SENSOR SUPPLY AGREEMENT
THIS SENSOR SUPPLY AGREEMENT dated as of February , 1998 by and between
Fresh Air Solutions, L.P., a Pennsylvania limited partnership (hereinafter
referred to as the "Purchaser") and Engelhard Sensor Technologies, Inc. (the
"Seller").
W I T N E S S E T H :
WHEREAS, Purchaser desires to purchase from Seller, and Seller desires
to sell to Purchaser, Products (as hereinafter defined) for use by Purchaser;
NOW, THEREFORE, for and in consideration of the mutual premises and the
terms and conditions hereinafter set forth, the Purchaser and the Seller, with
the intent to be bound thereby, agree to the following.
ARTICLE I - DEFINITIONS
As used herein, the following terms have the meanings ascribed to them
in this Article (except as otherwise expressly provided) and include the plural
as well as the singular:
1.1 "Agreement" or "Supply Agreement": This agreement as of the date
first above written, as the same may be amended from time to time pursuant to
the terms hereof.
1.2 "Master Agreement": The Master Agreement, dated as of November 17,
1997, by and among ICC Technologies, Inc., ICC Desiccant Technologies, Inc., ICC
Investment L.P., Engelhard Corporation, Engelhard DT, Inc. and Engelhard/ICC, as
the same may be amended from time to time pursuant to the terms thereof.
1.3 "Order": A written request by Purchaser to Seller to supply a
specific quantity and type of Product on a requested delivery date or an oral
request by Purchaser to Seller to supply a specific quantity and type of Product
on a requested delivery date; provided, however, that any oral request is
confirmed in a writing sent by Purchaser to Seller within two (2) days of the
date of the oral request.
1.4 "Products": Humidity and dew point infrared sensors that are
manufactured by the Seller.
ARTICLE II - SUPPLY OF PRODUCTS
2.1 Quantity. Subject to the terms of this Agreement, Seller will sell
to Purchaser, and Purchaser will buy from Seller, Products. Nothing herein shall
require Purchaser to purchase Products from Seller unless and until an Order is
placed by Purchaser with Seller.
2.2 Orders. Purchaser will place with Seller all Orders at least sixty
(60) days prior to the requested delivery date for such Products. Each Order
constitutes an irrevocable obligation of Purchaser to purchase from Seller the
quantity and type of Product set forth in such Order on the terms and conditions
set forth in this Agreement. In accordance with Seller's capacity and lead time
constraints, Purchaser will consolidate Orders to avoid abnormally small Orders
and will avoid requesting Seller to deliver abnormally large quantities of
Product in any Order, and, in any event, Seller will not be required to fill any
Order to the extent it exceeds Seller's capacity or lead times.
2.3 Price; Payment. The price, payment procedures and invoicing for
Products are as set forth on Schedule A hereto.
2.4 Warranty. (a) Seller agrees that the Products manufactured by the
Seller shall be free from defects in material and workmanship for one year from
the date of original installation or eighteen (18) months from the date of
shipment from Seller's factory, whichever may first occur under normal use and
service and when properly installed, and its obligation is limited solely to
repair or replace or refund the purchase price at Seller's option, at Seller's
factories, or any part or parts proven to be defective or non-conforming,
returned to Seller with transportation charges prepaid, which Seller's
examination shall disclose to its satisfaction to have been defective or
non-conforming. THIS WARRANTY IS EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES,
AND IS IN LIEU OF AND IN DISCLAIMER AND EXCLUSIVE OF ANY IMPLIED WARRANTIES OR
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AS WELL AS ALL OTHER
IMPLIED WARRANTIES, IN LAW OR EQUITY, AND ALL OTHER OBLIGATIONS OR LIABILITIES
ON OUR PART. THERE ARE NO WARRANTIES WHICH EXTEND BEYOND DESCRIPTION HEREOF.
Seller neither assumes nor authorizes any person to assume for Seller any
liability or obligation in connection with the sale of its Products, except said
repair or replacement of the defective part as set forth above. Seller's
liability does not include any labor charges for the replacement of parts,
adjustments,
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repairs or other work done outside its factories. Seller's liability does not
include any consequential or resulting damage to person, property, equipment,
goods, merchandise, profits, good will or reputation arising out of any defect
in or failure of its Products. Seller's obligation to repair or replace shall
not apply to Products altered outside its factory in any way, or which have been
subject to negligence or to misuse. On parts not its manufacture, such as
motors, controls, etc., Seller extends only the same warranties given to the
Seller. Seller's agreement hereunder runs only to the immediate purchasers and
does not extend, expressly or by implications, to any other person. Nothing in
the above warranty provisions, however, shall impose liability or obligation of
any type, nature or description upon Seller if Seller has not received payment
in full for the Product in question.
Where the non-conforming Product is replaced by Seller or where Seller
refunds the sales price received from Purchaser for such Product, Purchaser
shall return the non-conforming Product to Seller strictly in accordance with
Seller's written instructions concerning handling, shipping, insurance, mode of
transportation, and other matters as to which Seller issues instructions. In no
event shall Seller be liable for: (1) Products damaged in shipment or otherwise
without fault of Seller; (2) defects in Products due to negligence (other than
that of Seller), accident, abuse, improper care or storage, abnormal condition
of temperature or moisture; (3) damage to Products which have been tampered with
or altered in any way other than by Seller; or (4) expenses incurred by
Purchaser in attempting to correct any defects in Products.
(b) Seller additionally warrants that in the manufacture of Products it
complies with all applicable requirements of Sections 6, 7 and 12 of the Fair
Labor Standards Act as amended and the regulations and orders of the United
States Department of Labor issued under Section 14 thereof.
(c) Seller warrants to Purchaser that any Product sold by Seller to
Purchaser hereunder will not infringe the claim of any U.S. patent owned by a
third party covering the Product itself and agrees to indemnify Purchaser
against liability for any alleged infringement, provided, however, that
Purchaser shall notify Seller within ten (10) days after receipt by Purchaser of
any such claim of alleged infringement or any notice of commencement of any suit
based on such alleged infringement, and provided further, that Seller shall
control and remain in control of any and all proceedings taken in defending such
suit, including without limitation utilization
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solely of counsel of Seller's own selection to defend such suit. Seller does not
warrant against infringement by reason of use of any Product by Purchaser in
combination with other materials or in the operation of any process.
(d) Recommendations by Seller, if any, covering the utilization,
properties or qualities of Products delivered hereunder or with respect to
services performed are believed reliable but Seller makes no warranty whatever
with respect thereto. Use or application of the Products sold by Seller to
Purchaser hereunder is at the discretion of Purchaser without any liability or
obligation on the part of Seller.
(e) THESE WARRANTIES ARE EXCLUSIVE AND ARE IN LIEU OF ANY AND ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, ARISING BY LAW OR CUSTOM, INCLUDING BUT NOT BY
WAY OF LIMITATION, THE IMPLIED WARRANTY OF MERCHANTABILITY AND THE IMPLIED
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.
2.5 Delivery. All Products supplied hereunder will be delivered and all
risk of loss and damage and title to Products will pass to Purchaser F.O.B.
Seller's manufacturing site in California or any other location specified by
Seller in the continental United States, with markings and packaging as defined
in Schedule B hereto.
2.6 Use of Products. It is expressly agreed by the parties hereto that
in no event may Purchaser acquire Products from Seller for resale to any other
party but only for use by the Purchaser as a component in the production of
fabrication for sale by the Purchaser of a complete Climate Control System or
for sale by the Purchaser as part of a Cassette (as defined in the Master
Agreement) and/or a kit to its Affiliates or Strategic Partners for inclusion in
a complete Climate Control System.
ARTICLE III - GENERAL
3.1 Notifications. Any notice which either party may be required or
desires to give to the other party hereunder, except when otherwise provided
for, shall be deemed to be duly given: (i) when mailed by registered or
certified mail, postage prepaid to the other party at the following addresses or
any other address of addressee subsequently designated in writing by the duly
authorized representative of the party or (ii) when sent by facsimile to the
other party at the following telephone numbers or to any other telephone number
subsequently
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designated in writing by the respective duly authorized representative of the
party:
To Purchaser: Fresh Air Solutions, L.P.
330 South Warminster Road
Hatboro, Pennsylvania 19040
Attention: Chairman
To Seller: Engelhard Sensor Technologies, Inc.
6489 Calle Real
Goleta, California 93117
Attention:
with a copy to: General Counsel at:
101 Wood Avenue
Iselin, New Jersey 08830-0770
3.2 Term. This Agreement shall become effective as of the date hereof
and shall continue thereafter for a term expiring on February , 2002.
3.3 Termination for Breach. If either party is in material breach of
this Agreement, then the other party may, upon at least sixty (60) days' prior
written notice, terminate this Agreement, unless within such notice period the
breach is cured, in which event the notice of termination becomes ineffective.
3.4 Limitation of Liability. Notwithstanding anything to the contrary
in this Agreement or otherwise, in no event shall Seller be liable for indirect,
incidental, consequential or special damages incurred by Purchaser or any third
party arising out of or relating to this Agreement or any transactions hereunder
even if Seller has been apprised of or is aware of the possibility of such
damages. In no event shall the aggregate liability of Seller to Purchaser and
all third parties arising out of or relating to any supply of Products or the
transactions contemplated hereunder exceed the purchase price paid by Purchaser
with respect to the Products in respect of which such claim is made.
3.5 Force Majeure. Any delay in or failure of performance or delivery
by Seller shall not constitute a breach of or default under this Agreement or
give rise to any claims for damages if and to the extent caused, directly or
indirectly, by acts of God, acts of Purchaser, acts, rules or regulations of
governmental authority (civil or military, executive, legisla
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tive, judicial or otherwise), strikes or other concerted acts of workers,
lockout, labor difficulties, fires, floods, storms, accidents, earthquakes,
tidal waves or other natural disasters, epidemics, war, riots, rebellions,
sabotage, insurrection, difficulties or delays in public transportation or in
public or postal delivery services, car shortages, fuel shortages, inability to
obtain from usual sources of supply, inability to obtain suitable or sufficient
energy, labor, machinery, facilities, supplies or materials as and when
required, failure of any third party to honor its contractual commitment or any
other circumstances beyond Seller's reasonable control, whether of a similar or
dissimilar nature. Upon the occurrence of any of the circumstances described in
the foregoing sentence, Seller shall have no obligation whatsoever to make any
allocation of its available production, deliveries, services, raw materials or
other resources, but may at its option elect to allocate its available
production, deliveries, services, raw materials or other resources among any and
all purchasers as well as departments, divisions, subsidiaries and affiliates of
Seller upon such basis as Seller, in its sole discretion, may determine without
liability whatsoever for any failure of performance which may result therefrom.
3.6 Assignment. Purchaser shall have no right to transfer or assign its
interest or rights in this Agreement or delegate its obligations under this
Agreement without the prior written consent of Seller.
3.7 Severability. If any provisions of this Agreement or the
application of such provision to any party or circumstance shall be held invalid
the remainder of this Agreement or the application of such provision to a
different party or circumstance shall not be affected thereby; provided,
however, that the parties shall negotiate in good faith with respect to any
equitable modification of the provision or application thereof held to be
invalid.
3.8 Construction. Article and Section headings are for convenience of
reference only and shall not affect the interpretation of any of the provisions
of this Agreement. None of the provisions of this Agreement shall be for the
benefit of or enforceable by any third party.
3.9 Entire Agreement; Amendments. This Agreement, together with the
Master Agreement and the Transaction Documents and Related Agreements (each as
defined in the Master Agreement), contains the entire understanding between the
parties with respect to the within subject matter and shall be
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controlling to the exclusion of all terms and conditions on any purchase order,
acknowledgment form or any other documents which may be issued by the parties
hereto on or after the date hereof. This Agreement may not be modified or
amended except in a writing signed by the parties hereto. No waiver or
indulgence of any breach or default hereunder shall be construed as a waiver of
any subsequent breach of the same or any other provision of this Agreement.
3.10 Prior Agreements. This Agreement cancels and supersedes all other
written or verbal agreements which may have been in effect prior to this
Agreement relating to the within subject matter.
3.11 Jurisdiction. The parties hereto agree that all of the provisions
of this Agreement and any question concerning its interpretation and enforcement
shall be governed by the laws of the State of Delaware.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their duly authorized representatives, as of the date first above
written.
FRESH AIR SOLUTIONS, L.P. ENGELHARD SENSOR TECHNOLOGIES, INC.
By its General Partner
ICC DESICCANT TECHNOLOGIES,
INC.
By: By:
---------------------------------- ---------------------------------
Name: Name:
Title: Title:
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