Service Agreement - Westland Technologies Inc., Burke Rubber Co. Inc. and Burke Industries Inc.
SERVICE AGREEMENT
This SERVICE AGREEMENT (this "Agreement") is entered into as of June 27,
1996 between WESTLAND TECHNOLOGIES, INC., a California corporation, ("Buyer"),
BURKE RUBBER COMPANY, INC., a California corporation ("Seller"), and BURKE
INDUSTRIES, INC., a California corporation ("Burke Industries").
RECITALS
A. Pursuant to that certain Asset Sale Agreement ("Sale Agreement") dated
as of March 15, 1996, Seller agreed to sell, and Westland Technologies, LLC, a
California limited liability company ("Westland LLC"), agreed to buy, those
certain "Assets' used in connection with the "Business" of Seller, as such terms
are more specifically described therein. Except as otherwise specifically
described herein, initially capitalized terms used herein shall have the same
meaning as set forth. in the Sale Agreement.
B. Buyer is the owner and holder of all of Westland LLC's rights and
obligations under the Sale Agreement.
C. In connection therewith, and in order to promote Buyer's ability to
continue the operation of the Business after the Closing, the parties desire
that for a temporary period of time the parties take certain actions and provide
certain goods and services in connection with the Business, subject to the terms
and conditions and as otherwise provided for herein.
NOW, THEREFORE, in consideration of the mutual conditions and provisions
herein after set forth, and the provisions of the Sale Agreement, the parties
hereto agree as follows:
1. TRANSACTIONS RELATING TO THE BUSINESS.
1.1 BUYER'S RIGHT TO PURSUE CERTAIN TRANSACTIONS. The parties
acknowledge and agree that Buyer shall have the right, at its sole cost and
expense, to take any and all actions as, in the reasonable opinion of Buyer, may
be necessary to complete the transactions described in Paragraphs l (a), (b),
(c) and (d) below, to the extent and during the periods described therein.
(a) the transfer from Seller to Buyer of those military
contracts described on EXHIBIT 1 attached hereto ("Contracts"), subject to
the condition that Buyer assume all liabilities of and claims against
Seller. under the Contracts, that Buyer obtain the consent of the
applicable governmental agency of such transfer, and that the documents
evidencing such transfer and consent be satisfactory to Seller in its
reasonable discretion, and further provided that any such transfer and
consent be completed no later than one year after the date hereof;
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(b) the transfer from Seller to Buyer of the tooling and
equipment used to manufacture "large o-rings" (and the fixtures related
thereto) described on EXHIBIT 2 attached hereto ("Tooling"), subject to the
condition that Buyer assume all liabilities of and claims against Seller
under the Contracts, that Buyer obtain the consent of the owner of such
Tooling of such transfer, and that the documents evidencing such transfer
and consent be satisfactory to Seller in its reasonable discretion, and
further provided that any such transfer and consent be completed no later
than one-year after the date hereof;
(c) the consent of the owner of all tooling and equipment
located in or used in connection with the Business and not wholly owned by
Seller or Buyer ("Other Party Owned Tooling") , subject to the condition
that if such consent is not obtained within one year after the date hereof,
Buyer shall at its sole cost and expense return such Other Party Owned
Tooling to the owner thereof or, at the election of Burke Industries, to
Burke Industries; and
(d) the obtaining of funding from the U.S. Department of Defense
and/or relevant shipyards relative to the continuation of the "acid etch"
operations as conducted by Burke Industries at its San Jose facility,
provided that such funding be obtained no later than the two-year
anniversary of the date hereof.
1.2 SELLER'S AND BURKE INDUSTRIES' COOPERATION. During the one-year
period commencing on the date hereof (or longer period indicated below), each of
Seller and Burke Industries agrees that: (i) Seller and/or Burke Industries will
take such actions and properly execute and deliver to Buyer such further
instruments of assignment, conveyance and transfer as, in the reasonable opinion
of Buyer, may be necessary to assure, complete and evidence the full and
effective completion of those transactions described in Paragraph 1.1 above;
(ii) Burke Industries shall, in all material respects, use its best efforts to
keep available to Buyer the Tooling substantially at the same location and in
the same condition as existing as of the date hereof and, promptly. upon any
transfer of such Tooling to Buyer, Burke Industries shall furnish the facilities
and the labor for loading the Tooling onto trucks furnished by Buyer; and (iii)
Burke Industries shall, in all material respects, use its best efforts to
conduct the "acid-etch" operations in the usual, regular and ordinary course,
substantially in the same manner as theretofore conducted, and to keep available
said operations to Buyer for two (2) years after the date hereof.
2. GOODS AND SERVICES.
2.1 DELIVERY OF GOODS AND SERVICES. Burke Industries shall
manufacture and deliver upon Buyer's written request, and Buyer shall pay for
and accept, the following goods and services, at the prices and subject to the
terms and conditions, set forth below:
(a) during the one-year period commencing on the date hereof and
expiring on the one-year anniversary of the date hereof, on those
approximately thirty-three (33) different types of compounds and those
certain processing services and materials listed on EXHIBIT 3 attached
hereto, shall be at the prices and otherwise subject to the terms and
conditions set forth on EXBIBIT 3; provided, however, that the acid
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etching pricing in effect as of the date hereof will remain effective as to
the AD 79 shipset now in progress until its completion on or about July,
1996;
(b) during the period commencing on the one-year anniversary of
the date hereof and expiring on the two-year anniversary of the date
hereof, those approximately thirty-three (33) different types of compounds
listed on EXHIBIT 3 attached hereto, at the prices set forth on EXHIBIT 3
subject to two semi-annual increases (on said one-year anniversary, and six
months thereafter) as follows: (i) 70% of the stated price being adjusted
by an index that measures the increase, if any, in Burke Industries'
formula costs from January 26, 1996; and (ii) 30% of the stated price being
adjusted by the Producer Price Index (or, if discontinued, by a comparable
index acceptable to Burke Industries and Buyer);
(c) during the six-month period commencing on the date hereof
and expiring on the date which is six months from the date hereof, those
certain technical and laboratory services necessary or appropriate to
complete the development of the products described on EXHIBIT 4 attached
hereto, at the prices and otherwise subject to the terms and conditions set
forth on EXHIBIT 4;
(d) during the one-year period commencing on the date hereof and
expiring on the one-year anniversary of the date hereof, to the extent that
the Tooling described in Paragraph 1.1(b) has not been transferred to Buyer
as contemplated therein, those certain "large o-rings" described in EXHIBIT
5 attached hereto, at the prices and subject to the terms and conditions
set forth on EXHIBIT 5; and
(e) during the nine-month period commencing on the date hereof
and expiring on the date which is nine months from the date hereof, the use
of Burke Industries' "INFIMACS" computer software system, at the prices and
subject to the terms and conditions set forth on EXHIBIT 6 attached hereto.
2.2 DELIVERY; RISK OF LOSS. All goods shall be delivered F.O.B. at
Burke Industries' facility located at 2250 South Tenth Street, San Jose,
California. Burke Industries shall furnish the facilities and labor for loading
the goods onto the trucks or other carrier famished by Buyer. The cost of
transportation beyond Burke Industries' facility shall be paid by Buyer. The
risk of loss of the goods shall pass to Buyer as soon as the goods are loaded
onto the carrier.
2.3 BUYER'S INSPECTION. Buyer shall have the right to inspect the
goods for ten (10) days after delivery. This inspection shall be fully and
finally determinative of whether the goods conform to the terms of this
Agreement. Defects that are not noted and brought to the attention of Burke
Industries within ten (10) days after delivery shall not constitute the basis of
any claim or defense against Burke Industries under this Agreement or otherwise.
Failure to notify Burke Industries of the results of any inspection within ten
(10) days after delivery shall constitute a waiver of Buyer's rights of
inspection and shall be deemed an acceptance of the goods.
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2.4 TERMS AND CONDITIONS. Seller's and Burke Industries' obligation
to deliver the goods and services described in Paragraph 2.1 above shall be
subject to the following conditions precedent, and Buyer hereby agrees to the
following: (a) that all such goods and services shall be used only for Buyer's
direct use in Buyer's Modesto, California facility (or, if manufactured by Buyer
in a location other than Buyer's Modesto, California facility such goods and
services shall be used only for the manufacture of those products manufactured
by the Business as of the date hereof); (b) that delivery of such products or
services shall be provided by Seller or Burke Industries solely on a best
efforts basis, subject to the availability of any products or service required
by Seller or Burke Industries; and (c) that Buyer shall notify Burke Industries
in writing of its requirements at least ten (10) business days in advance of any
requested shipment. The parties hereto acknowledge and agree that any of Seller
or Burke Industries may buy or sell the goods described in Paragraph 2.1 from or
to any other party.
2.5 PAYMENT. Buyer shall make payment for the goods or services
provided hereunder at the time of delivery by cash, certified check or by means
of the "Line of Credit" (as defined in, and subject to the terms and conditions
of, Paragraph 3 below).
2.6 TERMINATION. As to the goods and/or services described in each
of Paragraphs 2.1(a), (b), (c), (d) and (e) above, the pricing, terms and
conditions set forth thereunder shall apply only to the extent that orders are
placed and shipped for delivery within the prevailing delivery cycle for such
products or services, or are in such quantities where such orders do not exceed
100% of the highest monthly usage within the most recent twelve (12) months (or,
as to Paragraph 2.1(c), that services are requested and scheduled) during the
periods described in said Paragraphs 2.1(a), (b), (c), (d) and (e). Immediately
upon expiration of the periods described in said Paragraphs 2.1(a), (b), (c),
(d) and (e), Burke Industries' and Seller's obligations and the prices, terms
and conditions set forth thereunder shall terminate and be of no further force
and effect.
3. LINE OF CREDIT. Subject to the provisions of this Paragraph 3, for
the three-year period commencing as of the date hereof, Burke Industries agrees
to make available to Buyer a temporary purchase money line of credit ("Line of
Credit"), in an amount not to exceed Three Hundred Fifty Thousand Dollars
($350,000.00), which Line of Credit shall be available solely for the purchase
of products or services from Seller or Burke Industries for Buyer's direct use
in Buyer's Modesto, California facility (or, if manufactured by Buyer in a
location other than Buyer's Modesto, California facility such goods and services
shall be used only for the manufacture of those products manufactured by the
Business as of the date hereof), and provided that payment in full must be made
no later than sixty (60) days after Burke Industries' presentment of invoice.
Among other conditions, the Line of Credit, and Burke Industries' obligation to
extend credit to Buyer, shall be subject to the following conditions: (i) Buyer
not being in default under any credit or lending agreements with any other
creditors or lenders relating to the Business or the Assets; (ii) Buyer
remaining in full satisfaction of the terms of the Note (as defined in the Sale
Agreement); and (iii) Buyer remaining in compliance with the sixty (60) day
payment terms and the other terms and conditions of said Line of Credit.
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4. BLACK TILE AGREEMENT.
4.1 COMMISSIONS PAYABLE. Subject to the provisions of Paragraph 4.3
below, Burke Industries shall pay to Buyer a commission of five percent (5.00%)
of the net invoice value (exclusive of freight and transportation costs, trade
discounts, and sales and other taxes) of all shipments of the product commonly
known as "Black Tile, " Stock No. FXA 3624 ("Black Tile") from Burke Industries'
San Jose, California facility to Unified Defense, L.P. to the extent such
shipments are made and invoices are rendered during the three-year period
commencing on the date hereof and expiring on the three-year anniversary hereof
("Commission Period") . All commissions payable to Buyer shall be due and
payable reasonably promptly upon Burke Industries' receipt of payment from
Unified Defense, L.P.
4.2 RIGHT OF FIRST OFFER. Subject to the provisions of Paragraph 4.3
below, in the event Burke Industries elects in its sole discretion not to
directly manufacture Black Tile at any time during the Commission Period, Burke
Industries shall first offer to Buyer the right for the contract manufacturing
of Black Tile by giving Buyer written notice to that effect ("First Offer
Notice"). The First Offer Notice shall specify the economic and other terms
upon which Burke Industries in its sole discretion would be willing to contract
for the manufacture of Black Tile with Buyer or any other party (which terms may
be based upon bids solicited and received by Burke Industries from other third
parties). Buyer shall have five (5) business days after receipt of the First
Offer Notice to exercise its first offer right with respect to the terms and
conditions described in the First Offer Notice, by delivery to Burke Industries
of written notice evidencing such exercise. Within ten (10) business days
following delivery of such notice of exercise, Burke Industries and Buyer shall
prepare and deliver all documents and instruments necessary or appropriate to
contract for Buyer's manufacture of Black Tile in accordance with the First
Offer Notice and otherwise on terms acceptable to Burke Industries. If Buyer
does not exercise its first offer right within said five-day period, or if the
documents and instruments are not delivered within said ten-day period, Buyer's
first offer right shall immediately terminate and Burke Industries shall be free
to contract for the manufacture of Black Tile with any party desired by Burke
Industries on economic terms and conditions no more favorable to such party than
the most favorable terms and conditions offered to Buyer by Burke Industries.
4.3 CONDITIONS AND LIMITATIONS. In consideration of the covenants
and agreements of this Paragraph 4, Buyer and Burke Industries acknowledge and
agree to the following: (a) that Burke Industries' obligations under this
Paragraph 4 shall be subject to Buyer not being in default under this Agreement,
the Note or any other agreements relating to the Business or the Assets; (b)
that no representation or warranty is made, express or implied, as to the
quantity, price or timing of the Black Tile to be shipped by Burke Industries
during the Commission Period; and (c) as between Buyer and Burke Industries,
their successors and assigns, Burke Industries is the owner of and has the sole
exclusive right to the ownership, possession and use of all contracts,
processes, products, production knowledge, machinery, tooling, equipment or
other assets, tangible or intangible or held in connection with the Black Tile.
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5. RIGHT TO INFORMATION. Buyer acknowledges that all existing documents,
papers, files and other written materials relating to the financial history,
transaction data, accounts and production cost data of the Business to the
extent the same was prepared or relates to the period prior to the date hereof
("Financial Information") shall be and remain the property of Seller and/or
Burke Industries. Within ninety (90) days after Seller's or Burke Industries'
request therefor, Buyer shall deliver to Seller or Burke Industries, as
applicable, all Financial Information to the extent in Buyer's possession or
otherwise located in the Modesto, California facility. During the one year
period commencing on the date hereof and expiring on the one-year anniversary
hereof, Buyer shall have the one-time right to request that Burke Industries
make available all Financial Information (other than customer proprietary
information) to the extent in Burke Industries' possession or otherwise located
in the San Jose, California facility for review by Buyer and Buyer's
representatives at the San Jose, California facility and for duplication by
Buyer at Buyer's sole cost and expense.
6. FINANCIAL STATEMENTS. Buyer will furnish or cause to be furnished to
Burke Industries a current financial statement of Buyer, in form and substance
acceptable to Burke Industries, consisting of a balance sheet, an income
statement and a schedule of covenant compliance, as follows: (a) so long as
Buyer is not in default hereunder or under any other agreement with Seller or
Burke Industries, on a quarterly basis no later than thirty (30) days after the
end of each quarter, and (b) upon the occurrence of any default hereunder or
under any other agreement with Seller or Burke Industries (and regardless of
whether Buyer cures any such default), on a monthly basis no later than thirty
(30) days after the end of each calendar month.
7. COMMERCIAL CODE. Except as otherwise provided herein, this Agreement
shall be governed by the Uniform Commercial Code as adopted in the State of
California as effective and in force as of the date hereof.
8. NO DUTY OF SELLER OR BURKE INDUSTRIES. The parties acknowledge and
agree that, except to the extent specifically provided herein, neither Seller
nor Burke Industries owes any duty whatsoever to Buyer, express or implied, with
respect to the transport, installation, start-up or continued operation of the
Business, the condition of the Assets, or otherwise with respect to the Assets
or the Business.
9. TERMINATION. This Agreement may be terminated at any time by mutual
written consent of the Buyer and Seller (or Burke Industries) or by either party
upon written notice delivered to the other party in the event such party has
determined that there has been an assignment prohibited under Paragraph 11 below
or that there has otherwise been a material breach of any covenant of the other
party contained herein. In the event of termination of this Agreement by either
Buyer or Seller as provided above, except for breach, such termination shall be
without liability of either party and all of the parties' respective obligations
hereunder shall cease.
10. LIMITATION ON DAMAGES. If Seller or Burke Industries breaches or
repudiates this Agreement, Buyer's sole right to damages shall be the difference
between the contract and the market price. In no circumstances shall Buyer have
any right, under any theory of law, to any
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incidental damages, lost profits, "benefit of the bargain," business
opportunities or any form of consequential damages in connection with this
Agreement.
11. NO ASSIGNMENT OR DELEGATION. No right or interest in this Agreement
may be assigned by any of Buyer, Seller or Burke Industries without the prior
written permission of the other party, and no delegation of any obligation owed,
or of the performance of any obligation, by Buyer, Seller or Burke Industries,
may be made without the written permission of the other party. For purposes of
this Paragraph 11, "assignment" shall include without limitation any transfer,
assignment or hypothecation, directly or indirectly, of any ownership or voting
interest in Buyer, or of any power to direct or cause the direction of the
management and policies of Buyer, all of which shall be prohibited under this
Paragraph 11. Any attempted assignment or delegation shall be wholly void and
totally ineffective for all purposes unless made in conformity with this
paragraph.
12. FORCE MAJEURE. Neither Seller nor Burke Industries shall be held
responsible for any delivery, any failure to make a delivery or any failure to
provide services under this Agreement if that failure is due to any cause,
contingency, or circumstance not subject to its control that impairs, prevents
or hinders the availability of raw materials or the manufacture or delivery of
merchandise or services, including but not limited to federal, state or
municipal action, statute, ordinance or regulation; strike or other labor
trouble; fire damage to or destruction in whole or in part of merchandise,
manufacturing plant or other facility; or the lack or inability to obtain raw
materials, labor, fuel or supplies. Seller shall be released from its
obligations under this Agreement under any of the circumstances specified in
this Paragraph 12.
13. NOTICES. All notices or demands required or permitted under this
Agreement shall be in writing, and shall be addressed as follows-
If to Buyer: Westland Technologies, Inc.
107 South Riverside Drive
Modesto, California 95354
Attn: Thomas Halyburton
Telecopier No.: (209) 571-6411
If to Seller or Burke Industries, Inc.
Burke Industries: 2550 South Tenth Street
San Jose, California 95112
Attn.: Rocco Genovese
Telecopier No.: (408) 995-5163
or to such other address as either party may designate from time to time by
notice in the manner provided herein. All such communications shall be deemed
effective (a) upon delivery to the specified address, if hand-delivered or sent
by mail, (b) on the next business day after proper deposit with an overnight air
courier with request for next business day delivery, or (c) on the date shown on
the telecopier transmittal sheet for transmittal of the documents, if sent by
telecopier.
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14. ARBITRATION. Any controversy or claim arising out of this Agreement,
or any breach thereof, shall be settled by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.
15. TIME IS OF THE ESSENCE. Time is of the essence in the performance of
each and every obligation of the parties hereunder.
16. EXHIBITS; RECITALS. All Exhibits attached to this Agreement are
incorporated herein by this reference as though set forth in full herein. The
parties acknowledge that the Recitals set forth herein are true and correct and
are incorporated herein by this reference.
17. GOVERNING LAW. This contract shall be governed by and shall be
interpreted and enforced in accordance with the internal laws of the State of
California applicable to agreements to be performed entirely within such state.
18. INTEGRATION CLAUSE. This instrument is the entire contract and
exclusively determines the rights and obligations of the parties, any prior
course of dealing, custom or usage of trade, or course of performance
notwithstanding.
19. MODIFICATION. This Agreement can be modified or rescinded only by a
writing signed by both of the parties or their duly authorized representatives.
20. COUNTERPARTS. This Agreement may be executed in any number of
counterparts each of which shall be an original but all of which shall together
constitute but one and the same instrument.
21. WAIVER OF TRIAL BY JURY. EACH OF THE PARTIES HERETO HEREBY WAIVES THE
RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF,
OR IN ANY WAY RELATING TO: (I) THIS AGREEMENT; OR (II) ANY CONDUCT, ACTS OR
OMISSIONS OF ANY OF THE PARTIES HERETO OR ANY OF THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS, ATTORNEYS OR ANY OTHER PERSONS AFFILIATED WITH THEM; IN EACH
OF THE FOREGOING CASES, WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
BUYER: WESTLAND TECHNOLOGIES, INC.,
a California corporation
By:
----------------------
Its:
-----------------
SELLER: BURKE RUBBER COMPANY, INC.,
a California corporation
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By:
----------------------
Its:
-----------------
BURKE INDUSTRIES: BURKE INDUSTRIES, INC.,
a California corporation
By:
----------------------
Its:
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SCHEDULE OF EXHIBITS
1 - List of Military Contracts
2 - Tooling Re: Large O-Rings
3 - Items and Pricing Re: Compounds and Select Products
4 - Servicing and Pricing Re: Selective Services
5 - Items and. Pricing Re: Large O-Rings
6 - Terms and Conditions Re: Data Processing and Accounting Services
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EXHIBIT 1
Burke Industries, Inc.,
BRC Agreement
List of Military Contracts
BURKE ORDER NO. CONTRACT NO. CUSTOMER NAME
--------------------------- ----------------------- -----------------------
#38625 SP043096M4516 DFAS-Columbus Ctr
Van Nuys Division
P.O. Box 182157
Columbus, OH 43218-2157
#38954 N0060496C0012 DFAS-Columbus Ctr.
Van Nuys Division
#38456 N6660495MKG90 Naval Undersea Warfare
Ctr.
Det Supply Officer
Building 1176
Newport, RI 02841-1708
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EXHIBIT 2
Burke Industries, Inc.,
BRC Agreement
Tooling Re: Large O-Rings
Subject to the Service Agreement attached hereto, the following
customer-owned tooling is located in Seller's San Jose facility.
CUSTOMER CUSTOMER TOOL# BURKE PART # DESCRIPTION
------------ ----------------- ----------- ----------------------
UTC 64972-00 8817-0020 Mold - 10 ft. O-Ring
ROHR 7516644 7427-0008 Mold - 5 ft. O-Ring
ROHR Al8534-05-01 7427-0015 Mold - 2-cavity (7ft.)
Al8534-07-01 7427-0016
The following Burke-owned fixtures are related to the above
customer-owned tooling:
5 ft. fixture
7 ft. fixture
10 ft. fixture
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EXHIBIT 3
Burke Industries, Inc.,
BRC Agreement
Terms and Pricing Re: Compounds and Select Products
Subject to the Service Agreement attached hereto, the pricing for the mixed
compounds s as follows:
STOCK # MINIMUM ORDER PRICE PER LB.
----------------- -------------------------- ----------------------
1021 2,000 lbs. $1.358
1033 2,000 lbs. $1.363
1120 2,000 lbs. $1.630
1125 2,000 lbs. $1.326
1150 700 lbs. $1.526
1152 2,000 lbs. $1.286
1155 2,000 lbs. $0.940
1156 2,000 lbs. $1.456
1174 2,000 lbs. $1.399
3020 2,000 lbs. $0.631
3050 2,000 lbs. $1.292
3056 2,000 lbs. $0.766
3110 2,000 lbs. $1.243
3112 2,000 lbs. $1.225
3112 - slab only 700 lbs. $1.470
4086 2,000 lbs. $1.172
5001 2,000 lbs. $1.604
5035 700 lbs. $2.068
5079 700 lbs. $2.083
5109 2,000 lbs. $1.951
5156 2,000 lbs. $1.644
6012 2,000 lbs. $0.920
6100 AA-1 8 tiles; will be sold as calendared material
6116 2,000 lbs. $0.573
6129 700 lbs. $0.596
8002 1,000 lbs. $1.207
8004 1,000 lbs. $0.921
8005 1,000 lbs. $1.133
8054 1,000 lbs. $0.875
BXA2697 2,000 lbs. $0.928
EXA2945 2,000 lbs. $1.331
HXA3472 2,000 lbs. $1.459
Lot charge of $100 for orders below minimum quantity, in addition to the
price per pound.
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EXHIBIT 3 (CONTINUED)
Burke Industries, Inc.,
BRC Agreement
Terms and Pricing Re: Compounds and Select Products
Subject to the Service Agreement attached hereto, the pricing for the
processed materials listed below are as follows:
MINIMUM
ORDER
Wilden Pump Materials $3.363 /lb. 2,000 lb.
(fabric to be supplied by Buyer)
Track Shrouds $85.04 ea. 150 ea.
(cured part only; finishing is the
responsibility of the Buyer)
(fabric to be supplied by Buyer)
Extruded viton for Intel $27.50 /lb. 132 lb.
Calendared stock for AA-18 tiles
Stock 6100 $3.50 /lb. 132 lb.
Stock 5112 $4.60 /lb. 132 lb.
Acid etching
(1) Set up $600.00 shift
(2) Plus hourly charge $85.00 hour
(i.e. $940.00 for four hours;
$1,280.00 per shift)
It is estimated that approximately the following
units can be processed in one shift:
AD-79 400 pieces per shift
AA-18 400 pieces per shift
Fairing Strips 100 pieces per shift
AD-2 500 pieces per shift
Grinding of AD-79 tiles
Buyer acknowledges responsibility for $0.49 /lb.
disposal.
Buyer will receive from Burke Industries a $40,000.00 rebate 30 days
following the end of each of the first twelve full calendar quarters (commencing
the quarter ending June 30, 1996) during which Buyer has purchased from Seller
of Burke Industries at least $350,000.00 of mixed compounds and processed
materials included above or otherwise negotiated and purchased by Buyer from
Seller and Burke Industries. During the single quarter ending June 30, 1996,
Buyer will be required to purchase only $300,000.00 of product or services to
earn the $40,000.00 quarterly rebate. This rebate is payable subject to Buyer
being in compliance with its outstanding credit arrangements with Seller and
Burke Industries.
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EXHIBIT 4
Burke Industries, Inc.
BRC Agreement
Servicing & Pricing re: Selective Services
Subject to the Service Agreement attached hereto, the following technical
assistance will be provided by Burke Industries Technical staff.
Pellerin Milnor Dryer Gasket
-Technical staff support for four first article parts of varying design
selected by Buyer.
-Total support, paid by Seller, shall not exceed 40 manhours.
-Materials and tools to be provided by Buyer.
-Technical support is on a "best effort" basis and Burke carries no
responsibility for the successful completion of this project.
Dresser Industries NSF Certification
-Chief Chemist to monitor progress of on-going compound evaluation by
Dresser/NSF and provide formulating assistance.
-Total support, paid by Seller, shall not exceed 24 manhours.
-Fees and costs related to materials, testing, listing and auditing
activities from Dresser, NSF or other outside parties shall be
paid by Buyer.
-Technical support is on a 'best effort" basis and Burke carries no
responsibility for the successful completion of this project.
Sheave Liner Performance Upgrade
-Attendance by two technical staff people, at Seller's expense, at a
one-day meeting (at Buyee's Modesto facility) to evaluate
condition of all returned field samples.
-Technical support is on a "best effort" basis and Burke carries no
responsibility for the successful completion of this project.
-Project meeting must be held within one year of the date of the
Service Agreement.
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EXHIBIT 4 (CONTINUED)
Burke Industries, Inc.
BRC Agreement
Servicing & Pricing re: Selective Services
Subject to the Service Agreement attached hereto, the pricing and
conditions for additional technical services listed below shall be as follows:
HOURLY RATE FOR TECHNICAL SUPPORT
$75.00/Hr. SENIOR TECHNICIAN
Frank Cote
Mark Sorensen
$50.00/Hr. Mat Wachter
Jerry Jackson
Conditions:
1) Hourly rate will be charged 'portal to portal' (i.e., charge for
travel) also charge for out of pocket expenses.
2) Total maximum availability of 40 hours per person; within six
months of date of close.
3) 72 hours notice required.
2
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EXHIBIT 5
Burke Industries, Inc.
BRC Agreement
Items and Pricing Re: Large O-Rings
Subject to the Service Agreement attached hereto, the pricing for large
O-Rings is as follows:
(1) Setup charge per order $2,750.00
(2) Plus a charge per O-Ring equal to $575.50
Rejected parts must be returned within 10 days of delivery, and will be
accepted only to the extent of manufacturing defects by the Seller.
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EXHIBIT 6
Burke Industries, Inc.
BRC Agreement
Terms and Conditions Re: Data Processing and Accounting Services
Subject to the Service Agreement attached hereto, the pricing and
conditions for the use of Seller's or Burke Industries' financial, accounting
and data processing systems and services will be as follows:
For a period of 90 days from the date of the Service Agreement:
Use of the IBM RS/6000 Model 320 and attendant peripheral
devices (listed below), and access to the INFIMACS program
and data base, at no charge.
Peripheral devices:
6 ea. Wyse model 370 color terminals
3 ea. IBM model 3164 mono terminals
2 ea. IBM model 2381 printers
1 ea. IBM model 4226 printer
Various communication interface devices
For an additional period of six months
Use of the IBM RS/6000 Model 320 and attendant peripheral
devices (listed above), and access to the INFIMACS program
and data base, at a charge of $3,000 per month, payable in
advance, cancelable at any time by Buyer with 14 days'
notice.
Within 9 months of the date of the Service Agreement or at
the cessation of the above payments, Buyer will return to
Seller the IBM RS/6000 Model 320 and attendant peripherals.
If, however, the Buyer executes a site license for INFIMACS
in that time, then access to Seller's data base will be
terminated, and the equipment will become the property of
the buyer.
ACCOUNTING RECORDS
All accounts a able, payroll, billing, and general ledger
records are the property of the Seller, and are to be
physically returned to the Seller's primary place of
business within 90 days after the date of the Service
Agreement.