Exhibit 10.26
RAW MATERIAL PURCHASE AND SALE AGREEMENT
This Agreement is made as of January 1, 2004 between each entity listed as
a "Seller" on Schedule 1 attached hereto (each a "Seller" and collectively the
"Sellers") and each entity listed as a "Purchaser" on Schedule 2 (each a
"Purchaser" and collectively the "Purchasers").
RECITALS
Purchaser is engaged in the manufacture and sale of titanium dioxide, and
Purchaser's operations require the supply of raw materials, including
titanium-bearing feedstock (the "Products").
Seller has entered into contracts with third parties for the acquisition of
Products.
Purchaser desires to purchase Products from Seller, and Seller desires to
sell such Products to Purchaser, pursuant to the terms and conditions hereof.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration the parties hereto agree as follows:
Section 1. Purchase and Sale. Seller hereby agrees sell to Purchaser, and
Purchaser hereby agrees to purchase from Seller, the Products set forth on
Schedule 3 under the terms and conditions of this Agreement.
Section 2. Purchasing Services.
2.1. Purchasing Services. Seller will provide the following services to
Purchaser:
(a) Upon receipt from Purchaser of an order containing the standard
specifications listed on Schedule 4 attached hereto, Seller will
purchase the Products from a third-party supplier in the
quantities set forth in such standard specifications. Upon
Purchaser's request, Seller will make available to Purchaser at
Seller's offices, copies of all purchase orders submitted to
suppliers for Purchaser's review and copying.
(b) Seller is responsible for all payments to suppliers arising from
the purchase of Products, including transportation and related
costs, customs, duties and local and other applicable taxes.
(c) Seller is responsible for all administrative costs associated
with the performance of this Agreement, including personnel and
overhead costs.
(d) Seller shall process all freight or other claims for the
replacement of lost or damaged Products with the responsible
parties.
(e) Seller shall use reasonable efforts to ensure good and timely
performance and delivery from each supplier. In addition, Seller
will inform Purchaser on shipping delays or Product
unavailability and use its reasonable good faith efforts to
acquire Product from alternate sources. Seller is responsible for
obtaining corrective action from the supplier and providing
recommendations to Purchaser on a suggested course of action to
remedy problems in the supply of Products.
Section 3. Purchaser's Rights and Obligations.
3.1. Product Purchases.
(a) Purchaser shall deliver to Seller a purchase order (the "Purchase
Order") for Products to be purchased according to the standard
specifications.
(b) Purchaser shall have the right to inspect and test all Product
purchases and to reject any or all Products that are
non-conforming in Purchaser's reasonable judgment.
(c) Purchaser shall be required to accept delivery of all conforming
Products supplied by Seller pursuant to a Purchase Order and the
standard specifications.
(d) Purchaser shall be responsible for all payments due to Seller
hereunder for Products supplied pursuant hereto.
(e) Purchaser shall be responsible for all transportation and
delivery costs for Products purchased.
Section 4. Compensation and Reimbursable Expenses.
4.1. Seller's Fee. Purchaser shall pay to Seller for its services hereunder
the fee (the "Fee") set forth on Schedule 5 attached hereto.
4.2. Payment. Seller shall invoice Purchaser for all Products purchased
hereunder. The Fee shall be due and payable net 15 days from the end
of the month in which the Products are purchased by Purchaser from
Seller. Purchaser may offset amounts due to Seller through the Kronos
netting system.
Section 5. Delivery. All sales of Products to Purchaser and passage of title to
such Products shall take place upon delivery of the Products at Purchaser's
dock.
Section 6. Term. The term of this Agreement shall begin on the date first
written above (the "Effective Date") and shall continue in full force and
effect for one year from the Effective Date, subject to automatic renewal
for a consecutive one year term, unless terminated pursuant to the terms of
this Agreement.
Section 7. Termination.
7.1. Without Cause. Either Purchaser or Seller may terminate this Agreement
at any time by giving written notice of termination, via Registered or
Certified Mail, to the other party at least one hundred-eighty (180)
days prior to the effective date of termination. This Agreement may be
terminated for any reason or no reason and with or without cause.
7.2. For Cause. This Agreement may be terminated if either party shall
violate a material term of this Agreement and fail to discontinue the
violation or to cure the violation within thirty (30) days after the
receipt of written notice of the violation.
Section 8. Product Warranties. Seller warrants that at the time of delivery to
Purchaser, the Products shall conform in all material respects to the
specifications for such Products set forth in the standard specifications.
Seller further warrants that it will convey to Purchaser good title to the
Products free from any lawful encumbrance. Seller MAKES NO WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE, NOR IS THERE ANY OTHER
EXPRESS OR IMPLIED WARRANTY.
Section 9. Returns and Adjustments. In the event of a breach of the warranty set
forth herein, Seller shall replace the non-conforming Products, at its cost
and expense, with conforming Products.
Section 10. Limitation of Liability. In no event shall either party be liable to
the other for any type of indirect, special, consequential, exemplary, or
punitive damages, including but not limited to loss of profit or revenue or
loss of operating time or production.
Section 11. General Provisions.
11.1.Force Majeure. In the event of war, fire, flood, strike, labor
trouble, breakage, or failure of performance of equipment, or shortage
or inadequacy of raw materials, supplies or equipment, accident, riot,
act of governmental authority, acts of God, or other similar
contingencies beyond the reasonable control of Seller interfering with
Seller's supply or transportation of Products, or in the event of
inability to obtain, on terms deemed by Seller to be practicable, any
raw material (including energy source) used in connection with the
production of Products, quantities so affected shall be eliminated
from quantities ordered without any liability of Seller, but the terms
shall otherwise remain unaffected. Seller may, during any period of
shortage, due to any of the causes indicated in this paragraph,
allocate its available supply of Products among any or all Purchasers
on such basis as Seller, in its reasonable discretion, may deem fair
and practical.
11.2.Assignments; Amendment. This Agreement shall not be assigned by
Seller in whole or in part without the prior written consent of
Purchaser. This Agreement may be amended at any time by the mutual
consent of both parties.
11.3.Entirety. All Schedules and Exhibits to this Agreement are
incorporated by reference herein and shall form a part of this
Agreement as though expressly set forth herein. There is no
understanding, representation, or warranty of any kind expressed or
implied, not expressly set forth in this Agreement. No modification of
this Agreement shall be of any force or effect unless in writing
signed by the party to be bound.
11.4.Notices. Any notice, request, demand, instruction or other
communication to be given to either party hereunder, shall be in
writing, and shall be deemed to be delivered (a) upon receipt, if
delivered by facsimile, or electronic mail, (b) upon receipt if hand
delivered, (c) on the first business day after having been delivered
to a national overnight air courier service, or (d) three business
days after deposit in registered or certified mail, return receipt
requested.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the year and date first above written.
PURCHASER:
KRONOS TITAN GmbH
By:/s/ Volker Roth By:/s/ Ufert Fiand
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Name: Volker Roth Name: Ufert Fiand
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Title: Title:
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KRONOS EUROPE S.A./N.V.
By:/s/ Erik van der Auwera By:/s/ Henry Basson
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Name: Erik van der Auwera Name: Henry Basson
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Title: Title:
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KRONOS CANADA, INC.
By:/s/ Antoine Doan
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Name: Antoine Doan
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Title:
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SELLER:
KRONOS (US), INC.
By:/s/ Gregory M. Swalwell
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Name: Gregory M. Swalwell
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Title:Vice President Finance; Chief FInancial OFficer
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SCHEDULE 1
SELLER
The following entities are each a "Seller" under the Agreement
1. Kronos (US), Inc.
SCHEDULE 2
PURCHASER
The following entities are each a "Purchaser" under the Agreement
1. Kronos Titan GmbH
2. Kronos Europe S.A./N.V.
3. Kronos Canada, Inc.
SCHEDULE 3
PRODUCTS
Each Seller shall procure the following Products listed below its name:
1. Kronos (US), Inc.
a. Titanium-bearing Rutile
b. Titanium-bearing Slag
SCHEDULE 4
STANDARD SPECIFICATIONS
Orders placed by Purchaser with Seller for Products shall contain the
following information:
1. Product type
2. Product specifications
3. Quantity
4. Delivery date
SCHEDULE 5
PRICE
Seller's Fee for Products purchased by Purchaser shall be the sum of the
following:
1. Seller's cost for the Products
2. All freight, customs, duties and taxes arising from the purchase of the
Products plus a service fee of 2.5% of the sum of 1 and 2 above.