MARKETING COOPERATION AGREEMENT
This Marketing Cooperation Agreement ('Agreement') is made as of
July 11, 1996 by and between Salton/Maxim Housewares, Inc., a Delaware
corporation ('Salton'), and Windmere-Durable Holdings, Inc., a Florida
corporation ('Windmere').
RECITALS
A. Pursuant to that certain Stock Purchase Agreement between
Salton and Windmere dated as of February 27, 1996 (the 'Stock Purchase
Agreement'), Windmere has concurrently herewith sold, assigned, transferred,
conveyed and delivered to Windmere certain shares.
B. Salton and Windmere are also parties to a Stockholder
Agreement dated as of July 11, 1996 (the 'Stockholder Agreement'), pursuant to
which Windmere and the Company establish certain terms and conditions
concerning Windmere's investment in Salton and Salton's corporate governance.
C. Both Salton and Windmere believe that, in order to form a
successful strategic alliance that will enhance the overall competitive
position of each party without limiting the competition which may exist between
them, Salton and Windmere shall participate in a variety of mutually
satisfactory marketing cooperation efforts designed to achieve maximum market
penetration for both parties.
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants set forth in this Agreement, Salton and Windmere hereby agrees as
follows:
Article 1. DEFINITIONS
Capitalized terms used in this Agreement without definition shall have
the respective meanings accorded to them in the Stockholder Agreement.
Article 2. SCOPE OF COOPERATION
2.1 Cooperation Efforts. Under this Agreement and in a manner consistent
with all applicable laws and regulations, each of Salton and Windmere
shall participate in a variety of mutually satisfactory marketing
cooperation efforts designed to expand the market penetration of each
of Salton and Windmere through, among other things: (i) the expansion
of distribution bases or channels; (ii) the possible use of
co-branding or housebrand strategies for certain products; and (iii)
the possible coordination of promotional activities. Notwithstanding
the foregoing, the parties agree that the terms of any transaction or
series of related transactions between Salton and Windmere arising
from or relating to any such marketing cooperation
efforts (collectively, 'Marketing Transactions') shall be subject to
the provisions of Section 5.3 of the Stockholder Agreement.
2.2 Marketing Cooperation Conference. Without limiting the generality of
the foregoing, the parties agree that a marketing conference shall be
held at least once every ninety (90) days to identify marketing
cooperation opportunities. Windmere shall host the first such
conference within three (3) months of the date hereof. Thereafter,
each party shall alternate hosting every other such conference held
throughout the term hereof. Such conference size, format (in person,
video conference or teleconference), topics and schedule will be
decided between the parties.
Article 3. CONFIDENTIALITY
3.1 Definition. The term 'Confidential Information' shall mean any
information disclosed by one party (the 'Disclosing Party') to the
other party (the 'Receiving Party') concerning the operations and
affairs of the Disclosing Party or its Affiliates in connection with
the performance of this Agreement or any Marketing Transaction.
3.2 Confidentiality Obligations. Receiving Party and its Affiliates will
treat and hold as such, and except as contemplated by any Marketing
Transaction, will not use for the benefit of themselves or others, any
Confidential Information. Receiving Party and its Affiliates shall
not disclose such Confidential Information to any third party during
the term of this Agreement or at any time thereafter. The Receiving
Party shall only permit disclosure of the Confidential Information to
the Receiving Party's directors, officers, employees, agents and
advisors who have a need to know (it being agreed that such directors,
officers, employees, agents and advisors shall be informed by the
Receiving Party of the confidential nature of such information and
that by receiving such information they are agreeing to be bound by
this Agreement) and shall not use the Confidential Information for any
purpose other than the purpose contemplated by this Agreement.
3.3 Exceptions. The confidentiality obligations set forth in this Article
3 shall not apply to any information which:
(a) is rightfully in the possession of the Receiving Party prior
to receipt from the Disclosing Party; or
(b) is rightfully received by the Receiving Party from a third
party without the breach of any restriction on disclosure; or
(c) is disclosed pursuant to applicable laws, regulations or court
order, provided that the Receiving Party shall give the
Disclosing Party prompt notice of such request so that
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the Disclosing Party has an opportunity to defend, limit or
protect such disclosure; or
(d) is established to be in the public domain other than as a
consequence of a breach of an obligation undertaken not to
disclose the information; or
(e) is made public by the Disclosing Party.
Article 4. TERM
The term of this Agreement shall commence on the date hereof and shall
terminate at the first time after the date hereof that the Purchaser
Interest shall have been less than thirty percent (30%) for a period
of at least ten (10) consecutive days.
Article 5. NOTICE
Any notice required or permitted to be given under this Agreement
shall be written, and may be given by personal delivery, by cable,
telecopy, telex or telegram (with a confirmation copy mailed as
follows), by Federal Express, United Parcel Service, DHL, or other
reputable commercial delivery service, or by registered or certified
mail, first-class postage prepaid, return receipt requested. Notice
shall be deemed given upon actual receipt. Mailed notices shall be
addressed as follows, but each party may change address by written
notice in accordance with this paragraph.
To Salton: Salton/Maxim Housewares, Inc.
550 Business Center Drive
Mount Prospect, Illinois 60056
Attention: Chief Executive Officer
Fax: (708) 803-8080
with a copy to: Sonnenschein Nath & Rosenthal
8000 Sears Tower
Chicago, Illinois 60606
Attention: Neal Aizenstein, Esq.
Fax: (312) 876-8938
To Windmere: Windmere Corporation
5980 Miami Lakes Drive
Miami Lakes, Florida 33014-9867
Attention: Chief Executive Officer
Fax: (305) 364-0502
with a copy to: Greenberg, Traurig, Hoffman,
Lipoff, Rosen & Quentel, P.A.
1221 Brickell Avenue
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Miami, Florida 33131
Attention: Andrew Hulsh, Esq.
Fax: (305) 599-0717
Article 6. GOVERNING LAW
This Agreement shall be governed by, construed under and enforced in
accordance with, the laws of the State of Delaware without regard to
its conflict-of-laws principles.
Article 7. ASSIGNMENT
This Agreement and all of the provisions hereof shall be binding and
inure to the benefit of Salton, Windmere and their respective
successors and assigns. Neither party hereto shall assign or transfer
any rights, privileges or obligations hereunder without the prior
written consent of the other party hereto.
Article 8. ARBITRATION
8.1 Negotiation and Arbitration. All disputes relating to this Agreement
or any Marketing Transaction shall be settled through friendly
negotiation between the parties, including providing written notice of
the dispute to the other party in advance of submitting any dispute to
arbitration pursuant to Section 8.2 hereof. The parties agree that no
such arbitration concerning a dispute between the parties will be
started until after the senior executive of each company has attempted
to speak (in person, by telephone or by videophone) to the other
concerning the dispute and attempted to resolve the dispute. In case
no settlement can be reached, the dispute shall be submitted to
arbitration as provided in Section 8.2.
8.2 Arbitration Procedures. All disputes relating to this Agreement or
any Marketing Transaction which are not resolved in accordance with
Section 8.1 hereof shall be finally settled by the arbitration
procedures set forth below and in accordance with the applicable
procedures of arbitration of the Commercial Arbitration Rules of the
American Arbitration Association as in effect from time to time. In
the event of such a dispute, a party may commence arbitration
hereunder by delivering to the other party a notice of arbitration (a
'Notice of Arbitration'). The Notice of Arbitration shall specify the
matters as to which arbitration is sought, the nature of any dispute
or the claims of such party to the arbitration and shall specify the
amount and nature of damages, if any, sought to be recovered as a
result of any alleged claim, and any other matters required by the
Commercial Arbitration Rules of the American Arbitration Association
as in effect from time to time to be included therein, if any. The
arbitration proceeding shall be held before three (3) arbitrators in
the headquarters city of the party not initiating the claim. Two (2)
of the arbitrators shall first be appointed by the parties, one (1) by
Salton (the 'Salton
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Arbitrator') and one (1) by Windmere (the 'Windmere Arbitrator'). In
the event that either party fails to select an arbitrator as set forth
herein within twenty (20) days from the delivery of a Notice of
Arbitration, then the matter shall be resolved by the arbitrator
selected by the other party. The Salton Arbitrator and the Windmere
Arbitrator shall appoint a third arbitrator, who shall act as the
chairman of the arbitral tribunal. If the Salton Arbitrator and the
Windmere Arbitrator fail to appoint a third arbitrator within twenty
(20) days after they have been appointed, the Salton Arbitrator and
the Windmere Arbitrator shall each prepare a list of three independent
arbitrators. The Salton Arbitrator and the Windmere Arbitrator shall
each have the opportunity to designate as objectionable and eliminate
one (1) arbitrator from the other arbitrator's list within seven (7)
days after submission thereof, and the third arbitrator shall then be
selected by lot from the arbitrators remaining on the lists submitted
by the Salton Arbitrator and the Windmere Arbitrator. The law applied
in such proceeding shall be the same as the governing law selected in
Article 6 of this Agreement. The arbitration procedure set forth
above shall be the sole and exclusive method for resolving and
remedying claims for money damages arising out of the terms of this
Agreement or any Marketing Transaction. The results of such
arbitration shall be conclusive and binding upon the parties, and
shall be enforceable in any court having jurisdiction over the parties
against whom the award was rendered. The arbitrators selected
pursuant to this Article 8 will determine the allocation of the costs
and expenses of arbitration based upon the percentage which the
portion of the contested amount not awarded to each party bears to the
amount actually contested by such party.
Article 9. SEVERABILITY
Should any clause, sentence, or paragraph of this Agreement judicially
be declared to be invalid, unenforceable, or void, such decision shall
not have the effect of invalidating or voiding the remainder of this
Agreement unless the economic equity of the parties is materially
affected thereby.
Article 10. ENTIRE AGREEMENT
This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter of this Agreement and
merges all prior discussions between them, and neither of the parties
shall be bound by any modification of this Agreement, other than as
duly set forth on or subsequent to the date hereof in writing and
signed by a duly authorized representative of the party to be bound
thereby; provided that any amendment or waiver of any of the
provisions of this Agreement may only be made in accordance with the
terms of the Stockholder Agreement.
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Article 11. COOPERATION.
Each of the parties agrees to do such further acts and to execute and
deliver such additional documents as are reasonably necessary or
appropriate to give effect to the transactions contemplated by this
Agreement and carry out the purpose and intent of this Agreement.
Article 12. EQUITABLE RELIEF
The parties acknowledge and agree that any unauthorized use, transfer
or copying of the Confidential Information will cause irreparable
injury to the Disclosing Party by substantially diminishing the value
of the Disclosing Party's trade secrets and other proprietary rights
contained in the Confidential Information. Therefore, if the
Receiving Party (including its directors, officers, employees, agents
and advisors) attempts to use, transfer, copy, license, assign or
otherwise convey the Confidential Information in any manner contrary
to the terms of this Agreement, the Disclosing Party shall, in
addition to any other remedies available to it, have the right to
enjoin, preliminary and permanently, the Receiving Party from any such
act, and the Receiving Party hereby acknowledges that other remedies
are inadequate and consents to such injunction.
Article 13. COUNTERPARTS
This Agreement may be executed in one or more counterparts all of
which taken together will constitute one and the same instrument.
Article 14. HEADINGS
Headings of Articles and other provisions of this Agreement are for
convenience only, and do not alter the meaning of this Agreement.
IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Marketing Cooperation Agreement, on the dates
below indicated.
WINDMERE-DURABLE HOLDINGS, INC. SALTON/MAXIM HOUSEWARES, INC.
By: By:
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Name: David M. Friedson Name: Leonhard Dreimann
Title: President Title: Chief Executive Officer
Date: July 11, 1996 Date: July 11, 1996
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Marketing Cooperating Agreement - Salton/Maxim Housewares Inc. and Windmere-Durable Holdings Inc.
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