Ultrafem Inc. Contracts
Sample Business Contracts
Sales Contract - Shell Chemical Co. and Ultrafem inc.
Control No. 74110-96
SALES CONTRACT
[LOGO] DATED JANUARY 1, 1996
1. PARTIES.
Shell: SHELL CHEMICAL COMPANY, for itself and as agent for SHELL OIL
COMPANY ("Seller"), P. O. Box 2463, Houston, TX 77252-2463,
facsimile no. 713-241-6465.
Buyer: ULTRAFEM, INC., 500 Fifth Avenue, Suite 3620, New York, NY 10110
facsimile no. 212-575-5741
Minimum
Annual Shipment Price
2. PRODUCT Quantity FOB Point Quantity (Per Unit)
(thousand lbs.)
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KRATON(R)
Compound Seller's Shipping See (1) See (1)
Grades:(2) Location below. below.
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GRP 6571 1996: 122.2
1997: 620.4
1998: 1,475.8
GRP 6582 1996: 527.8
1997: 2,679.6
1998: 6,374.2
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(1) - For full truck loads delivered east of the Rockies, the price will
be $2.21/lb., freight prepaid from Seller's shipping location.
($0.03/lb. will be added for full truck load shipments delivered west of
Rockies). For less than full truck loads, the price will be $2.21/lb.
plus standard differential per Seller's pricing policy, freight collect.
An additional charge of $0.05/lb. will be added for GRP 6582-3075, as
described on Exhibit B.
(2) - See Exhibit B, "Product Description".
3. PERIOD. The period of this Contract will begin on January 1, 1996
and end on December 31, 1998, but will continue from year-to-year thereafter,
subject to termination on such ending date or on any date thereafter by
either party giving the other at least one hundred eighty (180) days prior
written notice.
4. PRICE AND PAYMENT TERMS. Price is subject to change by Seller from
time to time on at least fifteen (15) days' notice.
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Seller may institute or withdraw a Temporary Voluntary Allowance (TVA) or
other similar competitive allowance off the then current contract price
without notice and the institution or withdrawal of such an allowance will
not be deemed a change in price. Any tax (other than on income), duty or
other governmental charge now or hereafter imposed on the Product or on any
raw material used in manufacturing the Product (or on Seller, or required to
be paid or collected by Seller, by reason of the manufacture, transportation,
sale or use of such Product or raw material) will be paid by Buyer in
addition to the price. If Seller is prevented by law, regulation or
governmental action from increasing or continuing any price already in effect
under this Contract, Seller may terminate this Contract on ninety (90) days
written notice. If Buyer gives satisfactory evidence that it can purchase a
product of like quality and quantity produced in the United States (including
its territories or possessions) at a lower price and under terms and
conditions similar to those of this Contract and Seller elects not to meet
the lower price, all quantities actually purchased by Buyer at the lower
price will be deducted from the applicable remaining quantity obligation. If
Seller elects to meet the lower price, Seller may withdraw its lower price on
notice or immediately upon termination of the competitive lower price.
Payment terms are net thirty (30) days from date of invoice.
5. QUANTITY LIMITATION. During each year of the contract period,
Buyer will purchase the specified Annual Quantity or, if Buyer's requirements
are reduced, an annual quantity that bears the same ratio to the reduced
requirements as the specified Annual Quantity bore to Buyer's estimated total
requirements as of the date the Contract was executed. On or before the 15th
day of the month preceding each calendar quarter, Buyer shall provide Seller
with quarterly forecasts for expected Product needs for planning purposes. In
addition to Seller's right to apportion in an event excusing performance (as
provided in Article 8 below), Seller shall also have the right to limit the
quantity of Products to be supplied to Buyer as follows:
A. during the first three (3) years of the Period, Seller may limit
the quantity of Product(s) to be supplied in any month to one-third
(1/3) of the quarterly amount forecasted for the relevant calendar
quarter by Buyer; or
B. after the first three (3) years of the Period, Seller may limit
the quantity to be supplied in any month to one-twelfth (1/12) of the
Annual Quantity or, after the initial ninety (90) days of each Contract
year, the average of the monthly quantities shipped during the expired
months of that Contract year.
6. SHIPMENTS. Seller will select the origin of shipment and the
carrier. The quantity of all bulk rail and truck shipments will be determined
by Seller by outage tables with corrections for temperature or by
weighmaster's certificate as appropriate and Seller's quantity determination
will govern. Buyer will promptly unload each shipment at its own risk and
expense, including any demurrage or detention charges.
7. WARRANTIES. Seller warrants that each Product will meet
specifications designated as such in Exhibit A hereto. Shell warrants that it
will comply with all applicable laws and governmental rules, regulations and
orders. SHELL MAKES NO OTHER WARRANTIES, WHETHER OR MERCHANTABILITY, FITNESS
OR OTHERWISE, AND NONE WILL BE IMPLIED.
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8. EXCUSES FOR NONPERFORMANCE. Either Seller or Buyer will be excused
from the sale or purchase obligations of this Contract to the extent that
performance is delayed or prevented by any circumstance (except financial)
reasonably beyond its control or by fire, explosion, mechanical breakdown,
strikes or other labor trouble, plant shutdown, unavailability of or
interference with the usual means of transporting the Product or compliance
with any law, regulation, order, recommendation or request of any
governmental authority. In addition, Seller will be so excused in the event
it is unable to acquire from its usual sources and on terms it deems to be
reasonable, any material necessary for manufacturing the Product. If, because
of such circumstances, there should be a shortage of Product from any of the
Seller's sources, Shell will not be obligated to purchase Product in order to
perform this Contract and may apportion its available Product among all its
customers and its own internal uses in such manner as Seller finds fair and
reasonable; provided, however, that Seller will not be obligated to apportion
or otherwise make available to Buyer Product which Shell obtains by purchase
or exchange for their own internal uses. Quantities of Product consequently
not shipped will be deducted from the applicable remaining quantity
obligation unless the Parties agree otherwise.
9. SAFETY AND HEALTH COMMUNICATIONS. Seller will furnish to Buyer
Material Safety Data Sheets which include health, safety and other hazard
communication information on Product consistent with the Occupational Safety
and Health Administration's Hazard Communications Standard. Seller will also
furnish other health or safety information as available. Buyer will
disseminate appropriate health and safety information to all persons Buyer
foresees may be exposed to Product (including but not limited to Buyer's
employees, contractors and customers). If Product is further processed, mixed
or incorporated into another product, Buyer will likewise disseminate
appropriate health and safety information to all persons Buyer foresees may be
exposed.
10. LIABILITIES AND INDEMNITY. Seller expressly disclaims any
expertise or other special knowledge with regard to Buyer's intended
applications for utilizing Seller's Products and enters into this Contract on
the condition that Buyer assumes all responsibility for determining
suitability of same. Buyer expressly acknowledges that in selecting Seller's
Products for use in the manufacture of its products, Buyer has made its own
evaluation concerning the use of Seller's Products and has not relied on any
representation by any employee or agent of Shell Chemical Company, Shell Oil
Company, or any of their affiliates, parents and subsidiaries to determine
the suitability of Seller's Product for use in Buyer's applications. BUYER
ACKNOWLEDGES THAT IT IS SOLELY RESPONSIBLE FOR INDEPENDENTLY DETERMINING SUCH
SUITABILITY AND THAT BUYER IS RELYING SOLELY ON ITS OWN STUDIES, DATA AND
OTHER RELEVANT INFORMATION TO DETERMINE WHETHER BUYER'S PRODUCTS AND THE
MATERIALS CONTAINED THEREIN (INCLUDING SELLER'S PRODUCTS) ARE SAFE AND
EFFECTIVE FOR BUYER'S APPLICATIONS.
To the maximum extent permitted by applicable law, Buyer shall defend,
indemnify and hold harmless Shell Chemical Company, Shell Oil Company, their
affiliated, parent and subsidiary companies (inclusive of the directors,
officers and employees of each) against any loss, damage, claim, suit,
liability, judgment, and expense (including but not limited to reasonable
attorneys' fees and costs of litigation), and any fines, penalties and
assessments, arising out of bodily or personal injury, disease or death of
persons, damage to or loss of any property or violation of the applicable law
of any governmental authority which in any way arises, directly or indirectly,
out of Buyer's use of Seller's Products, Buyer's marketing and sales of its
products, or use by any person of
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Buyer's products; provided, however, that such indemnification obligation
shall not apply to the extent such loss, damage, claim, suit, liability,
judgment, or expense arises out of Seller's failure to meet specifications.
Seller shall have the right, but not the duty, to participate in the defense
of any such claim or suit with attorneys of its own selection (at Seller's
sole expense) without relieving Buyer of any obligations hereunder.
The obligations, indemnities and liabilities assumed by Buyer under this
Article shall not be limited by any provisions or limits of insurance
required in Article 11 below and shall survive the termination of this
Contract.
If it is judicially determined that any of the indemnity obligations (which
Buyer agrees shall be supported by insurance) under this Article or the
insurance obligations under Article 11 below are invalid, illegal or
unenforceable in any respect, the parties agree that said obligations shall
be automatically amended to conform to the maximum monetary limits and other
provisions in the applicable law for so long as such law is in effect.
11. INSURANCE. Buyer shall maintain at all times (beginning with the first
date of commercial manufacture of Buyer's products), at Buyer's expense and
with insurers satisfactory to Shell, General Liability Insurance (to be
inclusive of Product Liability coverage for Buyer's products and potential
defects therein) for bodily and personal injury and property damage, combined
limit of $5,000,000 (five million dollars) per occurrence. Whenever requested
by Shell, Buyer shall furnish evidence satisfactory to Shell that such
insurance is in effect. To the maximum extent permitted by law, and without
in any way limiting Buyer's obligations, indemnities or liabilities as set
out elsewhere in this Contract, all insurance policies maintained by Buyer as
described above as well as any other applicable insurance maintained by Buyer
shall name Shell Oil Company, Shell Chemical Company, and their affiliated,
parent and subsidiary companies (inclusive of the officers, directors and
employees of each) as additional insureds with respect to the applicable
insurance coverage. The policies shall also contain a waiver of subrogation
in favor of those same parties. All such policies shall be regarded as
primary insurance underlying any other insurance (including any insurance
maintained by Shell) and shall not be limited by the liability and indemnity
provisions contained elsewhere in this Contract.
12. CLAIMS AND LIMITATIONS. Neither Shell nor Buyer will have any liability
to the other for any claim (except for indebtedness of Buyer to Seller)
arising out of or in connection with this Contract unless claimant gives the
other Party notice of the claim, setting forth fully the facts on which it is
based, within ninety (90) days of the date such facts were discovered or
reasonably should have been discovered. Shell's liability for defective or
nonconforming Product, whether or not based on negligence, will not exceed
the purchase price of the Product involved in the claim. Except as may be
otherwise expressly provided herein, NEITHER PARTY WILL BE LIABLE FOR ANY
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES.
13. RESTRICTIONS.
A. USE OF SHELL MARKS. Buyer agrees that it will not utilize the
tradename "SHELL" or any trademarks (including, but not limited to,
"KRATON"), service marks, logos, emblems, trade dress or similar identifying
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characteristics pertaining to Shell Chemical Company, Shell Oil Company, or
any of their affiliated, parent or subsidiary companies in conjunction with
the marketing, advertising, promotion, sale, branding or display of Buyer's
products.
B. USE OF SHELL PRODUCT. Buyer agrees that it will utilize the Products
purchased hereunder exclusively for manufacture of the basic Ultrafem Softcup
product, and not for commercial production of a contraceptive version,
disease prevention/protection version or any other enhanced or
multiple-purpose version of the basic Softcup, unless Buyer obtains the prior
express, written consent of Shell.
14. RECORDS OF PRODUCT COMPLAINTS. For Shell's information only, Buyer agrees
to send to Shell, promptly after receipt by Buyer, copies of any written
complaints (and summaries of verbal complaints) received by Buyer from users
of its products and to keep Shell advised of the status of corrective actions
taken by Buyer in response to such complaints.
Shell agrees to hold such information in strictest confidence and will not
disclose it to any third party without Buyer's express consent, except to the
extent such disclosure is required by law or legal process, or requested by
any governmental entity having the legal authority to compel disclosure.
15. CONFIDENTIALITY. Seller agrees not to disclose Buyer's formulations for
GRP 6571 and GRP 6582 to any third party (including third parties engaged in
the manufacture of female hygiene products) and not to use the same except to
supply Buyer, in each case for a period of five (5) years from the contract
date, after which period Seller's obligation of non-use shall cease. Buyer
agrees that Seller may thereafter treat GRP 6571 and GRP 6582 in the same
manner as Seller treats its own proprietary and confidential information.
However, during the period of Seller's obligation of non-disclosure and
non-use, if Buyer's formulations are publicly disclosed by Buyer or any other
entity having the right to disclose same, Seller's obligation shall cease
immediately upon such disclosure.
16. REMEDIES. If Buyer fails to continuously maintain insurance as provided
under Article 11 above or utilizes an identifying characteristic in breach of
Article 13 above, Seller may, in addition to any other remedies, terminate
this Contract without liability to Buyer, such termination to become
effective upon receipt of written notice by Buyer. If Buyer fails to pay any
indebtedness to Seller when due, Seller may, in addition to any other
remedies, suspend shipments and/or change terms of payment immediately with
written notice to Buyer. In addition, Seller may send Buyer written demand
for payment and if payment (or other mutually agreed disposition) is not made
within thirty (30) days of Buyer's receipt of such notice, Seller may terminate
this Contract effective at any time upon or after expiration of said thirty (30)
day period. Buyer's obligation to perform will not be limited by any previous
waiver by Seller.
In addition to the foregoing, if at any time during the Period of this
Contract Shell reasonably concludes that (based on credible information
available to Shell) the continuation of supply of Products to Buyer poses an
unreasonable risk of significant financial exposure to Shell, Shell may
terminate this Contract effective sixty (60) days after receipt of written
notice by Buyer. Shell will
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use best efforts to assist Buyer's transition to an alternate supply of
material in substitution of Seller's Products.
17. NOTICES. Notice by either Shell or Buyer will be made only by facsimile
or similar electronic transmission, effective at the time sent to the number
set out in Article 1 with confirmation, or by letter or telegram addressed to
the other Party at its address in Article 1 and will be considered given as
of the time it is sent by facsimile transmission or deposited with the U.S.
Postal Service or the telegraph company, postage or charges prepaid.
18. GOVERNING LAW. THIS CONTRACT WILL BE INTERPRETED AND THE RIGHTS,
OBLIGATIONS AND LIABILITIES OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF TEXAS.
19. ASSIGNABILITY. Neither this Contract (including all rights, duties and
obligations hereunder) nor any claim against Shell or Buyer arising directly
or indirectly out of or in connection with this Contract will be assignable
by Shell or Buyer or by operation of law, without the prior written consent
of the other Party, such consent not to be unreasonably withheld. However,
notwithstanding the above, Seller shall have the right to assign this
Contract to an affiliate or to a wholly-owned subsidiary of Seller without
the consent of Buyer.
20. ENTIRETY AND RELEASE. This Contract, as of the beginning date of its Period,
contains the complete and exclusive agreement of Shell and Buyer concerning
the Product identified in Article 2, merges and supersedes all prior
understandings and representations (oral or written) and terminates all prior
contracts between Shell and Buyer concerning the same product. Except for any
indebtedness or indemnity obligation of Buyer to Seller, each releases the
other from all claims arising in connection with any such prior contract.
Neither this Contract nor any agreement supplementing or amending this
Contract (including any purchase order or other document issued by Buyer)
will be binding unless signed by the Parties, and performance prior to such
execution will not constitute a waiver of this requirement.
EFFECTIVE ONLY if signed by Buyer and returned within thirty (30) days of the
contract date, and then signed by Seller. Any shipment of Product made during
the period of this Contract, but prior to execution, will be deemed to have
been made under the terms hereof.
ULTRAFEM, INC. SHELL CHEMICAL COMPANY
By Audrey Contente By James H. Johnson
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Title Senior Vice President Title General Manager-Elastomers
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Date February 23, 1996 Date February 29, 1996
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