Document:

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                                                                    Exhibit 10.5

                            FIRST AMENDMENT TO LEASE

     This First Amendment to Lease (this "Amendment") is made as of May 6,
2004 by and between THE BOARD OF TRUSTEES OF THE LELAND STANFORD JUNIOR
UNIVERSITY, a body having corporate powers under the laws of the State of
California ("LANDLORD"), and Incyte Corporation, a Delaware corporation
("TENANT"), in the following factual context:

     A.   Landlord and Tenant, formerly known as Incyte Pharmaceuticals, Inc.,
are the parties to that certain Lease dated as of June 19, 1997, as amended by
(i) Notice of Commencement Date dated October 28, 1998, (ii) Notice of Base Rent
and Rentable Area dated November 24, 1998, and (iii) Notice of Rent Commencement
Date and Expiration Date dated November 24, 1998 (as so amended, the "LEASE"),
under which Tenant leases from Landlord a two-story building commonly known as
3160 Porter Drive in Palo Alto, California, as more particularly described in
the Lease. Capitalized terms used in this Amendment and not otherwise defined
herein shall have the meanings given to them in the Lease.

     B.   Landlord and Tenant now desire to further amend the Lease as provided
in this Amendment.

     NOW THEREFORE, the parties hereby agree as follows:

     1.   BASIC LEASE INFORMATION. Article 1 of the Lease is hereby amended to
modify the following terms:

          Building Address/Address of Tenant:  3160 Porter Drive
                                               Palo Alto, CA 94304
<PAGE>

     2.   PREMISES. The last four sentences of Section 3.1 of the Lease, and all
references in the Lease (including, without limitation, in Article 14 of the
Lease) to "Ground Lease," and "Ground Lessee" are hereby deleted. The defined
term "Ground Lease Property" shall be replaced with the defined term "3160/3170
Porter Drive Site", which shall mean the total area of both the Premises and the
land and improvements adjacent to the Premises that are commonly identified as
3170 Porter Drive, and currently leased to Lockheed Martin Corporation.

     3.   USE. Section 7.1 of the Lease is hereby amended to delete the second
sentence of such section and to substitute the following:

          "For the purposes of this Lease, "research and development" means uses
          primarily related to the study, testing, engineering, design, analysis
          and experimental development of products, processes, or services
          related to current or new technologies. Research and development may
          include limited manufacturing, fabricating, processing, assembling or
          storage of prototypes, products or materials, or similar related
          activities, where such activities are incidental to research,
          development or evaluation. Examples of research and development uses
          include, but are not limited to, computer software and hardware firms,
          electronic research firms, biotechnical firms, medical device firms,
          and pharmaceutical research laboratories. Related administrative uses,
          such as (a) finance, marketing, sales, accounting, purchasing, or
          corporate offices, (b) provisions of services to others on or
          off-site, and (c) related educational uses, may also be included
          provided they remain supportive to the primary uses of research and
          development and are part of the same research and development firm.
          Related administrative uses may constitute up to ninety percent (90%)
          of the Rentable Area of the Premises so long as at least ten percent
          (10%) of such Rentable Area is devoted to the primary uses of research
          and development."

     4.   INITIAL IMPROVEMENT WORK. The parties agree that the terms and
conditions of Sections 8.1 and 8.2 have been fully performed and are no longer
applicable to the Lease; provided, however, Tenant's acceptance of the Premises
pursuant to Section 8.2 remains subject to latent defects.

     5.   LANDLORD'S INDEMNITY. Landlord's indemnity as set forth in Section 8.4
shall also benefit any assignee of Tenant's leasehold estate, and any subtenant
that subleases the entire Premises for substantially all of the remaining term
of the Lease.

                                       2
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     6.   ALTERATIONS. Notwithstanding anything to the contrary in Article 9 of
the Lease or elsewhere in the Lease, Landlord hereby acknowledges and agrees
that Tenant shall not be obligated or required to remove, upon the Termination
Date, any Alterations existing in the Premises as of the date of this Amendment.
In addition, the following modifications are hereby made to Article 9 of the
Lease:

          (a) The phrase "Notwithstanding the foregoing" at the beginning of the
          second sentence of Section 9.1 is hereby deleted and replaced with the
          following: "Notwithstanding the foregoing, after completion of
          Tenant's initial improvements to the Premises, . . "

          (b) All references to the "Tenant Improvement Allowance" in Section
          9.5 are hereby deleted.

     7.   INDEMNITY. Tenant's indemnity with respect to the condition of the
Premises or any occurrence on the Premises, as set forth in clause (c) of
Section 21.1(a) of the Lease, is hereby modified to add the following words
after the word "Agents": "or to the extent of Landlord's liability pursuant to
Section 8.4 of this Lease."

     8.   CONFIDENTIALITY. The second sentence of Article 28 of the Lease is
hereby modified to add the following at the end thereof: "but does not include,
and shall not be deemed to include, disclosures by either party as required (a)
to comply with the rules of any exchange upon which the disclosing party's
shares are traded, (b) to comply with the requirements of applicable law, or (c)
to facilitate any sale or financing of the Premises or the land underlying the
Premises, so long as any party who receives any of the information described in
the first sentence of this Article 28 in connection with such sale or financing
agrees in writing to maintain the confidentiality of such information pursuant
to the first sentence of this Article 28."

     9.   EFFECT OF AMENDMENT. As modified by this Amendment, the Lease remains
in full force and effect.

                                       3
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first above written.

                                THE BOARD OF TRUSTEES OF THE LELAND
                                STANFORD JUNIOR UNIVERSITY

                                By Stanford Management Company

                                By: /s/ Jean Snider
                                    -------------------------------
                                    Jean Snider, Managing Director
                                        Stanford Research Park

                                INCYTE CORPORATION

                                By: /s/ David Hastings
                                    -------------------------------

                                Its: EVP, CFO
                                     -------------------------------

                                       4exv10w14

 

EXHIBIT 10.14

***Indicates that a portion of the exhibit has been omitted based on a request
for confidential treatment submitted to the Securities and Exchange Commission.
The omitted portions have been filed separately with the Commission.

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 One Crown Way,
Philadelphia, PA 19154 (hereinafter the “Supplier”) and Cott Corporation, a
Canada corporation, with a place of business at 333 Avro Avenue, Pointe-Claire,
Quebec H9R 5W3 (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: (i) those [***] listed on
Schedule 1(a) to this Agreement; (ii) any future [***]who [***]
despite Buyer’s [***] to [***]; (iii) any present or future [***]
for whom any member of Buyer Group [***] in circumstances where such
[***] and (iv) [***] production facility, which is currently a
[***]for a member of Buyer Group) 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 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. It is
understood and agreed that Supplier shall have no obligation to
supply Buyer Group with aluminum cans and ends in Spain, but, if
Buyer Group requires aluminum cans and ends in Spain, Buyer Group
shall be entitled to buy such aluminum cans and ends from other
suppliers pursuant to Section 1(e) of this Agreement.
	 
	 	(b.1)	 	 Schedule 1(b.1) contains the list of [***]that have been
authorized by Buyer and Supplier to [***], subject to and in
accordance with the terms of this Agreement. Supplier acknowledges
and agrees that Buyer cannot [***] whether any of its [***]
(including those listed on Schedule 1(b.1)) [***] any or all of
their [***] for [***] from [***]. Buyer will, however, use [***] to
try to [***] them to do so, but this shall not require Buyer to do
anything that may be construed as an attempt to induce any such
[***] to breach any agreements to which they are bound to [***] from
[***]. Buyer and Supplier may mutually agree (from time to time) to
authorize any of Buyer Group’s future [***] to [***] directly from
Supplier under this Agreement and at such time(s) Schedule 1(b.1)
will be updated to add any additional [***] under this Agreement.
	 
	 	(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). Actual can and end purchases for [***] and
estimated can and end purchases for [***] are shown by location on
Schedule 1(b.2) attached to this Agreement. For greater clarity,
Supplier acknowledges and agrees that all rights and remedies set
out in this Agreement that are available to Buyer are similarly (but
without duplication) available to all members of Buyer Group [***]
pursuant to this Agreement (despite the fact that certain provisions
of this Agreement may or may not specifically reference Buyer Group
or [***] pursuant to this Agreement). [***]
	 
	 	(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 to Buyer Group’s
requirements for Products for any present or future Buyer Group
manufacturing facilities (including without limitation, but subject
to Section 1(b.1) of this Agreement, those of [***] designated by
Buyer and [***] under this Agreement) 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 and its [***] 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 (but subject to the last sentence of Section 1(a)
with respect to the supply of aluminum cans and ends in Spain) 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) are set out on Schedule 1(f) attached to
this Agreement and 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. [***] will pay for all costs of
testing, including without limitation, third party testing Buyer
Group may require, and any costs required to make any equipment
changes in any of Buyer Group’s plants in order to accommodate the
changes to the Specifications. 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.
Supplier will inform Buyer if any of the proposed changes to the
Specifications have been approved by [***]. 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”) 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 at the Prices set forth
in this Agreement [***] and pricing [***] to be[***] (subject to
the same [***] of this Agreement and subject also to [***], from
time to time, as described below).
	 
	 	 	 	[***]
	 
	 	(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, [***] 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, [***].

	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 set out in Schedule 3(a), and are subject to adjustment as
therein set out. Other than as set out in Schedule 3(a), 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 [***] and [***] of the Products to the
Buyer Group’s or its designated [***] filling locations (each, a
“Designated Location”) with title to and risk of loss in the
Products passing to Buyer or such [***] as directed by Buyer, 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, including without limitation the terms of the Schedules
hereto.
	 
	 	(e)	 	[***]
	 
	 	(f)	 	[***]
	 
	 	(g)	 	If Supplier develops a new can or end (the “New Product”)
that [***] to Buyer, then Supplier shall be entitled to [***] to
develop and manufacture such New Products, and once [***] (in
accordance with this Section 3(g)), [***] of the [***] in the
finished Product [***] shall [***] to the Buyer and [***] of the
[***] in the finished Product [***] shall [***] to Supplier.
Supplier’s [***] shall be over a period of no more than [***] from
the date of the [***] and shall be [***] over the [***] over such
[***] period for all New Products forecasted to be manufactured by
the Supplier over such period (whether for [***] or others).
Supplier and Buyer, both acting reasonably and in good faith, shall
agree on the [***] of New Products over which the [***] shall be
amortized as well as the [***] and the methodology and mechanics for
auditing the [***] prior to Supplier [***] The [***] agreed to for
[***] manufactured in North America is set forth in the Supplier
[***] that is attached hereto as Schedule 3(g).
	 
	 	(h)	 	Where Supplier introduces an initiative to [***] which
results in Buyer Group, [***] incurring any [***] (including without
limitation to execute any equipment or production line modification
in Buyer plants, e.g. [***] in all plants and the [***] and any
other costs associated with inventory of cans and ends that [***],
Supplier shall [***] Buyer for all such [***] within thirty (30)
days after presentation by Buyer of its [***]. For clarity, such
[***] and [***] shall not be included in the [***] referred to in
Section 3(g) above. Buyer shall use its [***]

	4.	 	FREIGHT; FAILURE TO SUPPLY; CUSTOMER REFUSAL

	 	(a)	 	Set out on Schedule 4(a) hereto 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).
	 
	 	(e)	 	Attached hereto as Schedule 1(a) is the initial list of [***]
to be supplied products manufactured with [***] Supplier
acknowledges that this list may change from time to time, but Buyer
will use [***] Buyer Group [***] to be supplied with products
manufactured with [***] As soon as reasonably practicable after the
execution of this Agreement, Buyer will identify the service,
quality, specification and other parameters and requirements that
Supplier must satisfy in order to be [***] Buyer will act in good
faith with a view [***]. Supplier will have a period of [***]
following the identification of the parameters and requirements by
Buyer (or until the [***] for [***] initially identified on Schedule
1(a)), working in conjunction with Buyer, within which to satisfy
the [***] parameters and requirements. If Supplier cannot satisfy
any [***] parameters and requirements (pursuant to a mutually agreed
upon process) within that time period then Supplier must [***] to
have [***] until Supplier begins [***] Buyer Group for [***] in
accordance with this Agreement. If Supplier has satisfied such
[***] parameters and requirements, but the [***] manufactured with
[***] then Supplier shall not be obligated to [***]
	 
	 	(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, [***]
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 [***]
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 [***] 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, [***] (as
the case may be) 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)	 	Supplier, in addition to the other rights and
remedies set out in this Agreement that are available to Buyer
Group, [***] shall be responsible for: (A) the reasonable
direct out-of-pocket costs of removal, return and destruction
of such defective Products and their contents pursuant to
Buyer’s instructions working in conjunction with the Supplier
and/or customers of the Buyer Group, [***] for disposal or
destruction of the defective Products, (including without
limitation any [***] on Buyer Group, [***] with respect
thereto, but [***]; (B) the cost of such defective Products,
based on the net charges, per thousand cans and ends as
invoiced to Buyer; and (C) the cost of the contents of such
defective Products (as determined by the direct costs of
materials, labour and transportation incurred with respect to
such contents). Supplier must be provided with the opportunity
to inspect non-conforming Products prior to any reimbursement
hereunder. Buyer will verify any costs [***] in writing.

	 	(g)	 	Buyer Group, [***] 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 [***] 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 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, [***] (North America)

 

 

	 	 	 	 	 
	

	 	2003:
	 	100% of requirements of Buyer Group, [***] (North America, UK (by no later than October 1,
2003, provided that if Supplier is not ready to begin
supplying Super Ends in UK by such date it shall
nonetheless begin to [***] in accordance with Section
3(g), at the same time as it begins to [***] and
continue thereafter to [***] but only to the extent that
Buyer has [***], and provided further that, if Supplier
makes [***], then the provisions of Section 3(g)
of this Agreement shall apply thereto) and, by
mutually agreeable timing, in Mexico* and
Europe*)
	 
	 	 	 	 
	

	 	2004:
	 	100% of requirements of Buyer Group, [***] (North America, Mexico*, UK* and Europe*)
	 
	 	 	 	 
	

	 	2005:
	 	100% of requirements of Buyer Group, [***] (North America, Mexico*, UK* and Europe*)
	 
	 	 	 	 
	

	 	2006:
	 	100% of requirements of Buyer Group, [***] (North America, Mexico*, UK* and Europe*)

	 	 	 	in each case subject to the limitations otherwise set out in
this Agreement. All such [***] shall [***] towards the [***]
referred to in Section 3(g).
	 
	 	 	 	[*Timing for Mexico, UK (subject to what is set out above for
2003) and Europe is still to be agreed, and in the case of
Europe is [***] In the case of Mexico, Supplier shall begin
to [***] in accordance with Section 3(g), [***].]

	 	(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
Bill 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. [***] determined
to be damaged and missing [***] during the quarter.

	 	(c)	 	Minimum Production Runs
	 
	 	 	 	Where required by Buyer Group [***], the minimum production run
will be [***] per SKU instead of the current [***].

	 	(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.

 

 

	 	(ii)	 	Warehousing costs will be Supplier’s
responsibility.

	 	(e)	 	Six Sigma Requirements
	 
	 	 	 	Supplier shall comply with Buyer’s Six Sigma requirements set forth
in Schedule 6(e) to this Agreement.

	 	(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
Schedule 6(f) to this Agreement.
	 
	 	(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 set out in Schedule 6(g) 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.

 

 

	 	(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 on Schedule 6(h).
	 
	 	(ii)	 	Supplier will update Schedule 6(h) 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, [***] 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, [***] all the
necessary support to help secure new business. This includes,
Supplier and Buyer Group, [***] visiting potential customers to
present Supplier’s capabilities, specifications, QA/QC procedures,
producing sample runs, making plant visits, etc.
	 
	 	(j)	 	[***]

	 	(i)	 	Supplier will [***] Buyer for any [***] Buyer
Group, [***] experience when [***] to Supplier’s cans and
ends.
	 
	 	(ii)	 	Supplier will [***]

	 	(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 [***] 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 white base coat Buyer and Seller

 

 

	 	 	 	must mutually
agree on quantity, location and upcharge if any, [***] 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, [***] 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, [***] of Buyer Group and third party customers
of, and who contract with, Buyer, any member of Buyer Group, [***]
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).

	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 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 terms including the [***] provisions of this Agreement.
Buyer and Supplier agree that the contents of this Agreement are extremely
confidential. Accordingly [***] to all of Buyer’s companies, affiliates, [***]
will be at an [***] (agreed to from time to time) by Buyer and Supplier and
[***] and [***] shall be kept strictly confidential from third parties (subject
to the foregoing exceptions) including but not limited to Buyer’s [***] (other
than those listed on Schedule 1(b.1)) and other [***]. 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.
	

	 	 	 	 	 	One Crown Way
	

	 	 	 	 	 	Philadelphia, PA 19154
	

	 	 	 	 	 	Attention: VP, Sales - Beverage Division
	

	 	 	 	 	 	Fax No.: (215) 698-5335
	 
	 	 	 	 	 	 
	 	 	 	 	with (in the case of default notices), a copy to:
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	Crown Cork & Seal Company, Inc.
	

	 	 	 	 	 	One Crown Way
	

	 	 	 	 	 	Philadelphia, PA 19154
	

	 	 	 	 	 	Attention: General Counsel

 

 

	 	 	 	 	 	 	 
	

	 	 	 	 	 	Fax No.: (215) 698-6061
	 
	 	 	 	 	 	 
	 	 	(b)	 	Buyer: Cott Corporation
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	333 Avro Avenue
	

	 	 	 	 	 	Pointe-Claire, Quebec H9R 5W3
	

	 	 	 	 	 	Attention: VP, Global Procurement
	

	 	 	 	 	 	Fax No.: (514) 428-0180
	 
	 	 	 	 	 	 
	 	 	 	 	with (in the case of default notices), a copy to:
	 
	 	 	 	 	 	 
	

	 	 	 	 	 	Cott – Legal Department
	

	 	 	 	 	 	207 Queen’s Quay West, Suite 340
	

	 	 	 	 	 	Toronto, Ontario M5J 1A7
	

	 	 	 	 	 	Attention: General Counsel
	

	 	 	 	 	 	Fax No.: (416) 203-5609

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, 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 (directly or indirectly) 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/ William T. Gallagher
	 	By
	 	/s/ John Sheppard
	

	 	

	 	 	 	

	Name:

	 	William T. Gallagher
	 	Name:
	 	John Sheppard
	Title:

	 	Vice President
	 	Title:
	 	President and COO
	 
	 	 	 	 	 	 
	

	 	 	 	By
	 	/s/ Ivan Grimaldi
	

	 	 	 	 	 	

	

	 	 	 	Name:
	 	Ivan Grimaldi
	

	 	 	 	Title:
	 	Vice President, Global Procurement

 

 

Schedule 1(a)

[***]

 

 

Schedule 1(b.1)

[***]

[***]

[***]

[***]

[***]

[***]

 

 

Schedule 1(b.2)

[***] Actual Volume; [***] Forecast Volume

[*** - Three pages omitted]

 

 

Schedule 1(f)

Specifications

[*** - 21 pages omitted]

 

 

Schedule 3(a)

Prices

          Prices throughout the Term of this Agreement shall be as set forth in this
Schedule 3(a), subject only to those changes that are expressly provided for in
this Schedule 3(a).

          I. ALUMINUM PROGRAM

	a)	 	Subject to Sections (i), (ii) and (iii) under PRICES in this Schedule
3(a), adjustments will be made on [***] to reflect changes (increases or
decreases) in the [***] adjustments will be based on the [***] period,
preceding the adjustment date. The [***] adjustment will be based on the
[***] period preceding the adjustment date. Calculations of any
adjustments will be made based on [***] or some other mutually agreeable
publication if [***] is no longer publishing.
	 
	b)	 	Floor price – There will be [***] as part of Supplier’s pricing program.
	 
	c)	 	Ceiling price – The adjustments for the [***] will be [***] based upon a
[***] based on [***] .
	 
	d)	 	[***]
	 
	(e)	 	Buyer acknowledges being advised by Supplier that Supplier’s supply
agreements with its aluminum suppliers are currently all scheduled to end
on [***]. Therefore, Supplier cannot commit to Buyer that the aluminum
program terms set forth above shall continue after [***]. If such
contract(s) cause the prevailing terms of Supplier’s current aluminum
supply agreements to change, beginning [***], Supplier may change Prices
and the aluminum program terms set forth above to reflect terms in
Supplier’s new aluminum supply contract(s) with its aluminum suppliers.
Supplier agrees that any Price changes made under this Agreement based on
Supplier’s [***] shall reflect the [***]. Such changes in [***] will be
subject to confirmation by Supplier’s independent auditor (currently
PricewaterhouseCoopers). Buyer’s [***] will [***].
	 
	(f)	 	[***] Costs
	 
	 	 	Prices will be changed to reflect verifiable changes in the [***]
component of the price Supplier pays to [***]. Such changes in [***]
will be subject to confirmation by Supplier’s independent auditor
(currently PricewaterhouseCoopers).

 

 

	II.	 	PRICES – United States, Canada and Mexico

All pricing is for cans and ends combined.

	i)	 	Delivered prices effective with shipments on [***], which price already
reflects [***]. Buyer shall pay for all Products delivered pursuant to
this Agreement [***] within [***] days following the later of the date of
the actual receipt of the Products at the Designated Location and receipt
by Buyer of the Supplier’s invoice therefor, [***]. Supplier acknowledges
that Buyer shall be entitled to satisfy [***]. Invoices and all other
payments with respect to Products for Canadian and U.S. and Mexican
locations shall be in [***]. Delivered prices in Mexico shall be [***].
	 
	ii)	 	On [***] Prices will [***] the [***] period. Supplier shall be
entitled to [***] for that period. Supplier will [***] of the [***]
throughout the remaining Term of the Agreement. Following [***], the
Prices will be [***] as described in “Aluminum Program” above, and
such [***] shall be reflected as an [***] in [***] through the [***]
for the balance of the Term.
	 
	iii)	 	In addition to the Price changes to reflect [***], Supplier shall be
[***] shall[***] and shall in any event be [***] than the [***] in
the [***] The [***] to determine the [***] shall be the [***] and
are not subject to subsequent[***]. In order to effect such a [***],
Supplier will be required to provide Buyer with at least [***] notice
thereof and must provide Buyer with written evidence that Supplier’s
[***]. In no event will Buyer be required to accept a [***]. Upon
Buyer’s request from time to time, Supplier shall provide Buyer with
written verification from its auditors (PricewaterhouseCoopers) that
Supplier is in compliance with this paragraph.
	 
	 	 	[***]
	 
	 	 	[***]
	 
	iv)	 	Interest at the rate of [***] will be due on all overdue amounts.
	 
	III.	 	PRICES – Outside United States, Canada and Mexico

All pricing is for cans and ends combined.

 

 

	i)	 	Delivered prices effective with shipments on [***] and [***], which price
already reflects the [***]. Delivered prices in any other country where
Supplier will supply Products under this Agreement shall [***] in that
country, as agreed by the parties [***] based on [***] and [***]. Buyer
shall pay for all Products delivered pursuant to this Agreement [***]
within [***] following the later of the date of the actual receipt of the
Products at the Designated Location and receipt by Buyer of the Supplier’s
invoice therefor, [***]. Supplier acknowledges that Buyer shall be
entitled to satisfy [***]. Invoices and all other payments with respect
to Products for each country shall be in [***].
	 
	ii)	 	On [***], Prices will [***] the [***] period. Supplier shall be
entitled to [***] for that period. Supplier will [***] of the [***]
throughout the remaining Term of the Agreement. Following [***], the
Prices will be [***] as described in “Aluminum Program” above.
	 
	iii)	 	In addition to the Price changes to reflect [***] changes, Supplier
shall be [***] shall [***], and shall in any event be [***] than the
[***] in the [***] The [***] used to determine the [***] shall be
the [***] and are not subject to subsequent [***]. In order to
effect such a [***] change, Supplier will be required to provide
Buyer with at least [***] notice thereof and must provide Buyer with
written evidence that Supplier’s [***]. In no event will Buyer be
required to accept a Price [***]. Upon Buyer’s request from time to
time, Supplier shall provide Buyer with written verification from its
auditors (PricewaterhouseCoopers) that Supplier is in compliance with
this paragraph.
	 
	 	 	[***]
	 
	 	 	[***]
	 
	iv)	 	The pricing set forth above will also apply to all [***]. The Price
for [***] will be adjusted from time to time to reflect changes in
the price for [***].
	 
	v)	 	The pricing set forth above will [***], provided, however, that, with
respect to the [***], Buyer will pay Supplier £ [***].
	 
	vi)	 	[***] outside of Europe may be subject to adjustment to reflect [***]. From time to time Buyer will advise Supplier
of its intention to enter a country. Supplier will be required to evidence any

 

 

	 	 	[***] at that time.
	 
	vii)	 	In the event Buyer enters into a market where [***] Supplier shall work with Buyer to [***].
	 
	viii)	 	Interest at the rate of [***] will be due on all overdue amounts.

[***]

	 	 	[***]

[***]

[*** - Four pages omitted]

 

 

Schedule 3(g)

[***] Schedule

[*** - Two pages omitted]

 

 

Schedule 4(a)

Designated Locations and Freight Rates

[*** - Two pages omitted]

 

 

Schedule 6(e)

SIX SIGMA

          GMP’s
/ Facility Maintenance – Supplier will comply with standard FDA
recommended Good Manufacturing Practices, “GMP’s”, at all production,
warehousing and any intermediate locations, controlled by the Supplier,
handling materials to be supplied to Buyer. These requirements include, but
are not limited to, cleanliness of locations, proper sanitation (as
appropriate), compliance with personal hygiene and proper attire policies,
hairnet policies, “no-jewelry” policies and “no loose items above the waist
policies.” Supplier will maintain current training and GMP review records for
all employees and maintain appropriate documented pest control policies and
programs.

          Locations
and Location Changes – Supplier will inform Buyer of the address
and contact persons of each location for which Buyer supplied materials are
produced, warehoused, or otherwise maintained; and to which specific Buyer
group facilities (including copackers) each of these locations provides
materials. Supplier will request approval from Buyer for any and all proposed
changes of production location, warehousing, etc., as related to the specific
receiving Buyer facilities (including copackers), prior to effect of the
change.

          Site
Inspections – Buyer reserves the right to periodically, and without
prior notice, inspect all facilities related to Supplier Buyer supplied
materials for “GMP” and Quality compliance. Buyer reserves the right to
pre-inspect “new” or added locations of Supplier production, warehousing or
locations associated with handling of materials to be supplied to Buyer.

          Shipping
of Out-of-Standard Materials – Suppler will inform and request
approval from Buyer Corporate Purchasing and Buyer Technical Services, in
advance of shipping to Buyer, any known materials with Quality and / or supply
matters related to Buyer supplied materials, regardless of the Supplier
interpreted severity of the matter. Buyer reserves the right to inspect and /
or further evaluate these materials prior to Supplier shipping to a Buyer
facility.

          Can
Body, Can End and Associated Packaging Changes – Supplier supplied
Cans, Can Ends and associated packaging and shipping materials (i.e. pallets,
tear sheets, strapping, etc.) will be in accordance with previously agreed upon
standards. Where standards are not established, the materials will be of
acceptable Quality, as determined by Buyer.

          Any and all changes to Cans, Can Ends, associated packaging and / or
shipping materials from those with agreed upon established parameters; or in
cases where parameters are not currently established, changes from those
materials currently being received, must be reviewed and approved via

 

 

Buyer Corporate Purchasing. Such changes may include, but are not limited
to, can or can end design or dimensional changes, raw materials for can or can
end production, internal enamel coatings, et al.

          Can
and Can End Quality – Supplier will establish and maintain a procedure
such that individual Supplier production facilities will provide “conformance
to specification” supporting test result data to all specific Buyer receiving
facilities (including copackers) and Buyer Technical Services, at an agreed
upon frequency and to agreed upon detail, initially established to be “weekly”,
for the following identified “Critical parameters”: (Note: These test results
should be charted with indications of the mean, specification parameters, upper
and lower control limits of the process and standard deviations {or “Sigma”
levels}).

          Can
Body Manufacturing Critical Parameters:

	 	 	 
	Factory Finished Can Heights

	 	[***]
	Plug Diameter

	 	[***]
	Flange Width

	 	[***]
	Axial Load

	 	[***]
	Buckle

	 	[***]
	Metal Exposure

	 	[***]

          Can
End Manufacturing Critical Parameters:

	 	 	 
	Curl Diameter

	 	[***]
	Curl Height

	 	[***]
	Buckle

	 	[***]
	Metal Exposure

	 	[***]
	Pull Force

	 	[***]
	Pop Force

	 	[***]
	Tab Strength

	 	[***]

 

 

          In addition to the above physically measurable parameters, Buyer and
Supplier (both acting reasonably and in good faith) will mutually establish
acceptability parameters for the following attribute data. Once parameters are
established, Supplier must run all cans to the Buyer approved standards. COTT
PPG or a designated representative of COTT PPG must sign off such standards.

          Can Litho Graphics Clarity and Print Legibility

          Can Litho Register

          Can Litho Color(s)

          Buyer also reserves the right to establish acceptable parameters for these
physical attributes:

          Can Dings

          Can Dents

          Can Scratches and

          Can Creases

          Buyer reserves the right to refuse and / or return to Supplier any
supplied materials for which there are noted Supplier related Quality issues,
either at the time of receipt of the materials, or as a result of poor
performance level of these materials. Costs of these materials, shipping to
Buyer and / or return shipping to Supplier, destruction costs or any costs
related to these materials will be the liability of Supplier. Evaluation of
incoming Supplier supplied materials will be at a frequency of Buyer’s
discretion. In a timely manner, Supplier may provide supporting evaluation
results for questioned materials.

          Commitment
to Continuous Process Improvement / Six Sigma – In keeping with
Buyer’s internal Continuous Process Improvement / Six Sigma initiatives, Buyer
is requiring all of its Suppliers to adopt similar initiatives of Continuous
Process Improvement in all aspects and areas of their business relating to
manufacturing and delivery of supplied materials, services provided and
business relations with Buyer. The target reduction in variance for process
standard deviation is to attain a goal of “Six Sigma” with measurable progress.

          Note:
Six Sigma variation is defined as “3.4 defects per
million”. Buyer
Suppliers will periodically be asked to provide the current standard deviation
data or “Sigma status” of certain

 

 

operations. Responses to these requests must be supplied to Buyer within
a reasonable period of time and backed-up by supporting data on the process, as
necessary.

          Supplier will cooperate with efforts made by Buyer in seeking to reduce
variation in product quality and service to Six Sigma performance levels.
Supplier will have individuals participating in the Buyer’s Six Sigma training
sessions and initiatives and will integrate Six Sigma methodologies into
Supplier’s problem solving paradigms.

 

 

Schedule 6(f)

Qualification Procedures for Cans Are Attached

Qualification Procedures for Ends to be finalized within 60 days of execution of this Agreement

[*** - 18 pages omitted]

 

 

Schedule 6(g)

Service Rates

[***]

 

 

Schedule 6(h)

Service Personnel

CROWN CORK & SEAL CO. INC.

Contact Information for Crown

Plants Supplying Cott Beverages

	 	 	 	 	 
	Batesville, MS

Plant Manager: Larry Outlaw

195 Crowne Rd.

Batesville, MS 38606

Phone: (662) 563-7664

Fax: (662- 563-5639

Home phone: (601) 234-8103
	 	Conroe, TX

Plant Manager: Roger Harp

201 n. Frazier St.

Conroe, TX 77303

Phone: (936) 539-5401

Fax: (936) 539-1640

Home phone: (936) 866-6502
	 	Olympia, WA

Plant Manager: Troy Lovett

1202 Fones Rd.

Olympia, WA 98501

Phone: (360) 491-4900

Fax: (360) 459-5226

Home Phone: (360) 4560-8955
	 	 	 	 	 
	Calgary, AB, Canada

Plant Manager: Andy Pomerleau

4455-75th Avenue

Calgary, AB T2C 2K8

Phone: (403) 236-0241

Fax: (403) 236-0295

Cell: (403) 603-9065

Home phone: (403) 236-0339
	 	Winchester, VA

Plant Manager: Frank E. Babic

1461 Martinsburg

Winchester, VA 22604

Tel: (540) 662-2591

Fax: (540) 662-5644
	 	Puerto Rico

VP. Ops. James T. Bennett

12Km 6Hm – 65th Infantry Ave.

Carolina, Puerto Rico 00986

Tel: (787) 769-9650

Fax: (787- 769-8714
	 	 	 	 	 
	Lawrence, MA

Plant Manager: David C. Bush

155 Shepard St.

Lawrence, MA 01843

Phone: (978) 685-1961

Fax: (978) 686-9964
	 	Mankato, MN

Plant Manager: Robert L. Mason

174 Chestnut Street

Mankato, MN 56001

Phone: (507) 625-5081

Fax: (507) 625-5075
	 	Worland, WY

Plant Manager: Walter M. Wallace III

620 North Fourth St.

Worland, WY 82401

Phone: (307) 347-8271

Fax: (307) 347-8275
	 	 	 	 	 
	Cheraw, SC

Plant Manager: David T. Pierce

100 Evans Row

Cheraw, SC 29520

Tel: (843) 537-9794

Fax: (843) 537-4382
	 	Montreal, QC, Canada

Plant Manger: François Carrier

10000 Meilleur St.

Montreal, (QC) H3L 3J7

Tel: (514) 389-5961

Fax: (514) 389-0926
	 	Weston, ON, Canada

Plant Manger: Dave Baikie

21 Fenmar Dr.

Weston, Ont. M9L 2Y9

Tel: (416) 741-6002

Fax: (416) 741-6099

Pager: (416) 339-1529

Home phone: (905) 265-9190
	 	 	 	 	 
	Owatonna, MN

Plant Manager: Graham Foulkes

2929 West Bridge St.

Owatonna, MN 55060

Phone: (507) 455-1344

Fax: (507) 455-8140
	 	Lakeville, MN

Plant Manager: Thomas H. Lundin

8415-220th St. West

Lakeville, MN 55044

Tel: (612) 469-5491

Fax: (612) 469-3977

	 	Lacrosse, WI

Plant Manager: Kenneth D. Galberaith

1501 St. James St.

Lacrosse, WI

Phone: (608) 782- 6300

Fax: (608) 785-3484

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