EXHIBIT 10.14
SUPPLY AGREEMENT
This Supply Agreement (hereinafter "Agreement") is effective as of the 1st day
of January, 2002, by and between CROWN CORK & SEAL COMPANY, INC., a Pennsylvania
corporation, with a place of business at Xxx Xxxxx Xxx, Xxxxxxxxxxxx, XX 00000
(hereinafter the "Supplier") and COTT CORPORATION, a Canada corporation, with a
place of business at 000 Xxxx Xxxxxx, Xxxxxx-Xxxxxx, Xxxxxx X0X 0X0 (hereinafter
"Buyer").
IN CONSIDERATION OF the sum of one dollar ($1.00) now paid by each of the
parties hereto to the other (the receipt and sufficiency of which are hereby
acknowledged by each of the parties hereto), the mutual covenants contained
herein and other good and valuable consideration, the parties hereto agree as
follows:
1. SCOPE; PRODUCTS; SPECIFICATIONS
(a) Supplier hereby agrees to supply to Buyer and its current and future
affiliates world-wide (and Buyer collectively with such affiliates, or
any such entity individually, will hereinafter sometimes be referred
to as the "Buyer Group"), and Buyer agrees to purchase from Supplier,
except as otherwise provided in this Agreement, 100% of Buyer Group's
requirements (as soon as practicable following the expiration of any
pre-existing contractual commitments, and with the exception of:
CONFIDENTIAL TREATMENT REQUESTED for the following products (the
"Products"), in accordance with and pursuant to the terms of this
Agreement:
Aluminum beverage cans, in sizes of 355ml, 330ml, 250ml, 200ml
and 150ml, and ends, in sizes of 202 (and 206 where required by
Buyer) and any other sizes required by Buyer Group, based on
Buyer Group's current portfolio of beverage products
(collectively, the "Agreed Can/End Sizes"). It is understood and
agreed that, subject to the balance of this Section 1 and to
Section 3(h), for North America the can size will be 355ml and
the end size will be 202.
At Buyer's option where Supplier has the available equipment
capability, Supplier will supply cans in any other sizes that are less
than 355ml and ends in any other sizes in addition to the Agreed
Can/End Sizes. If Supplier is unable or unwilling to supply any such
other can and/or end sizes in addition to the Agreed Can/End Sizes
where Supplier has the equipment capability, Supplier shall be deemed
to have failed to supply Products in accordance with its obligations
under this Agreement. For purposes of this Agreement, the term
"equipment capability" shall mean the Supplier having the installed
equipment available to produce such Products in a plant already
supplying such Products or substantially equivalent products to
Supplier's other customers' filling locations located in the same
country (and for such purposes Canada and the United States shall be
deemed to be a single country) as the Buyer Group facility that Buyer
proposes to be supplied by Supplier, whether or not Supplier has any
available capacity to run Products on such equipment and whether or
not Supplier's plant is actually located in such country. If in the
future Buyer Group requires an end or can size for which Supplier does
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not have equipment capability, Buyer shall first give Supplier notice
of its desire to source such cans and ends and a period of thirty (30)
days within which to reach agreement with Buyer, both parties acting
reasonably and in good faith, pursuant to which Supplier may supply
such cans and ends to Buyer Group. If no agreement is reached within
such thirty (30) day period, Buyer Group shall be free to purchase
such ends or cans from another supplier, without being considered to
be in default of its obligations under this Agreement. If Supplier has
the equipment capability to produce any such other cans and ends but
not the capacity to do so, Supplier will take whatever steps are
necessary to add the capacity such that it shall be able to begin
production for Buyer Group within ninety (90) days of being requested
to do so by Buyer, failing which Supplier shall be deemed to be in
default of its obligations to supply Products under this Agreement and
in addition to all of Buyer's other rights and remedies, Buyer shall
be entitled to source such cans and ends from other suppliers without
being considered to be in default of its obligations under this
Agreement.
Upon mutual agreement of Supplier and Buyer, both acting reasonably
and in good faith, and where Supplier has the equipment capability,
Supplier will also supply steel cans and ends in the above sizes in
accordance with this Agreement and such cans and ends shall also be
considered to be "Products". If Supplier has the equipment capability
and does not commence supplying steel cans and ends, as aforesaid,
within ninety (90) days of Buyer's request, Buyer shall be entitled to
source such cans and ends from other suppliers without either party
being considered to be in default of its obligations under this
Agreement. If in the future Buyer Group requires a steel can and/or
end for which Supplier does not have equipment capability, Buyer shall
first give Supplier notice of its desire to source such cans and ends
and a period of thirty (30) days within which to reach agreement with
Buyer, both parties acting reasonably and in good faith, pursuant to
which Supplier may supply such cans and ends to Buyer Group. If no
agreement is reached within such thirty (30) day period, Buyer Group
shall be free to purchase such cans or ends from another supplier,
without either party being considered to be in default of its
obligations under this Agreement. For greater clarity, it is
understood and agreed that in no event can Buyer Group be required to
convert to steel cans and ends from aluminum cans and ends.
Notwithstanding the above or anything else in this Agreement to the
contrary, the parties acknowledge that Supplier Group shall have no
obligation to supply Buyer Group with aluminum cans and/or ends in a
country where Supplier Group is already supplying the market with only
steel cans and/or ends and, in particular, the parties acknowledge
that the Products currently being supplied and that shall be supplied
by Supplier Group to Buyer Group in Spain shall be steel cans and
ends. CONFIDENTIAL TREATMENT REQUESTED
(b.1) CONFIDENTIAL TREATMENT REQUESTED
(b.2) Any Buyer Group manufacturing facilities that are currently under a
supply agreement with another vendor will be supplied by Supplier as
soon as practicable following the termination date of the contract(s).
CONFIDENTIAL TREATMENT REQUESTED
(c) Supplier and all of Supplier's current and future affiliated companies
world-wide (collectively the "Supplier Group") will be bound by this
Agreement. With respect only
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to Buyer Group's requirements for Products for any present or future
Buyer Group manufacturing facilities CONFIDENTIAL TREATMENT REQUESTED
located outside of North America, the United Kingdom, Mexico and Spain
(it being understood and agreed, for greater clarity, that Supplier
has an absolute obligation pursuant to the terms of this Agreement to
supply Products to Buyer Group CONFIDENTIAL TREATMENT REQUESTED
filling locations within North America, the United Kingdom, Mexico and
Spain), in the event that Supplier Group (including for such purposes,
controlled joint venture entities in which any member of Supplier
Group is a member) has the equipment capability but does not have the
available capacity in an existing facility to support Buyer Group's
acquisitions or expansion, Supplier shall add capacity within a time
period not to exceed twelve (12) months in order to so supply, failing
which Supplier shall be deemed to have failed to supply Products in
accordance with its obligations under this Agreement.
(d) For purposes of this Agreement, "affiliate" of any party means any
entity that, directly or indirectly, controls, is under common control
with or is controlled by that party and "affiliated" has a
corresponding meaning. For purposes of this definition and this
agreement, "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with"), as used with respect
to any entity, shall mean the possession, directly or indirectly, of
more than 50% of the voting securities of such entity.
(e) Notwithstanding anything in this Agreement to the contrary, Supplier
shall have no obligation to supply Products to filling locations
located in any countries outside North America, the United Kingdom,
Spain CONFIDENTIAL TREATMENT REQUESTED and Mexico if Supplier Group or
controlled joint venture entities in which any member of Supplier
Group is a member does not already have the equipment capability
within, or serving customers in, any such country, and Buyer Group
shall be free to purchase cans and ends in respect of filling
locations in such countries from other suppliers without being
considered to be in default under this Agreement.
(f) The specifications for the Products (including palletizing, on a plant
by plant basis) CONFIDENTIAL TREATMENT REQUESTED consist of the
specifications for those Products currently being produced by Supplier
for Buyer Group (the "Specifications"). Supplier will provide Buyer
notice of any proposed future changes to the current Specifications at
any Designated Location(s) and will obtain Buyer's written approval
thereto prior to implementation. CONFIDENTIAL TREATMENT REQUESTED
Supplier will provide Buyer with all necessary information and product
samples required by Buyer in order for Buyer to make an informed
determination on the proposed changes. CONFIDENTIAL TREATMENT
REQUESTED Buyer will notify Supplier of its acceptance or rejection of
the proposed changes within ninety (90) days of its receipt of all of
the above.
(g) If Supplier is required under this Agreement to make a new investment
to add capacity in order to supply Buyer Group in a country where
Supplier is not supplying Buyer Group at the time the request to
supply is made by Buyer, Supplier has the option to require Buyer to
enter into a purchase commitment for that country ("Additional
Commitment")
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for a term of up to five years (the exact term being at Supplier's
sole discretion) with all of the terms and conditions of this
Agreement to apply thereto except that pricing shall be CONFIDENTIAL
TREATMENT REQUESTED.
CONFIDENTIAL TREATMENT REQUESTED
(h) Notwithstanding anything in this Agreement to the contrary Supplier
will not be obliged to supply Products to Buyer Group pursuant to the
terms of this Agreement in any countries other than Canada, United
States, Mexico, United Kingdom and Spain until such time as the annual
volume of purchases by Buyer Group, CONFIDENTIAL TREATMENT REQUESTED
in the aggregate, reaches 4 billion cans, excluding any future volume
that is acquired by Buyer Group and thereafter supplied by Supplier
pursuant to this Agreement where any such incremental volume was
already being supplied by Supplier immediately before it becomes part
of the requirements of the Buyer Group, CONFIDENTIAL TREATMENT
REQUESTED.
2. TERM
This Agreement shall, subject to any early termination in accordance with the
terms hereof, be in effect for a period of five (5) years commencing on January
1, 2002 and expiring on December 31, 2006 (the "Term").
3. PRICING AND PAYMENT
(a) The prices (the "Prices") charged to Buyer for the Products are
CONFIDENTIAL TREATMENT REQUESTED, and are subject to adjustment
CONFIDENTIAL TREATMENT REQUESTED. Other than CONFIDENTIAL TREATMENT
REQUESTED, the Prices shall not be increased during the Term. Buyer
shall have the right, upon written request from time to time, to
request an audit by Supplier's CPA (currently PricewaterhouseCoopers)
of the books and records of Supplier relating to the Price changes in
order to obtain a certification by PricewaterhouseCoopers of
compliance with this Section 3(a). The cost of the audit shall be paid
by Buyer, unless the audit discloses that Supplier has not been in
compliance with this Section 3(a), in which case it shall be paid for
by Supplier.
(b) The Prices include CONFIDENTIAL TREATMENT REQUESTED with title to and
risk of loss in the Products passing to Buyer CONFIDENTIAL TREATMENT
REQUESTED, at such time as the Products are received at the Designated
Location.
(c) Pallets, tier sheets and top frames (collectively "dunnage") are the
property of Supplier. Dunnage will not be charged to Buyer and
Supplier will arrange pick up and loading of all dunnage at Supplier's
own cost.
(d) Supplier shall produce and deliver the Products as and when required
by Buyer Group and in accordance with the terms of this Agreement,
CONFIDENTIAL TREATMENT REQUESTED.
(e) CONFIDENTIAL TREATMENT REQUESTED
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(f) CONFIDENTIAL TREATMENT REQUESTED
(g) CONFIDENTIAL TREATMENT REQUESTED
(h) CONFIDENTIAL TREATMENT REQUESTED
4. FREIGHT; FAILURE TO SUPPLY; CUSTOMER REFUSAL
(a) Set out CONFIDENTIAL TREATMENT REQUESTED is a list of the current
Designated Locations and Supplier's current actual freight costs from
its manufacturing facilities and warehouses to each Designated
Location. Supplier shall update this list from time to time as freight
rates change and as Buyer adds or removes Designated Locations and as
Supplier adds or removes manufacturing facilities and warehouses
(subject to this Agreement).
(b) Buyer will have the option to take responsibility for transportation
of the Products at one or more Designated Location(s), with at least
thirty (30) days prior notification to the Supplier, at Buyer's sole
cost and expense from the applicable manufacturing facility or
warehouse. If Buyer assumes transportation responsibility:
(i) title and risk of loss to the Products will pass to Buyer at
Supplier's plant or warehouse of origin, as the case may be; and
(ii) Supplier will provide Buyer with pick up allowances of no less
than Supplier's actual freight costs for the applicable
Designated Location(s).
(c) In the event Supplier closes a plant or production line, Supplier will
supply Buyer Group from another facility on the same terms, or will
compensate Buyer for any additional price, transportation, film and
plate costs that Buyer Group is required to pay or incur in order to
obtain supply from any other supplier until Supplier has resumed
supply to Buyer Group in accordance with this Agreement, and in any
case without any disruption in supply of Products to Buyer Group.
Buyer shall use its best commercial efforts to minimize such
additional costs.
(d) Supplier will use back-up supply from other Supplier plants or
purchase supply from other beverage can vendors when there are supply
and/or quality problems that cannot be corrected soon enough without
affecting supply to Buyer, and all supply shall be at the Prices and
on the terms set out in this Agreement (with Supplier being
responsible for any other additional film and plate costs).
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(e) CONFIDENTIAL TREATMENT REQUESTED
(f) If at any time during the Term of this Agreement any Products do not
comply with the Specifications, including for such purposes the
requirements contained in Sections 7(a) and 7(b), or Supplier is
unable or unwilling to manufacture or supply the Buyer Group,
CONFIDENTIAL TREATMENT REQUESTED with its agreed supply commitments in
accordance with this Agreement, whether or not as a result of Force
Majeure, Supplier shall use its best commercial efforts to replace the
non-conforming Products within a time period that is acceptable to
Buyer in Buyer's sole reasonable discretion. If the Supplier does not
so replace the non-conforming Products or fails to so supply Products,
unless caused by (A) a Force Majeure event that shuts down at least
CONFIDENTIAL TREATMENT REQUESTED of Supplier Group's production
capability for Products within or in respect of a given country (and
for such purposes Canada and the United States shall be deemed to be a
single country) or (B) the failure of Buyer or any other member of
Buyer Group CONFIDENTIAL TREATMENT REQUESTED purchasing Products under
this Agreement to comply with the terms of this Agreement, including
without limitation Section 5(e) below, the following shall apply as
Buyer's exclusive remedies, in addition to the remedies set forth in
Section 6(b) and Section 8 below:
(i) Supplier shall indemnify Buyer Group, CONFIDENTIAL TREATMENT
REQUESTED for all reasonable direct out-of-pocket losses, costs,
damages and expenses suffered or incurred by them as a result of
a failure by Supplier to replace or supply such Products,
including without limitation, additional costs incurred by them
to obtain Products or similar products from another supplier.
(ii) CONFIDENTIAL TREATMENT REQUESTED
(g) Buyer Group, CONFIDENTIAL TREATMENT REQUESTED will use best commercial
efforts to minimize any such costs, downtime and any other monies for
which it seeks reimbursement from Supplier pursuant to this Section 4.
Except as otherwise explicitly set out in this Agreement, Supplier
Group shall in no event be liable for lost profits or other
consequential or incidental damages
5. PRODUCTION AND INVENTORY
(a) Buyer shall provide Supplier on a monthly basis with a 3-month rolling
forecast of requirements by Designated Location. The Supplier
acknowledges that any forecast provided by Buyer is a good faith
estimate only, and is not a commitment on the part of Buyer or any
other member of the Buyer Group CONFIDENTIAL TREATMENT REQUESTED to
purchase any quantity of Products.
(b) Supplier shall supply each Designated Location from its closest
applicable manufacturing location(s), however if the closest Supplier
manufacturing location is more than 500 miles from a Designated
Location or if the manufacturing location is across a body of water,
Supplier and Buyer will jointly determine a list of SKUs and min/max
inventory levels of at least thirty (30) days supply for each SKU to
store and ship from a local
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warehouse to be maintained by Supplier at its cost within 50 miles
from the relevant Designated Location.
(c) Whenever the inventory level of any SKU reaches or falls below the
pre-determined inventory amount equivalent of at least thirty (30)
days supply, Supplier will replenish its local warehouse to the
pre-determined levels within five (5) business days. The same
procedure will apply on inventory of ends. The only exceptions to this
program will be special order and/or cans intended for export out of
the country in which such cans have been filled, which will be
produced within 48 hours written notice and delivered within 96 hours
if required by Buyer.
(d) Supplier shall provide to Buyer a detailed inventory report (including
in-transit inventory) every month by the seventh (7th) day after the
end of each month for the prior month for each warehouse and
manufacturing location.
(e) Buyer shall fax its releases of requirements for each Designated
Location for the following week (quantity by SKU) no later than
Thursday noon. Releases will be in full truckload quantities with
date/time required to arrive at the Designated Location.
(f) Supplier shall assign an employee to review inventory levels and
forecasts with Buyer on a monthly basis, to assure optimum levels are
kept and to avoid any slow movers and obsolescence.
(g) Prior to every shipment, Supplier will inspect all cans and ends prior
to shipment to or pick up by Buyer to ensure they arrive at the
Designated Locations free of damage (but even if any such
inspection(s) disclose no damage Supplier shall nonetheless be
responsible in accordance with this Agreement for any damage that
occurs prior to risk of loss shifting to Buyer).
(h) The Supplier will be responsible for maintaining inventory levels
sufficient to service the Buyer Group's requirements in keeping with
Buyer's forecasts from time to time. The Supplier will be responsible
for all freight, storage and handling charges associated with
warehousing finished goods inventory.
6. ADDITIONAL CLAUSES
(a) Super Ends
At Buyer's request, Supplier will begin supplying Super Ends at the
following annual rate for production within 90 days following
qualification of such ends by Buyer at those Designated Locations
where they are qualified:
"SUPER END" AVAILABILITY:
------------------------
2002: 100% of requirements of Buyer Group, CONFIDENTIAL
TREATMENT REQUESTED (North America)
2003: 100% of requirements of Buyer Group, CONFIDENTIAL
TREATMENT REQUESTED (North America, UK (by no later
than October 1, 2003, CONFIDENTIAL TREATMENT REQUESTED
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and, by mutually agreeable timing, in Mexico
CONFIDENTIAL TREATMENT REQUESTED and Europe
CONFIDENTIAL TREATMENT REQUESTED)
2004: 100% of requirements of Buyer Group, CONFIDENTIAL
TREATMENT REQUESTED (North America, Mexico CONFIDENTIAL
TREATMENT REQUESTED, UK CONFIDENTIAL TREATMENT
REQUESTED and Europe CONFIDENTIAL TREATMENT REQUESTED)
2005: 100% of requirements of Buyer Group, CONFIDENTIAL
TREATMENT REQUESTED (North America, Mexico CONFIDENTIAL
TREATMENT REQUESTED, UK CONFIDENTIAL TREATMENT
REQUESTED and Europe CONFIDENTIAL TREATMENT REQUESTED)
2006: 100% of requirements of Buyer Group, CONFIDENTIAL
TREATMENT REQUESTED (North America, Mexico CONFIDENTIAL
TREATMENT REQUESTED, UK CONFIDENTIAL TREATMENT
REQUESTED and Europe CONFIDENTIAL TREATMENT REQUESTED)
in each case subject to the limitations otherwise set out in this
Agreement. CONFIDENTIAL TREATMENT REQUESTED
CONFIDENTIAL TREATMENT REQUESTED
(b) Missing and Damaged
(i) Supplier will take all necessary steps in order for cans and ends
to arrive at Buyer's plants free of damage and according to
quantities no less than what is reported on Xxxx of Lading.
(ii) Supplier and Buyer will jointly monitor Supplier's performance
with quarterly audits for incoming cans and ends from each
ship-from location whether a Supplier manufacturing plant or
warehouse location. CONFIDENTIAL TREATMENT REQUESTED
(c) Minimum Production Runs
Where required by Buyer Group, CONFIDENTIAL TREATMENT
REQUESTED the minimum production run will be CONFIDENTIAL
TREATMENT REQUESTED per SKU instead of the current
CONFIDENTIAL TREATMENT REQUESTED.
(d) Warehousing
(i) Supplier will ensure that strict hygiene and handling
procedures are established and adhered to at all
warehouses whether these are Supplier controlled or
privately owned.
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(ii) Warehousing costs will be Supplier's responsibility.
(e) Six Sigma Requirements
Supplier shall comply with Buyer's Six Sigma requirements set forth
CONFIDENTIAL TREATMENT REQUESTED.
(f) Qualification Procedure
Qualification procedures and requirements to convert those plants
which do not produce finished product using Supplier's Products will
be supplied by Buyer within 60 days from the date this Agreement is
signed. Upon mutual agreement of Supplier and Buyer, both acting
reasonably and in good faith, these will become CONFIDENTIAL TREATMENT
REQUESTED.
(g) Local Technical Support (at Supplier's cost)
(i) Seamer Service:
A. Supplier will assign a local seamer service representative
at each filling location with calls made every week.
B. Supplier will establish specific programs at each plant to
improve employee knowledge and skills in operating seamers
and to improve efficiency.
C. Supplier will also establish preventive maintenance programs
at every location.
(ii) Can line efficiency and package integrity:
A. Supplier will assign a local Technical Service Manager at
each filling location with calls made on a regular basis.
B. The Technical Service Managers will work closely with
Buyer's Plant Managers to develop programs to improve
filling line efficiencies and diminish package damage during
filling, storage and distribution.
Supplier will, in addition, perform support services at the rates
CONFIDENTIAL TREATMENT REQUESTED for extraordinary requirements
in addition to the services described above. Supplier will not
charge Buyer for any technical support and expertise provided by
Supplier's technical center with respect to third party claims.
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(h) Plant Communication / Qualification
(i) The names, titles, phone numbers (during and after office hours
and weekends) and pager numbers of all key plant and warehouse
personnel including sales and technical services are listed
CONFIDENTIAL TREATMENT REQUESTED.
(ii) Supplier will update CONFIDENTIAL TREATMENT REQUESTED at a
minimum every quarter or whenever there are changes to the list.
(iii) Supplier will establish adequate Customer Service
Representation and lines of communication at the local level
among Buyer Group's, CONFIDENTIAL TREATMENT REQUESTED and
Supplier's plants and warehouses.
(iv) Supplier and Buyer will agree on a mutually acceptable date when
Supplier will visit each filling location, it has been awarded
in order to establish contacts and mutually agree on a plan for
a seamless transition. This will include, among other things;
plant visits, qualification, safety stock procedure,
manufacturing and delivery lead times, trial run, warehousing,
ordering procedure, QA/QC procedures, technical and sales
representation. The date of visit will be no later than 120 days
prior to Supplier beginning supplying these locations.
(v) Supplier will do same as above whenever it plans to start up a
new beverage line or manufacturing plant to supply Products
pursuant to this Agreement.
(i) New Customer Support
When needed Supplier will provide Buyer Group, CONFIDENTIAL TREATMENT
REQUESTED all the necessary support to help secure new business. This
includes, Supplier and Buyer Group, CONFIDENTIAL TREATMENT REQUESTED
visiting potential customers to present Supplier's capabilities,
specifications, QA/QC procedures, producing sample runs, making plant
visits, etc.
(j) CONFIDENTIAL TREATMENT REQUESTED
(k) Graphic and Plate Changes
(i) Buyer will supply Supplier with camera ready artwork for new
designs and changes to existing designs. Supplier will pay for
film and plate costs.
(ii ) Supplier will charge CONFIDENTIAL TREATMENT REQUESTED for
designs that are "wet on wet", require more than 4 color
printing or white base coat, except that for any new SKUs in
Buyer's system for which Buyer requires
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white base coat Buyer and Seller must mutually agree on quantity,
location and upcharge if any, CONFIDENTIAL TREATMENT REQUESTED
and failing agreement Buyer shall be free to purchase such cans
(and corresponding ends) from another supplier.
(l) Supplier shall provide Buyer with a detailed summary of its QA/QC
procedures and allow Buyer to review Supplier's QA/QC procedures in
full from time to time upon request (but not make copies thereof).
7. REPRESENTATIONS; WARRANTIES; COVENANTS
(a) Supplier represents, warrants and covenants that:
(i) the Products will, at the time of receipt by Buyer Group,
CONFIDENTIAL TREATMENT REQUESTED comply in all respects with all
laws, regulatory policies, rules and orders (collectively
"Laws") and conform in all respects to the Specifications and
will be suitable and useable as a commercially acceptable
container for beverages intended for human consumption;
(ii) the materials which Supplier uses in connection with the
manufacture of the Products (A) will be free of defects in
materials and workmanship and (B) will neither contain unsafe
food additives nor be adulterated in any way (provided however
in no event Supplier incur any liability under this warranty or
that set out in (i) above where the containers are not packed,
stored and distributed by Buyer in accordance with good business
practice, or where the alleged damage results from rust or
outside corrosion occurring after receipt of the Products by
Buyer and not due to some defect with the Products, or from
improper capping, closing, crimping, filling and gassing
operations by Buyer);
(iii) each pallet of Products shall have attached thereto a slip
indicating the date and shift when such Products were produced
and such other information as is mutually acceptable to the
parties hereto;
(iv) Supplier has the necessary corporate authority and capacity to
enter into this Agreement, and that the entering into by
Supplier of this Agreement and the performance of its
obligations hereunder will not contravene or violate or result
in the breach (with or without the giving of notice or lapse of
time, or both) or acceleration of any obligations of Supplier
under the provisions of any license, permit or agreement to
which Supplier is a party or by which it (or its assets) is
bound; and
(v) Supplier has, and will continue to have during the Term of this
Agreement, the necessary production and operational capacities
and abilities to fulfil its obligations under this Agreement.
(b) Notwithstanding anything to the contrary contained in this Agreement,
and in addition to the rights of Buyer Group and the obligations of
Supplier set out in this Agreement, Supplier agrees to indemnify,
defend and hold Buyer Group and all employees, agents, directors,
officers, CONFIDENTIAL TREATMENT REQUESTED and third party customers
of, and who contract with, Buyer, any member of Buyer Group,
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CONFIDENTIAL TREATMENT REQUESTED to produce beverages for them
(collectively, the "Buyer Indemnified Parties") harmless from and
against any and all direct and indirect third party claims for
personal injury or property damage to the extent arising from any
breach by Supplier of any of the representations, warranties or
covenants set forth in this Agreement, provided that Buyer gives
Supplier prompt notice of such claim, cooperates in the defense
thereof (which will include such matters as providing Buyer employees
for interview, deposition and testimony at trial and production of
relevant documents) and grants Supplier the right to handle, defend or
otherwise dispose of such claim as it may determine at Supplier's sole
cost and expense.
(c) In view of the warranties set forth above, Supplier makes no other
warranty, whether of merchantability, fitness or otherwise, express or
implied in fact or by law.
8. TERMINATION AND DEFAULT
If the Supplier breaches this Agreement or any warranty, representation or
covenant contained in this Agreement, Buyer may notify the Supplier in writing
outlining the details of such breach. A failure by Buyer to notify the Supplier
is not a waiver by Buyer of any such breach or of any rights and remedies
available to Buyer as a result of such breach, except for the right to terminate
this Agreement. If the breach is not remedied by Supplier within thirty (30)
days from the date of written notification to remedy the breach, or, if the
breach cannot reasonably be remedied within thirty (30) days, if substantial
steps to commence a cure are not initiated within such thirty (30) day period,
then Buyer may, in addition to all of its other rights or remedies, whether
under this Agreement or in law or in equity, terminate this Agreement by
providing written notification thereof to the Supplier. In addition, this
Agreement may be terminated by either party upon the occurrence and continuance
of any of the following, such termination to be effective immediately upon
delivery of a written notice to the other party:
(a) If a petition in bankruptcy or under a similar applicable law shall be
filed by or consented to by the other party, or if the other party
makes a proposal to its creditors or seeks the appointment of a
trustee, receiver, liquidator, custodian or other similar official for
its business or assets or makes an assignment for the benefit of its
creditors;
(b) If the other party becomes insolvent or ceases to carry on business,
or takes action to liquidate assets, or stops making payments in the
usual course of business;
(c) If a petition in bankruptcy or under a similar law shall be filed
against the other party and shall remain undismissed or unstayed for a
period of thirty (30) days; or
(d) If the other party's business or assets shall be placed in the hands
of a trustee, receiver, liquidator, custodian or other similar
official by any court, governmental or public authority or agency
having jurisdiction, or if an order shall be made or resolution passed
for the winding-up or the liquidation of the other party or if the
other party adopts or takes any corporate proceedings for its
dissolution or liquidation (other than as part of a bona fide
corporate reorganization).
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9. FORCE MAJEURE
Neither party shall be liable for failure or delay in performance under this
Agreement due in whole or in part to causes beyond the reasonable control of
such party, including without limitation, acts of God, civil commotion,
sabotage, fire, flood, explosion, acts of any government, unforeseen shortages
or unavailability of fuel, power, inability to obtain or delay in obtaining
governmental approvals, permits, licenses or allocations, and any other causes
which are not within the reasonable control of the party affected, whether or
not of the kind specifically enumerated above; provided, however, such shall not
excuse Buyer or the Supplier from paying any amounts due the other hereunder.
Either party affected by any such circumstances shall promptly give written
notice thereof to the other party. During any such period of Force Majeure
affecting the Supplier, the Supplier shall allocate its available supply among
its customers in the same proportion as existed before the occurrence of any
such circumstances. Performance of this Agreement shall be resumed as quickly as
reasonably possible after the party affected by any such circumstances has
notified the other party that the condition(s) is/are remedied. In the event raw
material supplies are reduced by the Supplier's vendors, the Supplier shall
balance such reductions proportionately to all the Supplier's customers of
products similar to the Products. Purchase and/or supply obligations would be
reduced only to the extent of the direct effect of the respective Force Majeure
circumstance. If the Buyer Group purchases products similar to the Products as a
result of a force majeure circumstance affecting the Supplier, any such
purchases shall count towards any volume rebates or discounts and/or purchasing
obligations of Buyer under this Agreement.
10. PATENTS, TRADEMARKS, COPYRIGHTS, AND UNFAIR COMPETITION
The Supplier warrants to Buyer that the Products manufactured and the use
thereof in the form furnished by the Supplier excluding any labels or
specifications supplied by Buyer will not infringe any United States or Canadian
patents, trademarks, copyrights or other rights of third parties. In the event
of a claim of any such infringement and provided that the Supplier is notified
thereof promptly upon Buyer becoming aware of such infringements and provided
further that the Supplier is given the complete defense of such action at its
sole cost and expense, the Supplier agrees to defend, indemnify, and hold the
Buyer Indemnified Parties harmless from and against awards of claims against any
or all of the Buyer Indemnified Parties as the result of such infringement. Upon
the institution of any suit or action alleging infringement against any or all
of the Buyer Indemnified Parties, the Supplier may (i) pay the amounts claimed,
provided that prior to such payment the Supplier obtains a full and final
release of the claim in favour of the applicable Buyer Indemnified Parties, in
form and substance satisfactory to Buyer, or (ii) furnish non-infringing
Products, provided they are acceptable to Buyer, or (iii) at the Supplier's sole
option, continue to supply the allegedly infringing Products, provided that in
such event the Supplier shall indemnify, defend and hold harmless Buyer
Indemnified Parties in respect of any claims which any Buyer Indemnified Party
is subjected to on account of infringement if in such suit or action it is held
that the manufacture or use of such Products did infringe a United States or
Canadian patent, trademark, copyright or other right.
11. CONFIDENTIALITY
Neither party (in this clause, the "Covenantor") shall disclose to any third
party the price, terms, conditions, purchasing patterns, forecast, or provisions
(other than the existence) of this Agreement or any information obtained from
the other party (in this clause, the "Covenantee") which would reasonably be
considered confidential or proprietary to the Covenantee without the express
written consent of the
13
Covenantee, unless disclosure is required by law, regulation, securities
commission, or stock exchanges. If such disclosure is required, Buyer and
Supplier shall use their best commercial efforts to obtain confidential
treatment and redaction of the pricing terms of this Agreement and related
CONFIDENTIAL TREATMENT REQUESTED provisions of this Agreement. Buyer and
Supplier agree that the contents of this Agreement are extremely confidential.
CONFIDENTIAL TREATMENT REQUESTED Nothing in this Section 11 prohibits either
party from disclosing any information to members of the Buyer Group or Supplier
Group, as the case may be, or to their respective professional advisors.
12. NOTICES
Any notice or other communication required or desired to be given by this
Agreement shall be in writing and delivered by facsimile transmission,
registered or certified mail, return receipt requested, or by personal or
nationally recognized courier delivery. Any notice or other communication
transmitted by facsimile shall be deemed to be received when sent so long as
there is valid written confirmation of receipt of the entire transmission. If
sent by registered or certified mail, it shall be deemed received 3 business
days after the mailing thereof. If a notice or other communication is dispatched
by personal or national recognized courier delivery, it shall be deemed to have
been received upon the delivery thereof to such address. Any notice or other
communication shall be sent to the address given below of the party to be
notified, unless such party has previously notified the other of a change of
address, in which case the notice or other communication shall be sent to such
changed address:
(a) the Supplier: Crown Cork & Seal Company, Inc.
Xxx Xxxxx Xxx
Xxxxxxxxxxxx, XX 00000
Attention: VP, Sales - Beverage Division
Fax No.: (000) 000-0000
with (in the case of default notices), a copy to:
Crown Cork & Seal Company, Inc.
Xxx Xxxxx Xxx
Xxxxxxxxxxxx, XX 00000
Attention: General Counsel
Fax No.: (000) 000-0000
(b) Buyer: Cott Corporation
000 Xxxx Xxxxxx
Xxxxxx-Xxxxxx, Xxxxxx X0X 0X0
Attention: VP, Global Procurement
Fax No.: (000) 000-0000
14
with (in the case of default notices), a copy to:
Cott - Legal Department
000 Xxxxx'x Xxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: General Counsel
Fax No.: (000) 000-0000
If any notice or other communication is transmitted or delivered or deemed
received after 4:00 PM (E.D.T.) on any day or on a non-business day, it shall be
deemed received on the next business day.
13. INTERPRETATION
When applicable, use of the singular form of any word shall mean or apply to the
plural, and the neuter form shall mean or apply to the feminine, masculine or
plural. The captions in this Agreement, including the heading to sections and
paragraphs, are for convenience of reference only and shall not affect its
interpretation or construction.
14. EXHIBITS
All exhibits and all schedules or attachments to exhibits or schedules
referenced in this Agreement as annexed hereto are incorporated herein by
reference and made a part hereof. From time to time, any exhibit, schedule or
attachment may be amended. Once amended, the restated exhibit, schedule or
attachment incorporating such amendments shall be executed in accordance with
Section 15 hereof and then annexed to this Agreement.
15. AMENDMENTS
This Agreement may not be amended except in a writing executed by authorized
officers of both parties. All such revisions shall as of their effective date
automatically become a part of this Agreement.
16. GENERAL
If any provision of this Agreement, whether a paragraph, sentence or portion
thereof, is determined by a court of competent Jurisdiction to be null and void
or unenforceable, such provision shall be deemed to be severed, and the
remaining provisions of this Agreement shall remain in full force and effect.
Neither party shall be deemed to have waived any right, power, privilege, or
remedy unless such waiver is in writing and duly executed by it. No failure to
exercise, delay in exercising or course of dealing respect to any right, power,
privilege or remedy shall operate as a waiver thereof by either party or of any
other right, power, privilege or remedy. No exercise or partial exercise of any
right, power, privilege or remedy shall preclude any other of further exercise
thereof by either party or the exercise of any other right, power, privilege or
remedy by either party.
17. PRIOR AGREEMENTS AND MERGER
This Agreement contains the entire agreement of the parties and there are no
agreements, representations or understandings with respect to the subject matter
hereof other than those stated or referred to herein or signed. This Agreement
supersedes any and all other agreements, representations or understandings,
15
written or oral, between the parties to this Agreement with respect to the
subject matter hereof made prior to the date of execution of this Agreement.
18. GOVERNING LAW
This Agreement shall be governed by and enforced in accordance with the laws of
the State of New York, without regard to conflicts of laws principles. The
parties hereby attorn to the non-exclusive jurisdiction of the courts of the
State of New York.
19. ASSIGNMENT
Neither this Agreement nor the rights or the obligations of the Supplier under
this Agreement shall be assigned or otherwise disposed of by the Supplier,
except to a wholly owned subsidiary of Supplier, without the prior written
consent of Buyer, which consent shall not be unreasonably withheld. An indirect
or direct change of control of the Supplier in law or in fact shall be deemed an
assignment of this Agreement by the Supplier; provided, however, that an
internal reorganization involving the creation of a new publicly traded holding
company that owns 100% of Supplier (for example the 2003 creation of Crown
Holdings, Inc) shall not be deemed such a change of control. Subject to the
foregoing provisions of this Section 19, this Agreement shall be binding upon
and enure to the benefit of the parties hereto and their respective successors
and assigns.
20. CURRENCY
Unless otherwise expressly indicated, all dollar amounts in this Agreement refer
to lawful currency of United States of America.
21. TIME OF THE ESSENCE
In this Agreement, time shall be of the essence.
IN WITNESS WHEREOF the parties have executed this Agreement on the 11th day of
November, 2003, but with effect as of the 1st day of January, 2002.
CROWN CORK & SEAL COMPANY, INC. COTT CORPORATION
BY /s/ Xxxxxxx X. Xxxxxxxxx BY /s/ Xxxx Xxxxxxxx
-------------------------- -----------------------------------
NAME: Xxxxxxx X. Xxxxxxxxx NAME: Xxxx Xxxxxxxx
TITLE: Vice President TITLE: President & COO
BY /s/ Xxxx Xxxxxxxx
-----------------------------------
NAME: Xxxx Xxxxxxxx
TITLE: Vice President, Global Procurement
16
SCHEDULE 1(a)
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CONFIDENTIAL TREATMENT REQUESTED
17
SCHEDULE 1(b.1)
---------------
CONFIDENTIAL TREATMENT REQUESTED
18
SCHEDULE 1(b.2)
---------------
CONFIDENTIAL TREATMENT REQUESTED
19
SCHEDULE 1(f)
-------------
CONFIDENTIAL TREATMENT REQUESTED
20
SCHEDULE 3(a)
CONFIDENTIAL TREATMENT REQUESTED
21
SCHEDULE 3(g)
CONFIDENTIAL TREATMENT REQUESTED
22
SCHEDULE 4(a)
CONFIDENTIAL TREATMENT REQUESTED
23
SCHEDULE 6(e)
CONFIDENTIAL TREATMENT REQUESTED
24
SCHEDULE 6(f)
CONFIDENTIAL TREATMENT REQUESTED
25
SCHEDULE 6(g)
CONFIDENTIAL TREATMENT REQUESTED
26
SCHEDULE 6(h)
CONFIDENTIAL TREATMENT REQUESTED
27
