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Exhibit 10.7
CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED
BASED ON A REQUEST FOR CONFIDENTIAL TREATMENT
OMITTED PORTIONS HAVE BEEN SEPARATELY FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION
SUPPLY AGREEMENT
THIS AGREEMENT is made the _____ day of _________, 1999
BETWEEN:
UCAR CARBON COMPANY INC., a Delaware corporation having an
office at 0000 Xxxx Xxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx,
Xxxxxxxxx, 00000, XXX
("UCAR CARBON")
AND:
XXXXXXX POWER SYSTEMS INC., a company organized and existing
under the laws of Canada, the main office of which is at 0000
Xxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
("BPS")
WHEREAS:
(A) UCAR CARBON and BPS have entered into the Collaboration Agreement
for the development of Target Products;
(B) BPS seeks an assured source of supply of the Materials in
connection with the development and manufacture of electrically conductive fuel
cell separator plates;
(C) BPS wishes to purchase from UCAR CARBON, and UCAR CARBON wishes to
supply to BPS, the Materials, on the terms and subject to the conditions set
forth in this Agreement;
NOW THEREFORE the parties covenant and agree as follows:
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PART 1
DEFINITIONS AND INTERPRETATION
DEFINITIONS
1.1 In this Agreement, including the recitals and schedules, except as expressly
provided or unless the context otherwise requires,
AFFILIATE, in relation to a specified Person, means a Person that
directly or indirectly controls, is under common control with, or is
controlled by the specified Person, and for the purposes hereof, a
Person will be deemed to CONTROL a corporation if
(a) securities of the corporation to which are attached more
than 50% of the votes that may be cast to elect directors of
the specified corporation or other rights to elect a majority
of the directors are held, other than by way of security only,
by or for the benefit of the Person, and
(b) the votes attached to those securities are sufficient, if
exercised, to elect a majority of the directors of the
corporation,
BUSINESS DAY means a day that is not a Saturday, a Sunday or a British
Columbia provincial, Canadian federal, United States national or
Tennessee state, holiday,
CHIEF EXECUTIVE OFFICER means, in the case of BPS, BPS's Chief
Operating Officer and in the case of UCAR CARBON, UCAR CARBON's
President,
COLLABORATION has the meaning ascribed to it in the Collaboration
Agreement,
COLLABORATION AGREEMENT means the Collaboration Agreement between UCAR
CARBON and BPS made May 3, 1999,
COMMENCEMENT DATE means the date of execution of this Agreement,
CONFIDENTIAL INFORMATION means, in relation to a Person, information
known or used by such Person in connection with its business or
technology, including, but not limited to, such Person's Intellectual
Property, customer information, financial information, marketing
information, and information as to business opportunities and research
and development,
DISCLOSING PARTY has the meaning ascribed to it in Section 6.1,
EVENT OF DEFAULT in relation to a party means an event of default
arising as a result of a party being subject to one or more of the
following circumstances:
(a) an order is made or a resolution is passed or a petition
is filed by such
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party for the liquidation, dissolution or winding-up of such party,
(b) such party is in material breach of its obligations under
Part 6,
(c) such party commits a material default in observing or
performing any other material covenant, agreement or condition
of this Agreement on its part to be observed or performed and,
where such breach is curable, does not rectify or cure such
breach within 30 days after receipt of written notice from the
other party to this Agreement specifying such breach;
(d) an execution, sequestration or any other process of any
court becomes enforceable against such party or any distress
or analogous process is levied upon any material part of the
property, assets or undertaking of such party and any such
process or distress is not stayed or otherwise suspended by a
court of competent jurisdiction within 30 days and has, or
could have, a material adverse effect on the business or
condition, financial or otherwise, of such party;
(e) such party applies to be put in bankruptcy, takes any
action that would permit its creditors to make an application
to put such party in bankruptcy, is adjudged or declared
bankrupt or makes an assignment for the benefit of creditors,
consents to a proposal or similar action under any bankruptcy
or insolvency legislation applicable to it, or commences any
other proceedings relating to it under any reorganization,
arrangement, readjustment of debt, dissolution or liquidation
law or statute of any jurisdiction whether now or hereafter in
effect, or consents to any such proceeding;
(f) a custodian, liquidator, receiver, receiver and manager,
receiver-manager, trustee or any other person with similar
powers is appointed for such party or in respect of any
material property or assets or material part of the property
or assets of such party and not discharged within 30 days
after its appointment and before any action is taken by it in
respect of such property or assets which will materially
affect the rights of the parties to this Agreement thereto;
(g) a final, non-appealable, decision of any judicial,
administrative, governmental or other authority or arbitrator
is made which enjoins or restrains or renders illegal or
unenforceable, the performance or observance by such party of
any material term of this Agreement;
EXCLUSIVE LICENSE means the exclusive license granted by UCAR to BPS
under Section 2.9 of the Collaboration Agreement,
FIRST YEAR MATERIALS FORECAST means BPS's preliminary forecast of its
requirements for the Materials for the first Year of this Agreement as
set forth in Schedule B,
FIRST YEAR MATERIALS PRICING means the pricing of the Materials
described in Schedule C based on and applicable to the First Year
Materials Forecast,
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FORCE MAJEURE means an act of God, strike, lockout or other industrial
disturbance, war, blockade, insurrection, riot, earthquake, typhoon,
hurricane, flood, fire, explosion or other similar occurrence beyond
the reasonable control of a party which prevents such party from
performing its obligations under the Agreement,
INTELLECTUAL PROPERTY means in relation to a Person, each patent,
patent application, industrial design, invention, design, trade secret,
idea, work, methodology, technology, innovation, creation, concept,
moral right, development drawing, research, analysis, know-how,
experiment, copyright, data, formula, method, procedure, process,
system or technique of such Person, but does not include trademarks or
tradenames,
LICENSE has the meaning ascribed to it in Section 5.1,
MATERIALS means any one or more of treated graphite flakes, expanded
graphite flakes and flexible graphite (commonly referred to as graphite
sheet or foil) [TEXT DELETED] or other [TEXT DELETED] or [TEXT DELETED]
developed pursuant to the Collaboration, as well as such materials
developed by UCAR CARBON before the Effective Date (as defined in the
Collaboration Agreement), including, but not limited to the materials
listed in Schedule A to the Collaboration Agreement,
MUTUAL SECRECY AGREEMENT has the meaning ascribed to it in the
Collaboration Agreement,
NOTICE has the meaning ascribed to it in Section 9.4,
PERSON means an individual, corporation, body corporate, firm, limited
liability company, partnership, syndicate, joint venture, society,
association, trust or unincorporated organization or trustee or other
such legal representative,
PEM FUEL CELL means a solid polymer fuel cell and includes a direct
oxidation fuel cell,
RECIPIENT has the meaning ascribed to it in Section 6.1,
RECIPIENT'S AGENTS has the meaning ascribed to it in Section 6.1(a),
SPECIFICATIONS means BPS's specifications for the Materials as set
forth in Schedule A or such other specifications for the same as the
parties may agree from time to time,
SUPPLIER EVALUATION SYSTEM means at any particular time, BPS's then
existing standard of evaluating supplier performance and product
quality, the current criteria in respect of which is set forth in
Schedule D,
TARGET PRODUCT means an electrically conductive fuel cell separator
plate developed pursuant to the Collaboration utilizing any of the
Materials,
TERMS AND CONDITIONS means the terms and conditions of purchase set
forth in Section 3.1 as may be amended from time to time by the
parties, and
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YEAR means the period of 12 months commencing on the Commencement Date
and where applicable, each consecutive period of 12 months thereafter
during the term of this Agreement.
INTERPRETATION
1.2 In this Agreement, except as otherwise expressly provided or unless
the context otherwise requires,
(a) "this Agreement" means this Supply Agreement, including
the Schedules hereto, as from time to time supplemented or
amended by one or more agreements entered into pursuant to the
applicable provisions hereof,
(b) the headings in this Agreement are inserted for
convenience only and do not form a part of this Agreement and
are not intended to interpret, define or limit the scope,
extent or intent of this Agreement or any provision hereof,
(c) the word "including", when following any general statement
or term, is not to be construed as limiting the general
statement or term to the specific items or matters set forth
or to similar items or matters, but rather as permitting the
general statement or term to refer to all other items or
matters that could reasonably fall within its broadest
possible scope,
(d) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with Canadian
generally accepted accounting principles applied on a
consistent basis,
(e) except where otherwise specified, all references to
currency mean currency of the United States of America,
(f) a reference to a statute includes all regulations made
thereunder, all amendments to the statute or regulations in
force from time to time, and any statute or regulation that
supplements or supersedes such statute or regulations,
(g) a reference to an entity includes any successor to that
entity,
(h) words importing the masculine gender include the feminine
or neuter, words in the singular include the plural, words
importing a corporate entity include individuals, and vice
versa,
(i) a reference to "approval", "authorization" or "consent"
means written approval, authorization or consent,
(j) a reference to a Part is to a Part of this Agreement and
the symbol Section followed by a number or some combination of
numbers and letters refers to the section, paragraph,
subparagraph, clause or subclause of this Agreement so
designated.
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SCHEDULES
1.3 The following are the schedules attached and incorporated in this Agreement
by reference and are deemed to form a part hereof:
Schedule A Materials Specifications
Schedule B First Year Products Forecast
Schedule C First Year Products Pricing
Schedule D Supplier Evaluation System Criteria
PART 2
SALE OF MATERIALS
MATERIALS SALE
2.1 During the term of this Agreement, BPS will purchase from UCAR CARBON, and
UCAR CARBON will sell to BPS, all of BPS's requirements of the Materials in
connection with the development and manufacture of electrically conductive fuel
cell separator plates. Notwithstanding the foregoing, BPS may acquire treated
graphite flakes, expanded graphite flakes and flexible graphite from sources
other than UCAR CARBON, but solely for benchmarking purposes. BPS's obligations
under this Section 2.1 are subject to BPS qualifying the Materials according to
the quality assurance procedures as defined in BPS's quality assurance manual
and UCAR CARBON being able, on a consistent basis, to meet BPS's requirements as
to pricing, delivery, quality and service in respect of the Materials from time
to time.
SUPPLIER EVALUATION SYSTEM
2.2 In evaluating whether or not UCAR CARBON is meeting BPS's requirements as to
pricing, delivery, quality and service, BPS will utilize its Supplier Evaluation
System. BPS will provide UCAR CARBON with, and train UCAR CARBON as to its then
current criteria in respect of, its Supplier Evaluation System. No change to the
Supplier Evaluation System will be effective as to UCAR CARBON until the parties
have agreed to such change. If UCAR CARBON is unable to meet BPS's requirements
as aforesaid or any agreed changes thereto within six months after being
requested to do so BPS will be deemed to have been granted a Default License, as
defined in Section 5.2, for such time as UCAR CARBON remains in non-compliance
and BPS may acquire the Materials from one or more alternative sources without
prejudice to its rights to continue acquiring the Materials from UCAR CARBON
under this Agreement. UCAR CARBON may revoke the Default License granted
pursuant to this Section 2.2 at such time as it becomes compliant under this
section. Upon revocation of the Default License, all sublicenses granted as a
result shall be revoked by BPS and UCAR CARBON shall [TEXT DELETED] from [TEXT
DELETED] any [TEXT DELETED] that BPS may have acquired, if any, for the [TEXT
DELETED] of [TEXT DELETED] and [TEXT DELETED] BPS's related, [TEXT DELETED] and
[TEXT DELETED] under the Default License. The purchase price for the [TEXT
DELETED] shall be the value of the [TEXT DELETED] as recorded on the books of
BPS as of the date of purchase subject to normal accounting practices with
regard to
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[TEXT DELETED].
MOST FAVOURED CUSTOMER
2.3 If after termination of the Exclusive Period as defined in Section 2.9 of
the Collaboration Agreement, UCAR CARBON sells or supplies or offers to sell or
supply to another Person a like quantity of like Materials under like
circumstances at a price or on other terms that are more favourable to such
Person than the price or other terms offered to BPS, UCAR CARBON will so inform
BPS promptly. If in any [TEXT DELETED] period the price at which Materials are
sold or offered for sale to such Person is [TEXT DELETED] than the [TEXT
DELETED] or [TEXT DELETED] to BPS for a [TEXT DELETED] quantity of [TEXT
DELETED] Materials on [TEXT DELETED] terms during such period, the [TEXT
DELETED] by BPS to UCAR CARBON for the Materials will automatically be [TEXT
DELETED] to that [TEXT DELETED] price from the date on which such price was
[TEXT DELETED] to the other person. If the other [TEXT DELETED] to such other
Person are more [TEXT DELETED] than the [TEXT DELETED] to BPS, such [TEXT
DELETED] to BPS will be amended so that the more [TEXT DELETED] terms will apply
to all [TEXT DELETED] and as to all [TEXT DELETED] between BPS and UCAR CARBON.
Where applicable, the parties will make such adjustments to payments or
otherwise as may be necessary to fulfill the intent of this Section 2.3.
FIRST YEAR FORECAST AND PRICING
2.4 During the first year of this Agreement BPS agrees to buy at a minimum the
quantities set out in BPS's First Year Materials Forecast as set forth in
Schedule B and UCAR CARBON agrees to sell Materials at the prices set forth in
UCAR CARBON'S First Year Materials Pricing as set forth in Schedule C. UCAR
CARBON's pricing and delivery schedule for the first year is subject to change
if BPS makes a material change in its First Year Materials Forecast.
FUTURE FORECASTS AND PRICING
2.5 Future forecasts, pricing and production for the Materials will be dealt
with as follows:
(a) commencing no later than 60 days before the expiry of the
first year of this Agreement, and thereafter no later than the
end of each quarter, BPS will provide UCAR CARBON with a
rolling three-year forecast of its yearly requirements of the
Materials from UCAR CARBON, which forecast will not be binding
upon BPS;
(b) within 30 days after receipt of each Anniversary Forecast
(being that three-year forecast that is provided for the
quarter which begins on each one-year anniversary date of this
Agreement, i.e. the first being produced at the end of the
first year), UCAR CARBON will provide BPS in writing with its
pricing of the quantity or volume of the Materials forecast as
required by BPS for the first year of each Anniversary
Forecast and account for minor variations from quantities
forecast for such year together with a delivery schedule that
reflects such forecast;
(c) no later than 30 days after receipt of UCAR CARBON's quote
for such Materials, BPS will provide UCAR CARBON with a
written binding commitment to
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purchase a specified quantity or volume of Materials during
each first year of the Anniversary Forecast, which commitment
may vary from the forecast given by BPS for such year ("Annual
Commitment");
(d) if the quantity, timing or volume of the Materials set out
in the Annual Commitment is substantially different from the
first year of BPS's Anniversary Forecast, UCAR CARBON will no
longer be bound to its original price and delivery quote but
must, within 30 days after receipt of such Annual Commitment,
provide BPS with new quotes and delivery schedules that take
into account such difference. The parties will make the
appropriate adjustments to the pricing and delivery schedules
to reflect the new quotes and delivery schedules; and
(e) in addition to the foregoing, UCAR CARBON will, from time
to time at the request of BPS, provide BPS with firm fixed
quotes governing volumes of Materials for such periods of time
above and beyond the Annual Commitment as may, from time to
time, be specified by BPS.
DELIVERY OF MATERIALS
2.6 Without derogating from its obligations to supply the Materials on a timely
basis, UCAR CARBON must achieve, in any eight-week period
(a) during the first three months after the date of execution
of this Agreement, greater than an 90% on-time delivery rate
for the Materials with a variance from the agreed delivery
date of such Materials during the period of no more than two
days,
(b) subject to Section(c), after the first three months after
the date of execution of this Agreement, greater than a 95%
on-time delivery rate for the Materials with a variance from
the agreed delivery date of the Materials during such period
of no more than two days, and
(c) after the first nine months after the date of execution of
this Agreement, greater than a 99% on-time delivery rate for
the Materials with a variance from the agreed delivery date of
the Materials of two days or such lesser period as is
acceptable by competitive industry standards or as agreed to
by the parties.
For the purposes hereof, in determining on-time delivery dates, Materials that
do not meet the agreed Specifications will be deemed not to have been delivered.
LICENSE TO USE OF MATERIALS
2.7 Subject to Section 2.9 of the Collaboration Agreement, UCAR CARBON hereby
grants to BPS a perpetual, irrevocable, worldwide, non-exclusive, royalty-free
and paid-up right and license under UCAR CARBON's Intellectual Property rights
to use the Materials supplied by UCAR CARBON to BPS in connection with the
development, manufacture, use or sale of electrically conductive fuel cell
separator plates.
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IMPROVEMENTS TO MATERIALS
2.8 If during the term of this Agreement but after the term of the
Collaboration, UCAR CARBON develops material or technology which is relevant for
the development or manufacture of electrically conductive fuel cell separator
plates, UCAR CARBON will, to the extent that it is not otherwise prohibited from
disclosing the information, advise BPS of the new developments, subject to the
standards of confidentiality established in the Mutual Secrecy Agreement. UCAR
CARBON will, to the extent that it is not otherwise prohibited from selling the
materials or technology, offer to sell to BPS the new materials or to grant to
BPS a new license in respect of the new technology, subject to the further
agreement of the parties.
2.9 If during the term of this Agreement but after the term of the
Collaboration, BPS develops material or technology which is relevant for the
development or manufacture of flexible graphite materials, articles made from/of
flexible graphite materials (other than electrically conductive fuel cell
separator plates), or compositions which include flexible graphite materials,
BPS will, to the extent that it is not otherwise prohibited from disclosing the
information, advise UCAR CARBON of the new developments subject to the standards
of confidentiality established in the Mutual Secrecy Agreement. BPS will, to the
extent that it is not otherwise prohibited from selling the new material or
technology, offer to sell to UCAR CARBON the new materials or to grant to UCAR
CARBON a new license in respect of the new technology, subject to further
agreement of the parties.
PART 3
CONDITIONS OF SALE
SALES/PURCHASE ORDER CONDITIONS
3.1 All sales of Materials and all purchase orders issued and acknowledged under
this Agreement will be subject to the Terms and Conditions set forth below:
(a) ACCEPTANCE
A purchase order is not binding on BPS until accepted by UCAR CARBON.
Acceptance of a purchase order and all terms and conditions as set out
in this Section 3.1 will take place when (i) BPS receives UCAR CARBON's
acknowledgement by electronic mail, fax or other agreed form, or (ii)
UCAR CARBON delivers to BPS the materials or items ordered, whichever
is earlier.
(b) PRICE
The price for the materials or items ordered will be paid by BPS in
cleared funds to the bank nominated by UCAR CARBON within 30 days after
the later of
(a) receipt by BPS of the ordered goods, and
(b) the date of the applicable invoice,
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such payment to be made by check, credit transfer or irrevocable
confirmed letter of credit; provided that, subject to BPS's rights
under Section 3.1(h) and in the purchase order, BPS will only be
obligated to pay for materials or items that are actually received by
it. In addition, to the purchase price, BPS will pay to UCAR CARBON the
amount of all taxes, excises or other governmental charges (except
taxes on or measured by income) that UCAR CARBON may be required to pay
with respect to the production, sale or transportation of any materials
or items delivered to BPS under the purchase order.
(c) OVERSHIPMENTS, INSTALLMENTS
BPS will pay only for the maximum quantities ordered. Overshipments
will be held at UCAR CARBON's risk and expense for a reasonable time
while awaiting shipping instructions from UCAR CARBON. Return shipping
charges for excess quantities will be at UCAR CARBON's expense. Any
provision herein for delivery of materials or items by installment will
not be construed as rendering the obligations of UCAR CARBON severable
and BPS will only be obliged to pay the price of the materials or items
included in such installment after such installment is actually
received by BPS.
(d) PACKING AND SHIPMENT
Unless otherwise specified in the purchase order, if the price of the
ordered materials or items is based on the weight thereof, such price
must reflect the net weight of the materials or items ordered only, and
no charges will be allowed for boxing, crating, handling damage,
carting, drayage, storage or other packing requirements. Unless
otherwise specified in the purchase order, all ordered materials or
items must be securely packed in cartons, boxes or other containers,
and marked and otherwise prepared for shipment in a manner which is
(i) in accordance with good commercial practice,
(ii) acceptable to common carriers for shipment at the lowest
rate for the particular materials or items, and
(iii) adequate to ensure safe arrival of the ordered materials
or items at the named destination.
UCAR CARBON must xxxx all containers with necessary lifting, handling
and shipping information, purchase order numbers, date of shipment and
the names of the consignee and consignor, if applicable. An itemized
packaging sheet must accompany each shipment. No partial or complete
delivery will be permitted hereunder before the date or dates specified
for delivery without BPS's prior written consent thereto. If the
ordered materials or items are improperly delivered for shipment, any
additional cost thereby incurred will be for the account of, and will
be paid by, UCAR CARBON, and may be deducted by BPS from the payment of
the price for such materials or items.
(e) DELIVERY
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Unless otherwise directed by BPS or specifically provided in the
purchase order, the materials or items called for hereunder will be
delivered on a FCA origin basis. The term "FCA" has the meaning
ascribed thereto in, and is to be interpreted in accordance with, the
Incoterms 1990 published by the International Chamber of Commerce.
Notwithstanding the shipping terms contained in the purchase order,
title to the materials or items and risk will remain with UCAR CARBON
and not pass to BPS until delivery to BPS's named destination for
importation.
(f) WARRANTIES
UCAR CARBON warrants, represents, covenants and agrees as follows:
(i) the materials or items supplied pursuant to the purchase
order will
(A) be in full compliance with BPS's Specifications,
blueprints, drawings and data,
(B) be in conformity with samples approved by BPS,
(C) not infringe any patent, copyright, trade secret, mask
work right, trademark or other intellectual property right of
any person covering the material or item itself but UCAR
CARBON does not warrant against infringement by reason of the
use of such material or item in combination with other
articles or material or in the practice of any process other
than a process for which such item has been expressly
manufactured by UCAR CARBON,
(D) be so supplied, and BPS will have title thereto, free and
clear of all liens, charges, encumbrances and security
interests;
(ii) THERE ARE NO EXPRESS WARRANTIES BY UCAR CARBON OTHER THAN
THOSE SPECIFIED IN THIS SECTION. NO WARRANTIES BY UCAR CARBON (OTHER
THAN WARRANTY OF TITLE AS PROVIDED BY THE UNIFORM COMMERCIAL CODE)
SHALL BE IMPLIED OR OTHERWISE CREATED AT LAW OR IN EQUITY,
INCLUDING, BUT NOT LIMITED TO, WARRANTY OF MERCHANTABILITY AND
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE. Without limiting the
generality of the foregoing, BPS assumes all risk and liability for
the results obtained by the use of any products delivered hereunder
in combination with other articles or material or in the practice of
any process other than a process for which such item has been
expressly manufactured by UCAR CARBON.
(iii) BPS's receipt of any products delivered hereunder shall be
an unqualified acceptance of, and a waiver by BPS of any and all
claims (including claims arising under the warranties specified in
this Section 3.1(f)) with respect to, such products unless BPS gives
UCAR CARBON notice of claim within 150 days after such receipt or
within ten days after BPS shall have received
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written notice of any claim of infringement covered by clause
(i) above,
(iv) if any materials or items delivered hereunder do not meet
the warranties specified herein, BPS may, at its option
(A) require the UCAR CARBON to correct, at no cost to BPS, any
defective or non-conforming materials or items by repair or
replacement, or
(B) return such defective or non-conforming materials or items at
UCAR CARBON's expense to the UCAR CARBON and recover from the UCAR
CARBON the purchase order price thereof, or
(C) correct the defective or non-conforming materials or items
itself and charge UCAR CARBON with the cost of such correction.
The foregoing remedies are exclusive to BPS.
(v) No waiver by BPS of any drawing or specification
requirement for one or more of the materials or items ordered will
constitute a waiver of such requirements for the remaining
materials or items to be delivered hereunder, unless specified by
BPS in writing. The provisions of this Section 3.1(f) will not
limit or affect the rights of BPS under Section 3.1(h).
(g) INVOICES
Each invoice issued as a result of the purchase order must
(i) be rendered separately for each delivery,
(ii) not cover more than one purchase order,
(iii) contain the purchase order number under which it is
issued, and
(iv) be rendered to the proper Accounts Payable Department of
BPS as set forth in the purchase order.
Invoice payment terms will be calculated from the date the
invoice is received by the proper Accounts Payable Department
of BPS by electronic mail, fax or other agreed form.
(h) INSPECTION
Materials or items purchased pursuant to the purchase order are subject
to BPS's inspection and approval at any place BPS may reasonably
designate. BPS may, without liability hereunder or otherwise and
without prejudice to any other rights or remedies available to it,
reject and refuse acceptance of any materials or items, which do not
conform in all respects to
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(i) any instructions contained in the purchase order,
(ii) BPS's Specifications, drawings, blueprints and data, or
(iii) UCAR CARBON's warranties.
With respect to any materials or items which do not so conform, BPS
may, in BPS's sole discretion, hold such materials or items for UCAR
CARBON's inspection at UCAR CARBON's risk upon notification to UCAR
CARBON, or return such materials or items to UCAR CARBON at UCAR
CARBON's expense. BPS's rejection of any materials or items subject to
the purchase order will be without prejudice to its rights to require
UCAR CARBON to perform its obligations in respect of the balance of the
purchase order. Payment for any item will not be deemed to be an
acceptance thereof.
(i) CHANGES
BPS may, with reasonable notice to UCAR CARBON, at any time change
(i) the Specifications, drawings, blue prints and data
concerning the ordered materials or items where such materials
or items are to be specifically manufactured for BPS,
(ii) the method of packaging, packing or shipment of the
ordered materials or items, and
(iii) the place and/or time of delivery of such materials or
items.
If any such change causes an increase or decrease in the cost
(including any unusable work in progress) or the time required for the
delivery of the materials or items ordered, UCAR CARBON will claim an
equitable adjustment in the price or delivery schedule, or both within
30 days after receipt by UCAR CARBON of the requested change.
(j) INDEMNIFICATION
Each party will indemnify and hold the other harmless from and
against any claim, demand, cause of action, damage, costs and
expenses which the other might sustain or become liable for arising
from or in connection with that party's performance or nonperformance
hereunder. No claims of any kind, with the exception of those claims
arising out of Section 3.1(f)(i)(C), Section 3.1(f)(i)(D), Section
3.1(k) or Part 6 of the Agreement with respect to any material or
item covered by this document, whether as to materials or items
delivered or for delayed delivery or non-delivery of the material or
item and whether or not based on negligence or warranty, shall be
greater in aggregate amount than the purchase price of the materials
or items in respect of which such claims are made. In no event, with
the exception of those claims arising out of Section 3.1(f)(i)(C),
Section 3.1(f)(i)(D), Section 3.1(k) or Part 6 of the Agreement shall
either party be liable for special, indirect or consequential
damages, whether or not caused by or resulting from the negligence of
such party.
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(k) PATENTS
UCAR CARBON will defend, at UCAR CARBON's own expense, all suits,
actions or proceedings in which BPS, or any of the BPS's distributees
or dealers, or the users, lessees or customers of any of BPS's
products, are made defendants for actual or alleged infringement of any
copyright, trademark, trade secret, mask work right, Canadian, U.S.
or other foreign patent or other intellectual property right resulting
from the possession, use, sale or resale of any material or item
purchased hereunder. If by virtue of a patent infringement suit an
injunction is issued against BPS which prohibits or limits the use of
any materials or items ordered or purchased hereunder or UCAR CARBON
notifies BPS to cease use of any materials or items purchased
hereunder, UCAR CARBON, at BPS's request, will supply BPS with
non-infringing replacement materials or items of a similar kind,
quality and quantity. BPS will cease use of materials or items
purchased hereunder which are subject to an infringement action upon
receipt of notice of such action and upon request by UCAR CARBON. UCAR
CARBON's obligations under this Section 3.1(k) or Section 3.1(j) do not
apply to any suits, actions or proceedings in which the actual or
alleged infringement results from the use of such material or item in
combination with other articles or material or in the practice of any
process other than a process for which such item has been expressly
manufactured by UCAR CARBON.
(l) COMPLIANCE WITH LAW
UCAR CARBON warrants and represents that it has complied with, and will
continue, during the performance of its obligations hereunder, to
comply with, all laws and conform to all requirements of each
applicable governmental authority with respect to the supply of the
ordered materials or items, including those concerning the packaging,
storage, shipment and exportation of all or any part thereof, and will
ensure that no chemical substance delivered to BPS is on the list of
prohibited substances described in applicable environmental laws. UCAR
CARBON will obtain all federal, provincial, state, municipal and other
government or regulatory licenses, permits or other documents or
permissions that are required by BPS that are incidental to the sale or
shipment of the ordered materials or items to BPS.
BPS warrants and represents that it has complied with, and will
continue, during the performance of its obligations hereunder, to
comply with, all laws and conform to all requirements of each
applicable governmental authority with respect to the ordered materials
or items and payment therefor and importation thereof.
(m) NON-PUBLICITY
Except as may be required by law or applicable governmental regulatory
authorities, neither party will, without the prior written consent of
the other party
(i) make any news release, public announcement, denial or
confirmation of any purchase order or its subject matter, or
15
(ii) in any manner advertise or publish the fact that BPS has
placed any purchase order with UCAR CARBON.
(n) PROPERTY
All tooling, equipment or material of every description owned by a
party to this Agreement (the "Owner") and furnished to the other party
or specifically paid for by the Owner, and any replacement thereof,
will remain the property of the Owner. Such property, and whenever
practical, each individual item thereof, will be plainly marked or
otherwise properly identified as the "Property of the Owner." and will
be safely stored. The party will not substitute any property for the
Owner's property and will not use such property except in fulfilling
the purchase order. Such property, while in the party's custody or
control, will be held at that party's expense, and will be insured by
that party in an amount equal to its replacement cost with loss payable
to Owner. Such property will be prepared for shipment and delivered in
good condition, normal wear and tear excepted, to the Owner on a FCA
origin basis immediately upon request by the Owner.
(o) TERMINATION
BPS may require UCAR CARBON to terminate work under any purchase order
in whole or in part at any time by notice to UCAR CARBON in writing,
whereupon UCAR CARBON will immediately stop work on the purchase order,
or the terminated portion thereof, and notify its subcontractors to do
likewise. Except for such termination as is caused by a default or
delay of UCAR CARBON, UCAR CARBON will be entitled to reimbursement for
its actual costs applicable to the termination incurred up to and
including the date of termination. UCAR CARBON will also be entitled to
reasonable profit on the work done before such termination at a rate
not exceeding the rate used in establishing the original purchase
price. The total amount of such claim will not exceed the cancelled
commitment value of the purchase order.
(p) TERMINATION FOR DEFAULT
The BPS and UCAR CARBON covenant and agree as follows:
(i) BPS may, by written notice, terminate any purchase order
in whole or in part if UCAR CARBON fails
(A) to make delivery of the ordered materials or items or
to perform the services in the manner and within the time
specified therefor or any extension thereof by written
change order or amendment, or
(B) to replace or correct defective materials or items in
accordance with Section 3.1(f) and Section 3.1(h), or
(C) to perform any other provision of the purchase order,
or
(D) to make progress so as to endanger performance of its
16
obligations under the purchase order;
(ii) if a purchase order is terminated by reason of UCAR
CARBON's default, UCAR CARBON will transfer title and deliver
to BPS, promptly at BPS's request, in the manner and to the
extent directed by BPS,
(A) any completed materials or items, and
(B) such particularly completed materials or items as UCAR
CARBON has produced or acquired for the performance of the
terminated part of the purchase order.
UCAR CARBON will protect and preserve such property in the
possession of UCAR CARBON. Payment for completed materials or
items delivered to and accepted by BPS will be in an amount
agreed upon by UCAR CARBON and BPS, which amount must not
exceed the contract price therefor; and
(iii) failure by BPS to enforce any of its rights under the
purchase order will not be deemed a waiver thereof.
(q) ATTORNEY'S FEES
If UCAR CARBON and BPS are unable to resolve any dispute
arising under the purchase order and any suit or other
judicial proceeding is instituted with reference thereto, the
successful party in any such suit or other judicial proceeding
will be paid promptly by the other party an additional amount
equal to the successful party's reasonable attorney's fees and
costs incurred.
(r) GENERAL
The following general provisions will apply to all purchase orders:
(i) time will be of the essence hereof;
(ii) the purchase order is given pursuant to this
Agreement and will be subject to the terms of this
Agreement and in the event of any conflict between the
terms of this Agreement and the terms of the purchase
order, the terms of this Agreement will govern;
(iii) waiver by a party of any of its rights or default by
the other hereunder will not be deemed a waiver by such
party of any other right or default;
(iv) UCAR CARBON will not change a purchase order or ship
non-conforming items without first obtaining the written
consent of BPS;
(v) UCAR CARBON will, from time to time upon request by
BPS, do, execute, acknowledge, deliver, or cause to be
done, executed, acknowledged and delivered, all and every
such further acts, bills of sale, bills of
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lading, deeds, transfers and assurances as BPS may
reasonably request to evidence or protect BPS's ownership
interest in the ordered items or to carry into effect the
intentions of the parties as set out in this purchase
order.
(vi) UCAR CARBON will, at BPS's request, make available to
BPS's Affiliates those items or materials of the kind that
are the subject matter of the purchase order at prices
payable by BPS under the purchase order. UCAR CARBON may
but is not required, at BPS's request, to make available
to BPS licensees and customers those items or materials of
the kind that are the subject matter of the purchase order
at prices payable by BPS under the purchase order.
(s) ASSIGNMENTS
Neither party may assign any rights or obligations under a purchase
order (including the right to receive monies due hereunder) without the
prior written consent of the other party, and any purported assignment
without such consent will be void. No assignment will relieve the
assigning party from its obligations under the purchase order.
(t) NOTICE OF LABOR DISPUTE
Whenever an actual or potential labor dispute is delaying or threatens
to delay the timely performance of a purchase order, the affected party
will, as soon as practicable, notify the other party of such dispute
and furnish all relevant details. Receipt by the other party of such
notice will not constitute a waiver by that party of the affected
party's obligation to meet the delivery schedule; however, such dispute
may constitute an event of Force Majeure as governed by this Agreement.
(u) DISPUTE RESOLUTION AND APPLICABLE LAW
The Dispute Resolution and Applicable Law provisions set out in Parts 7
and Section 9.8 of this Agreement shall apply to all purchase orders.
EFFECT OF PURCHASE ORDER TERMS AND CONDITIONS
3.2 The terms and conditions set forth in this Part 3 apply only as to
individual purchase orders issued and accepted in the sale of materials under
this Agreement. In no way should any term contained in Section 3.1 be construed
to give greater rights to a party or alter or amend the obligations of BPS or
UCAR CARBON under the other terms of this Agreement. While a breach of the
individual terms of a purchase order may give rise to a remedy under that
particular purchase order, as set out in this Part 3, in no event will such
breach of an individual purchase order be considered an Event of Default under
this Agreement.
REVISED PURCHASE ORDER TERMS AND CONDITIONS
3.3 BPS will notify UCAR CARBON as soon as reasonably practicable of any
proposed changes to, or substitutions of, the Terms and Conditions. No change to
the Terms and Conditions will be effective as to UCAR CARBON until the parties
have agreed to such change in writing as
18
provided for in this Agreement.
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PART 4
PRICE OF THE PRODUCTS
PRICE
4.1 Subject to Section 2.3, the price payable by BPS for the Materials will be
as follows:
(a) UCAR CARBON will provide, at no cost to BPS, other than the costs
associated with shipping, insurance and other miscellaneous expense
related to packing or transportation not already assumed by BPS, those
minimal amounts of Materials that are necessary for the performance of
the work under the Collaboration or to be incorporated into PEM Fuel
Cells as a part of a developmental program of BPS or any of its
Affiliates or licensees. The maximum amount of materials provided under
this Section 4.1(a) will be determined subject to UCAR CARBON's sole
discretion;
(b) for all other Material supplied by UCAR CARBON and purchased by BPS the
price will be as may be agreed upon by the parties pursuant to
Section 2.4 and Section 2.5.
PART 5
GRANT OF LICENSE
GRANT OF CESSATION LICENSE
5.1 Subject to Part 8 and during the term of the Exclusive Period as defined in
Section 2.9 of the Collaboration Agreement, UCAR CARBON may only elect to cease
supply of Materials to BPS if UCAR CARBON has elected to cease supplying like
Materials or like materials to all other persons for use in electrically
conductive fuel cell separator plates. If UCAR CARBON determines to make such an
election, UCAR CARBON will promptly notify BPS of its intention to cease the
supply and grant to BPS, for so long as BPS is not in material default with
regard to its obligations under this Agreement, and for so long as UCAR CARBON
does not supply such Material(s) (the license term not to exceed the term of
this Agreement, as renewed,), a worldwide, non-exclusive, right and license (the
"Cessation License") sublicensable by BPS, to use the Intellectual Property
rights of UCAR CARBON to enable BPS to make, have made, use or sell such
Material or Materials in connection with the development, manufacture, use or
sale of electrically conductive fuel cell separator plates. In any event, UCAR
CARBON agrees to continue to supply the Materials for a one-year period
following the date on which UCAR CARBON gives notice of its intent to cease to
supply the Material(s).
GRANT OF DEFAULT LICENSE
5.2 Should BPS provide notice of default to UCAR CARBON as a result of UCAR
CARBON being the subject of an Event of Default that has occurred and is
continuing to occur for reasons other than UCAR CARBON's election to cease to
supply a Material(s) as the result of a dispute between the parties as to price
or terms (regardless of whether the dispute was arbitrated), UCAR CARBON will be
deemed to have granted to BPS for the original term of this Agreement, or if
20
the term has been renewed, as renewed, an irrevocable, worldwide, non-exclusive,
royalty-free and paid-up right and license (the "Default License") sublicensable
by BPS, to use the Intellectual Property rights of UCAR CARBON to enable BPS to
make, have made, use or sell the Materials in connection with the development,
manufacture or sale of electrically conductive fuel cell separator plates.
LICENSE RESTRICTIONS
5.3 Any licenses granted pursuant to this Part 5 will be in addition to, not in
substitution for, and without prejudice to, the Exclusive License or any other
license granted by UCAR CARBON to BPS under the Collaboration Agreement or
otherwise and includes the right by BPS to disclose UCAR CARBON's Confidential
Information to BPS's sublicensees only to the extent necessary and in connection
with the production, use or sale of the Materials licensed under this Part 5.
With regard to any license granted by UCAR CARBON under this Agreement, BPS
shall obtain from each of its sublicensees or other third parties from whom it
may obtain the Material(s) a contractual obligation which shall subject the
sublicensee or third party to obligations of confidentiality at least as
restrictive as that established in this Agreement and require a commitment that
the sublicensee or third party shall use the license, Materials and technology
solely for the production of Materials for BPS and for no other purpose. In
addition to all other remedies available under this Agreement, at law or in
equity, UCAR CARBON may notify BPS that BPS's sublicensee or third party appears
to be in breach of these requirements. Upon receipt of UCAR CARBON's notice, BPS
shall immediately, and at its own expense, take all necessary action to require
and insure that its sublicensee or third party complies with these requirements
including but not limited to termination of the sublicense or third party
contract, legal action to enforce the sublicense or third party contract, and
assistance to UCAR CARBON in the prosecution of any action UCAR CARBON may wish
to pursue.
TECHNOLOGY TRANSFER
5.4 UCAR CARBON will, promptly upon the grant of either a Cessation License or a
Default License, transfer to and provide BPS on a one-time basis all then
available and relevant technology, information, training and technical
assistance as may be necessary for the exploitation of the license for a
reasonable fee to be determined by the parties reflecting the reasonable cost of
effecting such technology transfer, training and technical assistance. If the
parties are unable to agree on a reasonable fee the matter will be referred to
the Dispute Resolution Procedures outlined in Part 7 of this Agreement.
FURTHER ASSURANCES FOR LICENSED MATERIALS
5.5 UCAR CARBON will execute such further assurances and other documents and
instruments and do such further and other things as may be necessary to
implement and carry out the intent of the provisions of this Part 5.
SURVIVAL OF PART 5 PROVISIONS
5.6 Notwithstanding anything in this Agreement and subject to the limitations
set out in Section
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5.3, any license granted pursuant to the provisions of this Part 5 prior to the
termination of this Agreement, will survive and continue to apply after any
early termination of this Agreement for the original term of the Agreement, or
if the term has been renewed, as renewed, and any reference in this Agreement to
termination will not affect this Part 5 unless specifically agreed to in writing
by the parties.
PART 6
CONFIDENTIALITY
CONFIDENTIALITY OBLIGATIONS
6.1 Each party (for purposes of this Part 6, the "Recipient"), at all times
during this Agreement and for a period of ten years after the expiry hereof,
(a) will, and will ensure that each of its directors, officers,
employees, Affiliates, licensees, including sublicensees
(collectively, the "Recipient's Agents") will, hold in
confidence and keep confidential the Confidential Information
of a party (the "Disclosing Party") disclosed to it by the
Disclosing Party,
(b) will not, and will use reasonable efforts to ensure that the
Recipient's Agents will not, directly or indirectly, use or
disclose any such Confidential Information except to the
extent that it is strictly necessary under this Agreement or
the Collaboration Agreement,
(c) will cause the Recipient's Agents that are recipients of or
exposed to such Confidential Information, to execute
confidentiality agreements to protect the same,
(d) will not, and will ensure that the Recipient's Agents will
not, except to the extent necessary for the purposes of this
Agreement, make copies of or otherwise reproduce such
Confidential Information, and
(e) will, and will ensure that each of the Recipient's Agents
will, use commercially reasonable best efforts to maintain all
such Confidential Information in a manner so as to protect the
same against wrongful disclosure, misuse, espionage and theft.
EXCEPTIONS FOR CONFIDENTIALITY
6.2 The Confidentiality obligations set out in Section 6.1 shall not apply to
any Confidential Information:
(a) which is or becomes generally available to the public through
no breach of this Agreement or any other obligation of the
Recipient or the Recipient's Agents to the Disclosing Party,
(b) of which the Recipient or the Recipient's Agents had knowledge
before the
22
date of this Agreement, as evidenced by competent proof,
unless the same was disclosed to the Recipient or the
Recipient's Agents by the Disclosing Party,
(c) of which the Recipient or the Recipient's Agents obtained
knowledge from a third party, as evidenced by competent proof,
unless such third party obtained such Confidential Information
in violation of any duty of confidence owed to the Disclosing
Party, or
(d) which is required to be disclosed pursuant to law or a rule,
regulation, policy or order of a governmental authority having
jurisdiction or pursuant to a final order or judgment of a
court of competent jurisdiction and in such case the parties
will cooperate with one another to obtain an appropriate
protective order or other reliable assurance that confidential
treatment will be afforded to such Confidential Information.
EMPLOYMENT RELATIONS
6.3 Neither party will, during the term of this Agreement and for a period of
two years next after the expiry or termination hereof, solicit for employment
any individual who is, at the time of such solicitation, employed by the other
party or its Affiliates nor will such party, directly or indirectly, induce any
such individual to leave his or her employment. Nothing herein will prevent a
party from employing any such employee so long as no solicitation or inducement
has been made to such employee by or on behalf of such party.
REASONABLE RESTRICTION
6.4 Each party agrees that the restrictions contained in this Part 6 are
reasonable for the protection of the respective legitimate business interests of
the parties.
MUTUAL SECRECY AGREEMENT AND COLLABORATION AGREEMENT
6.5 The provisions of
(a) the Mutual Secrecy Agreement (and not Section 6.1 and
Section 6.2 hereof) will apply to all "Proprietary
Information" (as defined in such agreement) disclosed by the
parties to one another before the Effective Date (as defined
in the Collaboration Agreement) notwithstanding that the same
Proprietary Information is disclosed again as Confidential
Information under this Agreement, and
(b) the provisions of the Collaboration Agreement (and not
Section 6.1 and Section 6.2) will apply to all Confidential
Information disclosed by the parties to one another during the
term of the Collaboration notwithstanding that the same
Confidential Information is disclosed again during the term of
this Agreement.
SURVIVAL OF PART 6 PROVISIONS
6.6 Notwithstanding anything in this Agreement, the provisions of this Part 6
will be separate and distinct covenants and agreements enforceable after the
termination of this Agreement in
23
accordance with the terms of this Part 6, and any reference in this Agreement to
termination will not affect this Part 6 unless specifically agreed to by the
parties.
PART 7
DISPUTE RESOLUTION
INITIATION OF PROCESS
7.1 If at any time a dispute between the parties with respect to any matter
relating to this Agreement arises, a party that wishes that the issue be
considered further must give written notice (the "Dispute Notice") to the other
requiring that such issue or dispute be decided pursuant to this Part 7.
REFERRAL TO CHIEF EXECUTIVE OFFICERS
7.2 If a Dispute Notice is given, the Chief Executive Officers of each of the
parties will initiate discussions with a view to settling the issue or matter. A
decision reached by such Chief Executive Officers and communicated by them in
writing to the parties will be binding on the parties and will be implemented.
SUBMISSION TO ARBITRATION
7.3 If no decision is communicated by the Chief Executive Officers within 30
days after such issue or dispute is referred to them, either party may at any
time before a decision thereon is so communicated and less than 120 days after
delivery of the Dispute Notice, by further notice given to the other, submit the
issue or dispute for a binding determination by a three member arbitration panel
in accordance with the rules of arbitration of the International Chamber of
Commerce.
ACCEPTANCE AND IMPLEMENTATION
7.4 Each of the parties will accept and proceed in good faith diligently to
implement the binding award or decision of an arbitrator on an arbitration
pursuant to Section 7.3.
PLACE OF ARBITRATION
7.5 All arbitration proceedings will be conducted in San Francisco, California
or in such other place as the parties may agree.
LEGAL PROCEEDINGS
7.6 A legal proceeding commenced by a party to this Agreement in respect of an
issue or dispute that may be arbitrated under this Agreement will be stayed
until the time during which arbitration may be initiated has expired or, if
arbitration is initiated, a decision on the arbitration is delivered or the
arbitration process has otherwise ended.
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EXCLUSIONS
7.7 This Part 7 will not apply to any action under Part 6 or for the grant of
provisional remedies, including injunctions, restraining orders and specific
performance, and each party reserves its right to commence such action or seek
such remedies from a court of competent jurisdiction.
PART 8
TERM AND TERMINATION
TERM
8.1 This Agreement will come into force on the Commencement Date and, subject to
Section 5.6 and Section 6.6, will continue for a period of nine years unless
terminated sooner pursuant to Section 8.2. Thereafter, unless terminated as
provided above, this Agreement will be deemed renewed automatically from year to
year until terminated by either party pursuant to Section 8.2 or upon written
notice of a party's election to not renew given by that party to the other 60
days before the end of the then current period. UCAR CARBON may, at any time,
terminate this Agreement and the Exclusive License arising under the
Collaboration Agreement on 30 days notice if it is determined that through
technological advances or otherwise, BPS no longer requires the Materials in the
development and manufacture of electrically conductive fuel cell separator
plates. The parties will review this Agreement within 90 days after each of the
third and sixth anniversary dates of the Commencement Date and will make such
changes to this Agreement as may be necessary or desirable in light of any
changed circumstances. If during such review period the parties cannot agree as
to the necessity or content of any such changes, the disagreement as to the
proposed changes shall be submitted to the Dispute Resolution Process set out in
Part 7 and the Agreement will continue in effect as if no review had been
initiated.
TERMINATION FOR DEFAULT
8.2 Subject to Section 5.6 and Section 6.6, either party will be entitled to
terminate this Agreement in accordance with the terms hereof by written notice
to the other if the other has become the subject of an Event of Default;
provided that if BPS is in breach of its obligations under Section 2.1 and not
under circumstances upon which a license has been granted under Section 2.2 or
Part 5, UCAR CARBON will have the usual remedies available under law or equity
and may terminate all licenses extended to BPS including the Exclusive License
except with respect to that limited license required for BPS's use of the
Materials and UCAR CARBON will not be entitled to terminate this Agreement with
regard to its obligations to supply BPS with the Materials.
NO PREJUDICE
8.3 The right to terminate this Agreement will not prejudice any other right or
remedy of either party in respect of the breach concerned (if any) or any other
breach.
NO FURTHER OBLIGATIONS
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8.4 Subject to Section 5.6 and Section 6.6 and the Collaboration Agreement, upon
the termination of this Agreement for any reason, except for any rights or
obligations which may have accrued before termination, or rights specifically
contemplated to continue after termination or arise as a result of termination,
neither party will have any further rights or obligations to the other under
this Agreement.
PART 9
MISCELLANEOUS
MODIFICATIONS, APPROVALS AND CONSENTS
9.1 No amendment, modification, supplement, termination or waiver of any
provision of this Agreement will be effective unless in writing signed by both
parties and then only in the specific instance and for the specific purpose
given.
FURTHER ASSURANCES
9.2 The parties will execute such further assurances and other documents and
instruments and do such further and other things as may be necessary to
implement and carry out the intent of this Agreement.
ENTIRE AGREEMENT
9.3 This Agreement and the Collaboration Agreement constitute the entire
agreement between the parties hereto and supersede all previous expectations,
understandings, communications, representations and agreements whether verbal or
written between the parties.
NOTICES
9.4 Every notice, request, demand, direction or other communication (each, for
the purposes of Section 9.4, Section 9.5 and Section 9.6, a "Notice") required
or permitted to be given pursuant to this Agreement will be deemed to be well
and sufficiently given if in writing and delivered by hand (or recognized
overnight courier service addressed as follows:
(a) if to BPS at:
0000 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx Xxxxxxxx
Xxxxxx X0X 0X0
Attention: President and Chief Operating Officer
Facsimile: (000) 000-0000
with a copy to BPS's Vice-President, Corporate Affairs at the
same address; and
(b) if to UCAR CARBON at:
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0000 Xxxx Xxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx
XXX 00000
Attention: The President
Facsimile: (000) 000-0000
with a copy to UCAR CARBON's General Counsel at the same address; or to such
other address as is specified by the particular party by Notice to the others.
DEEMED RECEIPT
9.5 Any Notice delivered as aforesaid will be deemed conclusively to have been
effectively given and received on the day Notice was delivered if it was on a
day that was a Business Day or on the next day that is a Business Day if it was
delivered on a day that was not a Business Day.
CHANGE OF ADDRESS
9.6 A party may at any time, by Notice to the others, change its address.
ENUREMENT
9.7 This Agreement will enure to the benefit of and be binding upon the parties
and their respective successors and permitted assigns.
APPLICABLE LAW
9.8 This Agreement will be deemed to have been made in British Columbia, Canada
and the construction, validity and performance of this Agreement will be
governed in all respects by the laws of British Columbia and applicable laws of
Canada. The application of the provisions of the United Nations Convention on
Contracts for the International Sale of Goods are hereby excluded.
ATTORNMENT
9.9 Each party irrevocably attorns to the exclusive jurisdiction of the courts
of British Columbia, Canada and all courts having appellate jurisdiction
thereover in respect of any proceeding arising out of or relating to this
Agreement.
JUDGMENT CURRENCY
9.10 If, for the purposes of obtaining a judgment in any court, it is necessary
to convert a sum awarded in Canadian Dollars (the "Original Currency") into
United States Dollars (the "Judgment Currency"), the parties agree that the rate
of exchange used
27
shall be established on the business day preceding the date on which the final
judgment is rendered by the court. If it is necessary to convert a sum awarded
in United States Dollars (the "Original Currency") into Canadian Dollars (the
"Judgment Currency"), the parties agree that the rate of exchange used shall be
established on the business day preceding the date on which the final judgment
is rendered by the court. The rate of exchange shall be determined by reference
to the Bank of Canada noon rate of exchange for Canadian to U.S. Dollars or U.S.
to Canadian as published by Reuters. In the event such rate is not available
through Reuters the rate shall be ascertained by reference to any other means by
which such rate is published from time to time by the Bank of Canada.
FORCE MAJEURE
9.11 Neither party will be liable to the other for default or delay in the
performance of its obligations under this Agreement if such default or delay is
caused by fire, strike, riot, war, act of God, delay of carriers, governmental
orders or regulation, complete or partial shutdown of plant by reason of
inability to obtain sufficient raw material or power, or any other occurrence
beyond the reasonable control of such party. The party whose performance is
prevented by any such occurrence will notify the other party of the same in
writing as soon as is reasonably possible after the commencement thereof, will
provide the other with full written particulars of such occurrence and attempts
made to remedy the same, will use commercially reasonable efforts to remedy such
occurrence with all reasonable dispatch and, upon cessation of the occurrence,
will give prompt written notice to the other party of the same. Should an event
of Force Majeure continue for such a period of time that UCAR CARBON will not be
able to meet BPS's monthly forecast as originally established in the Annual
Commitment for the Materials, UCAR CARBON shall use reasonable commercial
efforts to obtain an alternative source for performance which may include
leasing production time, assigning a temporary license to allow a third party
(which may include BPS) to fulfill the immediate production concerns and/or
other appropriate actions.
SEVERABILITY
9.12 If any provision contained in this Agreement is found by any court or
arbitrator for any reason to be invalid, illegal or unenforceable in any
respect,
(a) the validity, legality and enforceability of the remaining
provisions contained herein will not in any way be affected or
impaired thereby, unless in either case as a result of such
determination this Agreement would fail in its essential
purpose, and
(b) the parties will use their best efforts to substitute for any
provision that is invalid, illegal or unenforceable a valid
and enforceable provision which achieves to the greatest
extent possible the economic, legal and commercial objectives
of such invalid, illegal or unenforceable provision and of
this Agreement and, failing the agreement of the parties on
such a substitution within 30 days after the finding of the
court or arbitrator, either party may refer the matter for
dispute resolution under Part 7.
COUNTERPARTS
9.13 This Agreement may be executed in counterparts or by facsimile, each of
which will together, for all purposes, constitute one and the same instrument,
binding on the parties, and each of which will together be deemed to be an
original, notwithstanding that both parties are not
28
signatories to the same counterpart or facsimile.
ASSIGNMENT
9.14 Neither party may assign any right, benefit or interest in this Agreement
without the written consent of the other party, such consent not to be
unreasonably withheld, and any purported assignment without such consent will be
void. Notwithstanding the foregoing, upon notice to the other party, either
party may assign this Agreement to a wholly owned subsidiary of that party
without the other party's consent provided that no such assignment will release
the assignor from its obligations under this Agreement.
NO PARTNERSHIP
9.15 Nothing in this Agreement will create, or be deemed to create, a
partnership between the parties.
Dated as of the day and year first above written.
UCAR CARBON COMPANY INC. XXXXXXX POWER SYSTEMS INC.
By: By:
Authorized Signatory Authorized Signatory
By: By:
Authorized Signatory Authorized Signatory
29
SCHEDULE A
MATERIALS SPECIFICATIONS
SEE ATTACHED MATERIALS SPECIFICATIONS.
THE MATERIALS SPECIFICATIONS INCLUDED IN THIS SCHEDULE A MAY BE AMENDED BY THE
PARTIES AS CONTEMPLATED BY THE COLLABORATION AGREEMENT.
30
SCHEDULE A
----------------------------------------------------------------------------------------------------------------------
MATERIAL SPECIFICATION TITLE
Flexible Graphite [TEXT DELETED] Material [TEXT DELETED]
----------------------------------------------------------------------------------------------------------------------
AUTHOR DATE APPROVED DATE
Author: X. Xxxxxxxx Date: Oct 7, 1998 X. Xxxxxxxx July 12, 1999
----------------------------------------------------------------------------------------------------------------------
1. SCOPE
1.1. This specification covers flexible graphite material supplied
by UCAR as [TEXT DELETED]. The Specification covers several
possible [TEXT DELETED] and [TEXT DELETED].
2. APPLICABLE DOCUMENTS
2.1. American Society for Testing and Materials (ASTM)
2.1.1. - [TEXT DELETED] [TEXT DELETED] Measurement Technique
2.1.2. - [TEXT DELETED] [TEXT DELETED] Measurement
2.1.3. - [TEXT DELETED] [TEXT DELETED] and [TEXT DELETED] of
Gasket Materials
3. REQUIREMENTS
3.1. Precedence - In the event of any conflict between the
requirements of this specification and the referenced
documents, this specification shall govern.
3.2. Visual Requirements - The material shall have no gross
physical defects including [TEXT DELETED], [TEXT DELETED],
[TEXT DELETED] or [TEXT DELETED] on the surface. There may not
be more than [TEXT DELETED] between [TEXT DELETED] and [TEXT
DELETED] in diameter in any [TEXT DELETED] by [TEXT DELETED]
area. There shall be no [TEXT DELETED] more than [TEXT
DELETED] in diameter in the material.
3.3. Chemical Requirements - All flexible graphite material shall
conform to the following requirements:
-------------------------------------------------------------------------------------------------
Property Specification Tolerance Test Method
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
31
3.4. Physical Properties - Shall conform to the following
requirements:
---------------------------------------------------------------------------------------------------
[TEXT DELETED] gm/cm(2) [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.1
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[TEXT DELETED] mm [TEXT [TEXT [TEXT [TEXT
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[text deleted] [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.3
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[TEXT DELETED] mm [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.3
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.2
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.4
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT [TEXT See Section 4.5.2.4
DELETED] DELETED] DELETED] DELETED]
---------------------------------------------------------------------------------------------------
3.5. Dimensional Requirements - Plates produced from this material
shall conform to the dimensions specified on the relevant part
drawing. On occasion Xxxxxxx may request material to be sent
for testing purposes, only that does not have the dimensions
listed in this document. The results of tests requiring
specific dimensions will not be considered to be requirements
but should be performed and included in the Certificate of
Compliance. Such data should be labeled as such.
4. QUALITY ASSURANCE PROVISIONS
4.1. Responsibility for Inspection - Unless otherwise specified,
the supplier is responsible for the performance of all
inspections specified in Section 3. The supplier may use their
own, or any other facility suitable, for the performance of
the inspections specified herein.
4.2. Quality Verification - Xxxxxxx Power Systems Inc. will have
the right to subject any requested lot of material to any of
the inspection requirements specified to verify that the lot
will comply with the requirements specified herein.
4.3. Process Change Notification - The supplier shall provide
advance information in writing concerning any changes in
process or preservations from the product previously approved.
Approval to ship product incorporating changes shall be
dependant upon Xxxxxxx'x evaluation that these changes do not
violate this specification or the intended use of the product.
Xxxxxxx Power Systems Inc.
32
reserves the right to perform a qualification inspection if
necessary.
4.4. Certificate of Compliance - The supplier is required to
provide a certificate of compliance with data for each lot
number of material. Failure to supply a certificate may be
cause for rejection except as noted in section 3.4. The
supplier is required to provide the following data:
4.4.1. Material Lot Number, Purchase Order Number and BPS
Part Number.
4.4.2. Chemical Analysis (see Section 3.2.).
4.4.3. Physical Property Inspection Data (see Section 3.3).
4.5. Methods of Inspection
4.5.1. Chemical Requirements Inspection - A chemical
analysis shall be performed on each lot of material.
The analysis shall conform to the requirements of
Section 3.2.
4.5.2. Physical Property Inspection. The physical tests
shall be performed according to the following
methods.
4.5.2.1. [TEXT DELETED] - A sample of the [TEXT
DELETED] material shall be [TEXT DELETED] to
a known [TEXT DELETED] and [TEXT DELETED]
and [TEXT DELETED].
4.5.2.2. [TEXT DELETED] - [TEXT DELETED] samples
[TEXT DELETED] by [TEXT DELETED] are [TEXT
deleted] from [TEXT DELETED] on the [TEXT
DELETED]. Each of the samples is placed in
the [TEXT DELETED] and [TEXT DELETED] for
[TEXT DELETED]. The test parameters are:
---------------------------------------------------------------------------------------------
Test Condition Specification Tolerance Accuracy
---------------------------------------------------------------------------------------------
[TEXT DELETED] Load [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
Test Current [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
4.5.2.3. [TEXT DELETED] Strength - A sheet of the
material is [TEXT DELETED] to the [TEXT
DELETED]. [TEXT DELETED] samples of
specified size are [TEXT DELETED] from a
sample component in [TEXT DELETED] from each
other. The samples are tested according to
the requirements of [TEXT DELETED] according
to the following test parameters. The
ultimate flexural load shall exceed the
specified limit and the [TEXT
33
DELETED] at the [TEXT DELETED] shall exceed
the specified limit.
------------------------------------------------------------------------------------------------
Test Condition Specification Tolerance Accuracy
------------------------------------------------------------------------------------------------
Test Span [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Length [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Width [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Thickness [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Support and Load Pins [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
4.5.2.4. [TEXT DELETED]- A piece of material is
tested according to [TEXT DELETED]. The test
conditions are given in the following table:
------------------------------------------------------------------------------
Penetrator Preload Total Load
------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------
5. PACKAGING
5.1. Documentation - A packing list and certificate of compliance
will accompany each shipment. The packing list will contain
information as shown in Section 5.2. The certificate of
compliance will contain information as shown in Section 4.4.
6. REVISION HISTORY
6.1. New Issue. X. Xxxxxxxx
6.2. Change doc number to [TEXT DELETED] 07/10/98 M Sexsmith
6.3. Change [TEXT DELETED] thickness and [TEXT DELETED] numbers
27/10/98 M Sexsmith
6.4. Change all references to Grafoil to flexible graphite
(including document title), updated section 3.3 to include
[TEXT DELETED], and updated [TEXT DELETED] numbers. 02/09/99
X. Xxxxxxxxx
34
----------------------------------------------------------------------------------------------------------------------
MATERIAL SPECIFICATION TITLE
Flexible Graphite [TEXT DELETED] Material [TEXT DELETED]
----------------------------------------------------------------------------------------------------------------------
AUTHOR DATE APPROVED DATE
Author: X. Xxxxxxxx Date: July 20, 1999 X. Xxxxxxxx July 12, 1999
----------------------------------------------------------------------------------------------------------------------
1. SCOPE
1.1. This specification covers flexible graphite material supplied
by UCAR as blend [TEXT DELETED]. The Specification covers
[TEXT DELETED] and [TEXT DELETED].
2. APPLICABLE DOCUMENTS
2.1. American Society for Testing and Materials (ASTM)
2.1.1. - [TEXT DELETED] [TEXT DELETED] Measurement Technique
2.1.2. - [TEXT DELETED] [TEXT DELETED] Measurement
2.1.3. - [TEXT DELETED] [TEXT DELETED] and [TEXT DELETED] of
Gasket Materials
3. REQUIREMENTS
3.1. Precedence - In the event of any conflict between the
requirements of this specification and the referenced
documents, this specification shall govern.
3.2. Visual Requirements - The material shall have no gross
physical defects including [TEXT DELETED], [TEXT DELETED],
[TEXT DELETED] or [TEXT DELETED] on the surface. There may not
be more than [TEXT DELETED] between [TEXT DELETED] and [TEXT
DELETED] in diameter in any [TEXT DELETED] by [TEXT DELETED]
area. There shall be no [TEXT DELETED] more than [TEXT
DELETED] in diameter in the material.
3.3. Chemical Requirements - All flexible graphite material shall
conform to the following requirements:
-------------------------------------------------------------------------------------------------
Property Specification Tolerance Test Method
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
-------------------------------------------------------------------------------------------------
3.4. Physical Properties - Shall conform to the following
requirements:
35
--------------------------------------------------------------------------------------------------
[TEXT DELETED]gm/cm(2) [TEXT [TEXT [TEXT See Section 4.5.2.1
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] mm [TEXT [TEXT [TEXT
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT See Section 4.5.2.3
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] mm [TEXT [TEXT [TEXT See Section 4.5.2.3
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT See Section 4.5.2.2
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT See Section 4.5.2.4
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT [TEXT [TEXT See Section 4.5.2.4
DELETED] DELETED] DELETED]
--------------------------------------------------------------------------------------------------
3.5. Dimensional Requirements - Plates produced from this material
shall conform to the dimensions specified on the relevant part
drawing. On occasion Xxxxxxx may request material to be sent
for testing purposes, only that does not have the dimensions
listed in this document. The results of tests requiring
specific dimensions will not be considered to be requirements
but should be performed and included in the Certificate of
Compliance. Such data should be labeled as such.
4. QUALITY ASSURANCE PROVISIONS
4.1. Responsibility for Inspection - Unless otherwise specified,
the supplier is responsible for the performance of all
inspections specified in Section 3. The supplier may use their
own, or any other facility suitable, for the performance of
the inspections specified herein.
4.2. Quality Verification - Xxxxxxx Power Systems Inc. will have
the right to subject any requested lot of material to any of
the inspection requirements specified to verify that the lot
will comply with the requirements specified herein.
4.3. Process Change Notification - The supplier shall provide
advance information in writing concerning any changes in
process or preservations from the product previously approved.
Approval to ship product incorporating changes shall be
dependant upon Xxxxxxx'x evaluation that these changes do not
violate this specification or the intended use of the product.
Xxxxxxx Power Systems Inc. reserves the right to perform a
qualification inspection if necessary.
4.4. Certificate of Compliance - The supplier is required to
provide a certificate of compliance with data for each lot
number of material. Failure to supply a certificate may be
cause for rejection except as noted in section 3.4 The
supplier is required to provide the following data:
4.4.1. Material Lot Number, Purchase Order Number and BPS
36
Part Number.
4.4.2. Chemical Analysis (see Section 3.2).
4.4.3. Physical Property Inspection Data (see Section 3.3).
4.5. Methods of Inspection
4.5.1. Chemical Requirements Inspection - A chemical analysis shall
be performed on each lot of material. The analysis shall
conform to the requirements of Section 3.2.
4.5.2. Physical Property Inspection. The physical tests shall be
performed according to the following methods.
4.5.2.1. Area Weight - A [TEXT DELETED] of the [TEXT DELETED]
shall be [TEXT DELETED] to a known area [TEXT
DELETED] and [TEXT DELETED] and weighed.
4.5.2.2. [TEXT DELETED] - Two [TEXT DELETED] by [TEXT DELETED]
are [TEXT DELETED] from random locations on the
plate. Each of the samples is placed in the [TEXT
DELETED] and tested for [TEXT DELETED]. The test
parameters are:
---------------------------------------------------------------------------------------------
Test Condition Specification Tolerance Accuracy
---------------------------------------------------------------------------------------------
Compression Load [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
Test Current [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
Ambient Temperature [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
---------------------------------------------------------------------------------------------
4.5.2.3. [TEXT DELETED] - A sheet of the material is
compressed to the specified thickness. Two samples of
specified size are cut from a sample component in
perpendicular attitude from each other. The samples
are tested according to the requirements of [TEXT
DELETED] according to the following test parameters.
The [TEXT DELETED] shall exceed the specified limit
and the displacement at the [TEXT DELETED] shall
exceed the specified limit.
---------------------------------------------------------------------------------------------
Test Condition Specification Tolerance Accuracy
------------------------------------------------------------------------------------------------
Test Span [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Length [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Width [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Beam Thickness [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
Support and Load Pins [TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------------------------
37
4.5.2.4. [TEXT DELETED] - A piece of material is tested
according to ASTM F 36. The test conditions are given
in the following table:
------------------------------------------------------------------------------
Penetrator Preload Total Load
------------------------------------------------------------------------------
[TEXT DELETED] [TEXT DELETED] [TEXT DELETED]
------------------------------------------------------------------------------
5. PACKAGING
5.1. Documentation - A packing list and certificate of compliance
will accompany each shipment. The packing list will contain
information as shown in Section 5.2. The certificate of
compliance will contain information as shown in Section 4.4.
6. REVISION HISTORY
6.1. PA ECR 99 00172 00
6.2. ECN 99 00179 00 July 7, 1999 Initial Release.
6.3. Change all references to Grafoil to flexible graphite
(including document title), updated section 3.3 to include
[TEXT DELETED] determination, and updated [TEXT DELETED]
numbers. 02/09/99 X. Xxxxxxxxx
38
SCHEDULE B
FIRST YEAR PRODUCT FORECAST
SEE ATTACHED
39
SCHEDULE B
GRAFOIL MATERIAL FORECASTS
----------------------------------------------------------------------------------------------------------------------
Part No./Description [TEXT [TEXT [TEXT [TEXT [TEXT [TEXT [TEXT
DELETED] DELETED] DELETED] DELETED] DELETED] DELETED] DELETED]
----------------------------------------------------------------------------------------------------------------------
[TEXT DELETED] [TEXT
1 DELETED]
[TEXT DELETED],
[TEXT DELETED]
width, [TEXT
DELETED] length,
[TEXT DELETED] thick [TEXT [TEXT
2 [TEXT DELETED] DELETED] DELETED]
[TEXT DELETED] [TEXT [TEXT
3 DELETED] DELETED]
[TEXT DELETED],
[TEXT DELETED]
width, [TEXT
DELETED] length, [TEXT [TEXT [TEXT [TEXT
4 [TEXT DELETED] thick DELETED] DELETED] DELETED] DELETED]
[TEXT DELETED]
width roll, [TEXT
DELETED] thick on a
approx. [TEXT
DELETED] core [TEXT [TEXT [TEXT [TEXT [TEXT [TEXT [TEXT
5 DELETED] DELETED] DELETED] DELETED] DELETED] DELETED] DELETED]
----------------------------------------------------------------------------------------------------------------------
40
SCHEDULE C
FIRST YEAR PRODUCTS PRICING
SEE ATTACHED
41
SCHEDULE C
UCAR CARBON COMPANY INC.
X.X. Xxx 00000, Xxxxxxxxx, Xxxx 00000 X.X.X.
Date 08/03/99
Xxxxxxx Power Systems Inc.
0000 Xxxxxxxx Xxxxxxx Quotation Number: 99G1203
Xxxxxx, XX
Xxxxxx X0X 0X0 Inquiry Number:
Attn: X. Xxxxxx
In response to your inquiry, we are pleased to quote as follows:
----------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY DESCRIPTION PRICE
----------------------------------------------------------------------------------------------------------------------
"GRAFOIL" Products
Per Xxxxxxx Power Systems Supply Agreement
[TEXT DELETED] provided 7/29/1999
1 Volumes [TEXT DELETED], [TEXT DELETED] thick x [TEXT DELETED] $[TEXT
Per [TEXT x [TEXT DELETED] DELETED]/ea
DELETED] BPS P/N [TEXT DELETED]
2
[TEXT DELETED], [TEXT DELETED] thick x [TEXT DELETED] $[TEXT
3 x [TEXT DELETED] DELETED]/ea
[TEXT DELETED] [TEXT DELETED] x [TEXT DELETED] x [TEXT $[TEXT
4 DELETED] DELETED]/ea
BPS P/N [TEXT DELETED]
5 $[TEXT
[TEXT DELETED], [TEXT DELETED] x [TEXT DELETED] x [TEXT DELETED]/ea
DELETED]
$[TEXT
DELETED]/ea
[TEXT DELETED], [TEXT DELETED] x [TEXT DELETED] wide x [TEXT
DELETED]
SEE PARAGRAPH 1 ON REVERSE SIDE
----------------------------------------------------------------------------------------------------------------------
Delivery Point FCA Factory - Cleveland, Ohio
Items of Payment: Date Draft 30 Days
Estimated Time of Shipment From Plant: As Required
This date will be confirmed upon receipt of order. If it is
unsatisfactory please let us know.
The sale of the products described herein shall be governed by the
terms and conditions contained in any written contract currently
in effect between Buyer and Seller covering such sale. If there is
no such contract, then Seller hereby offers to sell such product
to Buyer only upon the terms set forth herein,
42
including those on the reverse side of this document.
This quotation is subject to acceptance within (30) days from the
date hereof.
Thank you for this inquiry. Be assured your order will receive our
prompt attention.
Very truly yours,
cc: X. Xxxxxxx UCAR
X.X. Xxxxx UCAR /s/ Xxxx X. Xxxxx
X.X. Xxxxx UCAR
43
SCHEDULE D
SUPPLIER EVALUATION SYSTEM CRITERIA
The Supplier Evaluation System Criteria shall consist of the following general
categories to be further defined and implemented at a later date subject to
Section 2.2 of the Agreement. Criteria has been established for the Delivery
category as set out in the attached "2.2 Delivers on Time" and "2.3 Delivers
Proper Quantities."
PRICE:
1. Competitive pricing
2. Advanced notice on pricing changes
3. Frequency of price reductions
4. Price accuracy
DELIVERY:
1. Meets due dates without constant follow-up
2. Delivers on time
3. Delivers proper quantities
4. Responses to emergency delivery requirements
5. Accurate documentation and information
6. Lead time competitiveness
QUALITY:
1. Meets Specifications
2. Product documentation
3. Product reliability
4. Durability
5. Product packaging
SERVICE:
1. Support on professional and technical matters
2. Inside sales support effectiveness, provides feedback from factory
3. Issues credit notes in a timely manner
4. Invoicing efficiency
44
2.2 DELIVERS ON TIME
Application:
Refers to the delivery of material, or completion of services requested
by way of purchase orders.
Question:
1. Does the vendor deliver ordered material or perform required
services on time?
Considerations:
Early deliveries usually mean early invoices. This has an adverse
effects on the Company's cash flow. Late deliveries have unfavorable
effect and can results in stock-outs (back orders) which inconvenience
the internal and external customers. Sometimes, late deliveries cause
the Company's customers to look elsewhere for product (loss of
opportunity for the Company).
The delivery date is the date agreed by both the buyer and the vendor.
The delivery date cannot be change without the approval of both the
buyer and the vendor. To allow for shipping and handling delays, the
Company applies a delivery grace period of two working days before or
after the required date. If the vendor delivers the product within this
period, the buyer considers the shipment on time. This performance
criteria item measures the delivery of each purchase order line item.
For example, an order for 3 pencils, 5 pens and 2 erasers would be
three (3) line items.
Supporting Documentation:
Purchase Order, Invoice, Order Confirmation.
This performance item is calculated using the following formula:
Formula: TLI= Total Line Items
LLI = Late Line Items (outside the two (2) day grace period
(TLI-LLI)/TLI x 100 = % of One-time Deliveries
The rating criteria will be as follows:
% of Line Items
Delivered on Time: Rating:
[TEXT DELETED]%- [TEXT DELETED]% E Highly Competitive (Exceptional)
[TEXT DELETED]%- [TEXT DELETED]% A Fully Competitive (Acceptable)
[TEXT DELETED]%- [TEXT DELETED]% M Generally Competitive
45
(Marginally Acceptable)
Less than [TEXT DELETED]% U Not Competitive (Unacceptable)
This PDQ'S Evaluation Criteria item will be measured primarily by
Xxxxxxx. The supplier will have direct input to this item and it will
be measured monthly.
Supplier Price, Delivery, Quality and Service Evaluation Criteria
2.3 DELIVER PROPER QUANTITIES
Application:
Refers to the delivery of material, or completion of services requested
by way of purchase orders.
Question:
1. How many incorrect quantities does the vendor ship?
2. Does the vendor split shipments on contracted items?
Considerations:
Incorrect quantities are either short shipments, over shipments or
split shipments. All of these conditions are significant contributors
to nonconformance costs. Short shipments and over shipments both
require vendor contact to rectify the problem. With split shipments the
vendor makes multiple shipments to fill the purchase order line item.
The Company incurs additional costs in handling material. Additional
costs are also incurred in accounting when the vendor sends a split
shipment invoices.
A grace quantity of five (5) percent on a under-shipment or ten (10)
percent on a over-shipment are acceptable.
Supporting Documentation:
Quantity Quotation, Purchase Order, Invoice, Order Confirmation.
This performance item is calculated using the following formula:
Formula: TLQ= Total Line Item Quantities Received
ILQ= Incorrect Line Item Quantities Received
(TLQ-ILQ)/TLQ x 100= % of Correct Line Item Quantities Received
The rating criteria will be as follows:
% of Line Items
Quantities Received: Rating:
46
[TEXT DELETED]% E Highly Competitive (Exceptional)
[TEXT DELETED]%- [TEXT DELETED]% A Fully Competitive (Acceptable)
[TEXT DELETED]%- [TEXT DELETED]% M Generally Competitive
(Marginally Acceptable)
Less than [TEXT DELETED]% U Not Competitive (Unacceptable)
This PDQ'S Evaluation Criteria item will be measured primarily by
Xxxxxxx. The supplier will have direct input to this item and it will
be measured monthly.
Supplier Price, Delivery, Quality and Service Evaluation Criteria
47
SUPPLY AGREEMENT
MADE AS OF AUGUST 5, 1999
BETWEEN
UCAR CARBON COMPANY INC.
AND
XXXXXXX POWER SYSTEMS INC.
