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EXHIBIT 10.19
Certain portions of this exhibit have been deleted and confidentiality filed
with the Securities and Exchange Commission pursuant to a confidential
treatment request under Rule 406 under the Securities Act of 1933, as amended.
The confidential portions of the exhibit that have been deleted are indicated
by "[***]" inserted in place of such confidential information. In addition, all
exhibits to this exhibit have been deleted and confidentially filed with the
Securities and Exchange Commission.
SUPPLY AGREEMENT
THIS AGREEMENT, made and entered into as of the 1 day of January,
2000, by and between UCAR CARBON COMPANY INC., a Delaware corporation with
offices at Highway 7, Santa Fe Pike, Columbia, Tennessee 38401 ("Seller") and
SIMCALA INC., P.O. Box 68, Ohio Ferro-Alloys Road, Mt. Meigs, Alabama 36057
("Buyer").
WHEREAS, Buyer operates a silicon metal plant in Mt. Meigs, Alabama
("Mt. Meigs") where it uses carbon electrodes ("electrodes"); and
WHEREAS, Buyer has purchased some of its electrodes in the past from
Seller; and
WHEREAS, Buyer desires to enter into a long term Supply Agreement with
the Seller for all of the electrodes which Buyer uses at its Mt. Meigs Plant,
and Seller is willing to supply Buyer with its requirements for electrodes, all
as set forth herein below.
W I T N E S S E T H:
1) Electrodes: Seller hereby agrees to sell and deliver to Buyer, and
Buyer hereby agrees to purchase and accept from Seller, during the
term of this Agreement, [***]% of Buyer's annual requirements of
electrodes and connecting pins. The electrode and connecting pin
specifications are described in Exhibit A.
2) Price: The price of electrodes for the duration of this agreement, is
set forth in Exhibit B.
3) Weights: All electrodes shipped under this Agreement shall be weighed
by certified truck or railroad scales, or with the consent of the
other party, by either Buyer's or Seller's certified scales.
4) Term: The term of this Agreement is set forth in Exhibit B.
5) Delivery: Seller shall deliver all electrodes sold hereunder to Buyer
FOB Buyer's Mt. Meigs facility, with title and risk of loss passing
Buyer at that point. Seller shall pay all freight charges for
electrodes.
6) Payment: Payment in U.S. dollars for electrodes hereunder is due
thirty (30) days from date of receipt of invoice for each shipment.
7) Warranty:
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A. Seller warrants that the electrodes delivered hereunder will
conform to the specifications set forth in Exhibit A, as
applicable, subject to such other specifications as may be
agreed upon, in writing, by and between the parties hereto.
B. Seller warrants that the use or sale of each electrode
delivered hereunder will not infringe upon any claim of any
United States patent covering the electrodes, but Seller does
not warrant against infringement by reason of the use of such
product in combination with other articles or material or in
the practice of any process other than any process for which
such product has been expressly designed or sold by Seller
hereunder.
C. THERE ARE NO EXPRESS WARRANTIES BY SELLER OTHER THAN THOSE
SPECIFIED IN THIS PARAGRAPH 7. NO WARRANTIES BY SELLER (OTHER
THAN WARRANTY OF TITLE AS PROVIDED BY THE UNIFORM COMMERCIAL
CODE) SHALL BE IMPLIED OR OTHERWISE CREATED AT LAW OR IN
EQUITY, INCLUDING, BUT NOT LIMITED TO, WARRANTY OF
MERCHANTABILITY AND WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE. Without limiting the generality of the foregoing,
Buyer assumes all risk and liability for the results obtained
by the use of any products delivered hereunder in combination
with other articles or material or in the practice of any
process.
D. Seller's liability under the warranties specified in this
paragraph 7 shall be limited to the repair or (at Seller's
option) the replacement, or refund of the purchase price, of
any product delivered hereunder which is in breach of
warranty. No claims of any kind with respect to any product
covered by this document, whether as to product delivered or
for delayed delivery or non-delivery of products and whether
or not based on negligence or warranty, shall be greater in
aggregate amount than the purchase price of the product in
respect of which such claims are made. In no event shall
either party be liable for special, indirect or consequential
damages, whether or not caused by or resulting from the
negligence of such party.
8) Force Majeure: Neither Buyer nor Seller shall be liable for any delay
or failure to perform hereunder caused by contingencies beyond their
reasonable control, including but not limited to, acts of God, fire,
flood, wars, sabotage, accidents, labor disputes (whether or not such
disputes are within the power of the party to settle), governmental
laws, rules, ordinances and regulations, whether valid or invalid,
(including, but not limited to, import or export prohibitions or
priorities, requisitions, allocations and price adjustment
restrictions), inability to obtain material, equipment, or
transportation and any other similar or dissimilar occurrence. In the
event any such contingency affects only a part of Seller's capacity to
produce and/or deliver electrodes, Seller will allocate production
and/or deliveries among the requirements of all its regular customers
and Seller's own requirements in such manner as Seller shall deem to
be fair and equitable. In no event shall Seller be obligated to
purchase raw materials or electrodes from others in order to enable it
to deliver electrodes to Buyer hereunder.
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9) Assignment: Any assignment of this Agreement without the prior written
consent of the other party shall be void.
10) Governing Law: The laws of the State of Delaware shall govern the
validity, interpretation and performance of this Agreement.
11) Arbitration: Disputes hereunder shall be finally settled by
arbitration in Delaware under the Rules of the American Arbitration
Association.
12) Notices: All notices or other communications required hereunder shall
be deemed given when sent registered or certified mail, postage
prepaid, addressed to the other party at the address set forth below,
or at such other address as the other party shall have heretofore
designated in writing. The Post Office receipt showing the date of
mailing shall be prima facie evidence of mailing.
If to Seller: UCAR Carbon Company, Inc.
Highway 7
Santa Fe Pike
Columbia, Tennessee 38401
Attention: J.D. Haworth
If to Buyer: SIMCALA, Inc.
P.O. Box 68
Ohio Ferro-Alloys Road
Mt. Meigs, Alabama 36057
Attention: C.E. Broadwine
13) Amendment: No amendment of or modification to this Agreement shall be
effective unless made in writing and signed by both parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
day and year first above written.
WITNESS: UCAR CARBON COMPANY INC.
- -------------------------------- By: /s/ Joseph D. Haworth
Title: Director of Specialty Metals Market
WITNESS: SIMCALA, INC.
- -------------------------------- By: /s/ C.E. Boardwine
Title: President and CEO
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EXHIBIT A
CARBON ELECTRODE AND GRAPHITE CONNECTING PIN MATERIAL SPECIFICATION:
- ------------------- ----------------- ----------------- ----------------- ----------------- --------------------
Socket
Dimensions
Machined with
Catalog Diameter Length 2" lead acme Specific
Number Dimensions Dimensions thread Bulk Density Resistance
- ------------------- ----------------- ----------------- ----------------- ----------------- --------------------
Max: [***]" Max: [***]" Diameter: [***]" [***] g/cc
S452330 Min: [***]" Min: [***]" Length: [***]" min [***](mu)(OMEGA)m max
- ------------------- ----------------- ----------------- ----------------- ----------------- --------------------
Max: [***]" [***] g/cc
P2330C Min: [***]" min [***] (mu)(OMEGA)m max
- ------------------- ----------------- ----------------- ----------------- ----------------- --------------------
RECEIVING INSPECTION: Buyer shall verify factory order number and length
against tally sheet.
INDIVIDUAL AUTHORIZED (As designated by customer)
TO APPROVE RECEIPT:
PACKAGING: Electrodes secured to truck bed on cradles or
pallets.
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EXHIBIT B
CARBON ELECTRODE PRICE:
1. The price beginning January 1, 2000 through June 30, 2000, is [***]
([***]) cents per pound delivered to Buyer's plant.
2. The price in effect beginning July 1, 2000 through December 31, 2000,
is [***] ([***]) cents per pound delivered to Buyer's plant.
3. The price beginning January 1, 2001 through December 31, 2001, is
[***] ([***]) cents per pound delivered to Buyer's plant.
4. The price in effect beginning January 1, 2002 through December 31,
2002, shall be no more than [***] percent ([***]%) above or below the
price delivered to Buyer's plant in previous year. Subject to the
foregoing, the electrode price change beginning on January 1, 2002,
will be [***] of the percentage change in published average silicon
metal prices in the previous twelve (12) months. Buyer and Seller will
mutually agree upon published silicon prices for this calculation.
AGREEMENT DURATION: The initial term of this Agreement shall be for a period of
thirty-six (36) months commencing on January 1, 2000 and terminating on
December 31, 2002.
By the end of each calendar year, the Buyer and Seller will meet to discuss the
possible extension of this supply agreement for another term.
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