Sample Business Contracts

Northeast Roundwood Supply Agreement - John Hancock Mutual Life Insurance Co. and Crown Paper Co.

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     This Agreement is made as of the 30th day of October, 1997 between JOHN
HANCOCK MUTUAL LIFE INSURANCE COMPANY, a Massachusetts Corporation ("Hancock"),
and CROWN PAPER Co., a Virginia corporation ("Crown").


     A. As of the date hereof, Hancock acquired certain real property interests
in timberlands from Crown Paper Co. pursuant to a Timberland Acquisition
Agreement (the "Purchase Agreement") dated as of October 21st, 1997 by and
between Crown and Hancock.

     B. The timberlands acquired by Hancock in the State of New Hampshire are
described on Exhibit A hereto (the "Timberlands").

     C. Crown owns a pulp mill located at Berlin, New Hampshire (the "Berlin

     D. The New Hampshire Timberlands constitute a material source of roundwood
supply for the Berlin Mill and the parties hereto intend to utilize this
Agreement to continue a long term relationship with respect thereto.

     E. The Purchase Agreement provides for an agreement embodying substantially
the terms hereof.

     Now, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and intending to be legally bound, the parties agree as

1.   Quantities of Hardwood Pulpwood to be Supplied.

     (a) During the period commencing on the date hereof and ending on Dec 1,
     1997 (the "Initial Period") and during each six month period thereafter



     commencing on December 1 or June 1 (the Initial Period and each such six
     month period being a "Six-Month Period"), until the supply obligations
     under this Section of this Agreement are terminated in accordance with the
     provisions of Section 6, Hancock shall supply to Crown at the Berlin Mill
     from any timberland owned by Hancock at such time, and Crown shall purchase
     from Hancock, the quantity of Hardwood Pulpwood set forth in Exhibit B. The
     quantities of Hardwood Pulpwood to be delivered during the Initial Period
     shall be prorated based upon the actual number of days within the Initial
     Period in relation to a 365-day year.

     (b) Hancock shall deliver such Hardwood Pulpwood so that the total quantity
     of Hardwood Pulpwood to be purchased by Crown and supplied by Hancock in
     each Six-Month Period shall be delivered substantially in accordance with
     Exhibit B.

     (c) The quantity of Hardwood Pulpwood to be supplied hereunder shall be
     purchased according to the specifications and the scaling rules set forth
     in Exhibit C hereto in accordance with the usual business practice of the
     timber industry in the State of New Hampshire.

2.   Prices.

     (a) The price at which Hardwood Pulpwood supplied hereunder is to be
     purchased by Crown shall be established by the parties hereto for each
     Six-Month Period during the term of this Agreement. Crown shall make
     payment no later than Friday for Hardwood Pulpwood delivered during the
     previous week (Monday through Sunday).

     (b) The prices for the Hardwood Pulpwood for each Six-Month Period shall be
     market price in the vicinity. The parties shall use their best efforts to
     agree on such market prices for each Six-Month Period at least 15 days
     prior to the beginning of each such period, but if the parties are unable
     to do so by such time, then neither party shall have any obligation to
     supply or purchase Hardwood Pulpwood pursuant to this Agreement for such
     Six-Month Period. Hancock shall have available for sale to Crown at the
     beginning of each such Six-Month Period sufficient quantities of Hardwood
     Pulpwood to satisfy the volumes provided for in Exhibit B.

     (c) The price for Hardwood Pulpwood supplied hereunder shall be f.o.b. the
     Berlin Mill or other point of delivery designated by Crown and shall be
     determined on the basis of green tons of delivered wood.

     (d) In addition to the payment provided for in paragraph 2(a), Crown shall
     pay to Hancock, within 30 days after the end of each Six-Month Period, a
     performance premium of four percent (4%) of the agreed price of the
     Products delivered to the Berlin Mill during such Six-Month Period,
     provided Hancock has delivered no less



     than 95% of the volume specified in Exhibit B for such Product during such
     period and provided such premium shall be paid on not less than 95% of such
     volume and on not more than 110% of such volume.

     (e) If Crown shall fail to make a payment for Hardwood Pulpwood delivered
     by Hancock to Crown hereunder when due, and such failure shall continue for
     fifteen (15) days after Crown receives written notice of such failure, then
     until such payment has been made (i) such unpaid amount shall bear interest
     from the original due date of such payment at one percent over the prime
     rate of Citibank, N.A. (New York City) in effect from time to time and (ii)
     Hancock shall be under no obligation to make further Hardwood Pulpwood
     deliveries hereunder until such delinquent payment is made.

3.   Deliveries.

     Title to the Hardwood Pulpwood shall pass to Crown at the point of delivery
     and the risk of loss or damage shall be borne by Hancock until delivery.

4.   Force Majeure.

     Hancock and Crown shall not be liable to each other for any failure or
     delay in delivery or acceptance of delivery of Hardwood Pulpwood where such
     failure or delay is due to circumstances beyond that party's control,
     including, without limitation, extraordinary weather conditions, fires,
     labor disputes, acts of God and acts of any governmental body or, as to
     Crown, in the event Crown, with at least 90 days notice to Hancock,
     substantially curtails operations at the Berlin Mill (collectively referred
     to herein as a "force Majeure Event"), nor shall any such failure or delay
     give either party the right to terminate this Agreement except as provided
     in Section 6. Each party shall use its best efforts to minimize the
     duration and consequences of any failure or delay in delivery or acceptance
     of delivery resulting from a Force Majeure Event and shall give the other
     party immediate notice of the occurrence of a Force Majeure Event and of
     the time when the party affected by such Force Majeure Event is no longer
     affected thereby. Notwithstanding the foregoing, if, as a result of a Force
     Majeure Event pursuant to which a delay in Hancock's performance is excused
     hereunder, or for any other reason deliveries from Hancock are reduced to
     the extent that Crown cannot maintain its scheduled production level at the
     Berlin Mill, Crown shall thereafter have the right to obtain the Hardwood
     Pulpwood, or substitutes therefor (in either case, "Substitute Hardwood
     Pulpwood"), from sources other than Hancock until such time as Hancock is
     again able to commence delivery of Hardwood Pulpwood to Crown hereunder.
     After Hancock gives notice to Crown that it is again able to commence
     delivery of Hardwood Pulpwood to Crown hereunder, Crown will notify Hancock
     of any commitments for Substitute Hardwood Pulpwood that Crown has



     entered into and Crown shall not be required to again accept delivery from
     Hancock until it has accepted delivery of all Substitute Hardwood Pulpwood
     contracted by Crown, provided that no such contract shall be entered into
     for a term longer than three months without the consent of Hancock, which
     consent shall not be unreasonably withheld, and Crown's obligation to take
     Hardwood Pulpwood hereunder (and Hancock's obligation to deliver such)
     shall be reduced, at Crown's election, by the quantity of all such
     Substitute Hardwood Pulpwood. Notwithstanding the foregoing, if as a result
     of a Force Majeure Event Crown cannot accept the quantity of Hardwood
     Pulpwood determined hereunder, Crown shall promptly notify Hancock of the
     same, and Hancock shall thereafter have the right to contract for the sale
     of any such Hardwood Pulpwood Crown is unable to accept. After Crown gives
     notice to Hancock that it is again able to accept delivery of Hardwood
     Pulpwood to Crown hereunder, Hancock will notify Crown of any commitments
     for the sale of Hardwood Pulpwood that Hancock has entered into and Hancock
     shall not be required to again deliver Hardwood Pulpwood to Crown until it
     has delivered all Hardwood Pulpwood contracted by Hancock, provided that no
     such contract shall be entered into for a term longer than three months
     without the consent of Crown, which consent shall not be unreasonably
     withheld, and Hancock's obligation to deliver Hardwood Pulpwood hereunder
     (and Crown's obligation to accept such Hardwood Pulpwood) shall be reduced,
     at Hancock's election, by the quantity of all such Hardwood Pulpwood.

5.   Confidentiality.

     (a) It is recognized that both parties may disclose to each other certain
     information regarding the subject of this Agreement which they consider to
     be private and confidential, the disclosure of which could prove injurious
     to either party. Therefore, the parties agree to use such information
     solely for the use, sale and pricing of the Hardwood Pulpwood, and to use
     their best efforts to prevent the disclosure of such information (other
     than information which is a matter of public knowledge or which has been
     filed as public information with any governmental authority) to third
     parties without the prior written consent of the affected party, unless
     such disclosure is required by law.

     (b) Notwithstanding the provisions of paragraph 5(a), either party may make
     any such disclosure necessary in connection with a legal action to enforce
     its rights hereunder and, in the event there is a material breach by
     Hancock of its obligations pursuant to Section 7, Crown may disclose to any
     third party purchaser of Timberlands involved in such breach the terms of
     Section 7 as they relate to such Timberlands.



6.   Termination of Supply Obligations.

     (a) Although it is the intent of the parties that this Agreement shall
     result in a long term, mutually beneficial supply relationship, the wood
     supply obligations pursuant to Section 1 of this Agreement may be
     terminated by either party, at its option exercisable by written notice to
     the other party, but only under any one of the following circumstances:

          (i) As of November 1st, 2009 (the "Initial Termination Date") or as of
          any November 1st thereafter which is a multiple of three years after
          the Initial Termination Date, provided (A) such notice is given not
          less than three years prior to such termination date, and (B) such
          notice is accompanied by a certificate of an officer of the party
          providing such notice to the effect that the notice is being given due
          to a change in management practices of the terminating party such
          that, if Hancock is the terminating party, the Hardwood Pulpwood is no
          longer available and, if Crown is the terminating party, the Hardwood
          Pulpwood can no longer be utilized at the Berlin mill; or

          (ii) Through no default by either party, no Hardwood Pulpwood has been
          delivered pursuant to the terms of this Agreement during the initial
          twelve year term or any subsequent three year term; or

          (iii) By either party if the other party shall default in the
          performance of any of its agreements or obligations herein, and such
          default continues unremedied for a period of sixty (60) days after
          written notice from the non-defaulting party; or

          (iv) In the event Crown sells the Berlin Mill, then by either party,
          as to the supply obligations associated as provided in Exhibit B, (A)
          on 30 days prior written notice if such supply obligations were not
          assigned to the purchaser of such mill or (B) upon one year's prior
          written notice effective as of any November 1st following such sale if
          such supply obligations were assigned to the purchaser of such mill.

     (b) Any such termination of the supply obligations shall not constitute a
     waiver by either party of its rights to any damages or other remedies for
     any breach of this Agreement by the other party.

7.   Transfer of Timberlands.

     (a) Transfer. In the event Hancock desires to sell, assign or otherwise
     transfer all or any part of the Timberlands, other than Exempt Property as
     described below,



     transfers shall be made subject to this Agreement and Hancock shall submit
     to Crown for its approval, not to be unreasonably withheld or delayed, a
     proposal for equitable allocation of Hancock's obligations to provide the
     Hardwood Pulpwood volumes set forth in Exhibit B for each Annual Period of
     the remaining term of this Agreement to which property transferred shall be
     subject, with the overall objective of ensuring that such volumes are
     provided to Crown during the term of this Agreement and taking into
     consideration the following factors for determining such reduction: (i)
     species and product mix; (ii) site index (productivity); and (iii) time
     remaining under this Agreement. Cutting contracts, easements (including
     conservation easements), mineral leases and recreational leases shall not
     be considered a sale or transfer for purposes of this section.

     (b) Exempt Property. Notwithstanding anything to the contrary set forth
     above, the sale of any Timberlands shall be exempt from the obligations of
     this Wood Supply Agreement herein; provided (A) the aggregate of all such
     exempt property ("Exempt Property") shall not exceed 4,650 acres, and (B)
     until such 4,650 acre limit has been reached, any parcel containing 500
     acres or less which is sold or otherwise transferred shall be deemed Exempt
     Property. The transfer of any Exempt Property pursuant to the provisions of
     this subsection (a) shall relieve the Exempt Property from the obligations
     under this Agreement, but shall not relieve Hancock of its obligations
     under this Agreement including the obligations to make available to Crown
     the Hardwood Pulpwood volumes in Exhibit B.

8.   Representations and Covenants.

     (a) Hancock hereby covenants and agrees that:

          (i) it shall give Crown no less than 30 days prior notice of any
          transfer of any of the Timberlands or any other transaction related
          thereto which would have any effect on Hancock's obligations under
          this Agreement; and

          (ii) it has the right, power and authority to grant the rights hereby
          purported to be granted Crown.

     (b) Crown represents and warrants that it has the right, power and
     authority to enter into this Agreement and consummate the transactions
     contemplated hereby.

9.   Relationship of Parties.

     In all matters relating to this Agreement, both parties shall be acting
     solely as independent contractors and shall be solely responsible for the
     acts of their employees; and employees of one party shall not be considered
     employees of the



     other party. Neither party shall have any right, power or authority to
     create any obligation, express or implied, on behalf of the other party.

10.  SFI.

     Hancock agrees to manage the Timberlands in accordance with the Sustainable
     Forestry Initiative of the American Forest and Paper Association ("SF1").
     This commitment will last until the first occurrence of either one of the
     following two scenarios: (1) the SF1 program is no longer a viable, ongoing
     program, or (2) the Wood Supply Agreement between Crown and Hancock is no
     longer in effect.

11.  Compliance with Law.

     Each party agrees to comply with all applicable laws, statutes, ordinances
     and governmental rules and regulations applicable to the conduct of its

12.  Waiver.

     No waiver shall be deemed to be made by either party of any of its rights
     hereunder unless the same shall be in writing, and each waiver, if any,
     shall be a waiver only with respect to the specific instance involved and
     shall in no way impair the rights of the waiving party or the obligation of
     the other party in any other respect at any other time.

13.  Assignment.

     (a) Either party may assign this Agreement to any corporation which
     controls, is controlled by or is under common control with such party,
     formed by consolidation of such party with another corporation or
     corporations, or into which such party shall be merged, or to which
     substantially all the property of such party shall be conveyed or
     transferred as an entirety (the "Successor Corporation"), or to a trustee
     under any deed of trust mortgaging or pledging all, or substantially all,
     of such party's plants and real property. Upon any such transfer, all the
     terms and provisions of this Agreement binding upon, or inuring to the
     benefit of, the assigning party shall be binding upon, and inure to the
     benefit of, its successor or assign, whether so expressed or not, provided,
     however, in any such case the assignee shall assume in writing the
     obligations of the assigning party and the assigning party shall remain
     primarily liable hereunder. Except as above provided, this Agreement shall
     not be assignable or transferable by either party without the consent of
     the other party.

     (b) In the event Crown sells the Berlin Mill, Crown may assign to any such
     purchaser its supply rights under this Agreement as provided in Exhibit B,
     and, in



     such event, such assignment shall also be deemed a delegation and
     assumption by such purchaser of all Crown's duties and obligations
     hereunder related to such supply rights, and upon the assumption in writing
     by such purchaser of all Crown's duties and obligations hereunder, Crown
     shall be released from all future obligations hereunder with respect to
     such supply rights and Hancock shall thereafter look only to such assignee
     for performance under this Agreement with respect to such rights.

14.  Separability.

     If any provision of this Agreement is held to be invalid, illegal or
     unenforceable, the balance of this Agreement shall remain in effect.

15.  Notices.

     Any notices which may be required or are appropriate hereunder shall be in
     writing or by electronic means producing a written record (facsimile
     machine, telex, telecopier or telegraph), personally delivered or mailed by
     Registered or Certified United States Mail or reputable overnight courier,
     postage prepaid, return receipt requested, effective on personal delivery,
     one day after mailing if by reputable overnight courier or three days after
     mailing if by United States mail:

                  To Crown at the following address:

                                             Mr. A. Bradford Wyman
                                             Crown Vantage, Inc.
                                             650 Main Street
                                             Berlin, NH 03570
                                             Telephone: (603) 342-2500
                                             Facsimile: (603) 342-2301

                  Copy to:                   Chris McLain, Esq.
                                             Crown Vantage, Inc.
                                             300 Lakeside Drive, Room 1451
                                             Oakland, CA 94612-3592
                                             Telephone: (510) 874-3869
                                             Facsimile: (510) 874-3939



                  To Hancock at the following address:

                                     Hancock Timber Resource Group
                                     99 High Street, 26th Floor
                                     Boston, Massachusetts 02117
                                     Attn:   Mr. Bruce McKnight
                                     Telephone: (617) 747-1502

                  Copy to:           Robert H. Golden, Esq.
                                     John Hancock Mutual Life Insurance Company
                                     Trinity Place - Home Office Receiving
                                     Mortgage and Real Estate Law, T-50
                                     Boston, Massachusetts 02117
                                     Facsimile: (617) 572-9268

                  Copy to:           Mr. Henry L. Whittemore
                                     Hancock Timber Resource Group
                                     77 Water Street
                                     Hallowell, ME 04347
                                     Telephone: (207) 621 -4020

                  Copy to:           Mr. Thomas J. Colgan
                                     Wagner Forest Management, Ltd.
                                     P.0. Box 160
                                     150 Orford Road
                                     Lyme, New Hampshire 03768
                                     Telephone: (603) 795-2002

                  Copy to:           Karen Huber, Esq.
                                     Eaton, Peabody, Bradford & Veague
                                     144 Exchange Street, Fleet Center
                                     Bangor, Maine 04402
                                     Telephone: (207) 947-0111

16.  Headings.

     The headings in this Agreement are solely for convenience of reference and
     shall be given no effect in the construction or interpretation of this

17.  Counterparts.

     This Agreement may be executed in several counterparts, each of which shall
     be deemed an original, but all of which together shall constitute one



18.  Governing Law.

     This Agreement shall be construed and enforced in accordance with the laws
     of the State of New Hampshire, without regard to the principles of conflict
     of law thereof.

19.  Nonrecordation.

     Neither this Agreement nor a memorandum of the terms hereof shall be
     recorded in the land records of any jurisdiction where any of the
     Timberlands are located except in connection with a lawsuit filed by Crown
     as a result of a breach by Hancock of its obligations.

     IN WITNESS WHEREOF, the parties hereto each have caused this Agreement to
be duly executed as of the date first above written

                                       INSURANCE COMPANY

                                       By: Hancock Natural Resources Group, Inc.
                                       its Investment Manager, duly authorized

/s/ R. Carl Anderson                   By: /s/ John P. Lollis
------------------------------             ------------------------------------
                                       Name  John P. Lollis
                                       Its: Account Manager,
                                       Duly Authorized
                                       [Execute in Black Ink]

WITNESSED BY:                          CROWN PAPER CO.

/s/ R. Carl Anderson                   By: /s/ Christopher M. McLain
------------------------------             ------------------------------------
                                       Name: Christopher M. McLain
                                       Its: Senior Vice President
                                       Duly Authorized
                                       [Execute in Black Ink]




     The foregoing was acknowledged before me this 30th day of October, 1997, by
John P. Lollis, as Account Manager of and duly authorized to act on behalf of
Hancock Natural Resources Group, Inc., a Massachusetts corporation and
Investment Manager of John Hancock Mutual Life Insurance Company, a
Massachusetts corporation, on behalf of the corporation.

[EXECUTE IN BLACK INK]                      /s/ R. Carl Anderson
                                            Notary Public
                                            Name:   R. Carl Anderson
                                                    [Print or Type Name]
                                            My Commission expires:  3/23/99
                                            [AFFIX SEAL]


     The foregoing instrument was acknowledged before me this 30th day of
October, 1997, by Christopher M. McLain, Senior Vice President of Crown Paper
Co., a Virginia corporation, on behalf of the corporation.

[EXECUTE IN BLACK INK]                      /s/ R. Carl Anderson
                                            Notary Public
                                            Name:   R. Carl Anderson
                                                    [Print or Type Name]
                                            My Commission expires:  3/23/99
                                            [AFFIX SEAL]