall be resolved by binding arbitration pursuant to the
Uniform Arbitration Act as enacted in Idaho, Idaho Code Sections 7-901
et. seq.. The place of arbitration shall be Boise, Idaho. The
arbitration shall be conducted in accordance with the Commercial
Arbitration Rules of the American Arbitration Association before a
single arbitrator appointed in accordance with such rules. The
arbitrator shall be appointed within thirty (30) days following one
party's demand for arbitration, and the arbitration shall commence
within thirty (30) days following appointment of the arbitrator. The
arbitrator shall be empowered to award actual damages only, not
punitive damages. Judgment on the award rendered by the arbitrator may
be entered in any court having jurisdiction thereof. Each party shall
bear its own costs and fees in the arbitration and one-half of the
arbitrators' costs and fees. The foregoing provision shall not bar
either party from seeking injunctive relief from a court of competent
jurisdiction pending arbitration or disposition of the arbitration
proceeding.
12) ADDITIONAL CONDITIONS -
- Products to meet Buyer's supplied requirements.
- Product must be slipsheeted and shrink wrapped.
- No product, component, or ingredient with a foreign
country origin to be used without prior approval from
the Buyer.
- Product must meet all requirements of the United
States Federal Environmental Protection Act and
amendments thereto, as applicable, including those
related to pesticide and chemical residues.
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- Sample and grading to be supplied to Buyer as
requested.
13) NOTICES - All notices or communications between Buyer and Seller with
respect to a Purchase Order that are required or allowed hereunder
shall be sent via facsimile or overnight courier service (shipping
charges prepaid) to Buyer at the "Ship To" address identified in the
Purchase Order in question and the Seller's "To" address identified in
the Purchase Order in question.
14) TERMS - These Terms and Conditions shall remain in effect until amended
by Buyer at any time by notice to Seller, which amended Terms and
Conditions shall become effective as to all Purchase Orders sent to
Seller subsequent to the date of such notice.
15) PROHIBITION ON ASSIGNMENT - Seller's rights and obligations hereunder
shall not be assignable (whether by sale, merger, consolidation or
otherwise) without Buyer's prior written consent which may be withheld
for any reason.
J. R. SIMPLOT COMPANY
By _________________________________________________________
Its _________________________________________________________
AGREED AND ACCEPTED BY:
SELLER'S COMPANY NAME _______________________________________
STREET ADDRESS ______________________________________________
CITY _______________________________ STATE/PROVINCE ________
ZIP CODE/AREA CODE _________________ COUNTRY _______________
COMPANY REPRESENTATIVE ______________________________________
TITLE _______________________________________________________
SIGNATURE ____________________________________ DATE _________
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