EXHIBIT 10.23
PURCHASE AGREEMENT BETWEEN
XXXXX AND UNIVERSAL
INTRODUCTION (THE PARTIES)
This Agreement, effective as of November 10, 1997, by and between XXXXX
INC., a company of the state of Delaware, having a principal place of
business at 000 Xxxxx Xxxxxx, Xxxxxx, XX 00000 (hereinafter referred to as
("XXXXX") and UNIVERSAL INSTRUMENTS CORPORATION (hereinafter referred to
as UNIVERSAL), a Corporation of the State of Delaware, having a principal
place of business at 00 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxx, 00000.
RECITALS
UNIVERSAL may purchase from XXXXX and XXXXX is willing to sell to
UNIVERSAL, Product for integration and installation by UNIVERSAL with
UNIVERSAL'S equipment upon the terms and conditions that are hereinafter
set forth.
THEREFORE, XXXXX AND UNIVERSAL AGREE AS FOLLOWS:
DEFINITIONS
For the purposes of this Agreement, and solely for that purpose, the terms
set forth herein will be defined as follows:
A. The "PA" is a document which identifies agreed to pricing of
Products to be provided by XXXXX to UNIVERSAL.
B. "Product" will mean those components and assemblies referenced by
part number and revision in the PA's identified in Exhibit A. PA's
referenced in Exhibit A may only be modified upon the mutual consent
of both parties.
C. "Replacement Parts" will mean all the individual parts, components
or assemblies used to maintain or repair UNIVERSAL machines.
1. SALES, PRICING AND PAYMENT
X. XXXXX agrees to sell to UNIVERSAL Products in accordance with this
AGREEMENT.
B. UNIVERSAL may offer to purchase additional Products from XXXXX. The
terms of this agreement apply to any additions mutually agreed by
XXXXX and UNIVERSAL. Such additions shall be added to a PA
identified in Exhibit A.
C. Exhibit B defines the method for establishing price and agreed to
cost reduction expectations.
D. If XXXXX offers Products to a third party at a price less than that
charged UNIVERSAL or a first tier source of UNIVERSAL, such lower
prices will be made available to UNIVERSAL and
made available to first tier sources of UNIVERSAL. Such lower prices
will be made available within thirty (30) calendar days of their
offer to a third party.
E. Payment to XXXXX for Products purchased by UNIVERSAL will be made in
US dollars, net 30 days after receipt of Product by UNIVERSAL.
2. SPECIFICATIONS AND DESIGN
No modifications to the specification or design of a Product listed on a
PA identified in Exhibit A will be made without UNIVERSAL'S prior written
consent. UNIVERSAL agrees to accommodate the change within twelve months
of notification.
3. TOOLING
A. All molds, jigs, fixtures, dies and patterns (hereinunder "Tooling")
paid for by UNIVERSAL will become the property of UNIVERSAL. Tooling
paid for or provided by UNIVERSAL under this Agreement will be
marked "Property of Universal Instruments Corporation" with the
appropriate tool number assigned and will be consigned to XXXXX.
UNIVERSAL has the right at any time to remove any or all UNIVERSAL
owned Tooling at no charge to UNIVERSAL. XXXXX will modify UNIVERSAL
owned Tooling, as directed by UNIVERSAL, maintain and provide all
necessary repairs, at UNIVERSAL'S expense for the Tooling herein.
XXXXX will be responsible for any damage not attributable to normal
wear and tear of Tooling. UNIVERSAL makes no warranties of any kind
as to the suitability of the Tooling provided and XXXXX assumes full
responsibility to qualify any or all Tooling in accordance with
UNIVERSAL approved process. XXXXX assumes all risks and liabilities
for property damage or personal injury that may arise from the
installation, modification, operation and removal of Tooling.
B. Tooling paid for by XXXXX will become the property of XXXXX.
X. XXXXX will restrict the use of Tooling developed and manufactured on
behalf of UNIVERSAL to process UNIVERSAL Product.
D. The provisions of this Particle 3 shall survive termination of this
Agreement.
4. PURCHASE COMMITMENT
A. UNIVERSAL'S obligation to purchase is limited to those commitments
established by UNIVERSAL'S Kanban, Linestocking, Vendor Schedule,
Purchase Order and agreed to exception as set forth in Exhibit C.
B. If the KANBAN delivery mechanism is used, UNIVERSAL shall only be
held liable for the cost of one Kanban release quantity or the
equivalent of four weeks demand, whichever the lesser. Release
quantity or demand will be defined by the Kanban lot sizing software
provided by UNIVERSAL. Reimbursement will only be made for material
that is unique to UNIVERSAL and has been obsoleted by engineering
change or has not been requested by UNIVERSAL for a period in excess
of one year.
C. If the LINE STOCKING delivery mechanism is used UNIVERSAL shall only
be held liable for the cost of a quantity equal to the average
weekly quantity delivered over the four week period prior to a
schedule change. Reimbursement will only be made for material that
is unique to UNIVERSAL and has been obsoleted by engineering change
or has not been requested by UNIVERSAL for a period in excess of one
year.
D. If a VENDOR SCHEDULE delivery mechanism is used UNIVERSAL shall only
be held liable for the cost of four weeks worth of unconsumed
requirements. XXXXX will be responsible for providing documentation
to substantiate a claim. Reimbursement will only be made for
material that is unique to UNIVERSAL and has been obsoleted by
engineering change or has not been requested by UNIVERSAL for a
period in excess of one year.
5. SHIPPING
X. XXXXX will package the Products for shipment to avoid damage during
normal handling and in accordance with UNIVERSAL'S packaging
specification 43233602.
B. All goods must be prepared for shipment at XXXXX'X expense in
conformance with the Carriers' tariffs to insure safe delivery at
the lowest cost. Containers and closures must meet the requirements
of the National Motor Freight Classification, Uniform Freight
Classification Rules and Regulations and tariffs of other common
Carriers applicable to the mode of transportation. XXXXX will xxxx
containers, packages, etc. with necessary lifting, loading and
shipping information, XXXXX should release shipment to the Carrier
with no valuations. If XXXXX prepays the transportation charges,
such charges must be supported by a copy of the Xxxxxxx'x xxxx or
other evidence satisfactory to UNIVERSAL. Failure to submit such
proof at the time UNIVERSAL is billed or within 30 days after such
evidence is requested by UNIVERSAL will constitute a waiver by XXXXX
of such charges. Excess shipping costs due to XXXXX'X delinquency or
failure to follow standard routing instructions without an
authorized deviation from UNIVERSAL will be XXXXX'X responsibility.
C. Releases/packing slips must reference UNIVERSAL'S part number, PA
number, quantity and warehouse location.
D. Products will be shipped F.O.B. shipping point to UNIVERSAL'S
designated locations.
6. QUALITY
XXXXX will be responsible for Product quality and where applicable
compliance with UNIVERSAL'S specifications and standards. UNIVERSAL may
reject any or all Product which contains defective material, workmanship,
or does not conform to UNIVERSAL'S specifications and standards. Rejected
material may be returned at XXXXX'X invoice price, plus additional
handling cost incurred by UNIVERSAL. Payment by UNIVERSAL will not
constitute acceptance.
7. WARRANTY AND REWORK
X. XXXXX expressly warrants all Product against defects resulting from
the design, workmanship, materials and/or manufacture of the Product
and will conform to specifications and standards for a period of two
years from the date of acceptance. Notice of all claims by UNIVERSAL
under this warranty will be given to XXXXX within two years of
delivery. Said Product must be operated within the limits of the
performance specifications. Provided that UNIVERSAL notifies XXXXX
as provided for above with respect to any defect, XXXXX will at
XXXXX'X expense and at XXXXX'X option, promptly replace or accept
the return of (and credit UNIVERSAL for) any defective Product. All
costs of shipment to and from KOLAR will be the responsibility of
KOLAR.
THIS WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES WHETHER STATUTORY,
EXPRESSED, OR IMPLIED, INCLUDING IMPLIED WARRANTIES OF FITNESS FOR
USE AND MERCHANTABILITY EXCEPT AS TO TITLE.
B. If received Product is found to be defective, and UNIVERSAL has the
capability to repair and time does not permit normal replacement
processing, XXXXX agrees to reimburse UNIVERSAL for the cost of that
repair. UNIVERSAL will notify XXXXX of the anticipated cost and
approval before starting repair.
8. SALE OF PRODUCT OR EQUIPMENT TO OTHERS
XXXXX agrees to sell Products made to UNIVERSAL'S drawing and/or
specification only to UNIVERSAL or UNIVERSAL designated third parties. It
is the responsibility of XXXXX to ensure that the Product ordered is for
direct sale to UNIVERSAL, or UNIVERSAL designated third parties, and not
to others. In the event that the Product ordered from XXXXX is from a
designated that request will be referred to UNIVERSAL'S Worldwide Parts
Service and Distribution for quotation and availability.
9. DISCONTINUANCE/ALLOCATION OF PRODUCT
XXXXX agrees to notify UNIVERSAL, in writing within 48 hours, after a
decision that a Product listed on a PA is being discontinued or going on
allocation. An appropriate product support plan will be developed jointly
with UNIVERSAL prior to the actual discontinuance or allocation. If
required by UNIVERSAL, XXXXX agrees to service and support form, fit and
function-compatible engineered replacements to UNIVERSAL for seven years
after the announcement to discontinue a Product.
10. PATENTS, COPYRIGHTS AND PROPRIETARY RIGHTS
A. Except with respect to Products manufactured to UNIVERSAL
specifications, XXXXX agrees to indemnify and hold UNIVERSAL and
their end users harmless against all claims that the Products
produced by XXXXX and any related documentation infringe any patent,
copyright, trade secrets or other intellectual property rights of
third parties.
XXXXX hereby represents to UNIVERSAL that it is has no knowledge of
any such claim of infringement. Each party hereby agrees to give the
other party prompt written notice of any claim of infringement of
which it hereafter becomes aware. XXXXX will assume the defense of
any suit, action, proceeding or objection based on any such claim of
infringement brought against UNIVERSAL and/or end user(s) relating
to the Products and/or any related documentation by reputable
counsel retained at the expense of XXXXX and will pay any damages
assessed against or otherwise payable by UNIVERSAL and/or end user
in any such suit as a result of the final disposition of any such
claim, suit, action, proceeding or objection. UNIVERSAL will give
XXXXX the cooperation it requires, at XXXXX'X sole cost for all
expenses incurred by UNIVERSAL except for salaries of the employees
of UNIVERSAL and fees and expenses of any counsel retained by
UNIVERSAL in the defense of any such claim, suit, action, proceeding
or objection. Notwithstanding the forgoing, UNIVERSAL may be
represented in any such suit by its Counsel at its own cost and
expense.
B. In the event of any claim that the use or sale of the Products or
any part thereof or any related documentation furnished by XXXXX is
alleged to infringe on any third party patent, copyright or other
intellectual property right, XXXXX, at its sole cost and expense,
will promptly and expeditiously take one of the following action:
(a) procure for UNIVERSAL the right to continue the use and sale of
the Products, part and/or documentation; (b) modify the infringing
portions of the Products, part and/or documentation so they become
non- infringing or (c) replace the Product with non-infringing
product with the same form, fit and function.
C. The provisions of this Article 10 shall survive any termination of
this Agreement.
11. TERM AND TERMINATION
A. Unless earlier terminated pursuant to the other provisions of this
Article 11, this Agreement will be deemed effective as of the date
written above and will continue in full force and effect for a
period of four years.
B. Except as expressly provided herein, the expiration or termination
of this Agreement will not affect or impair the rights, liabilities,
and obligations of either party to the other as provided pursuant to
this Agreement or under any purchase order for Products existing
prior to such expiration or termination, nor will such expiration or
termination relieve either party of any obligation or liability
accrued under this Agreement or pursuant to any purchase order prior
to such expiration or termination, nor effect or impair the rights
of either party arising under this Agreement prior to such
expiration or termination.
C. In the event that there is a material breach by UNIVERSAL of any of
the terms or conditions of this Agreement and if UNIVERSAL fails to
cure such breach within 30 days after written notice from XXXXX
describing the breach and requesting its cure, then XXXXX may
terminate this Agreement effective at the end of said 30 days;
12. SEVERABILITY
In case any one or more of the provisions contained in this Agreement will
for any reason be held to be invalid, illegal, or unenforceable in any
respect, except in those instances where removal or elimination of such
invalid, illegal, or unenforceable provision or provisions would result in
a failure of consideration under this Agreement, such invalidity,
illegality, or unenforceability will not affect any other provision
hereof, and this Agreement will be construed as if such invalid, illegal,
or unenforceable provision had never been contained herein.
13. FORCE MAJEURE
Neither party shall be responsible for delays in performance due to causes
beyond its control, including but not limited to acts of God, war (whether
declared or undeclared), fire or strikes.
14. ENTIRE AGREEMENT
This Agreement and the Exhibits attached hereto shall constitute the
entire agreement between UNIVERSAL and XXXXX with respect to the
transactions contemplated hereby and supersedes all prior agreements and
understandings between the parties relating to such transactions. No
amendment to or modification of this Agreement will be binding unless in
writing and signed by duly authorized representatives of both parties and
attached hereto as Exhibit D. No provision contained on the reverse side
of any XXXXX Quotation, acceptance, invoice or any other XXXXX
acknowledgment form will be effective.
15. ASSIGNABILITY
This Agreement may not be assigned by either party without the prior
consent of the other party however, either party may assign this Agreement
to any entity which acquires substantially all of the assets or business
of the Assignor, without such consent.
16. RELATIONSHIP OF THE PARTIES
Both parties are independent contractors under this Agreement. Nothing
contained in this Agreement is intended or is to be construed to
constitute UNIVERSAL and XXXXX as partners, agents, or joint ventures with
respect to this Agreement. Neither party hereto shall have an express or
implied right or authority to assume or create any obligations on behalf
or in the name of the other party or to bind the other party to any
contract, agreement, or undertaking with any third party.
17. COMPLIANCE WITH LAWS
XXXXX will comply with all applicable federal, state and local laws, rules
and regulations. XXXXX warrants that all goods and services supplied
pursuant to this Agreement will have been produced in compliance with all
applicable federal, state and local laws, orders, rules and regulations.
XXXXX will indemnify UNIVERSAL and its customers for loss or damage
sustained because of XXXXX'X noncompliance with any law, order, rule or
regulation.
XXXXX will furnish to UNIVERSAL any information required by UNIVERSAL and
reasonably available to XXXXX during the term of the Agreement or any
extensions hereof to enable UNIVERSAL to comply with the requirements of
any federal, state and/or government agency.
18. USE AND HANDLING OF HAZARDOUS MATERIALS
A. "Hazardous Materials" will mean any hazardous or toxic substance,
material or waste (including constituents thereof) that is or
becomes regulated by governmental authorities including any material
or substance that is:
i. listed or defined as a "hazardous waste", "hazardous
substance" or "toxic substance" under the environmental laws;
ii. petroleum and its by-products;
iii. asbestos, radon gas, urea formaldehyde foam insulation;
iv. polychlorinated biphenyl; or
v. designated as a hazardous or toxic substance or waste or by
words similar in import by any local, state, or federal
environmental law or regulation.
B. Prior to commencing any activity and/or bringing any materials onto
UNIVERSAL premises (owned or leased), XXXXX will:
i. Identify to the designated UNIVERSAL representative all
hazardous materials that XXXXX will use to perform the
services identified in the specification and indicate the
amount of such hazardous material that will be required to
perform the services on a weekly basis. All materials to be
used on UNIVERSAL premises must be reviewed and approved by
the designated UNIVERSAL representative.
ii. Clearly label all hazardous materials which UNIVERSAL permits
XXXXX to bring onto UNIVERSAL premises and inform all
employees of UNIVERSAL who have a need to know as to the
nature and potential hazards of such materials.
iii. Provide to the designated UNIVERSAL representative Material
Safety Data Sheets (OSHA form 20 or the equivalent) for all
hazardous materials identified above.
19. OZONE DEPLETING SUBSTANCES
The manufacturer/XXXXX of any material purchased under this Agreement is
certifying by acceptance of this Agreement that either the material is not
manufactured with any substance that xxxxx public health and environment
by destroying ozone in the upper atmosphere or if the material was
manufactured with ozone destroying substances, the manufacturer/XXXXX
certifies that the material is labeled according to the Clean Air Act
Amendments of 1990 public law 101-549 Section 611(d)(2) or any alternative
labeling that the Environmental Protection Agency has determined
acceptable.
20. EQUAL EMPLOYMENT OPPORTUNITY AND AFFIRMATIVE ACTION
This order incorporated by reference: (a) all provisions of 41 C.F.R.
60-1.4 and 60-2 as implemented by Federal Acquisition Regulation (FAR)
52.222-26(b)(1)-(11) pertaining to the Equal Opportunity clause; (b) all
provisions of 41 C.F.R. 60-250 as implemented by FAR 52.222-35 and - 37
pertaining to employment reports and affirmative action for disabled
veterans and veterans of the
Vietnam Era; and (c) all provisions of 41 C.F.R. 60-741 as implemented by
FAR 52.222-36 pertaining to affirmative action for handicapped/disabled
workers. XXXXX agrees to comply with any and all applicable State and
Local Government Equal Employment Opportunity and Affirmative Action laws,
including any and all applicable statutes, rules, regulations, ordinances
and other guidelines.
21. EEO-1 REPRESENTATION
XXXXX represents that it has submitted Standard Form 100 (EEO-1)
compliance reports as required by 41 C.F.R. 60-1.7 as implemented by FAR
52.222-22.
22. CERTIFICATION OF NON SEGREGATED FACILITIES
KOLAR certifies that in compliance with 41 C.F.R. 60-1.8 as implemented by
FAR 52.222-21, it does not and will not maintain or provide for its
employees any segregated facilities at any of its establishments and that
it does not and will not permit its employees to perform their services at
any location under its control where segregated facilities are maintained.
XXXXX agrees that breach of this certification is a violation of the Equal
Opportunity clause incorporated herein. XXXXX further agrees that it will
either: (a) obtain certifications of non-segregated facilities from
proposed subcontractors for specific time periods; or (b) obtain
certifications of non-segregated facilities from proposed subcontractors
before the award of any subcontracts subject to the Equal Opportunity
clause will retain such certifications in its files and forward the Notice
set forth in FAR 52.222-21 to proposed subcontractors.
23. APPLICABLE LAW
This Agreement will be governed by and construed in accordance with the
laws of the State of New York without regard to the conflicts of laws
provisions thereof.
24. EXHIBITS
The Exhibits listed below are attached and made a part of this Agreement:
25. REFERENCE MATERIAL
The following reference material can be found on the UNIVERSAL web site
"xxx.xxx";
Kanban Procedure
Packaging Specification
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the date first above written.
UNIVERSAL INSTRUMENTS XXXXX
CORPORATION
( ) BY: BY:
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Xxx xxXxxxx (date) (date)
Vice President Corporate Operations
( ) BY: BY:
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Xxxxxxxx Xxxxx (date)
Purchasing Agent, Commodity Team Leader
