Exhibit 10.9
PURCHASE AGREEMENT
This Agreement, effective March 1, 2001 is between CFC International, a
Delaware corporation, with offices at 000 Xxxxx Xxxxxx, Xxxxxxx Xxxxxxx,
Xxxxxxxx 00000 ("Seller") and Xxxxxx Healthcare Corporation, a Delaware
corporation, with offices at Xxx Xxxxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxx 00000 on
behalf or its self and its affiliates (entities controlling, controlled by, or
under common control with Baxter)("Buyer").
1.0 Background
1.1 Seller produces hot stamping foil which conforms and meets the
Specification Requirements submitted, accepted and in Seller's possession for
the Specification numbers listed attached in the Exhibit A., hereafter referred
to as "Products". Product Specifications may be revised from time to time and
new Specifications and numbers added by mutual agreement between parties. Buyer
requires foil for use in printing flexible packaging.
2.0 Distribution
2.1 Subject to the terms and conditions of this Agreement, Seller shall
manufacture and sell Products to Buyer, and Buyer shall purchase Products for
manufacture into goods for use or resale in any country in the world. Buyer
agrees to purchase all their global foiling requirements from seller, or as
stated in Section 13.2.
3.0 Shipment of Products
3.1 Seller will ship Products, F.O.B. Seller's facility, freight
collect, to locations specified by Buyer and via carriers specified by Buyer.
3.2 Seller agrees to maintain negotiated consignment inventory at
Xxxxxx'x locations per specific plant consignment agreements.
4.0 Prices
4.1 Seller will sell Product to Buyer and Buyer agrees to buy the
Product from Seller. Prices shall be firm during the first year of this
Agreement (March1, 2001 through February 28th, 2002) as per the attached Exhibit
A. However, after the first year: Buyer's pricing will be adjusted by one half
of the raw material price change if greater than 5% adjusted for the "Foil
Composition Percentage" consisting of the following components:
Foil Composition US 2001 Raw Germany 2001
Components Percentage Material USD Raw Material Euro
---------- ---------- ------------ -----------------
Carrier Film 40% $1.63 per pound $ 1.79 per pd
Solvent 10% $ .41 per pound $ .45 per pd
Pigment/Plasticizer/Ink 15% (To be negotiated (To be negotiated
Energy 10% if if
Labor/Overhead 25% excessive) excessive)
Any price changes will require a 30-day prior written notice, including written
justification for the change. Both CFC International and Xxxxxx Healthcare will
track price changes in the polypropylene and polyester industry and use these
changes as a guide for any Product price increases or decreases.
Formula Cost Increase/Decrease:
Percentage Increase = Percentage of Increase Materials 2001 Base Period x one
half (.5) the Material (above 5%) - cost increase x percentage breakdown of
costs.
New Unit Cost = Percentage Increase plus 100% x unit cost *Note: Same formula to
be applied for cost decreases on materials.
Example:
Carrier film increases 30% (30% - 5% = 25%)
Percentage Increase = 25% x .5 x .40 = 5%
New Unit Price = 105% x .38 (Unit Cost) = $.399
4.2 Seller and Buyer will work to reduce non-value added costs
throughout the duration of our contract. Cost reduction efforts will include
twice yearly meetings to review potential cost elimination ideas, implement
strategies and identify future projects. Our goal will be to reduce our total
cost by 5% per year which can be measured in, quantifiable dollars.
4.3 CFC agrees to reduce contract pricing 2.5% per year for the
second year of this Agreement and an additional 2.5% during the third year of
this Agreement effective March1, 2002 and 2003 with orders shipped on or after
the anniversary date. This price reduction applies to all locations except
Mexico, and Latin America (Mexico, Brazil, and Colombia).
5.0 Payment
5.1 The terms of payment for the Product purchased by Buyer under this
Agreement shall be net 30 days from invoice date.
6.0 Purchases and Delivery
6.1 During the terms of this agreement, Seller shall sell and Buyer
shall purchase, on an annualized basis, Buyer's requirements for Products
(Domestic and International locations).
6.2 Any delay in the performance of any of the duties or obligations of
either party shall not be considered a breach of this Agreement and the time
required for performance shall be extended for a period equal to the period of
such delay, provided that such delay is caused by the acts of God, acts of the
public enemy, insurrections, riots, labor disputes, including strikes, lockouts,
or boycotts, fires, explosions, floods, droughts, or other unforeseeable causes
beyond the control and without the fault or negligence of the party affected.
The party so affected shall give prompt written notice to the other of such
cause as rapidly as possible, and shall promptly notify the other when such
cause has terminated.
6.3 If Seller is unable to deliver for any such reason, Buyer may take
all steps reasonably necessary to assure itself of sufficient supply of hot
stamping foil, including committing to purchase more than necessary for the
expected period of delay, if necessary, to obtain hot stamp foil at a reasonable
price and when and where needed or obtain from another supplier if unavailable
through seller.
7.0 Quality Control
7.1 Seller warrants that the Products will be manufactured by Seller
and shall meet the written Specification Requirements as described in the
Specification Sheets and listed by Specification Number in Exhibit A. Seller
warrants the Products will meet any changes in the Specifications that the
parties expressly agree to prior to such changes.
7.2 All Products shall be subjected to a quality control inspection by
Seller in accordance with Seller's current quality control standards and system.
Seller's quality control standards and systems have been reviewed by Buyer prior
to the date of this Agreement.
7.3 Seller shall permit Buyer to review periodically its quality
control procedures and records, and with a Seller representative present, to
visit Seller's facilities at reasonable times, in order to assure satisfaction
of the requirements of this Paragraph 7.0.
7.4 Buyer, at its discretion, may after delivery to it of Products,
inspect and/or audit the products for integrity and adherence to the
Specifications. If any Product fails to conform to the Specifications, Buyer may
return the Product to Seller for credit or replacement, with all freight and
out-of-pocket handling at Seller's expense.
8.0 Guarantee
8.1 All Products sold to Buyer under this Agreement are hereby
guaranteed as set forth in Exhibit A (price and Specification Sheets in your
possession.)
9.0 Warranty and Indemnification
9.1 Seller warrants that Products are in compliance with the
Specifications, and that the manufacture and sale of the Products do not and
will not infringe any patent. To the extent permitted by law, Seller
specifically disclaims any other express or implied warranties. Seller does not
make any other warranties or representations except as specifically set forth in
this Agreement and in the labeling of the Products. In no event shall Seller be
liable for indirect, incidental or consequential damages.
9.2 Seller will defend, indemnify and hold Buyer harmless with respect
to any liability of Buyer for infringement of any patent arising out of the
purchase or use of Products supplied to Buyer under this Agreement. Buyer shall
promptly communicate to Seller any claim of infringement it receives. Buyer will
cooperate fully with Seller in defending or otherwise resolving any such charge
of infringement. Seller will have full control of the defense of any litigation
brought against Buyer for alleged infringement by Products supplied under this
agreement. Buyer, at its expense, shall be entitled to be represented by its own
counsel in any litigation which is controlled by Seller. Seller agrees to bear
all costs and expenses of litigation, including its own attorney fees in
connection with any charge of infringement by the Products supplied under this
Agreement, and Seller shall reimburse Buyer for any disbursement made by Buyer
in satisfaction of any final judgment issued in any such litigation.
10.0 Term of Agreement
10.1 This Agreement shall commence on March 1, 2001 and shall continue
for a period of three (3) years through February 28, 2004, ("Term"), unless
terminated in accordance with Section 11.
11.0 Termination
11.1 Either party may terminate this Agreement for any material breach
of this Agreement by the other party, by giving thirty (30) days prior written
notice to the other party that such termination shall take effect if such breach
is not cured as of the expiration of said thirty (30) day period.
11.2 Either party may terminate this Agreement effective immediately
upon the giving of written notice, if the other party shall file a petition in
bankruptcy, or shall be adjudicated a bankrupt, or shall take advantage of the
insolvency laws of any state, or shall make an assignment for the benefit of
creditors, or shall be voluntarily or involuntarily dissolved, or shall have a
receiver, trustee or other court officer appointed for its property. Seller
shall deliver and Buyer shall pay for all Products ordered by Buyer under
purchase orders issued by Buyer prior to the date of such written notice of
termination and not canceled by Buyer. Further, such termination shall not
relieve either party of any rights accrued and obligations incurred, but not yet
satisfied, prior to termination of this Agreement.
12.0 Effect of Termination
12.1 The termination of this Agreement, if such termination is for any
reason except breach of this Agreement by Buyer, will not operate to relieve
Seller from its obligation to deliver all Products ordered by Purchase orders of
Buyer received by Seller prior to receipt of written notice of such termination.
Such termination shall not relieve Buyer from accepting and paying for all
orders in the production schedule.
13.0 Other Provisions
13.1 All sales of the Products by Seller to Buyer shall be subject to
the terms, conditions and provisions of this Agreement and shall not be subject
to the terms and conditions contained on any purchase order of Buyer or
confirmation or invoice of Seller except insofar as any such purchase order or
confirmation establishes (a) the quantity of Products, (b) the delivery date,
and (c) delivery location of such Products.
13.2 If, during the term of this Agreement, Baxter receives a written
offer with better pricing, terms and conditions or technology compatible with
Xxxxxx'x requirements, from a supplier to supply products which are of like
quality with any of the Products supplied hereunder, and which are deliverable
in like quantities, Baxter will notify Seller within thirty (30) days after
receipt from Baxter of such notice, Seller shall, at its option (i) agree upon
such better pricing, terms and conditions, or technology, or (ii) permit Baxter
to purchase from the other source during the time such other source offers
Baxter better pricing, terms and conditions, or technology, and the quantities
so purchased by Baxter shall be deducted from any quantities covered by this
Agreement.
13.3 This Agreement contains the entire agreement between the parties
relating to the subject matter herein and all prior proposals, discussions, and
writings by and between the parties and relating to the subject matter herein
are superseded by this Agreement. None of the terms of this Agreement shall be
deemed to be waived by either party or amended unless such a waiver or amendment
is in writing and is signed by the party to be charged with such waiver or
amendment, and such writing recites specifically that it is a waiver of, or
amendment to, the terms of this Agreement.
13.4 All notices and demands required or permitted to be given or made
pursuant to this Agreement shall conclusively be presumed for all purposes of
this agreement to be given or made at the time the notice or demand is
personally given or made, or at the time it is placed in an envelope and
deposited in the United States mail, with sufficient postage prepaid, addressed
as follows:
If to Buyer If to Seller
----------- ------------
Vice President of Purchasing Sr.Vice President, International Sales
(I.V. Systems Division) CFC International
Xxxxxx Healthcare Corporation 000 Xxxxx Xxxxxx
Xxxxx 120 and Wilson Xxxxxxx Xxxxxxx, XX 00000
Xxxxx Xxxx, XX 00000
or to such other address as to which either party may notify the other.
13.5 This agreement shall be binding upon and inure to the benefit of
the parties hereto, their successors and assigns. This Agreement shall be
assignable by Buyer to any of its affiliates without the consent of Seller, by
either party with the written consent of the other, or by either party without
the consent of the other to purchaser of all or substantially all of the assets
of its business to which this Agreement relates.
13.6 This Agreement is deemed to have been entered into in the State of
Illinois and its interpretations, construction, and the remedies for its
enforcement of breach are to be applied pursuant to and in accordance with the
laws of the State of Illinois.
13.7 In the event that a court of competent jurisdiction holds that
particular provisions or requirements of this Agreement are in violation of any
law, such provisions or requirements shall be enforced and shall remain in full
force and effect to the extent they are not in violation of any such law or not
otherwise unenforceable, and all other provisions and requirements of this
Agreement shall remain in full force and effect.
In Witness Whereof, the parties have caused this Agreement to be executed by
their authorized representatives.
XXXXXX HEALTHCARE CORP CFC INTERNATIONAL
By:_____________________________ By:_____________________________
Xxxx Xxxxxxxxx Xxxxxx X. Xxxxxxx
Title: V.P. Purchasing Title: Sr. Vice President,
International Sales
Date:___________________________ Date:___________________________
Date:___________________________ Date:___________________________
