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Exhibit 10.27
AMENDED AND RESTATED DISTRIBUTION AGREEMENT
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This Amended and Restated Distribution Agreement, dated to be effective
as of August 29, 1997, is entered into by and between Vitro, S.A., a sociedad
anonima organized under the laws of the United Mexican States ("VITRO"), and
Vitrocrisa, S.A. de C.V., a sociedad anonima with variable capital organized
under the laws of the United Mexican States ("VITROCRISA" or "DISTRIBUTOR"), on
the one part (collectively, the "VITRO PARTIES"), and Libbey Inc., a corporation
organized under the laws of the State of Delaware ("LIBBEY"), and Libbey Glass
Inc., a corporation organized under the laws of the State of Delaware ("LIBBEY
GLASS" or "MANUFACTURER"), on the other part (collectively, the "LIBBEY
PARTIES").
PURPOSE OF AGREEMENT
Vitro, Vitrocrisa, Libbey, and Libbey Glass entered into that certain
Distribution Agreement dated August 29, 1997 (the "DISTRIBUTION AGREEMENT").
Vitro, Vitrocrisa, Libbey, and Libbey Glass have agreed to amend, restate, and
supersede the Distribution Agreement by the terms and provisions of this
Agreement.
It is the expressed purpose of both Libbey Glass and Vitrocrisa to
carry out the sales plans agreed set forth in the Vitrocrisa annual operating
budgets, which will derive from the broader guidelines of the ongoing three-year
strategic plans of Vitrocrisa, as such budgets and strategic plans may be
approved by appropriate directors action of the board of directors of
Vitrocrisa.
ARTICLE I
DEFINITIONS
Section 1.1 The term "AFFILIATE" shall mean, with respect to each of
the parties, any other person or party which at the relevant time, directly or
indirectly, controls, is controlled by, or is under common control with such
party. The term "CONTROL", as used with respect to any person or party, means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such person or party, whether
through the ownership of voting securities, by contract, or otherwise.
Section 1.2 The term "AGREEMENT" shall mean this Amended and Restated
Distribution Agreement.
Section 1.3 The term "EXCLUDED PRODUCTS" shall mean coffee pots, meter
covers, glass covers for cooking ware, blender jars, and lighting fixtures sold
to OEMs. In addition, "Excluded Products" shall mean any other OEM article for
sale to OEM customers that are not in direct competition with Distributor and
are not sold to Distributor's customers, including those in the Foodservice,
Industrial, Premium, and Retail Channels of Distribution.
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Section 1.4 The term "FOODSERVICE CHANNEL OF DISTRIBUTION" shall mean
sales to foodservice distributors, foodservice importers, hotels, restaurants,
chain restaurants, bars, casinos, airlines, cruise lines, breweries,
microbreweries, hospitals, health care facilities, penal institutions, colleges,
all eating and drinking establishments, independent cutters and decorators,
warehouse clubs; internet sales in all the above segments; and all other
generally acknowledged distributor and end-user segments of the traditional
foodservice sector of the country specified.
Section 1.5 The term "GLASS TABLEWARE" shall mean those products which
are the subject of the distribution rights set forth in this Agreement and shall
mean the glass product lines illustrated in the current 1997 catalogs of Libbey
Glass or Vitrocrisa, Crisa Corporation, a Texas corporation, and WorldCrisa
Corporation, a Delaware corporation; all glass products of the type sold by
Libbey Glass or Vitrocrisa, other than Excluded Products, into the Foodservice,
Industrial, Premium, or Retail Channels of Distribution; future new products,
other than Excluded Products, of Libbey Glass or Vitrocrisa; and new and
existing products manufactured by Libbey Glass or Vitrocrisa and specially
differentiated through packaging under the brand name, identification, or logo
of the purchaser (a "SPECIALLY DIFFERENTIATED PRODUCT"). The intent is that any
glass tableware, other than Excluded Products, that is destined for application
in the Foodservice, Industrial, Premium, and Retail Channels of Distribution are
the products intended by this Agreement to be the subject of the exclusive
distribution rights set forth herein.
Section 1.6 The term "INDUSTRIAL CHANNEL OF DISTRIBUTION" shall mean
sales to candle packers, religious candle markets, distilleries, wineries,
floral distributors, mounters and fabricators, cosmetic industry, and all other
generally acknowledged segments of the traditional industrial sector of the
country specified.
Section 1.7 The term "OEM" shall mean original equipment manufacturer.
Section 1.8 The term "PREMIUM CHANNEL OF DISTRIBUTION" shall mean sales
for use as a premium or to promote another product, including, without
limitation, sales for such purposes to customers in the fast food industry, oil
industry, soft-drink industry, supermarket continuity industry, premium
packaging, and all other generally acknowledged segments of the traditional
premium and incentive sector of the country specified.
Section 1.9 The term "RETAIL CHANNEL OF DISTRIBUTION" shall mean sales
to retail distributors, mass merchant discount stores, department stores,
specialty retail stores, craft stores, supermarkets, factory outlet stores,
dinnerware companies, flea markets, door-to-door direct sales, wholesale
outlets, gift shops, potteries, catalog showrooms, warehouse clubs, home
shopping networks, internet sales for consumer use, private label sales for any
class of retailer, importers, and all other generally acknowledged segments of
the traditional retail sector of the country specified.
Section 1.10 The term "TERRITORY" shall mean those certain geographic
areas set forth on SCHEDULE 1 to this Agreement.
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ARTICLE II
AMENDED AND RESTATED DISTRIBUTION AGREEMENT
Section 2.1 AMENDED AND RESTATED DISTRIBUTION AGREEMENT. The terms and
provisions of the Distribution Agreement are hereby canceled and superseded by
the terms and provisions of this Agreement. All references in any other
agreement to the Distribution Agreement dated August 29, 1997 by and between
Vitro, Vitrocrisa, Libbey, and Libbey Glass shall be deemed to refer to this
Agreement, and all references to specific provisions of such Distribution
Agreement contained in any other agreement shall refer to the corresponding
provisions of this Agreement.
ARTICLE III
APPOINTMENT OF VITROCRISA AS DISTRIBUTOR
Section 3.1 APPOINTMENT OF VITROCRISA AS DISTRIBUTOR. The Libbey
Parties hereby appoint Vitrocrisa as the exclusive seller, distributor, and
sales representative for all sales in the Territory of the Libbey Parties' Glass
Tableware manufactured in the United States of America and Canada, except for
Excluded Products. Notwithstanding the foregoing, the Libbey Parties reserve the
right to sell Glass Tableware to customers in the Premium Channel of
Distribution in the United States of America and Canada even though, to the
knowledge of the Libbey Parties, such Glass Tableware is purchased with the
intention of exporting the same to customers in the Territory, but the Libbey
Parties will not actively solicit such sales for export into the Territory.
ARTICLE IV
TERM
Section 4.1 TERM. The term of this Agreement with respect to Glass
Tableware will continue until terminated by either party on ninety (90) days
advance written notice to the other parties; provided, that the Libbey Parties
may not terminate this Agreement for any reason without Vitro's express written
consent as long as Libbey and Vitro each, directly or indirectly through one or
more Affiliates, maintains a minimum ownership of twenty five percent (25%) of
the equity of Vitrocrisa or of an entity which, directly or indirectly, owns or
controls Vitrocrisa.
ARTICLE V
PRICING AND PAYMENT TERMS
Section 5.1 Libbey Glass agrees to sell to Vitrocrisa, and Vitrocrisa
agrees to purchase from Libbey Glass, Glass Tableware listed on the then current
Libbey Glass Southern Foodservice Price List for bulk items for sale in the
Territory assigned to Vitrocrisa at a price equal to the price set forth on
SCHEDULE 2 to this Agreement. Libbey Glass will agree to adjust its discounts
offered to Vitrocrisa to provide for the same relative pricing advantage as
compared to its published discount structure as at Closing for similar volumes
of the same products, as and when Libbey's published discount structure changes.
Special discounts offered selectively to address competitive situations will not
be considered a change in the published discount
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structure. Payment by Vitrocrisa to Libbey Glass shall be due on the sixtieth
(60th) day from receipt of the Glass Tableware by Vitrocrisa.
Section 5.2 Libbey Glass agrees to sell to Vitrocrisa, and Vitrocrisa
agrees to purchase from Libbey Glass, Glass Tableware listed on the then current
Libbey Glass USA Retail Price List for Libbey Glass branded, four color packaged
products for sale in the Territory assigned to Vitrocrisa at a price equal to
the price set forth on SCHEDULE 3 to this Agreement. Libbey Glass will agree to
adjust its discounts offered to Vitrocrisa to provide for the same relative
pricing advantage as compared to its published discount structure as at Closing
for similar volumes of the same products, as and when Libbey's published
discount structure changes. Special discounts offered selectively to address
competitive situations will not be considered a change in the published discount
structure. Payment by Vitrocrisa to Libbey Glass shall be due on the sixtieth
(60th) day from the date of receipt of the Glass Tableware by Vitrocrisa.
Section 5.3 Pricing for the Vitrocrisa Specially Differentiated
Products manufactured by Libbey Glass for shipment to the Territory assigned to
Vitrocrisa will be on a quoted basis.
Section 5.4 All prices for delivery to Vitrocrisa for shipment to
Mexico by rail or truck will be FOB the USA/Mexico border. Title and risk of
loss will pass to Vitrocrisa on delivery of the Glass Tableware at such border.
Section 5.5 All prices for delivery to Vitrocrisa for shipment by ship
to customers in the Territory assigned to Vitrocrisa will be FAS the
transporting ship at the port of Miami, Florida or Houston, Texas or New
Orleans, Louisiana or with respect to Libbey Glass' foodservice items only, Los
Angeles, California. Title and risk of loss will pass to Vitrocrisa on delivery
of the Glass Tableware at the dock.
Section 5.6 Notwithstanding the foregoing, from time to time by mutual
agreement in writing, Libbey Glass and Vitrocrisa may agree upon special pricing
or special terms for any particular transaction whereby Vitrocrisa wishes to
purchase Glass Tableware to meet a competitive situation or otherwise obtain a
particular piece of business in the Territory in which case such mutual
agreement shall supersede the pricing and terms set forth above.
Section 5.7 All payments by Vitrocrisa to Libbey Glass will be in US
dollars.
Section 5.8 The methodology of computing the amount to be paid by
Vitrocrisa to Libbey Glass pursuant to SECTIONS 5.1 (and SCHEDULE 2) and 5.2
(and SCHEDULE 3) to purchase Glass Tableware hereunder sets forth the intended
sharing of profits and margins among Vitrocrisa and Libbey Glass with respect to
Glass Tableware sold hereunder. If any change in the methodology of computing
such prices is required in order to comply with governmental regulations or
legal requirements and such change would have a material adverse economic effect
on either Vitrocrisa or Libbey Glass with respect to the profits and margins
intended to be shared hereunder, Vitrocrisa and Libbey Glass agree to negotiate
in good faith another methodology of computing such price to meet governmental
regulations and legal requirements
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and to place Vitro and Libbey in the same relative economic position with
respect to the sharing of profits and margins as is intended by ARTICLE V.
ARTICLE VI
PERFORMANCE STANDARD
Section 6.1 Libbey Glass and Vitrocrisa agree to use their best efforts
to carry out the sales plans agreed upon in the annual operating budgets which
will derive from the broader guidelines of the ongoing three-year strategic
plans of Vitrocrisa, as such budgets and strategic plans may be approved by
extraordinary directors action of the board of directors of Vitrocrisa.
ARTICLE VII
OPERATING PROCEDURES
Section 7.1 Distributor shall maintain its own offices and places of
business and pay all of its own expenses in connection with the sale and
distribution of Glass Tableware under this Agreement, except as otherwise
provided herein.
Section 7.2 Distributor is designated to serve customers in the
Territory. Any inquiries or orders for Manufacturer's brand of Glass Tableware
from customers outside of the Territory will be referred by Distributor to
Manufacturer.
Section 7.3 Manufacturer shall furnish Distributor in connection with
the Glass Tableware to be distributed hereunder a reasonable number of catalogs
and existing sales literature which the Manufacturer may, from time to time,
have in connection with its own sales, but the Manufacturer shall not be
obligated to generate or create any catalogs or sales literature for
Distributor.
Section 7.4 The relationship between the parties hereto shall be one of
independent contractors. Neither the Distributor nor the Manufacturer shall be
empowered to have any authority to act for the other, make any commitment on
behalf of the other, make any agreement on behalf of the other, make any payment
on behalf of the other, or otherwise obligate the other in any way. Neither
Distributor nor Manufacturer shall hold itself out as having any authority to
act in any way for the other unless otherwise specifically agreed in writing.
Section 7.5 All Glass Tableware sold hereunder shall be transferred to
Distributor free and clear of all liens and encumbrances.
Section 7.6 Manufacturer shall secure and apply all packaging for Glass
Tableware sold hereunder and unless otherwise agreed in writing with respect to
any particular transaction the prices charged for Glass Tableware shall be
deemed to include all packaging expenses.
Section 7.7 Regular current stock items to be procured and imported
hereunder will be ordered at levels that correspond to a mutually agreed upon
level per SKU. Should the Distributor require quantities in excess of the agreed
threshold levels, a separate Make and Ship
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order must be processed with specific quantities and release dates. Failure by
the Distributor to honor the Make and Ship order by the release date or within
thirty (30) days thereafter will result in shipment and invoicing of the full
order as originally specified.
Section 7.8 In some cases Distributor may desire and request Specially
Differentiated Product to be created specifically for its customers in the
Territory, which new items are beyond the normal stock collection of the
Manufacturer. These will be private items and may require new molds and cartons.
Unless otherwise agreed, the cost of developing new molds and cartons is the
responsibility of the Distributor and will be invoiced to the Distributor at
actual out of pocket costs paid to third party vendors in arms length
transactions. Four-color photography, artwork separations, and final layout for
any retail packaging for these new items are the responsibilities of the
Distributor specifying the new package development of these "retail type" boxes.
These materials must be supplied in cooperation with the respective scheduling
department of the Manufacturer. The actual box itself, and its procurement, will
reside with the Manufacturer and will be included in the purchase price of the
Glass Tableware with respect to Distributor's purchases. These minimum
quantities, including any subsequent modifications, will be used as guidelines
(but not the sole criteria) by Manufacturer in rejecting order from Distributor
for production.
Section 7.9 It is the intent of all parties to keep the packaging of
Specially Differentiated Products to a minimum. No more than 150 SKU's, on a
revolving basis, will be made in the United States and Canada and carry the
brand of a Vitro Party on the box. It is expected this program of
differentiation will be phased in over a one-year period, commencing on the date
of this Agreement. Distributor acknowledges receipt of minimum run per
production process from Manufacturer for non-stock items.
Section 7.10 Shipper carton markings, country of origin markings, and
appropriate languages to be reflected on the packaging will be the
responsibility of the Manufacturer. A close exchange and co-operative working
relationship between the new product development organization of the Distributor
and the new product development organization of the Manufacturer will be
absolutely necessary. It is expected that the Distributor will be very specific
in its requirements at the time of the order.
Section 7.11 All specifications applicable to Glass Tableware supplied
hereunder, including, but not limited to, material, packaging, property,
dimensions, limit samples, esthetics, cosmetics, inspection, acceptance quality
limits, and acceptance samples will be agreed upon by the Manufacturer and the
Distributor at the time an order is accepted. Once established for an item the
specifications shall remain in effect until revised by mutual agreement. All
Glass Tableware must meet all such specifications or may be rejected by
Distributor in which case the Distributor shall receive a full refund or credit
against the purchase price, as the Distributor may elect, and the product in
question shall be returned to the Manufacturer at the Manufacturer's expense or
disposed of at the Manufacturer's expense.
Section 7.12 In special situations where clearly identified in advance
at the time an order is accepted by the Manufacturer, Glass Tableware may be
ordered for a customer of the
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Distributor where timely, complete delivery of Glass Tableware conforming to the
specifications is required. In such cases, any penalty paid by the Distributor
for any failure to meet the requirements of the order will be reimbursed by the
Manufacturer unless such failure was not the fault of the Manufacturer as set
forth in ARTICLE IX.
Section 7.13 Claims for breakage, shortages, overages, wrong-ware
shipped, and all other distribution related errors must be sent to the
Manufacturer by the Distributor within seven (7) days from the date of receipt
of shipment.
Section 7.14 Claims for quality issues will be sent by the Distributor
to the Manufacturer on or before thirty (30) days following notification to the
Distributor from its customer of such issues. Resolution of such claims must be
within ninety (90) days of receipt by the Manufacturer of the quality claim.
Section 7.15 Product liability claims and all associated legal costs
and any settlement costs will be the final responsibility of the Manufacturer.
The Manufacturer will defend and hold harmless at its expense the Distributor
from and against any and all cost, expense, and liability resulting from any
claim by a third party for bodily injury or damage to property alleging that any
Glass Tableware supplied hereunder is defective or fails to conform to the
specifications, from any claim by a governmental authority that the Glass
Tableware does not meet applicable legal requirements, and from any claim by a
governmental authority that Glass Tableware must be recalled due to a safety
condition or defect. The Manufacturer's obligations under this SECTION 7.15 is
subject to timely notice (unless failure to give timely notice does not
materially adversely affect the Manufacturer) and the right to control the
defense and settlement of the claim if so desired by the Manufacturer. The
Manufacturer's obligations under this SECTION 7.15 do not apply to any cost,
expense, or liability caused by the negligent or wrongful act or omission of the
Distributor; provided, however, the simple purchase and resale shall not be
deemed to be the negligent or wrongful act or omission of the Distributor.
ARTICLE VIII
ADDITIONAL PRODUCTS OTHER THAN GLASS TABLEWARE
Section 8.1 It is anticipated that by mutual agreement from time to
time the Libbey Parties and the Vitro Parties may authorize the other to
distribute additional products other than Glass Tableware in all or part of the
Territory. Such agreements with respect to products other than Glass Tableware
shall be on such terms and conditions as may be agreed upon by the parties at
the time, including, without limitation, pricing, products, territories,
duration, and terms and conditions of sale, all of which may be different or the
same as set forth herein and, unless specifically otherwise agreed in writing,
shall be subject to change and the agreement subject to termination on written
notice from either Vitrocrisa or Libbey Glass to the other. All such agreements
shall be separate and distinct agreements from this Agreement and in no event
shall additional products other than Glass Tableware be subject to the
provisions of this Agreement.
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ARTICLE IX
FORCE MAJEURE
Section 9.1 Except for an obligation for the payment of money when due,
neither party shall be liable for any failure or delay in the performance of its
obligations under this Agreement when such failure or delay is caused by as acts
of God, riot or civil commotion, strike, lockout or other labor disturbance,
fire, act or any order of government (whether or not valid), flood, war, peril
of sea, breakdown of machinery, delay in supply and/or transit of materials,
components, parts or assemblies from suppliers or sub-contractors, or any other
matter or peril provided that in all cases such cause is beyond the reasonable
control of the party who failed or was delayed in performance and such party
could not have prevented the failure or delay through reasonable action and has
taken reasonable action to mitigate the effect of the delay or failure. With
respect to an obligation for the payment of money, if by any regulation or order
of an applicable governmental authority a party is precluded from transmitting a
payment due under or by reason of this Agreement, the party owing the payment
shall make the payment in accordance with its obligations hereunder if it places
the sum due to the credit of the party to whom the payment is due in a bank
located in the country of paying party or if it effects payment by some other
method then authorized by the applicable governmental authority.
ARTICLE X
ENFORCEMENT; NON-WAIVER
Section 10.1 The parties hereby acknowledge and agree that Libbey Glass
and Vitrocrisa would be damaged irreparably in the event any of the provisions
of this Agreement are not performed in accordance with its specific terms or
otherwise is breached. Accordingly, the parties hereto agree that, subject to
the provisions of SECTION 11.14, Vitrocrisa and Libbey Glass shall be entitled
to an injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any action instituted in any court of the United States of
America (or of any state thereof) or of the United Mexican States having
jurisdiction over Vitro, in addition to any other remedy to which Libbey Glass
or Vitrocrisa may be entitled, at law or in equity.
Section 10.2 A failure by the Vitro Parties or Libbey Parties to
exercise or enforce any right conferred upon them by this Agreement shall not be
deemed to be a waiver of any right or operate so as to bar the exercise or
enforcement thereof at any subsequent time or times, and all express rights
granted to any Vitro Party and any Libbey Party hereunder shall be in addition
to any right that the Vitro Parties and the Libbey Parties may have under the
general law in respect of a breach hereof. No waiver by either the Vitro Parties
or the Libbey Parties of any condition or the breach of any term, covenant,
representation, warranty, or undertaking contained in this Agreement, whether by
conduct or otherwise, in any one or more instances shall be deemed to be or
construed as a further or continuing waiver of any such condition or breach or a
waiver of any other condition or deemed to be or construed as a waiver of the
breach of any other term, covenant, representation, warranty, or undertaking
contained in this Agreement.
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ARTICLE XI
MISCELLANEOUS
Section 11.1 GOVERNING LANGUAGE. Notwithstanding the translation of
this Agreement or any of its Schedules or Exhibits into Spanish or any other
language, the English language version of this Agreement and any of its
Schedules and Exhibits shall be controlling and shall govern in any legal
proceeding or arbitration.
Section 11.2 COMMUNICATIONS. All correspondence, information,
specifications, reports, notices, and other written or oral communications
between the parties with respect to this Agreement and the transactions
contemplated hereunder shall be in the English language.
Section 11.3 NO THIRD-PARTY BENEFICIARIES. This Agreement shall not
confer any rights or remedies upon any person other than the parties and their
respective successors and permitted assigns.
Section 11.4 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties related to the subject matter hereof and supersedes
any prior understandings, agreements, or representations by or among the
parties, written or oral, that may have related in any way to the subject matter
hereof.
Section 11.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties named herein and their respective
successors and permitted assigns.
Section 11.6 ASSIGNMENT. No party may assign or otherwise transfer any
of its rights or obligations under this Agreement, by operation of law or
otherwise, without the prior written consent of the other parties, which consent
shall not be unreasonably withheld. Any purported or attempted assignment
contrary to the terms hereof shall be null and void and of no force or effect.
Notwithstanding the foregoing, Vitrocrisa may permit its Affiliates to purchase
Glass Tableware from Libbey Glass and distribute such Glass Tableware in the
Territory assigned hereunder to Vitrocrisa, provided that Vitro and Vitrocrisa
each shall be responsible to cause such Affiliates of Vitrocrisa to perform the
obligations of Vitrocrisa hereunder.
Section 11.7 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
Section 11.8 HEADINGS. The article and section headings contained in
this Agreement are inserted for convenience only and are not part of this
Agreement and shall not affect in any way the meaning or interpretation of this
Agreement.
Section 11.9 NOTICES. All notices, demands, requests, and other
communications to be given or made under this Agreement shall be in writing in
English and shall be:
(a) personally delivered with signed receipt obtained
acknowledging delivery;
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(b) transmitted by postage prepaid registered mail, return receipt
requested (air mail if international);
(c) transmitted by telex or facsimile, subject to confirmation of
receipt by the addressee; or
(d) sent by overnight express mail to the parties at their
addresses set forth below:
If to a Libbey Party, such notices shall be addressed to:
Libbey Inc.
300 Madison Avenue
Toledo, Ohio 43604
USA
Attn.: General Counsel Fax No.: 419-325-2585
or to any subsequent address of which Libbey Glass may notify
Vitrocrisa in writing.
If to a Vitro Party, such notices shall be addressed to:
Vitro Corporativo, S.A. de C.V.
Av. del Roble 660
Col. Valle del Campestre
Garza Garcia, N.L. 66225
Mexico
Attn.: Director Juridico Internacional
Fax No.: 528-329-1372
or at any subsequent address of which Vitrocrisa or Vitro may
notify Libbey Glass in writing.
Any notice, demand, request, or other communication shall be effective only if
and when it is received by the addressee.
SECTION 11.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS, UNITED
STATES OF AMERICA, WITHOUT GIVING EFFECT TO ANY CONFLICTS-OF-LAW RULES OR
PRINCIPLE THAT MIGHT REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.
Section 11.11 AMENDMENTS AND WAVIER. This Agreement may be amended,
modified, superseded, or canceled and any of its terms, covenants,
representations, warranties, undertakings, or conditions may be waived only by
an instrument in writing signed by (or by some person duly authorized by) all of
the parties hereto or, in the case of a waiver, by the party waiving compliance.
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Section 11.12 SEVERABILITY. Any term or provision of this Agreement
that is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction. If the final judgment of a
court of competent jurisdiction declares that any term or provision hereof is
invalid or unenforceable, the parties agree that the court making the
determination of invalidity or unenforceability shall have the power to reduce
the scope, duration, or area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified after the expiration of the
time within which the judgment may be appealed.
Section 11.13 NO VIOLATION OF LAW. Any obligation of any party hereto
is subject to the approval of all applicable governmental authorities,
including, without limitation, any export license or import license required by
the government of any country. Nothing in this Agreement shall be construed to
require any party to disclose to the other any information, to take any action
or refrain from taking any action or remain in any situation in violation of any
law or regulation, rule or requirement of any applicable governmental authority
to which such party is subject. Subject to the foregoing, in performing its
distribution functions hereunder, Vitrocrisa agrees to use reasonable efforts,
and to cause its customers to use reasonable efforts, to furnish such
information and do such acts to enable Libbey Glass to comply with any
requirement, restriction, or condition imposed upon any export out of the
country of manufacture or upon Libbey Glass by any applicable governmental
authority of the United States, and Libbey Glass agrees to use reasonable
efforts, and to cause its suppliers to use reasonable efforts, to furnish such
information and do such acts to enable Vitrocrisa to comply with any
requirement, restriction, or condition imposed upon any import into the
Territory or upon Vitrocrisa by any applicable governmental authority.
Section 11.14 Arbitration.
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(a) The parties to this Agreement shall exert good faith
efforts promptly to resolve any controversy or claim arising out of or related
to this Agreement or the breach thereof within fifteen (15) days of receipt of
notice by one party from another party that such a controversy or claim exists.
If the parties fail to resolve such controversy or claim within such fifteen
(15) day period, they shall, unless otherwise provided in this Agreement, give
notice in writing to the Chief Executive Officers of Libbey and Vitro (the
"CEOs"), who will meet within fifteen (15) days of receipt of such notice at a
mutually acceptable time and place to attempt to resolve any such controversy or
claim. Notwithstanding the foregoing, the parties hereby agree that either party
can seek injunctive relief as contemplated by SECTION 10.1. In the event the
CEOs fail to meet or to resolve the controversy or claim arising out of or
related to this Agreement or the breach thereof within such fifteen (15) day
period, the controversy or claim (other than business and operational decisions
customarily exercised by management in entities similar to Vitrocrisa and Libbey
Glass, which are to be resolved by the CEOs) shall be settled by arbitration in
accordance with the then existing International Arbitration Rules of the
American
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Arbitration Association (the "AAA"), which shall commence upon one party
providing the other parties with a written demand for arbitration (the "DEMAND
FOR ARBITRATION"). The arbitrators may determine the appropriate monetary
damages for any breach or other appropriate remedy, but may not cause this
Agreement to be terminated. Notwithstanding the foregoing, the parties hereby
agree that if either party seeks injunctive relief as contemplated by SECTION
10.1, such party does not thereby waive its rights to arbitration under this
SECTION 11.14.
(b) The arbitral tribunal shall be composed of three
arbitrators and Libbey Glass and Vitrocrisa shall each appoint one Arbitrator.
If either Libbey Glass or Vitrocrisa fails to appoint an arbitrator within
thirty (30) days after the date the claimant's Demand for Arbitration is
communicated to the other party (the "NOTIFICATION DATE"), the AAA shall make
such appointment. The two arbitrators thus appointed shall attempt to agree upon
the appointment of a third arbitrator to serve as chairman of the arbitral
tribunal. If said two arbitrators fail to agree upon the appointment of such
third arbitrator within sixty (60) days after the Notification Date, the AAA
shall make such appointment. The place of arbitration shall be Dallas, Texas,
United States of America. The arbitral proceeding shall be conducted in the
English language.
(c) To the extent that they may validly so agree, the parties
hereby exclude any right of appeal to any court in connection with the arbitral
award. Judgment upon the arbitral award may be entered in any court having
jurisdiction thereof or having jurisdiction over any party or any party's
assets.
(d) The validity of this SECTION 11.14 shall be governed by
the United Nations Convention on the Recognition and Enforcement of Foreign
Arbitral Awards or the InterAmerican Convention on International Commercial
Arbitration, to which Mexico and the United States of America have adhered.
(e) All costs of arbitration and enforcement thereof,
including reasonable attorney's fees and court costs, costs of expert witnesses,
transportation, lodging and meal costs of the parties and witnesses, costs of
transcript preparation, and other reasonable and necessary direct and incidental
costs shall be apportioned to one or more of the parties by a majority of the
arbitrators as they deem appropriate. In the event any party to this Agreement
commences legal proceedings to enforce the arbitral award, the expense of such
litigation (including reasonable attorneys' fees and costs of court) shall be
borne by the party or parties not prevailing therein.
Section 11.15 SCHEDULES AND EXHIBITS. The Schedules and Exhibits
attached hereto and referenced herein constitute a part of this Agreement and
are specifically incorporated by reference herein.
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13
IN WITNESS WHEREOF, the parties have hereunto have caused this
Agreement to be executed by their duly authorized officers as of the day and
year first above written.
LIBBEY GLASS INC.,
a Delaware corporation
By: /s/ A. H. Smith
--------------------------------
Title: Vice President
------------------------------
LIBBEY INC.,
a Delaware corporation
By: /s/ A. H. Smith
--------------------------------
Title: Vice President
------------------------------
VITRO, S.A.,
a sociedad anonima organized under the
laws of the United Mexican States
By: /s/ Claudio Del Ville
--------------------------------
Title: Attorney in Fact
------------------------------
VITROCRISA, S.A. DE C.V.,
a sociedad anonima with variable capital
organized under the laws of the United
Mexican States
By: /s/ Roberto B. Rubio
--------------------------------
Title: President
------------------------------