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* * * * * * *
Powertex hereby grants to SCS, Inc. for the full term
of Powertex's exclusive licensing agreement with Sea Land
Service on the SEA-BULK units and any extension thereof,
this Consulting Agreement to utilize SCS, Inc.'s,
technical expertise in the manufacturing, marketing and
sale of the SEA BULK units throughout the world.
The agreement provided that notices to SCS should be sent to Mr.
Clark's condominium located at 580 Patten Avenue, Unit #39, Long
Branch, New Jersey 07740. Mr. Clark did not purchase the
condominium until April 6, 1984.
Pursuant to the agreement, Powertex was required to pay SCS a
"commission" of 2 � percent of net sales of Sea Bulk liners by
Powertex and its sublicensee, Insta-Bulk. Beginning with the
quarter ending September 30, 1987, through February 25, 1992, the
"commission" was increased to 3 � percent of net sales of Sea Bulk
liners, and, for sales by Insta-Bulk, the commission remained at 2 �
percent. During the period from mid-1985 through February 25, 1992,
Powertex paid approximately $927,451 to SCS pursuant to the
agreement.
On October 26, 1995, Sea-Land filed a lawsuit in the Superior
Court of New Jersey against Mr. Clark, Mary J. Clark, SCS, Powertex,
and Mr. Podd, based on claims of fraud, commercial bribery,
conspiracy, and breach of fiduciary duties in order to recover the
payments made to SCS. The suit sought damages and demanded that SCS
return the payments made by Powertex. The relevant portions of the
complaint stated:
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