EXHIBIT 10.20
FRAME AGREEMENT NO 96-029
This agreement, made and entered into this 1st day of October, 1996 by and
between FCI ENVIRONMENTAL, INC., a corporation organised and existing under the
laws of the State of Nevada, having its principle business at 0000 Xxxxx Xxxxx
Xxxxx X, Xxx Xxxxx, Xxxxxx 00000 XXX hereinafter referred to as the "COMPANY"
and
AUTRONICA AS, a corporation organised and existing under the laws of Norway and
having its principle business at Haakon VII gt. 4. X-0000 Xxxxxxxxx Xxxxxx,
hereinafter referred to as "AUTRONICA".
The AUTRONICA GROUP GENERAL TERMS AND CONDITIONS FOR PROCUREMENT (AU-873/AW/Rev
5, dated 15.10.94) attached in appendix A forms an integrated part of this
agreement.
1. DEFINITIONS
1.1 "Effective date" shall mean the date of this agreement as written above.
1.2 "Products" shall mean the Environmental products as described in Appendix B
covered by this agreement and manufactured by the Company.
1.3 "Territory" shall be as specified in Appendix C.
2. SCOPE
2.1 THE AGREEMENT AND OBJECTIVES
2.1.1 The Company hereby appoints Autronica and Autronica hereby accepts
appointment as the Company's exclusive authorised Distributor for the
products listed in Appendix B *hereinafter referred to as the
"Products"), for the market identified in Appendix C (hereinafter
referred to as the Territory).
2.1.2 The Company undertakes to participate in the "just-in-time" and fast
throughput manufacturing principles practised by Autronica and provide
Autronica with
FCI ENVIRONMENTAL PETROSENSE-Registered Trademark-
as described in appendix B, of consistently high quality at the
minimum overall cost to the precise delivery times agreed with
Autronica.
2.1.3 Autronica's objectives in entering into this Agreement with the
Company are:
- to develop a close long-term working partnership with a world
leading Company for timely and reliable material supply well
presented at minimum overall cost to Autronica and the Company;
to co-operate in the mutual exchange of concepts and ideas to
progressively improve the product performance and sales.
2.1.4 The relationship between the Company and Autronica is that of
independent contractors and under no circumstances shall the be deemed
to be partners or employees of each other.
3. ORDERS, REPLENISHMENT OF GOODS AND DELIVERY TIME
3.1 FRAME ORDER
For Products covered by this agreement listed in Appendix B, annual frame
orders will be raised by Autronica covering our best estimate of annual
usage. Any estimated annual requirement quantities previously indicated or
referred to in a resulting frame order are Autronica's genuine usage
forecast
estimate at the time of raising the frame order. These quantities are
indicative guidance figures only and Autronica will not be liable for them.
3.2 FORECAST
The Company will be faxed a 3 month delivery plan as attached as appendix
D, every fourth week. The delivery plan contains all forecast information
available at Autronica. The quantities are indicative guidance figures
only for assisting the Company in improving its MA- function for Autronica
orders, and Autronica will not be liable for them.
3.3 CALL OFF
Based on the issued frame orders, the column "called off Qty" on the faxed
delivery plan, are to be understood as a call off from Autronica.
The Company shall within one week after received call off or order
acknowledge these by return fax.
The acknowledgment shall include the following information:
Autronica order no, Company and Autronica article no, quantity, price, and
confirmed day of delivery.
Orders may also be issued separately on a Autronica purchase order form.
The orders or call offs may be acknowledged by the Company, using the
Company's standard sales order confirmation form. However, it is
understood and agreed that such forms of Purchase order and sales order
confirmation are used solely for the convenience of the parties in setting
the quantities and delivery time for products, and that the terms and
conditions for these purchases shall be according to this agreement.
3.4 DELIVERY
The called off equipment shall be delivered on the week stated, under the
terms and conditions agreed in this contract. (The lead time shall not
exceed 4 weeks.) The precise quantity of each item will reflect the
Autronica's exact quantitative planning requirement. Autronica will not
allow for rejections and nothing less than one hundred percent defect free
product quality for each delivery is deemed acceptable.
The Company will be able to supply increases between the forecast given 8
weeks ahead compared to actual call off with at least 50% without any
delays in deliveries.
The Company will deliver Goods in labelled packages the labelling will also
show the Autronica's part number and name, Company's batch trade details,
the quantity and the description including a specification reference where
appropriate.
3.5 TERMS OF DELIVERY
The equipment is delivered CPT, (INCOTERMS 1990) Autronica's locations in
Trondheim or Stavanger as required by Autronica.
4.0 PRICES
4.1 PRICE BASIS
a) The Prices set down in this agreement shall remain fixed against
increase and/or surcharge until 31 october 98.
i) Thereafter, Autronica and the Company may consider an appropriate
review of Order Prices, upwards and downwards consistent with
current business, trading and economic factors.
ii) The Company will at all times ensure that Autronica's competitive
position on prices (Order Prices) is maintained. The Company
warrants that at the effective date of this Agreement the prices
(Order Prices) set down in this Agreement do not exceed those
charged to any other customer of the Company purchasing Goods of
a like nature. If at any time the Company offers lower prices to
any other customer purchasing Goods of a similar nature, then the
prices charged to Autronica shall not exceed these lower prices.
This applies to similar quantities of Goods specified in this
Agreement.
iii) Any variation in Order prices are valid only where authorised by
Autronica in writing.
4.2 TERMS OF PAYMENT
Payment is made 60 days end of month after material and duly certified
invoices, including any attachments and certificates required by the
contract, are received by Autronica.
4.3 CURRENCY DEPENDENCE
The prices in this agreement are in US Dollars and not dependent on
exchange rates with any other currency.
5. RESPONSIBILITIES
5.1 RESPONSIBILITIES OF THE COMPANY
5.1.1 The Company will provide Autronica with sales and technical
information and material regarding the products, including available
sales promotion literature or brochures. This information will also
be made available on diskette on an agreed format so that Autronica
can incorporate it into its own sales and technical documentation.
5.1.2 At its own cost the Company will provide sales and technical
assistance as agreed between the Company and Autronica.
5.1.3 The products are apart from special Autronica branding standard
products from the Company and will be made according to the
specification valid and made public through the Company's data-sheets
at the time of entering the agreement, unless changes are approved as
described in Appendix A.
5.14 The Company warranties spare parts availability for the equipment
covered by this agreement for a period of 5 years after the last
delivery of any product covered by this agreement has been made.
Before parts, at the end or after this period are made obsolete by the
Company, the Company shall offer Autronica a possibility for a last
time buy-out of spares for existing sites. The offer shall be valid
for at least 3 (three) months.
5.15 The Company will provide initial technical training at Norway at no
cost for Autronica. Additional training will be given by the Company
at the Company's premises as required by Autronica at no cost for
Autronica except the travel and accommodation cost for Autronica's
personnel.
5.2 RESPONSIBILITIES OF AUTRONICA
5.2.1 Autronica shall actively promote the sale of the products within the
territory both directly and through its distributors. Such promotions
shall include, but not be limited to sales calls, demonstrations,
seminars and exhibitions.
5.2.2 Autronica shall do its utmost to meet or exceed any annual sales
volume targets that are mutually agreed upon between the Company and
Autronica.
5.2.3 Autronica will purchase necessary demonstration equipment and stock to
be able to supply according to customers demand, provided the Company
complies with the lead-times given in paragraph 2.4.
Autronica will purchase initial demonstration equipment according to
appendix E. These units will be issued on a separate order, 7 units
of each line item for immediate delivery and the rest to be called off
when required by Autronica. The remaining 7 will be invoiced at the
30 september 96, but payment terms 60 days end of month after delivery
has been made after Autronica's call off.
5.2.4 Autronica will keep a reasonable amount of spare parts/modules to be
able to support customer demand. The Company will as a part of the
agreement provide Autronica with USD 25.000 worth of spares. (Based
on the prices in appendix B). The content and delivery time of these
spares/modules shall be agreed between the parties not later than
march 97.
5.2.5 Autronica will be responsible for installation of the products and
warranty and user paid services in the Territory.
5.2.6 Autronica will not make modifications to the products without the
written approval of the Company.
5.2.7 Autronica will not sell the products to customers outside the
Territory or when it has reason to believe that the aim is to export
the products to customers outside of the Territory.
Autronica will refer to the Company all inquiries received from
customers outside the Territory.
5.2.8 Autronica will sell the Products solely under the Company's name, and
will not remove, cover or destroy any Company names or labels. On the
equipment sold to Autronica the Company will attach a label "Marketed
Exclusively by Autronica" according to drawing AU (TBA).
5.2.9 Autronica will devote its best efforts to assist the company in
obtaining necessary certification of the Products within the territory
by any government agency or other certifying body. The Autronica
effort will be done at no cost to the Company, however fees and
payments to the certification bodies/test houses will be born by the
Company. Certification granted will be jointly in the names of
Autronica and the company.
5.3 WARRANTIES
5.3.1 The Company warrants that the equipment supplied under this agreement
is according to the Specification as established according to
paragraph 5.1.3, and will be free from defects in design workmanship
and fabrication. The warranty is valid for 24 months after the
equipment has been installed commissioned at the end users site, or 27
months from the equipment has been delivered to Autronica, whichever
applies first.
Equipment that is returned to the Company under warranty will be
replaced or repaired at the Company's option. However equipment that
is repaired will be tested and delivered in a state so that they can
be sold as new.
Equipment that is returned for repair under warranty will by Autronica
be delivered FCA (INCOTERMS 1990) Autronica's locations either at
Stavanger or Trondheim. The equipment will after repair or
replacement be delivered according to the terms in paragraph 3.5.
5.4 BRANDING
The Company will without additional cost to Autronica include the label
according to paragraph 5.2.8.
6. CERTIFICATES OF CONFORMITY
Autronica required a Certificate of Conformity to be provided with each and
every delivery. Each certificate must be signed by an authorised
representative of the Company and verify that the Goods have been examined
and inspected and found to be exactly in accordance with the approved
sample and/or Specification.
7. TRADEMARKS
7.1 Neither of the parties shall, while this agreement is in force or
thereafter, acquire through performance of its duties under this agreement
the ownership of the Trademarks of the other party. Furthermore the
parties shall not use for their own account any of the trademarks of the
other party or trademarks similar thereto.
7.2 Neither of the parties shall at any time register, or cause to be
registered, in its own name or in the name of another, or use, or employ
the Trademarks of the other party during and after the duration of this
agreement. The parties shall report to the other party any infringement or
imitations of the other party which comes to attention and shall assist in
protecting the other part's rights in and to the trademarks.
8. CONFIDENTIALITY OF PROPRIETARY INFORMATION
All information relating to Proprietary information (including, but not
limited to methods of manufacture, trade secrets, processes, formulas,
software, firmware, designs, schematics, drawings, marking and sales data,
performance data, vendor list, distributor contracts, price data, cost
data, financial data) referred to in this agreement as "Know-how" supplied
to the other party verbally, in writing, by model or in any other way is
solely for the use in fulfilling the obligations according to this
agreement and remains the property of the originating party. The parties
agree to use and disclose to their employees and/or agents this kind of
information only on a need to know basis in order to fulfill the
obligations according to this agreement.
9. TERMINATION OF THE PROCUREMENT AGREEMENT
9.1 This agreement is valid from the last date of signature and remains in full
force and effect for a period of three years.
9.2 Both parties have the right to withdraw from the Agreement where it can be
shown that the principles of this Agreement and its objectives are not
being upheld, but after allowing reasonable (minimum 90) opportunity for
due corrective action. Any claim that the principles are not being upheld
shall be sent to the other party by registered mail.
9.3 This agreement shall automatically terminate upon the occurrence of the
following event:
* If at any time either party files a petition for insolvency,
bankruptcy or is adjudicated bankrupt, or takes advantage of any
insolvency acts or assignments for the benefit of creditors, or
undergo significant change in ownership, the other party shall have
the right to terminate this agreement immediately without notice. At
no time or for any reason should this Agreement be considered an asset
of the insolvent party.
9.4 Upon termination of this Agreement for any cause, Autronica shall
immediately cease to sell, distribute or promote the Products with the
exception of orders in hand, outstanding quotes and spare parts to already
delivered installations. The Company shall deliver products to sales made
according to the first sentence in this paragraph according to the terms
and conditions in this agreement, also after the Agreement is terminated.
10. MISCELLANEOUS
10.1 Modifications/Additions to appendix A: Autronica Group General Terms and
Conditions for procurement (AU-873/AW/Rev 5, dated 15.10.94).
PARAGRAPH 9.b: The Company is not yet certified, but the process ISO-9001
certification will be started by October 7, 1996. The certification is
estimated to be completed by October 7, 1997.
PARAGRAPH 16: The following text shall be added at the end of the said
paragraph:
"Notwithstanding the foregoing, either party may disclose confidential
information where required by law, the legal order of any court or
governmental agency, or the rules of any applicable securities exchange"
10.2 Any instance or instances of failure by either party to enforce any
provision or group of provisions of this agreement shall not be construed
as a waiver of that or any other provision.
10.3 Points of contact concerning this agreement:
FCI Environmental Inc.: Xxx Xxxxxxx
Autronica: Xxxxx Xxxxxx
10.4 This agreement including its two appendixes has been issued in 2 - two -
original copies, one for each of the parties.
FCI Environmental, Inc. Autronica AS
27.9.96
/s/ Xxxxxxxx Xxxxxx /s/ Asbjorn Wexsahl
President Procurement manager
