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EXHIBIT 10.37
PURCHASE AGREEMENT
"PHILIPS"
XXXXXX, XXXXX 0, 0000
0
XXXXXXXX AGREEMENT
By and between
Xxxxxxxx Lighting B.V., a company with limited liability incorporated under
the laws of the Netherlands having its office in Bindhoven, acting on its own
behalf and on behalf of its associated companies represented by Mr. X.X. HUT
(hereinafter referred to as "Xxxxxxxx")
and
Sylvania N.V., a company with limited liability incorporated under the laws
of Belgium having its office in Tienen, Belgium represented by Mr. M. SWAANEN
(hereinafter referred to as "Sylvania")
Hereinafter referred to jointly as the "Parties".
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It is agreed upon as follows:
ARTICLE 1
DEFINITIONS AND SCOPE
1.01 "Agreement" shall mean this present document and all annexes, exhibits
and other documents referred to herein or attached hereto and signed or
initialled by the parties hereto, all of which annexes, exhibits and
other documents form an integral part hereof.
1.02 "Lamps" shall mean Tungsten Halogen Reflector lamps 230 and 240V
aluminised shaped XXX 00, XXX 00 S.
1.03 "Capsules" shall mean Tungsten Halogen burner 50 W 230 V and or 240 V
for mounting in Halogen Reflector lamps (aluminised) shaped PAR 20 and
Tungsten Halogen burner 75 W 230 V and/or 240 V for mounting in Halogen
Reflector lamps (aluminised) shaped PAR 30 L.
1.04 "Specifications" shall mean all requirements and other specifications of
the Lamps and Capsules as agreed upon by the parties and
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"Quality Agreement" shall mean the agreement on quality specifications
for Lamps and for Capsules
49 F 0405-028/A for Lamps PAR 38
49 F 0405-031 for Lamps PAR 00 X
00 X 0000-000/X for Capsules
which is further detailed and attached as Annex 1.
1.05 "Effective Date" shall mean the date on which this Agreement is duly
signed by both parties hereto.
1.06 "Contract Year" shall mean a period of twelve (12) months, starting the
Effective Date and every successive period of twelve (12) months during
the term of this Agreement.
ARTICLE 2
PURCHASE AND SALE OF LAMPS AND CAPSULES
The purpose of this Agreement is to define the terms and conditions under
which Xxxxxxxx shall purchase from Sylvania a minimum quantity of Lamps and
Capsules per Contract Year, during a period of 2 (two) years, and Sylvania
shall supply said quantities of Lamps and Capsules complying with the
Specifications.
ARTICLE 3
ORDERING PROCEDURE
3.01 On the terms and conditions as set forth herein, Sylvania shall sell and
deliver to Xxxxxxxx and Xxxxxxxx shall purchase and accept from
Sylvania, a minimum quantity of
five hundred thousand (500,000)
both
Halogen PAR 38
Aluminised lamps
75 & 000 X
000 & 240 V version with Philips Wiso design
and
Halogen PAR 30 S
Aluminised lamps
75 & 000 X
000 & 240 V version with Philips Wiso design
one million and six hundred thousand (1,600,000)
Capsules
00 X / 00 W
230 & 240 V
in each Contract Year.
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3.02 It is the intention of the Parties that deliveries shall be
spread evenly over the year, with a minimum order quantity of
twenty thousand (20,000) Lamps and fifty thousand (50,000) Capsules.
3.03 Monthly orders for supply of Lamps and Capsules specified by type, and
quality shall be placed by Philips with Sylvania at least forty (40)
working days in advance of the desired delivery date. Sylvania shall
acknowledge these orders by letter or fax at least three (3) working days
after receipt of such an order confirming the delivery dates as requested
by Philips, or if the order cannot be executed in accordance with the
requested delivery dates. Sylvania shall indicate the alternative
delivery dates, which should be within a maximum of twenty (20) working
days additional to the original delivery dates requested by Philips.
In the event that Sylvania cannot, for whatever reason, deliver within
the maximum of sixty (60) working days from receipt of an order from
Philips, Philips shall be informed within ten (10) working days after the
receipt of the order from Philips of the delivery date, Philips on
receipt of this information shall confirm acceptance of this delivery
date or cancel the order, where upon the minimum quantity as referred to
in Section 3.1 will be reduced accordingly.
3.04 Each month Philips shall provide Sylvania a 3 months binding forecast
from which Philips may not deviate with more than 10% and a further nine
(9) months non-binding rolling forecast of the total quantity of Lamps
and Capsules on an aggregated total level which Philips plans to order
for delivery.
ARTICLE 4
QUALITY PERFORMANCE AND WARRANTY
4.01 Unless otherwise agreed by the parties hereto, the Lamps and Capsules
sold by Sylvania to Philips shall be of a quality and performance in
accordance with the "Specifications" set forth in Annex I and the Quality
Agreement.
4.02 The Lamps and Capsules shall be packed and labelled as per the
"Specification" defined in Annex 2 to this Agreement. The Lamps and
Capsules shall be supplied to Philips under Philips owned trademarks to
be indicated by Philips and bear the markings as indicated by Philips.
Artwork and packaging initiation cost for these brands will be paid by
Philips as incurred.
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4.03 The warranty described in Sections 4.01 and 4.02 of this Agreement is
the sole warranty which Sylvania gives with regard to Lamps and
Capsules.
Sylvania can not be held liable for lamps produced by Philips using
Sylvania capsules.
Philips shall be at liberty to examine or have examined the Capsules
and Lamps suppled by Sylvania and may within 40 days as from the
delivery, reject such Capsules and Lamps which do not comply with the
quality and performance mentioned above. Sylvania shall, at its
option, either replace the Capsules and Lamps within 20 days from the
date of Philips written notice of rejection or issue a credit note for
the respective invoice amount.
ARTICLE 5
LIABILITY
Sylvania shall not be liable for any damages or losses except those for
which Sylvania has expressly assumed liability in this Agreement.
Sylvania's liability shall in no event be considered to extend to indirect
or consequential damages of any nature whatsoever, including loss of
profits and / or revenues and Philips shall indemnify and hold Sylvania
harmless for all costs, damages and interests which might arise directly or
indirectly form any claim of third parties expressly including but not
limited to a claim based on product liability.
ARTICLE 6
DELIVERY AND SCOPE
Sylvania shall arrange for supply of the Lamps and Capsules from its
factory in lienen Belgium and Philips shall take delivery of all Lamps and
Capsules ordered by Philips under the Agreement at the agreed times
Delivery ex Works, lienen as this Term is defined in the Incoterms
(version 1990), it being understood that Sylvania will be responsible for
the loading of the Lamps and Capsules.
ARTICLE 7
FORCE MAJEURE
7.01 If Sylvania is unable, due to force majeure (including without
limitation the direct results of: acts of God; fire; natural
phenomena; governmental regulations; acts; restrictions or omissions
to act of any governmental authority, domestic of foreign; strikes,
labour disputes; shortage of materials in the market; civil commotion;
delays in transport and any other cause beyond its reasonable
control), to fill all or any part of orders on the scheduled delivery
dates thereof, any
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such cause shall be sufficient excuse for any failure or delay in delivery
and Philips' orders may be scaled down by Sylvania to a share of available
production.
7.02 Any suspension or reduction of orders or deliveries of Lamps and
Capsules, due to force majeure shall not invalidate this Agreement and
upon removal or termination of the cause of such force majeure orders and
deliveries of Lamps and Capsules shall be resumed in accordance with
terms and conditions hereof.
ARTICLE 8
PRICES
Sylvania shall supply the products under the following conditions:
Lamps Type (Wiso) Price ex Factory Min. Qty per annum
----- ---------------------------- ------------------
PAR 38 BEF 180 500,000 pcs
PAR 30 S BEF 168
If the minimum quantity of 500,000 pcs for both products together will be
exceeded in the course of the first 12 months of the contract the price of
all lamps will be reduced as from that moment on by REF 5 per lamp for all
future purchases.
It is the mutual understanding that the Sylvania purchase prices as they
have been established as stipulated in this paragraph should allow
Philips to achieve a reasonable margin when selling said lamps.
In the event Philips consider this margin to be provably jeopardised due to
external market conditions not initiated by Philips, Sylvania agrees to
adapt 12 months after signing the lamp prices to be charged to Philips,
but Philips recognises that Sylvania must earn a reasonable return on the
sale of lamps covered by this Agreement.
Capsules Type Price ex Factory Min. Qty per annum
-------- ---- ---------------- ------------------
50 W/75 W REF 55 1,600,000 pcs
Prices for Capsules are firm for 2 years.
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Minimum quantities:
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If the agreed minimum capsule quantity is not purchased Philips agrees to
purchase from Sylvania one (1) finished lamp for each three (3) capsules
purchased below the minimum annual quantity.
If the agreed minimum lamp quantity is not purchased Philips agrees to purchase
from Sylvania three (3) burners for each lamp purchased below the minimum
annual quantity as long as capacity is available.
ARTICLE 9
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PAYMENT
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Philips shall pay cash invoice from Sylvania for Lamps and Capsules supplied
within thirty (30) days from the last day of the calendar month in which said
Lamps and Capsules are invoiced.
ARTICLE 10
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DURATION/TERMINATION
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This Agreement shall become valid as from the Effective Date and shall remain
in effect for an initial term of two (2) years and may thereafter be
automatically renewed for successive two (2) year periods if not terminated by
either party by a notice of termination sent to the other party by registered
mail at least three (3) months before the end of the initial period or 3 months
before the end of any successive two (2) years period.
This Agreement may be terminated earlier:
(a) in the event a party hereto would breach any of the material provisions of
this Agreement the other party is entitled to give written notice to the
party in breach specifying such breach and if the breach is remediable
giving the party in breach an opportunity to remedy the breach to
reasonable satisfaction of the other party within a reasonable period of
time which need not be in excess of thirty (30) calendar days. Failing
such remedy, the party issuing the notice of breach is entitled to take
any action open to it under this Agreement or in law including suspension
of payments, work or deliveries as the case may be, immediate termination
by notice in writing and/or to claim damages; or
(b) by either party by written notice to the other party in the event the
latter party would become insolvent, bankrupt or makes an assignment for
the benefit of its creditors;
(c) by either party by written notice to other party in the event of a change
of ownership or control of the other party whereby the business and/or
shares of that party would pass to other(s) than those now.
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having ownership or exercising control. It is understood that this is not
application the event a change of ownership of shares of a party is
effecutated through a public listing at a stock exchange.
Article 11
Deliveries after notice of termination
As from the moment Philips gives notices of termination of this Agreement in
accordance with article 10, Sylvania shall maintain its deliveries to Philips
for the coming three (3) months period of the level supplied during the three
(3) months period prior to the receipt of Philips' notice of termination.
Mutatis muntandis as from the moment Sylvania gives notice of termination of
this agreement in accordance with article 10.
Philips shall maintain its off-take from Sylvania in the coming three (3)
months period at the level of the three (3) months period prior to the moment
of Sylvania's notice of termination.
Article 12
Confidentiality
During the term of this Agreement and any renewal hereof and for a period of
two (2) years after is expiration or termination, each party agrees not to use
or disclose any proprietary information (whether technical, commercial or
otherwise) made available to it by the other party or which it may have
acquired in the performance of this Agreement, unless and to the extent such
information is to the public domain through no fault of the receiving party, is
known and on record at the receiving party prior to receipt or is lawfully
obtained from a third party who was free to disclose such information.
Article 13
Assignment
This Agreement is not assignable in whole or in part by either party without
the prior written consent of the other party, provided, however, that a party
may assign its right under this Agreement to any successor of substantially all
of the business assets related to this Agreement or to an affiliate. Such
assignment shall become effective only when the signee acknowledges in writing
that it agrees to all terms and conditions of this Agreement.
Article 14
Governing Language and Choice of Law
The governing language of this Agreement shall be in English and the applicable
law shall be that of Belgium.
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Article 15
Disputes
All disputes shall be within the jurisdiction of the courts at Leuven,
Belgium.
Made on March 1, 1996 in two (2) copies
PHILIPS LIGHTINGS, B.V. SYLVANIA N.V.
By: /s/ By: /s/
--------------------------- ---------------------------------
TITLE: Senior President TITLE:
DATE: April 4, 1996 DATE: March 11, 1996
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RIDER TO THE PURCHASE AGREEMENT BETWEEN PHILIPS LIGHTING BV AND SYLVANIA NV
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By and between:
Philips Lighting BV, a company with limited liability incorporated under the
laws of The Netherlands, having its office in Eindhoven, acting on its own
behalf and on behalf of its associated companies.
represented by Mr. X.X. HUT
(hereinafter referred to as "Philips")
and:
Sylvania NV, a company with limited liability incorporated under the laws of
Belgium having its office in Tienen, Belgium
represented by Mr. J. Germis
(hereinafter referred to as "Sylvania")
Hereinafter jointly referred to as the "Parties."
It is witnesseth:
Whereas Philips and Sylvania have entered into a purchase agreement dated March
1, 1996.
Whereas such purchase agreement provides for the purchase by Philips of minimum
quantities of Halogen PAR 38/Halogen PAR 30 S and capsules over each Contract
Year;
Whereas the value of the quantities accounted for the 1st Contract Year - which
started on March 1, 1996 (the "Effective Date") - only to 91.5 million BF
whereas the contract requires minimum purchases by Philips in the amount of
173.8 million BF per Contract Year,
Whereas Philips has requested Sylvania to agree to an amendment to the purchase
agreement to provide for:
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(1) an initial fixed contract period of 3 (instead of 2) years with minimum
purchase obligation of BF 91.5 million for the 1st, BF 121 million for the
2nd and BF 135.1 million of the third contract year;
(2) a price reduction for PAR 30S lamps.
In consideration of Sylvania's acceptance of such amendments Sylvania has
requested Philips to replace to the extent possible orders for capsules
by orders for lamps and more in particular PAR 20 and PAR 25 lamps.
It is agreed as follows:
Article 1
1.1. Article 3.01 of the Purchase Agreement of March 1, 1996 is replaced as
follows:
"3.01. On the terms and conditions as set forth herein, Sylvania shall
sell and deliver to Philips and Philips shall purchase and accept from
Sylvania the quantities of the following products to meet the agreed upon
minimum purchase values over the initial 3 year term of this Agreement:
1. Minimum purchase values (exel, VAT/transportation, etc)
1.1. First Contract Year (1/3/96 - 28/2/97): 91.5 MBF
1.2. Second Contract Year (1/3/97 - 28/2/98): 121 MBF
1.3. Third Contract Year (1/3/98 - 28/2/99): 155.1 MBF
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347.6 MBF
2. Products
2.1. Halogen PAR 38 Aluminised lamps 75 & 000 X - 000 & 240 V version
with Philips Wiso design
2.2. Halogen PAR 30S - Aluminised lamps 75 & 000 X - 000 & 240 V version
with Philips Wiso design
2.3. Capsules 50W/75W - 230 & 240 V
2.4. Halogen PAR 25; provided it is technically possible to produce such
lamps on existing SLI equipment subject to achievement of Philips
specifications to be proven by test.
2.5. Halogen PAR 20; provided it is technically possible to produce
such lamps on existing SLI equipment subject to achievement of
Philips specifications to be proven by test.
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3. General forecast Second contract year (1/3/1997 - 2/2/1998)
Quantity Selling Price
Capsules 600,000 55 BF
PAR 20 20,000 130 BF if available 1/1/1997
PAR 25 50,000 145 BF if available 10/1/1997
PAR 308 288,000 165 BF
PAR 38 185,000 180 BF
Philips undertakes to increase to the extent possible in both the 2nd and
3rd contract years the purchases of lamps and decrease the purchases of
capsules.
The price reduction on the PAR 30S lamps from 168BF to 155 BF per lamp will
be applicable as from March 1, 1997 and will be covered by a credit note
that will be issued to Philips at the end of the 2nd contract year. For the
determination of compliance with the minimum purchase requirement (values)
over the 2nd and 3rd contract years the purchases of the PAR 30S Lamps will
be counted at their reduced selling price of 155 BF.
The general forecast for the split-up of the orders per product type for the
3rd contract year will be communicated by Philips early 1998 subject to the
undertaking of Philips to further reduce the quantities of capsules by an
increase of the orders for PAR 20 and PAR 25 lamps.
4. Calculation of the relevant contract year purchase values/commitment to
cover possible shortfalls
4.1 The purchase values to which Philips has committed will not be
impacted by the delivery by Philips of components free of charge to be
assembled in the products and more in particular the coming cups and
lenses for PAR 20 lamps i.e. the reduced selling prices which will
result from the supply free of charge by Philips of such components
will not release Philips from its obligation to meet the minimum
purchase values (i.e. selling prices effectively invoiced by Sylvania
over the relevant contract years).
4.2 If the agreed upon minimum values would not have been reached at the
end of the second or third contract year, Philips will immediately
upon the expiration of such second Contract Year respectively third
Contract Year place an order to cover the shortfall. Such order will
be supplied by Sylvania within three (3) months following receipt."
1.2. Sylvania recognizes that the revised purchase value for the first
Contract year, i.e. 91.5M BF has been met.
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1.3. The ordering and forecast procedures provided for in Article 3.02 to 3.04
of the Purchase Agreement will remain unchanged subject only to the
understanding that they will be based on the revised committed purchase
values for the second and third contract years.
Article 2
Provided the conditions for the production of Halogen PAR 20 and PAR 25 lamps
will be met the specifications set forth in annex 1 and the Quality Agreement
shall be completed in mutual agreement to include the specifications for such
lamps.
Article 3
Article 8 of the Purchase Agreement is replaced as follows:
"Sylvania shall supply the products under the following conditions:
Lamps Type (Wi??) Price exfactory per lamp
----- ----------- ------------------------
XXX 00 XX 000
XXX 00X XX X00
XXX 00 BF 130
PAR 25 BF 145
Subject to supply by Philips of proper glassware (corning cups and lenses) free
of charge for assembly in the PAR 20 lamps the selling price per PAR 20 lamp
will be reduced with a maximum amount of BF 28 (not including efficiency losses
to be proven by test).
Capsules Type Price exfactory per lamp
-------- ---- ------------------------
50W/75W BF 55
The prices will remain firm until the expiration of the initial 3 year term of
the Purchase Agreement.
In case the Purchase Agreement will be renewed for (a) further consecutive 2
year period(s) the prices will be adapted to allow Sylvania to earn a
comparable return on the sale of the products covered by this Agreement (i.e.,
at least equal to the return envisaged at the time of the conclusion of the
Purchase Agreement)".
In case of renewal of the Purchase Agreement the minimum purchase value for the
third Contract Year will also be applicable for the subsequent contract years.
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Article 4
The 1st paragraph of Article 10 is replaced as follows:
"This Agreement shall become effective as from the Effective Date (March 1,
1996) and shall remain in effect for an initial term of three (3) years and
will thereafter be automatically renewed for successive two (2) year periods if
not terminated by either party by a notice of termination sent to the other
party by registered mail at least three (3) months before the end of the initial
period or 3 months before the end of any successive two (2) years period".
Article 5
5.1 All terms and conditions of the Purchase Agreement of March 1, 1996 which
are not amended by the present rider remain in full force and effect.
5.2 The effective date of the amendments shall be the date on which the
present rider will have been signed by both parties unless otherwise
indicated in the present rider.
Made in two copies. Each party acknowledges receipt of an originally signed
copy.
PHILIPS LIGHTING BV SYLVANIA NV
By: P.I. Hut By:
Title: Senior Vice President Title:
Date: Date:
