Document:

EX-10(A)

Exhibit 10(a)

[*] TEXT OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

Confidential Treatment Requested by Core Molding Technologies, Inc.

Under 17 C.F.R. Sections 200.80(B)(4), 200.83 and 240.24b-2

[NAVISTAR LOGO]

SUPPLY AGREEMENT

Navistar, Inc.

AND

Core Molding Technologies Inc. and Core Composites

Corporation

 

 

Table of Contents

	 	 	 	 	 
	TERMS
	 	 	4	 
	1. TERM OF AGREEMENT
	 	 	4	 
	2. FREIGHT
	 	 	4	 
	3. PAYMENT TERMS
	 	 	4	 
	PRODUCT
	 	 	4	 
	4. PRODUCT TERMS
	 	 	5	 
	5. PRICING
	 	 	5	 
	6. [****]
	 	 	6	 
	7. [****]
	 	 	6	 
	8. SERVICE PARTS AVAILABILITY
	 	 	6	 
	9. PACKAGING AND PACKING
	 	 	7	 
	10. LABELING
	 	 	7	 
	11. VOLUMES
	 	 	7	 
	12. TOOLING
	 	 	8	 
	13. PRODUCT IMPROVEMENTS / COST REDUCTION
	 	 	8	 
	14. FORCED SELLER CHANGES, OBSOLESCENCE, AND NEW PRODUCTS
	 	 	9	 
	15. PRODUCT REGULATORY COMPLIANCE
	 	 	9	 
	16. PRICING, QUANTITY, REBATE AND FREIGHT DISPUTES
	 	 	10	 
	17. INSPECTION OF PRODUCTS
	 	 	10	 
	SELLER PERFORMANCE
	 	 	10	 
	18. PERFORMANCE ACHIEVEMENT
	 	 	10	 
	19. KEEP COMPETITIVE AGREEMENT
	 	 	10	 
	20. SUPPLY FAILURE
	 	 	11	 
	21. LATE DELIVERY CHARGES
	 	 	11	 
	22. ASSURANCE OF PERFORMANCE
	 	 	11	 
	23. REIMBURSEMENT FOR NON-PERFORMANCE BY SELLER
	 	 	12	 
	24. WARRANTY
	 	 	12	 
	25. REIMBURSEMENT FOR WARRANTY CLAIMS
	 	 	12	 
	26. FINANCIAL VIABILITY
	 	 	13	 
	27. AUDIT RIGHTS
	 	 	13	 
	28. NAFTA DOCUMENTATION
	 	 	14	 
	29. SUPPLIER DIVERSITY PROGRAM
	 	 	14	 
	30. VALUE SELLING
	 	 	15	 
	ENGINEERING/TECHNICAL SUPPORT
	 	 	15	 
	31. GENERAL
	 	 	15	 
	32. ENGINEERING SPECIFICATION AND PRODUCT COMPLIANCE
	 	 	15	 
	33 TRUCK ENGINEERING CAD/CAM SUPPLIER DESIGN DATA REQUIREMENTS
	 	 	15	 
	34. ELECTRONIC DATA INTERCHANGE (EDI) TRANSACTION REQUIREMENTS
	 	 	15	 
	35. INFORMATION TECHNOLOGY
	 	 	17	 
	36. QUALITY REGISTRATION
	 	 	17	 
	LEGAL/REGULATORY
	 	 	18	 
	37. COMPLIANCE WITH LAWS AND REGULATIONS
	 	 	18	 
	38. NON-COMPLIANCE CHARGES
	 	 	18	 
	39. MATERIAL SAFETY DATA SHEETS (MSDS)/SUBSTANCE RESTRICTIONS
	 	 	18	 
	40. NON-DISCRIMINATION
	 	 	19	 
	41. VETERANS’ READJUSTMENT ASSISTANCE ACT
	 	 	19	 
	42. MECHANIC’S LIEN
	 	 	19	 
	43. GOVERNMENTAL REQUIREMENTS
	 	 	19	 
	44. INDEMNIFICATION
	 	 	20	 

 

			
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	45. LIABILITY INSURANCE
	 	 	21	 
	46. REMOVAL OF IDENTITY OF BUYER
	 	 	22	 
	47. NEW BUSINESS
	 	 	22	 
	48. CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY
	 	 	22	 
	49. TERMINATION
	 	 	23	 
	MISCELLANEOUS
	 	 	24	 
	50. ASSIGNMENT OF RIGHTS AND DUTIES
	 	 	24	 
	51. MODIFICATION AND AMENDMENT OF AGREEMENT
	 	 	25	 
	52. CHOICE OF LAW
	 	 	25	 
	53. CONSENT TO JURISDICTION
	 	 	25	 
	54. SEVERABILITY
	 	 	25	 
	55. NO LIMITATION OF RIGHTS AND REMEDIES; SPECIFIC PERFORMANCE
	 	 	26	 
	56. FORCE MAJEURE
	 	 	26	 
	57. ENTIRE AGREEMENT
	 	 	27	 
	58. NOTICES
	 	 	27	 
	Navistar, Inc.
	 	 	27	 
	59. NO WAIVERS
	 	 	28	 
	60. CONSTRUCTION
	 	 	28	 
	61. HEADINGS
	 	 	28	 
	62. COUNTERPARTS
	 	 	28	 
	APPENDIX A — PRODUCT DESCRIPTION
	 	 	 	 
	APPENDIX B — PRODUCT PRICING SCHEDULE
	 	 	 	 
	APPENDIX C — NON-CONFORMANCE CHARGE SCHEDULE
	 	 	 	 

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TERMS

	1.	 	TERM OF AGREEMENT
	 
	 	 	This Supply Agreement (the “Agreement) between Navistar, Inc., formerly known as
International Truck and Engine Corporation (the “Buyer”) and Core Molding
Technologies/Core Composites Corporation (the “Seller”), effective as of May 1, 2008
(the “Effective Date”) replaces the Supply Agreement between Seller and Buyer dated
November 1, 2005 in its entirety. This Agreement will be for an initial term of five
(5) years and four (4) months commencing June 23, 2008 and terminating October 31,
2013, unless otherwise terminated as provided herein (the “Initial Term”). This
Agreement may be extended for additional terms of one year (each a “Renewal
Term”) provided that both parties agree in writing to such extension no later than
sixty (60) days prior to expiration of the Initial Term or renewal term, as the case
may be. This Agreement is effective as of the Effective Date and shall remain in
effect until either terminated by either party in accordance with the terms of this
Agreement or the expiration of the Agreement at the end of the Initial Term or any
Renewal Term.
	 
	2.	 	FREIGHT

	 	A.	 	Seller agrees to use only those freight carriers specified by Buyer. Buyer
must approve in writing any other freight carriers used by Seller prior to shipment.
The terms of delivery for all Products (as defined below) sold pursuant to this
Agreement shall be F.O.B. at Seller’s United States’ plants. Seller further agrees to
ship any and all service parts to multiple locations as required by Buyer’s
Distribution Network.
	 
	 	B.	 	Seller is responsible for following Buyer’s routing instructions and handling
all transportation activities efficiently and effectively. Specifically, Seller is
required to have Product staged for delivery and paperwork accurately prepared to
support the freight carrier’s prearranged pick-up time. The Seller is responsible for
paying additional transportation charges billed by the freight carrier on charges
caused by seller. Buyer expects Seller to settle properly documented charges promptly.
Seller’s failure to do so will result in freight debits to Seller.
	 
	 	C.	 	Seller shall not be liable for meeting shipping schedules due to
transportation equipment availability (lack of).

	3.	 	PAYMENT TERMS
	 
	 	 	Payment terms under this Agreement shall be [****] from date of receipt of an
invoice from Seller, or the date of receipt of the Products (as defined below) by
Buyer, whichever is later. All payments shall be made in U.S. dollars.

PRODUCT

 

			
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	4.	 	PRODUCT TERMS

	 	A.	 	During the Initial Term (or Renewal Term, if any) of this Agreement, Buyer
shall purchase from Seller, and Seller shall sell to Buyer, one hundred percent (100%)
of Buyer’s original equipment, and up to one hundred percent (100%) of Buyer’s service
requirements as they presently exist for fiberglass reinforced products and sheet
molded compound as detailed in the written specifications, drawings, part numbers,
design and style of Buyer (“Product”), attached hereto as Appendix A — PRODUCT
DESCRIPTION/PRODUCT PRICING, or as they may be hereafter improved or modified if such
improvements and modifications are approved by Buyer in writing, except where the
Buyer’s customer specifies another supplier’s product. Buyer’s requirements for
modules, which may or may not include similar components or equipment as the Products
herein, are not included in Seller’s or Buyer’s obligations under this section.
	 
	 	B.	 	Buyer reserves the exclusive right at any time to make changes or modifications
to the drawings and specifications of any Products, materials, or work covered by this
Agreement which are designed by Buyer, or are uniquely designed or created for Buyer.
Any difference in price or time for performance resulting from such changes shall be
equitably adjusted, and the Agreement shall be amended and modified in writing
accordingly.
	 
	 	C.	 	During the Initial Term (and Renewal Term, if any) of this Agreement, Seller
shall not sell, give, transfer or in any way cause to be or facilitate to be
manufactured or sold the Products or any derivatives of Products identified in Appendix
B — PRODUCT PRICING SCHEDULE of this Agreement and any Products sold to Buyer under
this Agreement to any other party other than Buyer, unless expressly authorized in
writing by Buyer.
	 
	 	D.	 	Seller hereby agrees to provide Buyer’s Service Requirements for Products
solely through the Buyer’s Parts Distribution Network or Buyer’s designated Affiliates
and Seller is hereby prohibited from distributing such Products to Buyer’s Customers
through any alternate aftermarket distribution channel, unless written authorization to
do so has been obtained from Buyer.
	 
	 	E.	 	Shipments of Products by Seller must equal the exact quantity ordered by Buyer,
though consideration must be given to allow for optimization of packaging and freight,
unless otherwise agreed to in writing by Seller and Buyer. Shipping schedules may
contain authorization by Buyer to the Seller to fabricate within a time specified
quantities of Products under this Agreement, the delivery of which has not been
specified by Buyer.

	5.	 	PRICING

	 	A.	 	Similar Pricing for Production Products and Service Parts. Products
used for OEM production vehicles (“Production Parts”), Products used to service
previously sold Production Products (“Service Parts”), and packaging, if applicable,
shall be quoted and priced by Seller to Buyer at the equivalent pricing levels. Price
reductions granted to Buyer by Seller on Production Products will also apply to all
corresponding Service Parts.

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	 	B.	 	Evidence of Cost to Buyer. Seller must provide Buyer with cost
transparencies satisfactory to Buyer including costs, packaging, if applicable, to
Seller for all Products covered in this Agreement.
	 
	 	C.	 	Pricing of Products. Pricing for Products shall under no circumstances
exceed pricing of similar products to Seller’s Parts Distributors. Upon receipt of a
written request from Buyer, Seller hereby agrees to provide Buyer’s Supply Manager with
all necessary documentation to evidence Seller’s compliance with its agreement set
forth in the previous sentence of this section.
	 
	 	D.	 	Similar Terms as Seller’s Other Customers. Seller will provide
Products to Buyer with terms and conditions on an overall basis that are no less
favorable than those of any other customer of Seller purchasing comparable quantities
of the same or similar Products.
	 
	 	E.	 	[****]
	 
	 	F.	 	[****]
	 
	 	G.	 	Current prices for Products are set forth in Appendix B — PRODUCT PRICING
SCHEDULE.

	6.	 	[****]
	 
	7.	 	[****]
	 
	8.	 	SERVICE PARTS AVAILABILITY

	 	A.	 	Service Parts for the Products covered by this Agreement will be furnished and
combined with Buyer’s Production Product orders. If Buyer ceases production of any
product incorporating a Product covered by this Agreement, Seller shall continue to
perform normal maintenance to tools, jigs and fixtures at no charge to Buyer.
	 
	 	 	 	Buyer is responsible for repair and replacement beyond normal maintenance on tools
jigs and fixtures (secondaries) and supply Buyer with the Products necessary to
satisfy Buyer’s past model service and replacement requirements for Product for a
minimum of ten (10) years after cessation of production.
	 
	 	 	 	Buyer agrees that economic incentives provided by the Seller associated with this
agreement have a basis upon product volume. Buyer agrees to provide Seller with the
following increase schedule for out of production part numbers.

	 	a.	 	[****]
	 
	 	b.	 	[****]
	 
	 	c.	 	[****]
	 
	 	d.	 	[****]

 

			
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	 	e.	 	[****]
	 
	 	f.	 	[****]

	 	B.	 	In addition, upon termination or expiration of this Agreement, Buyer shall have
the opportunity for a one-time buy of Products by Buyer to fulfill such service and
replacement requirements. Buyer and Seller shall negotiate in good faith with respect
thereto.
	 
	 	C.	 	There will be annual review in September to look at potential for all time run
(ATR) opportunities on service parts not to exceed $100,000.00 of inventory.

	9.	 	PACKAGING AND PACKING

	 	A.	 	Seller must comply with all requirements detailed in the Buyer’s D-13 Packaging
and Packing Requirement — 2001 Revision and seller will make every effort to comply
with amendments and any issues will be negotiated. This document is deemed a part of
this Agreement and is available at http://www.internationalsupplier.com/. This
D-13 Packaging and Packing Requirement details packing, packaging, labeling and
shipping requirements.
	 
	 	B.	 	Buyer is responsible for conveying product packaging specifications to Seller.
	 
	 	C.	 	Interpretation of packaging specifications and determination of market
competitive packaging costs and pricing will be coordinated between Buyer’s and
Seller’s Corporate Packaging staffs.
	 
	 	D.	 	If returnable containers are required by Buyer, Buyer will cover that cost.
	 
	 	E.	 	Seller will adhere to all retail packaging regulations of the countries where
the Products will be sold. This includes but is not limited to federal, state,
provincial, county, city, and other applicable laws, regulations and statutes.
	 
	 	F.	 	Seller will adhere to all hazardous material packaging regulations of the
countries where the Products will be sold. This includes but is not limited to federal,
state, provincial, county, city, and other applicable laws, regulations and statutes.

	10.	 	LABELING
	 
	 	 	Seller must meet the requirements identified in the Buyer’s Quick Receive Guideline,
which is available at http://www.internationalsupplier.com/, and which is
deemed part of this Agreement. Seller will make every effort to comply with
amendments and issues will be negotiated.
	 
	11.	 	VOLUMES

	 	A.	 	Seller and Buyer agree that Buyer’s forecasted volumes are based on past usage
and projected market forecasts. The parties hereby agree that no minimum purchase

 

			
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	 	 	 	quantities are implied by any term of this Agreement, and no penalties shall be
imposed on Buyer for volumes of Products actually ordered by Buyer below those
quantities forecasted.
	 
	 	B.	 	Buyer and Seller agree to review product pricing when significantly under
quoted volumes.

	12.	 	TOOLING

	 	A.	 	All tooling, jigs, fixtures and associated manufacturing equipment necessary
for the successful production and testing of the Products for which Buyer pays Seller
in full will remain the exclusive property of Buyer, and Seller assumes all liability
for any loss, damage and/or for Seller’s failure to return such property, including
equipment, to Buyer upon request. Seller shall promptly notify Buyer of any such loss,
damage or shortage. Such tooling items must be identified and labeled as “Owned By
International”. Furthermore, all tooling as described above owned by Buyer shall be
used exclusively for the manufacture of Products for Buyer. Seller will perform normal
maintenance, at Seller’s expense, for the duration of this Agreement. Buyer is
responsible for repair and replacement beyond normal maintenance on tools, jigs and
fixtures (secondaries)
	 
	 	B.	 	Tooling developed for the production of the Products will conform to Buyer’s
product development guidelines. It is expected that Seller will exercise due care and
judgment in the design, specification, sourcing, building, and supervision of building,
of all tooling in such a way to maximize production efficiency and minimize cost.
Seller will analyze domestic and overseas placement of tooling using various cost, part
and tooling design, timing requirements and work with the buyer to select the most
globally competitive source. Buyer will pay Seller only the globally competitive tool
cost. Seller shall submit all tools for inspection and review by Buyer in accordance
with AIAG (Automotive Industry Action Group) Publication, Production Part Approval
Process, prior to Buyer making payment for same. Buyer may, at its option, see
detailed tooling documents, invoices and/or tooling orders prior to issuing its
approval for payment of tooling. Tooling costs may be shared with Seller or amortized
as mutually agreed upon by both parties in writing. If Seller pays for tooling and
amortizes cost to Buyer as described in the attached Amortization Agreement, upon
completion of amortization Buyer shall have the option to purchase all such tooling
from Seller for the price of one dollar ($1.00).

	13.	 	PRODUCT IMPROVEMENTS / COST REDUCTION

	 	A.	 	Seller and Buyer are committed to an active product cost reduction program.
Any Buyer-initiated cost savings resulting from product improvements and/or design
changes shall be credited [****]to Buyer after funding the total cost of initial
tooling investment. Any Seller-initiated cost savings resulting from product
improvements and/or design changes shall be credited [****] to Seller after funding the
total cost of initial tooling investment.

 

			
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	 	B.	 	COMPASS/IdeaStream Credits. Buyer and Seller will establish a goal of
[****]% COMPASS/IdeaStream credit per calendar year, beginning January 1, 2006. All
ideas must be credited by October 31st of each calendar year in order to
qualify for the [****]% savings. Seller hereby agrees that it will follow
COMPASS/IdeaStream guidelines set forth in the International Supplier Network website,
http://www.internationalsupplier.com/, for what constitutes an acceptable idea
submission.
	 
	 	C.	 	When tooling investment is required by either party to implement or achieve a
cost reduction, the party funding such tooling shall retain [****] of the cost savings
until such time as such party recoups the total tooling dollar investment, after which
time the cost reduction will be credited as stated above.

	14.	 	FORCED SELLER CHANGES, OBSOLESCENCE, AND NEW PRODUCTS

	 	A.	 	Seller shall not discontinue any Product(s) without written agreement from
Buyer. Buyer will work in good faith with Seller to accept reasonable requests.
	 
	 	B.	 	Seller shall provide Buyer (3) months advance warning of changes that will
result in changes to Buyer’s cost, part numbers, or production processes. Changes that
have a negative impact on the Buyer’s total installed cost may only be implemented with
prior written agreement from Buyer.
	 
	 	C.	 	When Seller introduces proprietary Products intended to replace those
Product(s) already purchased by Buyer, those Products will be priced to have a total
installed cost equal to or lower than the Products they replace. As replacement
Products are introduced, all price reductions, freight terms, and rebates described in
this Agreement will apply to the replacement Products on the dates set forth in this
Agreement.
	 
	 	D.	 	When Seller seeks to introduce new Products to Buyer that are not replacement
Products, Buyer and Seller will negotiate in good faith to implement a competitive
price. As new Products are introduced, all price reductions, freight terms, and
rebates described in this Agreement will apply to the new Products on the dates
specified in this Agreement.

	15.	 	PRODUCT REGULATORY COMPLIANCE

	 	A.	 	Components or systems purchased from Seller that have specific government
regulatory performance requirements will require Seller to provide evidence of
compliance satisfactory to Buyer and the applicable governmental regulatory authority,
in the form of a test report and/or engineering analysis, validating conformance to
those specific requirements.
	 
	 	B.	 	Seller must provide the same evidence of compliance whenever a change is made
to a particular component or system that affects the performance of that component or
system to a specific government regulatory performance requirement.

 

	
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	 	C.	 	Seller must provide an annual “Letter of Conformance” per the compliance
standard operating procedure F-2 as outlined at
http://wwwnio.navistar.com/r&q/compliance/soi f-2.doc.

	16.	 	PRICING, QUANTITY, REBATE AND FREIGHT DISPUTES

	 	A.	 	All pricing, quantity, and freight debits, and rebate disputes between Buyer
and Seller that Seller wishes to contest must be communicated in writing by Seller to
the Buyer within six (six) months of the date of dispute. For quantity disputes,
Seller must provide a copy of the relevant proof of delivery (“POD”) that is stamped
with the Buyer’s receipt number, and the bill of lading (“BOL”) number.
	 
	 	B.	 	Seller must provide sixty (60) days written notice to Buyer of any intention to
stop shipment of Products as a result of a dispute set forth above. Seller shall
present its dispute to the Mediation Board at least sixty (60) days prior to proposed
end of shipment date to allow for adequate response from Buyer.

	17.	 	INSPECTION OF PRODUCTS
	 
	 	 	All Products shall be received subject to Buyer’s inspection and/or rejection.
Defective Products or Products not in accordance with Buyer’s specifications will be
held for Seller’s instructions and at Seller’s risk, and, if Seller so directs, will
be returned at Seller’s expense. Payment for Products prior to inspection shall not
constitute an acceptance thereof. Returned Products will be deducted from total
shipments.

SELLER PERFORMANCE

	18.	 	PERFORMANCE ACHIEVEMENT
	 
	 	 	When seller is design responsible, seller is required to meet all cost, delivery,
quality and technology requirements, and documentation thereof, as specified in this
Agreement. Buyer’s plants, Parts Distribution Centers or Supply Manager will
communicate non-conformances directly to Seller with requests for corrective actions.
These corrective actions must be performed in a timely manner and the issues
corrected to the reporting location’s satisfaction. All non-conformance will be
subject to the minimum charges as detailed in Appendix C — NON-CONFORMANCE CHARGE
SCHEDULE. Charges are negotiable between buyer and seller. The provisions of this
paragraph are not intended to limit in any way any other rights and remedies Buyer
may have against Seller pursuant to this Agreement, under law or equity or otherwise.
Seller maintains the right to dispute occurrences and buyer agrees that negotiations
will take place in good faith.
	 
	19.	 	KEEP COMPETITIVE AGREEMENT
	 
	 	 	Buyer and Seller recognize that continuing to be competitive in price, delivery,
quality, and technology is essential for this Agreement. If buyer reasonably
demonstrates to Seller that any aggregate sample of product including [****] is not a
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	 	 	in price, delivery, technology or quality with other equivalent products of
equivalent value, production, usage or availability in the world, then Seller agrees
to provide an action plan and timetable within ninety (90) days of such demonstration
to cure the deficiency to Buyers satisfaction. If the plan fails to cure the
deficiency within the agreed upon timetable, then Buyer may at its option withdraw
the non-competitive Product(s) from this Agreement and serve notice to terminate the
obligations of the parties under this Agreement with respect thereto, effective upon
the date specified by Buyer in such notice. Buyer agrees that prior to exercising
its option, it will consider, in good faith, any proposal by Seller to correct the
deficiency. Buyer recognizes that within the Seller’s current product list there is
a normal distribution of products and profitability, Buyer agrees to maintain the
current product list with the Seller for the duration of this agreement. [****]
	 
	20.	 	SUPPLY FAILURE
	 
	 	 	In the event of a partial failure of Seller’s sources of supply for the Products
purchased, Seller will allocate to customers based on their level of purchases.
	 
	21.	 	LATE DELIVERY CHARGES
	 
	 	 	If Buyer determines that Seller’s deliveries are so far behind a given schedule,
provided their have been no changes in schedule for EDI during the past 10 working
days, that Buyer requests express shipments, Seller will pay the express charges. If
Seller’s deliveries are so far behind a given schedule that the Buyer is compelled to
use material not according to Buyer’s specification, or at a higher cost, the Seller
will pay additional costs, expenses, losses, or damages Buyer sustains. If buyer’s
schedules exceed tool capacity originally quoted, buyer will pay additional costs
required for express shipment. The provisions of this paragraph are not intended to
limit in any way any other rights and remedies Buyer may have against Seller pursuant
to this Agreement, under law or equity or otherwise.
	 
	22.	 	ASSURANCE OF PERFORMANCE
	 
	 	 	If Buyer reasonably deems itself insecure with respect to Seller’s ongoing
performance, due to Seller’s financial capacity, Buyer may demand that Seller provide
assurance of future performance to Buyer within five (5) days of the demand. This
assurance may be in any security acceptable to Buyer, including but not limited to,
collateral consisting of cash, letter(s) of credit, surety bond, parent guaranty, or
lender releases. This security shall be in an amount satisfactory to Buyer and shall
also be sufficient to offset costs and expenses incurred or reasonably expected to be
incurred by Buyer in securing for itself completion of the project or other
performance due from Seller. Buyer reserves its right to any other remedies allowed
in law or equity. Failure to provide the requested performance assurance within the
stated period shall constitute a default of this Agreement, and Buyer shall be free
to cancel this Agreement in its discretion immediately upon expiration of the time
specified for delivery of the requested performance assurance.

 

			
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	23.	 	REIMBURSEMENT FOR NON-PERFORMANCE BY SELLER

	 	A.	 	Seller acknowledges that Buyer requires on-time delivery in order to operate
its plants and parts distribution centers. The parties further acknowledge that the
precise amount of Losses (as defined in Article 44A — INDEMNIFICATION) which Buyer
would sustain in the event Seller were to fail to make timely or conforming deliveries
of Products would be difficult to determine. Therefore, the parties agree that Seller
shall be responsible for any and all actual, losses resulting from Seller’s failure to
make timely or conforming deliveries of Products, including, but not limited to, [****]
as detailed in Appendix C — NON-CONFORMANCE CHARGE SCHEDULE. Seller will advise Buyer
immediately in writing of any apparent imminent problem, and the parties will each use
their best efforts to avoid any actual assembly line downtime. In addition, Seller
shall not be responsible for assembly line downtime charges for delinquent delivery
resulting from schedule changes by Buyer or Buyer’s unforeseen manufacturing
difficulties or insufficient packaging. With respect to Service Parts, buyer shall be
responsible for any emergency premium expenses for “truck down” orders.
	 
	 	B.	 	Seller shall promptly notify Buyer in writing of any anticipated labor dispute
or labor shortage or any other labor performance interruption, and Seller shall arrange
for advance deliveries or warehousing, at Buyer’s option and at locations acceptable to
Buyer, of a mutually agreeable supply of Products. Seller agrees to provide Buyer with
its plan to continue production and support Buyer with Product in the event of a labor
dispute, shortage, interruption, or contract expiration ninety (90) days before such
event. Seller also agrees to keep Buyer informed of the status of negotiations toward
renewal of any union contract or agreement.
	 
	 	C.	 	Buyer and Seller agree to the delivery performance targets, and the associated performance charges, for shipments to Buyer’s Parts Distribution Centers (PDC’s),
contract packagers, and/or freight forwarders.

	24.	 	WARRANTY
	 
	 	 	Seller agrees to warrant its Product(s) against defects in design if responsible,
materials, or workmanship, or any combination of these. The seller’s responsibility
includes failures that are the result of the Seller’s manufacturing process
decisions. This warranty is subject to the terms and conditions published in Buyer’s
CTS-1100 Warranty Manual
(http://service.navistar.com/WarrantyPolicyManual/CTS1100.pdf) in effect at
the time the Seller’s Product(s), begin production, subject to Article 25 -
REIMBURSEMENT FOR WARRANTY CLAIMS, which follows.
	 
	25.	 	REIMBURSEMENT FOR WARRANTY CLAIMS

	 	A.	 	Subject to the terms in Article 24 — WARRANTY above, Seller shall reimburse
Buyer for warranty claim costs determined by Buyer to be the result of a defect in the
Seller’s material, design if responsible, and/or workmanship as follows:

	 	i.	 	Material costs at the Seller’s selling price (Seller to Buyer’s
Service Parts Organization); plus

 

			
	****	 	Confidential Treatment Requested by Core Molding
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	 	ii.	 	Buyer’s Handling Allowance (Buyer to Dealer) in effect at the
time of failure (currently, dealer net price times [****]); plus
	 
	 	iii.	 	Dealer’s approved labor rate at the time of failure times the
appropriate Standard Repair Time as published in Buyer’s current CTS-1200 and
current S-00025 Warranty Time Schedule Manual or mutually agreed to time if no
SRT is published; plus
	 
	 	iv.	 	Freight charges associated with the delivery of replacement
parts; plus
	 
	 	v.	 	Freight and processing cost incurred by Buyer due to Seller’s
requirement to have failed material returned; plus
	 
	 	vi.	 	Charges associated with the purchase of parts outside of Buyer’s
distribution system, and/or repairs made by subcontractors; plus
	 
	 	vii.	 	Cost of repairs of any damage to other components caused by
Seller’s defective parts.

	 	B.	 	In the event that a Product fails due to materials and/or workmanship at an
extraordinary rate and results in Buyer issuing an Authorized Field Change or a Safety
Recall, Seller will reimburse Buyer for reasonable expenses associated with
administering the Authorized Field Change or Safety Recall in addition to the
reimbursement as specified in Article 25-A-iii — REIMBURSEMENT FOR WARRANTY CLAIMS
above.
	 
	 	C.	 	If Buyer agrees to reimburse a Customer for product failures beyond the
warranty period or terms in order to show good will and maintain customer satisfaction,
Seller agrees to negotiate in good faith with Buyer regarding reimbursement for these
expenses to Buyer on a case-by-case basis.
	 
	 	D.	 	Seller will issue credit within six (6) months from the date of dispute of the
time that the claim is presented by the Buyer. If Seller fails to do so the Buyer has
the right to debit the Seller’s account.
	 
	 	E.	 	If the Seller disputes its responsibility for a claim it must do so in writing
within sixty (60) days of notice of such claim and provide details to support such
denial.

	26.	 	FINANCIAL VIABILITY
	 
	 	 	Buyer will not award any new or additional business to Seller without evidence of the
Seller’s financial viability, including, without limitation, being provided with it
most current audited financial statements. All publicly available financial
information will be promptly provided to the Buyer upon request. If Seller becomes a
privately held company reasonable access will be given.
	 
	27.	 	AUDIT RIGHTS
	 
	 	 	Buyer will have no audit rights beyond information already publicly available as long
as company remains a publicly traded company. If Seller becomes a privately held
company reasonable access will be given.

 

			
	****	 	Confidential Treatment Requested by Core Molding
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	28.	 	NAFTA DOCUMENTATION
	 
	 	 	Seller will provide to Buyer annually, by the specified due date, an accurate and
complete North American Free Trade Agreement (“NAFTA”) Certificate of Origin for
those parts that qualify for NAFTA and an accurate and complete Country of Origin
Affidavit for all parts. The NAFTA Certificate of Origin must be completed in
accordance with regulations published by the U.S. Department of the Treasury in 19
C.F.R. Sec. 181.11 et seq. and any amendments thereto, and in accordance with Buyer’s
NAFTA Policy included in the Customs Invoicing Instructions (International document
PR-38) available on the Buyer’s supplier website
http://www.internationalsupplier.com/. [****]
	 
	29.	 	SUPPLIER DIVERSITY PROGRAM
	 
	 	 	     Seller agrees to utilize “Small Disadvantaged-Owned Business Concerns,
Minority-Owned Business Concerns, Women-Owned Business Concerns, Veteran-Owned
Business Concerns, Service Disabled-Owned Business Concerns, and Hubzone-Located
Business Concerns” as required by Federal Laws 97-507, 99-661, and 103-355.
	 
	 	 	Buyer’s policy states that all suppliers receiving contracts from Buyer in excess of
five hundred fifty thousand dollars ($550,000), except small business concerns
defined above, will set a five percent (5%) minimum spending goal to further
subcontract with Small Disadvantaged-Owned Business Concerns; will, in addition, set
a five percent (5%) minimum spending goal to further subcontract with Minority-Owned
Business Concerns; will, in addition, set a five percent (5%) minimum spending goal
to further subcontract with Women-Owned Business Concerns; and will, in addition,
set a three percent (3%) minimum spending goal to further subcontract with
Veteran-Owned Business Concerns, Service Disabled-Owned Business Concerns, and
Hubzone-Located Business Concerns commensurate with the Seller’s sales to the Buyer.
The Seller further agrees to submit an annual written plan to Buyer by August 31st
outlining how the above stated goals will be achieved. Reference is hereby made to
the Supplier Diversity section of Buyer’s supplier website for goal details at
www.internationaldelivers.com. Seller also agrees to report their accomplishment
toward the above goals on a quarterly basis in the International Truck and Engine
Corporation electronic second-tier reporting system and annually in the Federal
(eSRS) electronic Subcontract Reporting System as required by FAR Part 19.7. Buyer
acknowledges and agrees that, for purposes of satisfying the foregoing goals: (i)
such goals apply only to those goods and services purchased by Seller in the United
States; and (ii) a purchases of goods and services may be entitled to credit toward
more than one of the foregoing goals depending on the status of the
subcontractor-.e.g., a subcontract with a “Minority Owned Business Concern” may also
qualify as a subcontract with a “Small Disadvantaged-Owned Business Concern” and/or
a “Women- Owned Business Concern”.

 

			
	****	 	Confidential Treatment Requested by Core Molding
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	30.	 	VALUE SELLING
	 
	 	 	Buyer has a Brand Promise which is “INTERNATIONAL listens, understands, and delivers
the best ways to move our Customers ahead. On the road and in their business.”
Seller is required to provide a value statement to the Buyer upon request. The value
statement should describe the value to the Buyer’s Customers that the Seller’s
Product provides over their competitor’s product.

ENGINEERING/TECHNICAL SUPPORT

	31.	 	GENERAL
	 
	 	 	Seller will provide at no additional cost to Buyer such design and design
qualification assistance, manufacturing assistance, technical and field support as
required by Buyer and compensation will be negotiated in good faith for substantive
resources.
	 
	32.	 	ENGINEERING SPECIFICATION AND PRODUCT COMPLIANCE

	 	A.	 	TRUCK GENERAL REQUIREMENTS. Seller must do the following:

	 	i.	 	Meet requirements as defined in Statements of Work (“SOW”),
Specification Transmittals, prints, models, and math data.

	 	B.	 	TRUCK ENGINEERED SYSTEMS AND COMPONENTS. Seller must do the following:

	 	i.	 	Meet requirements as defined in Statements of Work (SOW),
Specification Transmittals, prints, models and math data.
	 
	 	ii.	 	Provide on-site supplier engineers during the Product Development
Process if requested by Buyer’s engineers.
	 
	 	iii.	 	Have production intent prototype parts development capability.
	 
	 	iv.	 	Have the capability of and use electronic data exchange for
engineering and CAD data throughout the life of the development program and for
production maintenance.
	 
	 	v.	 	Use quality tools where warranted in the development of Buyer
components, such as, but not limited to, FEA (Finite Element Analysis), DVP&R’s
(Design Verification Plans and Reports), DFMEA (Design Failure Mode and Effects
Analysis), PFMEA (Process Failure Mode and Effects Analysis), and must provide
raw data, test reports, and detailed FMVSS Compliance reports for all tests as
needed.

	33	 	TRUCK ENGINEERING CAD/CAM SUPPLIER DESIGN DATA REQUIREMENTS
	 
	 	 	Buyer requires that Seller adhere to acceptable levels of CAD/CAM data as outlined in
Buyer document TEM-PR-7.03 and is deemed part of this Agreement.
	 
	34.	 	ELECTRONIC DATA INTERCHANGE (EDI) TRANSACTION REQUIREMENTS

15

 

	 	A.	 	Buyer requires that all EDI transactions with trading partners will be
communicated utilizing ANSI X 12 standards and AIAG implementation guidelines. The
following table summarizes the transaction requirements for Buyer’s Truck, Engine and
Service Parts business units. Please be reminded that as business needs and conditions
change, this set of required transactions will be modified accordingly.

	 	 	 	 	 	 	 	 	 
	EDI	 	 	 	 	 	 	 	 
	TRANSACTION	 	PURPOSE	 	TRUCK	 	ENGINE	 	SERVICE PARTS
	830

	 	Materials Release
	 	All Suppliers
	 	All Suppliers
	 	All Suppliers *
	862

	 	Shipment Authorization
	 	Selected Suppliers
	 	Selected Suppliers
	 	Selected Suppliers
	866

	 	Sequenced Components
	 	Selected Suppliers	 	 	 	 
	856

	 	Shipment Notification
	 	All Suppliers
	 	All Suppliers
	 	All Suppliers
	824

	 	Applications Advice
	 	All Suppliers
	 	All Suppliers
	 	All Suppliers
	861

	 	Receiving Advice
	 	All Suppliers	 	 	 	 
	846

	 	Inventory Advice
	 	 	 	All Suppliers	 	 
	864

	 	Text Messages
	 	Selected Suppliers	 	 	 	 
	997

	 	Functional

Acknowledgment
	 	ALL SUPPLIERS
	 	All Suppliers
	 	All Suppliers
	850

	 	Purchase Order
	 	Selected Suppliers
	 	Selected Suppliers
	 	All Suppliers
	860

	 	Purchase Order Change
	 	Selected Suppliers
	 	Selected Suppliers
	 	All Suppliers
	810

	 	Invoice
	 	Selected Suppliers
	 	 	 	Selected Suppliers
	820

	 	Remittance Advice
	 	Selected Suppliers
	 	Selected Suppliers
	 	Selected Suppliers

 

			
	*	 	For Service Parts, the 830 is a planning document only, to be used solely
for forecasting, not shipping, purposes.

	 	B.	 	Buyer and its suppliers share the challenges of continuously rising Customer
expectations and an increased demand for speed and agility in all business processes.
In recognition of these challenges, the following requirements have been developed to
streamline EDI activities while delivering the highest standards of process quality and
business flexibility. For purposes of clarity, these requirements have been grouped
into three categories: Implementation, Production and General. Seller must:

	 	i.	 	Implementation.

	 	a.	 	Implement all Buyer required transactions for all
plants in the applicable Buyer business unit within thirty (30) days of
first contact by Buyer or its designated enabling service.
	 
	 	b.	 	Eliminate testing for location changes, where the
supplier is currently doing that transaction with Buyer.
	 
	 	c.	 	Implement location changes for all current
transactions within seventy-two (72) hours of first contact by Buyer.

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	 	ii.	 	Production.

	 	a.	 	Trade all required transactions in a
“productionized” flow that eliminates all manual intervention by Buyer in
the underlying business processes.
	 
	 	b.	 	Access mailboxes minimum daily to retrieve 830,
846, 862, 850 and 860 transactions, and at 45-minute intervals to
retrieve 824 transactions.
	 
	 	c.	 	Send 997 transactions to acknowledge all
transactions received from Buyer.

	 	d.	 	Review all 997 transactions received from Buyer to
timely identify and correct errors related to the 856 transaction at the
translation level.
	 
	 	e.	 	Comply with all requirements pertaining to the
‘receiving suite’ of transactions, which include timely transmission of
accurate 856 transactions and timely processing / acknowledging 824
transactions.
	 
	 	f.	 	Communicate any systems downtime affecting 856
transmission to the appropriate Buyer’s EDI Coordinator.

	 	iii.	 	General.

	 	 	 	Provide current EDI contact information to Buyer at
mailto:edi.hotline@nav-international.com.

	 	C.	 	Due to Buyer’s high level of EDI to application integration, any manual
processing introduces excess cost, time, complexity and opportunity for error. As a
result, Buyer reserves the right to impose charges for non-compliance to EDI
requirements, as follows:

	 	i.	 	[****]
	 
	 	ii.	 	[****]

	 	D.	 	Buyer agrees that charges associated with non-compliance to items in Item 34
shall be waived until such time that a given Buyers location is compliant.

	35.	 	INFORMATION TECHNOLOGY

	 	A.	 	Seller attests to information technology capability that enables them to
electronically access Buyer via the International Supplier Network (“ISN”) website:
http://www.internationalsupplier.com/.
	 
	 	B.	 	Seller agrees to participate in any and all systems made available via ISN
within sixty (60) days of notice of availability. This includes but is not limited to
current systems such as eSPEC, (electronic RFQ) and COMPASS, or planned systems such as
eQuote (electronic quote), collaborative design tools, supplier profile, etc.

	36.	 	QUALITY REGISTRATION
	 
	 	 	All suppliers to Buyer are required to be registered to QS-9000 Quality Systems
Requirements and as modified from time to time. Buyer will also accept ISO 9000:2000
or TS-16949 registration as long as the Seller can also fulfill all AIAG PPAP
(Production Part Approval Process) documentation and approval requirements. Seller
must maintain its certification with an accredited registrar and must furnish copies
of registration certificates to the Buyer’s Supply Manager upon request.

 

	
	****  Confidential Treatment Requested by Core Molding
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LEGAL/REGULATORY

	37.	 	COMPLIANCE WITH LAWS AND REGULATIONS
	 
	 	 	Seller agrees that all materials, supplies, articles, or equipment to be manufactured
or furnished hereunder will be produced in compliance with all applicable laws
including,
but not limited to, the Fair Labor Standards Act. If this Agreement exceeds $10,000
and is otherwise subject to the Walsh-Healey Public Contracts Act, Seller also agrees
that all materials, supplies, articles, or equipment to be manufactured or furnished
hereunder will be produced in compliance with that act.
	 
	38.	 	NON-COMPLIANCE CHARGES
	 
	 	 	Any instance of Seller’s exception to or non-compliance with any of the requirements
set forth in this Agreement will result in a standard charge back per occurrence.
See Appendix C — NON-CONFORMANCE CHARGE SCHEDULE for specific non-compliance charges.
	 
	39.	 	MATERIAL SAFETY DATA SHEETS (MSDS)/SUBSTANCE RESTRICTIONS

	 	A.	 	Seller shall properly classify, describe, package, mark, label and provide
Material Safety Data Sheets (“MSDS”) for approval by Buyer prior to the initial
shipment of all Products, provide a new MSDS each time there are any changes to the
Product that affect the MSDS, and provide an updated MSDS every three years commencing
with the effective date of this Agreement. Seller will defend, indemnify and hold
harmless Buyer from any claims, penalties, or damages incurred by Buyer as a result of
any Product received from Seller not in agreement with the current MSDS provided to
Buyer.
	 
	 	B.	 	Seller is expected to eliminate lead (“Pb”) unless required by Buyer’s
specification, mercury (“Hg”), cadmium (“Cd”) and hexa-valent chromium (“Cr VI”) from
its Products. Seller will provide written notification of its action plans to Buyer to
eliminate these four heavy metals from its Products within six (6) months of the
signing of this Agreement.
	 
	 	C.	 	If the Seller’s parts are subsequently incorporated into Buyer’s Customers’
products, and if these Customers have specific material and/or substance reporting and
management requirements, Buyer will cascade these requirements down to Seller and
expects Seller to further cascade the requirements down to its sub-tier suppliers.
Seller has to achieve the specific material and/or substance reporting and management
requirements as part of the Production Part Approval Process (PPAP). Any changes in
the use of substances or concentrations of the substances as a result of engineering
changes requires pre-approval from Buyer and may require re-approval of the PPAP
process.

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	40.	 	NON-DISCRIMINATION
	 
	 	 	If this Agreement is subject to Executive Order 11246 pertaining to
non-discrimination and non-segregation, Seller certifies that it (1) is in compliance
with Sec. 202 of Executive Order 11246, as amended by Executive Order 11375, and
subsequent Executive Orders and the Rules and Regulations set forth by the Secretary
of Labor in effect as of the date of this order; (2) does not and will not provide or
maintain at any of its establishments, nor permit its employees to perform their
services at any location under its control where there are maintained segregated
facilities; and (3) agrees that a breach of this Certification violates the Equal
Employment clause of Executive Order 11246. “Segregated Facilities” means facilities
which are in fact segregated on a basis
of race, color, creed, religion or national origin. Seller agrees to (1) obtain an
identical certification from proposed subcontractors prior to the award of
subcontracts exceeding $10,000 which are not exempt from the provisions of the Equal
Opportunity clause, and (2) maintain such certifications in its files. The charge for
making a false representation is prescribed under 18 U.S.C. 1001 and any such false
representation shall be a material breach of this Agreement.
	 
	41.	 	VETERANS’ READJUSTMENT ASSISTANCE ACT
	 
	 	 	Seller agrees to comply with Section 503 of the Rehabilitation Act, the Vietnam Era
Veterans’ Readjustment Assistance Act (38 U.S.C. 4212) and implementing regulations
set forth by the Secretary of Labor as are applicable.
	 
	42.	 	MECHANIC’S LIEN
	 
	 	 	Buyer reserves the right to make payments directly to subcontractors, agents and
other entities whose efforts have been obtained by Seller in the fulfillment of this
Agreement if Seller becomes unable for any reason to timely compensate them or to
meet its debt obligations. In addition, Buyer reserves the right to make payments
directly to bankruptcy courts, trustees in bankruptcy or receivers, as it deems
necessary. Any amounts paid by Buyer to the entities or persons listed in this
paragraph other then Seller plus legal expenses incurred will be subtracted from any
amounts owed to Seller under this Agreement. If Buyer makes direct payments to
subcontractors or others as set out in this Article, Seller waives any right to
further recompenses from Buyer for the work completed by these entities. Buyer
reserves its right to any other remedies allowed in law or equity.
	 
	43.	 	GOVERNMENTAL REQUIREMENTS
	 
	 	 	Seller agrees to comply with all applicable statutes, regulations, laws and other
Government requirements, including but not limited to, 48 C.F.R. Sections 52.219-8
(Utilization of Small Business Concerns), 52.222-26 (Equal Employment Opportunity),
52.222-35 (Equal Opportunity for Special Disabled Veterans, Veterans of the Vietnam
Era, and Other Eligible Veterans), 52.222-36 (Affirmative Action for Workers with
Disabilities), 52.222-39 (Notification of Employee Rights Concerning Payment of Union
Dues or Fees), 52.222-41 (Service Contract Act of 1965) and 52.247-64 (Preference for
Privately Owned U.S.- Flag Commercial Vessels). The term “Contractor” and similar
terms used in such FAR provisions shall be construed to mean Seller for the purposes
of this Agreement.

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	44.	 	INDEMNIFICATION

	 	A.	 	Indemnification by Seller. Seller agrees to protect, defend, hold
harmless and indemnify Buyer, its officers, directors, dealers, employees, agents and
affiliates, against all claims, actions, suits, proceedings, demands (collectively,
“Claims”), including all liabilities, losses, costs, expenses (including all legal
costs and expenses) and all judgments, settlements and judicially or administratively
imposed damages (including all consequential damages) (collectively with Claims,
“Losses”), resulting from or arising or related to:

	 	i.	 	Any breach or violation of Seller’s representations, covenants or
agreements under this Agreement;
	 
	 	ii.	 	Any alleged negligence, gross negligence, recklessness, willful
misconduct or fraud on the part of Seller and/or its Affiliates or any employee,
subcontractor or agent of theirs related to this Agreement, or;
	 
	 	ii.	 	Any property damage or personal injury, including death,
attributed to, in whole or in part, a defect where design responsible,
materials, or workmanship of Seller’s Products or occurring in connection with
the manufacture of such Seller’s Products.

	 	B.	 	Indemnification by Buyer. Buyer agrees to protect, defend, hold
harmless and indemnify Seller, its officers, directors, dealers, employees, agents and
affiliates, against all claims, actions, suits, proceedings, demands (collectively,
“Claims”), including all liabilities, losses, costs, expenses (including all legal
costs and expenses) and all judgments, settlements and judicially or administratively
imposed damages (including all consequential damages) (collectively with Claims,
“Losses”), resulting from or arising or related to:

	 	i.	 	Any breach or violation of Buyer’s representations, covenants or
agreements under this Agreement;
	 
	 	ii.	 	Any alleged negligence, gross negligence, recklessness, willful
misconduct or fraud on the part of Buyer and/or its Affiliates or any employee,
subcontractor or agent of theirs related to this Agreement, or;
	 
	 	iii.	 	Any property damage or personal injury, including death,
attributed to, in whole or in part, Buyer’s negligent installation or use, or
both, of Seller’s Products.

	 	C.	 	Intellectual Property Indemnity. Seller agrees to defend, at its sole
expense, any Claim against Buyer, Buyer’s Customers, or either of their officers,
directors, employees, agents and affiliates based on an assertion or Claim that any
Product furnished by Seller to Buyer hereunder or the use or sale by Buyer or its
Customers in the manner contemplated by this Agreement infringes any patent or
copyright or other intellectual property right or is a wrongful use of third-party
trade secret or proprietary information, and further agrees to indemnify and hold Buyer
harmless from any Losses, including attorneys’ fees, settlements associated with said
Claim, or any Losses, including attorneys’ fees or costs, finally awarded in any such
Claim. If the use or sale of any Product furnished pursuant to this Agreement is
enjoined as a result of such Claim, Seller, at its option and at no expense to Buyer,
shall obtain for Buyer and its Customers the right to use and sell the Product(s) or
shall substitute an equivalent product(s) acceptable to Buyer and extend this indemnity
thereto. This indemnity

20

 

	 	 	 	does not extend to any Claim based on any infringement of any
patent by the combination of Product(s) furnished by Seller with other components added
thereto by Buyer, except when the Product(s) is a material part of the invention of an
asserted patent and the components furnished by Buyer to complete the claimed
combination, such as an engine, sensor, or vehicle frame are not novel within the
meaning of the patent or are specified or approved by Seller. This indemnity does not
extend to any infringement or alleged infringement arising solely out of Seller’s
compliance with Buyer-required specifications, designs, or instructions that (i) are
created solely by Buyer and (ii) are thereafter furnished to Seller in writing.
	 
	 	D.	 	Collaborative Efforts. In the event that a Claim should be made based
upon a design defect and the design was a collaborative effort, Seller and Buyer shall
cooperate fully in the defense of this matter, sharing in all Losses related to such
Claim, provided each party will contribute to the aggregate Losses arising from such
Claim in a proportion reflecting to the relative and comparative responsibilities of
the parties for such Losses, as well as any other relevant equitable considerations.
	 
	 	E.	 	Notice of Indemnification. No Claim shall be valid unless notice of
the matter which may give rise to such Claim is given in writing by the indemnitee (the
“Indemnitee”) to the persons against whom indemnification may be sought (“Indemnitor”)
as soon as reasonably practicable after such Indemnitee becomes aware of such Claim.
Failure of the Indemnitee to notify the Indemnitor within such notice period shall not
relieve Indemnitor of any liability hereunder, except to the extent the Indemnitor
reasonably demonstrates that the defense of such third party claim is materially
prejudiced by such failure. Such notice shall state that the Indemnitor is required to
indemnify the Indemnitee for a Loss and shall specify the amount of Loss, if available,
and relevant details thereof. The Indemnitor shall notify Indemnitee within a
reasonable time from such notice of its intention to assume the defense of any such
claim, which consent shall not be unreasonably withheld or delayed.

	45.	 	LIABILITY INSURANCE
	 
	 	 	During the Initial Term (and Renewal Terms, if any) of this Agreement, Seller shall
maintain at its own expense Comprehensive General Liability Insurance with coverage
of no less than US$ 5,000,000 per occurrence and US$ 5,000,000 general aggregate for
death, bodily injury, and property damage. Buyer retains the right to obtain an
increase in the above stated insurance limits at any time.
	 
	 	 	Seller’s liability under this Agreement shall be limited by the amount of such
insurance coverage and such insurance shall be primary and not contributory as to
other insurance Seller may have in effect. The above-required policy shall be
written on an “occurrence” basis unless the policy is available only on a “claims
made” basis, in which case such “claims made” insurance coverage shall be maintained
in effect for a period of four (4) years after the termination of this Agreement.
Such policy shall be maintained with an insurer authorized to issue policies in the
United States, which insurer shall be satisfactory to Buyer, and shall name Buyer as
an additional insured. Such policy shall provide that thirty (30) days written
notice shall be given to Buyer prior to cancellation or material changes to the
policy. Any such change, modification or cancellation shall not affect Seller’s
obligation to maintain the insurance coverage set forth above.

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	 	 	As of its execution of this Agreement, Seller shall provide Buyer with a certificate
of insurance evidencing such coverage. Failure to provide such certificate of
insurance shall void this Agreement, at Buyer’s sole option.
	 
	46.	 	REMOVAL OF IDENTITY OF BUYER
	 
	 	 	At its own expense Seller agrees to destroy or remove to the Buyer’s complete
satisfaction Buyer’s corporate name, addresses, trademarks, patent numbers, and all
other references to Buyer from all Products rejected or canceled by Buyer, or
purchased or produced by Seller in excess of quantities specified by Buyer, whether
such Products are completed or partially completed, delivered, tendered for delivery,
or undelivered, prior to disposition of such Products to parties other than Buyer, or
to destroy such Products. Seller acknowledges that any sale of Products bearing the
Buyer’s trade name and/or trademarks to any person or entity other than Buyer is an
infringement of the Buyer’s proprietary rights in its trade name and/or trademarks
and is an attempt by Seller to “pass off” products of others as the products of
Buyer. Without first obtaining the written consent of Buyer, Seller agrees that it
shall not in any manner make known the fact that Seller has furnished, or contracted
to furnish, Buyer the Products covered by this Agreement, or use the name of Buyer or
any of its trademarks or trade names in Seller’s advertising or other promotional
material.
	 
	47.	 	NEW BUSINESS
	 
	 	 	Buyer recognizes a strategic relationship with the Seller. As such, the Seller will
be invited to quote on future programs if the Seller has demonstrated capability in
the desired manufacturing process and meets the Buyers overall supplier performance
requirements. Provided Seller has demonstrated the preceding requirements, Buyer
will offer Seller an opportunity to become competitive and secure future business.
	 
	48.	 	CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY

	 	A.	 	During the term of this Agreement, each party hereto may disclose to the other
certain confidential information relating to the manufacturing, sale, marketing,
development or distribution of the Product(s), the application of the Product(s) by
Buyer, processes, trade secrets and business and financial information and marketing
plans of either party as well as confidential information (which may be in electronic
form, as well) resulting from the performance of this Agreement, including, without
limitation, purchase orders, sales projections, customer lists, designs under
development, intellectual property and know-how. Any such information that is marked
or otherwise clearly identified at the time of disclosure as “confidential” or
“proprietary” or any information which a person would reasonably deem to be
confidential information of the parties under the circumstances shall be considered as
“Confidential Information” for purposes of this Agreement, provided that, if
the information is disclosed orally, a writing identified as “confidential” or
“proprietary” and summarizing the Confidential Information will be provided within
thirty (30) days after disclosure. During the term of this Agreement and for a period
of five (5) years after the expiration or termination of this Agreement, the receiving
party will use its best efforts to prevent the disclosure of such Confidential
Information to third parties and will not use such Confidential Information for any
purpose other than to effectuate the provisions of this Agreement.

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	 	 	 	“Best efforts” with
respect to any Confidential Information means at least that degree of care normally
used by the receiving party to prevent disclosure to others of its own confidential
information of similar importance, but in no case less than a reasonable degree of
care. Notwithstanding the foregoing, Seller and Buyer agree that Confidential
Information shall not include any information which: (a) is or becomes publicly known
through no wrongful act on the receiving party’s part; or (b) is, at the time of
disclosure under this Agreement, already known to the receiving party without
restriction on disclosure; or (c) is, or subsequently becomes, rightfully and without
breach of this Agreement, in the receiving party’s possession without any obligation
restricting disclosure; or (d) is independently developed by the receiving party
without
reference to or use of the Confidential Information; or (e) is disclosed pursuant to
an order of any governmental or judicial authority, after prior notice to the
disclosing party respecting such order, and affording the disclosing party reasonable
cooperation respecting any objections by the disclosing party to the request for
disclosure, including a reasonable opportunity for the disclosing party to obtain a
protective order in respect to the Confidential Information at the expense of the
disclosing party.
	 
	 	B.	 	Upon request of the disclosing party at any time, the recipient agrees to
return to the disclosing party or destroy all materials in its possession or control
which contain Confidential Information of the disclosing party, including, without
limitation, documents, drawings, CAD drawings, computer media, models, prototypes,
sketches, designs, and lists furnished by the disclosing party or accessed by the
recipient, including copies thereof made by the recipient, and to delete from its
computers any software, data files, or CAD files containing Confidential Information
furnished by the disclosing party. If materials are destroyed, an officer of the
recipient shall identify such materials to the disclosing party and certify that their
destruction has been completed. Notwithstanding the foregoing, each party shall be
entitled to maintain one archival copy of the Confidential Information within its Law
Department or at the office of its General Counsel, such archival copy to be used
solely in connection with resolving claims or disputes between the parties relating to
this Agreement.
	 
	 	C.	 	Seller agrees that all drawings, graphics, technical analyses, models,
prototypes, writings, computer programs, algorithms, and other materials developed for
buyer under this Agreement are considered to be works for hire and shall become and
remain the property of Buyer. All drawings created under this Agreement shall be marked
“Navistar® Confidential” or “Navistar® Proprietary” or words to that effect. At the
request of Buyer, Seller shall execute or cause its employees, contractors or
subcontractors to execute, any and all documents which International may deem necessary
to assign to Navistar or a subsidiary thereof, Buyer’s successors or assigns, the sole
and exclusive right to such designs, model, and other materials, as well as to
industrial design registrations, design patents and copyrights related thereto.
	 
	 	E.	 	This Article 48 — CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY, shall
survive the termination or expiration of this Agreement.

	49.	 	TERMINATION

	 	A.	 	Termination by Buyer: At any time during the Initial Term (or any
Renewal Term) of this Agreement should Seller default in performing any of its material
obligations hereunder, the Buyer may give written notice of default giving the full
details thereof.

23

 

	 	 	 	If Seller fails within ninety (90) days of the receipt of written
notice of default to cure the default, then Buyer shall have the right to terminate
this Agreement with regard to the particular Product materially affected by the
default, or if the default materially affects all Products, Buyer shall have the right
to terminate this Agreement in its entirety. The Buyer shall give Seller ninety (90)
days written notice from the determination of the failure to cure the default,
whereupon the termination shall be effective.
	 
	 	B.	 	Termination by Seller: At any time during the Initial Term (or any
Renewal Term) of this Agreement should Buyer default in performing any of its material
obligations
hereunder, the Seller may give written notice of default giving the full details
thereof. If Buyer fails within ninety (90) days of the receipt of written notice of
default to cure the default, then Seller shall have the right to terminate this
Agreement with regard to the particular Product materially affected by the default,
or if the default materially affects all Products, Seller shall have the right to
terminate this Agreement in its entirety. The Seller shall give Buyer ninety (90)
days written notice from the determination of the failure to cure the default,
whereupon the termination shall be effective.
	 
	 	C.	 	Rights and Obligations of Parties. Except as otherwise provided for
herein, the termination of this Agreement for any reason shall be without prejudice to
(without acting as a limitation):

	 	i.	 	Either party’s obligations of confidentiality provided for in
Article 48 — CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY;
	 
	 	ii.	 	Either party’s right to receive all payments (including any
amounts provided for in Article 5 — PRICING hereof) accrued hereunder prior to
the date of such termination; and
	 
	 	iii.	 	Any other remedies which either party may then or thereafter have
hereunder or under law, equity or otherwise.

	 	B.	 	Survival. Any termination or expiration of all or part of this
Agreement shall not relieve either party of obligations incurred pursuant to and
during the Initial Term (or any Renewal Term) prior to such termination or
expiration of this Agreement, including but not limited to the warranty provisions
set forth in Article 24 — WARRANTY hereof, the Indemnification provisions of Article
44 — INDEMNIFICATION hereof, and the Confidential Information provisions set forth
in Article 48 — CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY hereof. Articles
23A — REIMBURSEMENT FOR NON-PERFORMANCE BY SELLER, 24 — WARRANTY, 25 — REIMBURSEMENT
FOR WARRANTY CLAIMS, 38 — NON-COMPLIANCE PENALTIES, 44 — INDEMNIFICATION, 46 -
REMOVAL OF IDENTITY OF BUYER, 48 — CONFIDENTIAL INFORMATION / INTELLECTUAL PROPERTY,
49C and D — TERMINATION, 52 — CHOICE OF LAW, 53 — CONSENT TO JURISDICTION, 55 — NO
LIMITATION OF RIGHTS AND REMEDIES, and 58 — NOTICES of this Agreement and any other
provision, that by its terms is intended to survive, shall survive any termination
or expiration of this Agreement.

MISCELLANEOUS

	50.	 	ASSIGNMENT OF RIGHTS AND DUTIES

24

 

	 	 	Either party may assign the rights and duties under this Agreement, either in whole
or in part, only with the prior written consent of the other party. No permitted
assignment hereunder shall be deemed effective until the assignee shall have executed
and delivered an instrument in writing reasonably satisfactory in form and substance
to the other party pursuant to which the assignee assumes all of the obligations of
the assigning party hereunder. Any purported assignment of this Agreement in
violation of this Article 50 — ASSIGNMENT OF RIGHTS AND DUTIES shall be void.
	 
	51.	 	MODIFICATION AND AMENDMENT OF AGREEMENT
	 
	 	 	No modifications of, or additions to, the provisions or conditions of this Agreement
(including the Exhibits, Appendices and Schedules hereto) will become a part of the
Agreement until agreed to in writing by the Buyer and Seller. This Agreement
(including the Exhibits, Appendices and Schedules hereto) may not be amended or
modified without the written consent of both Buyer and Seller. For purpose of
clarity, Appendix A — PRODUCT DESCRIPTION may not be amended, modified or altered
without the written consent of Buyer and Seller.
	 
	52.	 	CHOICE OF LAW
	 
	 	 	This Agreement shall be governed by and construed under the laws of the State of
Illinois, without giving effect to the choice of law provisions thereof.
	 
	53.	 	CONSENT TO JURISDICTION
	 
	 	 	All actions, proceedings, claims, counterclaims or cross-complaints in any action or
other proceeding brought by any party hereto against any other party hereto with
respect to any matter arising out of, or in any way connected with or related to,
this Agreement or any portion thereof, whether based upon contractual, statutory,
tortuous or other theories of liability arising out of or relating to this Agreement,
shall be heard and determined in any federal court sitting in Chicago, Illinois,
unless there is no federal court jurisdiction, in which case the action or proceeding
shall be heard and determined in any state court sitting in Chicago, Illinois, and
the parties hereto hereby irrevocably submit to the jurisdiction of such courts in
any such action or proceeding, IRREVOCABLY AGREE THAT ANY SUCH COURT IS A PROPER
VENUE FOR ANY SUCH ACTION, and irrevocably waive the defense of an inconvenient
forum. Each party irrevocably consents to the service of any and all process in any
such action or proceeding by the mailing of copies of such process to such party at
its address specified in Article 58 — NOTICES. Nothing in this Article 53 — CONSENT
TO JURISDICTION shall affect the right of any party hereto to serve legal process in
any other manner permitted by law.
	 
	54.	 	SEVERABILITY
	 
	 	 	In the event that any provision of this Agreement or the application thereof to any
party of circumstance shall be finally determined by a court of proper jurisdiction
to be invalid or unenforceable to any extent, then (i) a suitable and equitable
provision shall be substituted therefore in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid and unenforceable
provision, and (ii) the remainder of this Agreement and the application of such
provision to the parties or circumstances other than those to which it is held
invalid or unenforceable shall not be affected thereby.

25

 

	55.	 	NO LIMITATION OF RIGHTS AND REMEDIES; SPECIFIC PERFORMANCE
	 
	 	 	The provisions of each Article of this Agreement are not intended to limit any rights
and remedies of the Seller or Buyer. Each of the parties acknowledges and agrees
that the other party would be damaged irreparably in the event any of the provisions
of this Agreement are not performed in accordance with their specific terms or
otherwise are breached. Accordingly, each of the parties agrees that the other party
shall be entitled
to an injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and provisions
hereof in any action instituted in any court having jurisdiction over the parties and
the matter (subject to the provisions set forth in Article 53 — CONSENT TO
JURISDICTION above), in addition to other remedy to which they may be entitled, at
law or in equity.
	 
	56.	 	FORCE MAJEURE

	 	A.	 	Except as described below, neither party shall be liable for any failure or
delay in the performance of its obligations under this Agreement to the extent this
failure or delay both:

	 	i.	 	Is caused by any of the following: acts for war, terrorism, civil
riots, or rebellions; quarantines, embargoes, and other similar unusual
governmental action; extraordinary elements of nature or acts of God; and
	 
	 	ii.	 	Could not have been prevented by the non-performing party’s
reasonable precautions or commercially accepted processes (including, but not
limited to, implementation of disaster recovery and business continuity plans in
accordance with industry best practices), or could not reasonably be
circumvented by the non-performing party through the use of substitute services,
alternate sources, work-around plans, or other means by which the requirements
of a buyer of products substantively similar to the product hereunder would be
satisfied.

	 	 	 	Events meeting both of the above criteria are referred to as “Force Majeure Events.”
The parties expressly acknowledge that Force Majeure Events do not include vandalism,
the regulatory acts of governmental agencies, labor strikes, lockouts, labor
difficulty or the non-performance of third parties or subcontractors relied on for
the delivery of the Product unless such failure or non-performance by a third party
or subcontractor is itself caused by a Force Majeure Event, as defined above. Upon
the occurrence of a Force Majeure Event, the non-performing party shall be excused
from any further performance or observance of the affected obligation(s) for as long
as such circumstances prevail, and such party continues to attempt to recommence
performance or observance to the greatest extent possible without delay.
	 
	 	B.	 	Notwithstanding any other provision of this Article, a Force Majeure Event
shall obligate Seller to begin and successfully implement all services relating to
disaster recovery set forth in a “Disaster Recovery Plan” as may be specifically
requested by Buyer. If a Force Majeure Event causes a material failure or delay in the
performance of any Seller obligation with respect to any Product for more than five (5)
consecutive days, Buyer may, at its option, and in addition to any other rights Buyer
may have,

26

 

	 	 	 	procure such Product from an alternate source until Seller is again able to
provide such Products. Seller shall be liable for all payments made and costs incurred
by Buyer required to obtain the Product from the alternate source during this period.

	57.	 	ENTIRE AGREEMENT
	 
	 	 	This Agreement, together with green sheets, the Exhibits, Appendices and Schedules
attached hereto (and thereto), embodies and sets forth the entire agreement and
understanding of the parties with respect to the subject matter herein and there are
no promises, terms, conditions or obligations, oral or written, expressed or implied,
other
than those contained in this Agreement. The terms of this Agreement shall supersede
all previous oral or written agreements which may exist or have existed between the
parties relating to the subject matter of this Agreement. No party shall be entitled
to rely on any agreement, understanding or arrangement which is not expressly set
forth in this Agreement. Any other terms and conditions, including without
limitation any terms and conditions contained in any purchase order or sales invoice
issued pursuant to the Agreement, are hereby expressly excluded.
	 
	58.	 	NOTICES

	 	A.	 	Except as otherwise specifically provided, any notice or other documents to be
given under this Agreement shall be in writing and shall be deemed to have been duly
given if sent by registered mail, nationally recognized overnight courier or facsimile
transmission to a party or delivered in person to a party at the address or facsimile
number set out below for such party or such other address as the party may from time to
time designate by written notice to the other:

	 	 	 	 	 	 	 
	If to Buyer:
	 	Navistar, Inc.

4201 Winfield Road

P.O. Box 1488

Warrenville, IL 60555

	 

	 	 	 	Attn:
	 	Dustin Miller/ Supply Manager
	 

	 	 	 	Facsimile:
	 	630-753-6132
	 

	 	 	 	Phone:
	 	630-753-6097
	 

	 	 	 	Email:
	 	Dustin.Miller@navistar.com
	 
	 	 	 	 	 	 
	 	 	With copies to:
	 

	 	 	 	Attn:
	 	Steve Noland/ Purchasing Manager
	 

	 	 	 	Facsimile:
	 	630-753-6132
	 

	 	 	 	Phone:
	 	630-753-6220
	 

	 	 	 	Email:
	 	Steve.noland@navistar.com
	 
	 	 	 	 	 	 
	If to Seller:
	 	Core Molding Technologies, Inc. and Core Composites Corporation

800 Manor Park Drive

Columbus, OH 43228
	 

	 	 	 	Attn:
	 	Phil Murfitt
	 

	 	 	 	Facsimile:
	 	614-870-4064
	 

	 	 	 	Phone:
	 	614-870-5082
	 

	 	 	 	Email:
	 	pmurfitt@coremt.com

27

 

	 	 	 	 	 	 	 
	 	 	With copies to:
	 

	 	 	 	Attn:
	 	Kevin L. Barnett
	 

	 	 	 	Facsimile:
	 	614-870-4028
	 

	 	 	 	Phone:
	 	614-870-5603
	 

	 	 	 	Email:
	 	kbarnett@coremt.com

	 	B.	 	Any such notice or other document shall be deemed to have been received by the
addressee five (5) business days following the date of dispatch of the notice or other
document by mail or, where the notice or other document is sent by overnight courier,
by hand or is given by facsimile, simultaneously with the transmission or delivery.
To prove the giving of a notice or other document it shall be sufficient to show that
it was dispatched.

	59.	 	NO WAIVERS
	 
	 	 	Neither the failure nor delay on the part of a party to require the strict
performance of any term, covenant or condition of this Agreement or to exercise any
right or remedy available on a breach thereof shall constitute a waiver of any such
breach or of any such term or condition. The consent to, or the waiver of, any
breach, or the failure to require on any single occasion the performance or timely
performance of any term, covenant, or condition of this Agreement shall not be
construed as authorizing any subsequent or additional breach and shall not prevent a
subsequent enforcement of such term, covenant, or condition.
	 
	60.	 	CONSTRUCTION
	 
	 	 	The language in all parts of this Agreement shall be construed, in all cases,
according to its fair meaning. Buyer and Seller hereby acknowledge that each party
hereto and its counsel have reviewed and revised this Agreement and that any rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement.
Whenever used herein, the words “include’, “includes” and “including” shall mean
“include, without limitation”, “includes, without limitation” and “including, without
limitation”, respectively. The masculine, feminine or neuter gender and the singular
or plural number shall each be deemed to include the others whenever the context so
indicates. “Days” means calendar days unless other specified.
	 
	61.	 	HEADINGS
	 
	 	 	The headings used in this Agreement are for convenience only and are not a part of
this Agreement nor affect the interpretation of any of its provisions.
	 
	62.	 	COUNTERPARTS
	 
	 	 	This Agreement may be executed simultaneously in counterparts (and may be delivered
by facsimile), each of which shall be deemed an original, but all of which together
shall constitute a single agreement.

28

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their respective duly
authorized officers or representatives as of the day and year first above written.

	 	 	 	 	 
	BUYER: Navistar, Inc.

	 	SELLER: Core Molding Technologies Inc.

and Core Composites Corporation
	 	 
	 
	 	 	 	 
	           /s/ Dustin Miller

	 	          /s/ Kevin Barnett	 	 
	 

	 	 	 	 
	Name: Dustin Miller

	 	Name: Kevin Barnett	 	 
	Title: Supply Manager

	 	Title: President and Chief Executive Officer	 	 
	 
	 	 	 	 
	Date: 6/23/08

	 	Date: 6/23/08	 	 

29EX-10.43

 EXHIBIT 10.43

STOCK APPRECIATION RIGHTS AGREEMENT

     STOCK APPRECIATION RIGHTS AGREEMENT, dated as of July 1, 2008, between WESCO INTERNATIONAL,
INC., a Delaware corporation (the “Company”), and the Grantee whose name appears on the signature
page hereof (the “Grantee”).

W I T N E S S E T H:

     WHEREAS, the Board of Directors of the Company (the “Board”) has designated the Compensation
Committee of the Board (the “Committee”) to administer the Company’s 1999 Long-Term Incentive Plan
(as amended from time to time, the “Plan”); and

     WHEREAS, the Board has determined to grant to the Grantee, under the Plan, a Stock
Appreciation Right with respect to the aggregate number of shares of the Company’s Common Stock,
par value $.01 per share (the “Common Stock”), set forth on the signature page hereof (the “SAR
Shares”) at an exercise price of $40.04 per SAR Share;

     NOW, THEREFORE, to evidence the Stock Appreciation Right so granted, and to set forth its
terms and conditions under the Plan, the Company and the Grantee hereby agree as follows:

     1. Confirmation of Grant; Exercise Price. The Company hereby grants to the Grantee,
effective as of the date hereof, a Stock Appreciation Right (the “SAR”) with respect to the SAR
Shares at an exercise price of $40.04 per share (the “Exercise Price”). This Agreement is
subordinate to, and the terms and conditions of the SAR granted hereunder are subject to, the terms
and conditions of the Plan.

     2. Vesting Term. Equally at a rate of one-third of the amount granted on July 1,
2009, July 1, 2010 and July 1, 2011 as long as you are employed by WESCO.

     3. Exercisability. Provided that the Grantee remains employed by the Company on such
date, and to the extent the SAR has not previously expired, each SAR shall be exercisable upon
vesting.

     4. Termination of SAR.

          (a) Normal Termination Date. Unless an earlier termination date is specified in
Section 4(b), the SAR shall terminate on July 1, 2018 (the “Normal Termination Date”).

          (b) Early Termination. If the Grantee’s Active Employment (as defined below) is
voluntarily or involuntarily terminated for any reason whatsoever prior to the Normal Termination
Date, any portion of the SAR that has not become exercisable on or before the effective date of
such termination of employment shall terminate on such effective date. Any portion of the SAR that
has become exercisable on or before the date of the Grantee’s termination of Active Employment
shall remain exercisable for whichever of the following periods is applicable, and if not exercised
within such period, shall terminate upon the expiration of such period: (i) if the
Grantee’s Active Employment is terminated by reason of the Grantee’s death, Permanent Disability or
Retirement at Normal Retirement Age (each an “Extraordinary
Termination”), then any SARs held by
the Grantee and then exercisable shall remain exercisable solely until the first to occur of
(A) the first anniversary of the Grantee’s termination of employment or (B) the
expiration of the term of the SAR, and (ii) if the Grantee’s Active Employment is
terminated for any reason other than an Extraordinary Termination, then any then exercisable SARs
held by such Grantee shall remain exercisable for a period of sixty days after the date of the
Grantee’s termination of employment. Nothing in this Agreement shall be deemed to confer on the
Grantee any right to continue in the employ of the Company or any of its direct or indirect
subsidiaries, or to interfere with or limit in any way the right of the Company or any of its
direct or indirect subsidiaries to terminate such employment at any time.

 

 

     5. Restrictions on Exercise; Non-Transferability of SAR.

          (a) Restrictions on Exercise. The SAR may be exercised only with respect to full
shares of Common Stock. No fractional shares of Common Stock shall be issued. Notwithstanding any
other provision of this Agreement, the SAR may not be exercised in whole or in part, and no
certificates representing Shares shall be delivered, (i) unless all requisite approvals and
consents of any governmental authority of any kind having jurisdiction over the exercise of options
shall have been secured, (ii) unless the issuance of SAR Shares upon the exercise of the
SAR shall be exempt from registration under applicable U.S. federal and state securities laws, and
applicable non-U.S. securities laws, or the SAR Shares shall have been registered under such laws,
and (iii) unless all applicable U.S. federal, state and local and non-U.S. tax withholding
requirements shall have been satisfied. The Company shall use commercially reasonable efforts to
obtain the consents and approvals referred to in clause (i) of the preceding sentence, to satisfy
the withholding requirements referred to in clause (iii) of the preceding sentence so as to permit
the SAR to be exercised.

          (b) Non-Transferability of SAR. The SAR may be exercised only by the Grantee or by
his estate. The SAR is not assignable or transferable, in whole or in part, and it may not,
directly or indirectly, be offered, transferred, sold, pledged, assigned, alienated, hypothecated
or otherwise disposed of or encumbered (including without limitation by gift, operation of law or
otherwise) other than by will or by the laws of descent and distribution to the estate of the
Grantee upon his death, provided that the deceased Grantee’s beneficiary or the
representative of his estate shall acknowledge and agree in writing, in a form reasonably
acceptable to the Company, to be bound by the provisions of this Agreement and the Plan as if such
beneficiary or the estate were the Grantee.

          (c) Certain Definitions. As used in this Agreement the following terms shall have the
following meanings:

               (i) “Active Employment” shall mean active employment with the Company or any direct or
indirect subsidiary of the Company.

               (ii) “Fair Market Value” shall mean the closing price per share of the Common Stock on
the New York Stock Exchange or other established stock exchange (or exchanges) on the applicable
date, or if no sale of Common Stock has been recorded on such day, then on the next preceding day
on which a sale was so made. If shares of Common Stock are not traded on an established stock
exchange on the applicable date, Fair Market Value shall be determined by the Committee in good
faith.

SARS: July 1, 2008 Issuance

- 2 -

 

               (iii) “Retirement at Normal Retirement Age” shall mean retirement at age 65 or later.

               (iv) “Permanent Disability” shall mean a physical or mental disability or infirmity
that prevents the performance of such Grantee’s employment-related duties lasting (or likely to
last, based on competent medical evidence presented to the Board) for a continuous period of six
months or longer. The Board’s reasoned and good faith judgment of Permanent Disability shall be
final, binding and conclusive on all parties hereto and shall be based on such competent medical
evidence as shall be presented to it by the Grantee or by any physician or group of physicians or
other competent medical expert employed by the Grantee or the Company to advise the Board.

     6. Exercise of the SAR and Tax Withholding.

          (a) Exercise. To the extent that the SAR shall have become and remains exercisable as
provided in Section 3 and subject to such reasonable administrative regulations as the Board or the
Committee may have adopted, the SAR may be exercised, in whole or in part, by notice to the
Secretary of the Company or the Option Administration Department in writing given 15 business days
prior to the date on which the Grantee expects to exercise the SAR (the “Exercise Date”),
specifying the number of SAR Shares with respect to which the SAR is being exercised (the “Exercise
Shares”) and the expected Exercise Date, provided that if shares of Common Stock are traded
on a U.S. national securities exchange or bid and ask prices for shares of Common Stock are quoted
over the NASDAQ National Market (“NASDAQ”) operated by the National Association of Securities
Dealers, Inc., notice may be given five business days before the Exercise Date. Upon exercise of
the SAR, the Grantee shall be entitled to receive a number of shares of Common Stock (the “Net SAR
Shares”) equal to the quotient obtained by dividing x by y, where:

	 	x	= 	  the number of Exercise Shares multiplied by the excess, if any, of (A) the
Fair Market Value of a share of Common Stock on the Exercise Date over (B) the Exercise
Price, and
	 
	 	y	= 	  the Fair Market Value of a share of Common Stock on the Exercise Date.

No fractional share of Common Stock shall be issued to make any payment in respect of SAR; if any
fractional share would be issuable, the number of Net SAR Shares payable to the Grantee shall be
rounded down to the next whole share (no payment of cash, shares or other consideration shall be
made with respect to such fractional share). The Company may require the Grantee to furnish or
execute such other documents as the Company shall reasonably deem necessary (i) to evidence
such exercise, (ii) to determine whether registration is then required under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), and (iii) to comply with or
satisfy the requirements of the Securities Act, applicable state or non-U.S. securities laws or any
other law.

SARS: July 1, 2008 Issuance

- 3 -

 

          (b) Withholding. Whenever the Net SAR Shares are to be issued pursuant to the
exercise of the SAR, the Company may require the recipient of the Net SAR Shares to remit to the
Company an amount sufficient to satisfy the employer’s minimum statutory U.S. federal, state and
local and non-U.S. tax withholding requirements. If shares of Common Stock are traded on a U.S.
national securities exchange or bid and ask prices for shares of Common Stock are quoted on the
NASDAQ, the Company may, if requested by the Grantee, withhold Net SAR Shares to satisfy applicable
minimum statutory withholding requirements, subject to the provisions of the Plan and any rules
adopted by the Board or the Committee regarding compliance with applicable law, including, but not
limited to, Section 16(b) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange
Act”).

     7. Representations and Warranties of the Company. The Company represents and warrants
to the Grantee that (a) the Company has been duly incorporated and is an existing corporation in
good standing under the laws of the State of Delaware, (b) this Agreement has been duly authorized,
executed and delivered by the Company and constitutes a valid and legally binding obligation of the
Company enforceable against the Company in accordance with its terms, and (c) the Net SAR Shares,
when issued and delivered upon exercise of the SAR in accordance with the terms hereof, will be
duly authorized, validly issued, fully paid and nonassessable, and free and clear of any liens or
encumbrances other than those created pursuant to this Agreement or otherwise in connection with
the transactions contemplated hereby.

     8. Change in Control and Adjustments to Reflect Capital Changes.

          (a) Accelerated Vesting Upon Change in Control. In the event of a Change in Control,
the SAR shall become immediately and fully exercisable unless such Change in Control results from
the Grantee’s beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of
Common Stock or other Company Voting Securities (as defined in the Plan).

          (b) Recapitalization. The number and kind of shares subject to the SAR and the
Exercise Price of the SAR shall be appropriately adjusted to reflect any stock dividend, stock
split, or share combination or any recapitalization, merger, consolidation, exchange of shares,
liquidation or dissolution of the Company or other change in capitalization with a similar
substantive effect upon the Plan or the SAR. The Committee shall have the power and sole
discretion to determine the amount of the adjustment to be made in each case.

          (c) Certain Mergers. After any Merger in which the Company is not the surviving
corporation or pursuant to which a majority of the shares which are of the same class as the shares
that are subject to the SAR are exchanged for, or converted into, or otherwise become shares of
another corporation, the surviving, continuing, successor or purchasing corporation, as the case
may be (the “Acquiring Corporation”), will either assume the Company’s rights and obligations under
this Agreement or substitute an award in respect of the Acquiring Corporation’s stock for the SAR,
provided, however, that if the Acquiring Corporation does not assume or substitute for the SAR, the
Board shall provide prior to the Merger that any unexercisable and/or unvested portion of the SAR
shall be immediately exercisable and vested as of a date prior to such Merger, as the Board so
determines. The exercise and/or vesting of the

SARS: July 1, 2008 Issuance

- 4 -

 

SAR that was permissible solely by reason of this Section 9(c) shall be conditioned upon the
consummation of the Merger. If the SAR is neither assumed by the Acquiring Corporation nor
exercised as of the date of the Merger, the SAR shall terminate effective as of the effective date
of the Merger. Comparable rights shall accrue to the Grantee in the event of successive Mergers of
the character described above.

          (d) Certain Definitions.

               (i) “Change in Control” means the first to occur of the following events: (a) the acquisition
by any person, entity or “group” (as defined in Section 13(d) of the Exchange Act), other than the
Company, its subsidiaries, any employee benefit plan of the Company or its subsidiaries, or any
successor investment vehicle, of 30% or more of the combined voting power of the Company’s then
outstanding voting securities; (b) the merger or consolidation of the Company, as a result of which
persons who were stockholders of the Company immediately prior to such merger or consolidation, do
not, immediately thereafter, own, directly or indirectly, more than 70% of the combined voting
power entitled to vote generally in the election of directors of the merged or consolidated
company; (c) the liquidation or dissolution of the Company; (d) the sale, transfer or other
disposition of all or substantially all of the assets of the Company to one or more persons or
entities that are not, immediately prior to such sale, transfer or other disposition, affiliates of
the Company; and (e) during any period of not more than two years, individuals who constitute the
Board as of the beginning of the period and any new director (other than a director designated by a
person who has entered into an agreement with the Company to effect a transaction described in
clause (a) or (b) of this sentence) whose election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then
still in office who were directors at such time or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the Board.

               (ii) “Merger” means any merger, reorganization, consolidation, share exchange, transfer of
assets or other transaction having similar effect involving the Company.

     9. No Rights as Stockholder. The Grantee shall have no voting or other rights as a
stockholder of the Company with respect to any SAR Shares until the exercise of the SAR and the
issuance of a certificate or certificates to him for Net SAR Shares. No adjustment shall be made
for dividends or other rights for which the record date is prior to the issuance of such
certificate or certificates.

     10. Miscellaneous.

          (a) Notices. All notices and other communications required or permitted to be given
under this Agreement shall be in writing and shall be deemed to have been given if delivered
personally or sent by certified or express mail, return receipt requested, postage prepaid, or by
any recognized international equivalent of such delivery, to the Company, or the Grantee, as the
case may be, at the following addresses or to such other address as the Company or the Grantee, as
the case may be, shall specify by notice to the others:

SARS: July 1, 2008 Issuance

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               (i) if to the Company, to it at:

WESCO International, Inc.

Suite 700

225 West Station Square Drive

Pittsburgh, Pennsylvania 15219-1122

Attention: Legal Department

               (ii) if to the Grantee, to the Grantee at the address set forth on the signature page hereof.

All such notices and communications shall be deemed to have been received on the date of delivery
or on the third business day after the mailing thereof.

          (b) Binding Effect; Benefits. This Agreement shall be binding upon and inure to the
benefit of the parties to this Agreement and their respective successors and assigns. Nothing in
this Agreement, express or implied, is intended or shall be construed to give any person other than
the parties to this Agreement or their respective successors or assigns any legal or equitable
right, remedy or claim under or in respect of any agreement or any provision contained herein.

          (c) Waiver; Amendment.

               (i) Waiver. Any party hereto or beneficiary hereof, may, by written notice to the
other parties (A) extend the time for the performance of any of the obligations or other actions of
the other parties under this Agreement, (B) waive compliance with any of the conditions or
covenants of the other parties contained in this Agreement and (C) waive or modify performance of
any of the obligations of the other parties under this Agreement. Except as provided in the
preceding sentence, no action taken pursuant to this Agreement, including, without limitation, any
investigation by or on behalf of any party or beneficiary, shall be deemed to constitute a waiver
by the party or beneficiary taking such action of compliance with any representations, warranties,
covenants or agreements contained herein. The waiver by any party hereto or beneficiary hereof of
a breach of any provision of this Agreement shall not operate or be construed as a waiver of any
preceding or succeeding breach and no failure by a party or beneficiary to exercise any right or
privilege hereunder shall be deemed a waiver of such party’s or beneficiary’s rights or privileges
hereunder or shall be deemed a waiver of such party’s or beneficiary’s rights to exercise the same
at any subsequent time or times hereunder.

               (ii) Amendment. This Agreement may not be amended, modified or supplemented orally,
but only by a written instrument executed by the Grantee and the Company.

          (d) Assignability. Neither this Agreement nor any right, remedy, obligation or
liability arising hereunder or by reason hereof shall be assignable by the Company or the Grantee
without the prior written consent of the other parties.

          (e) Applicable Law. This Agreement shall be governed by and construed in accordance
with the law of the Commonwealth of Pennsylvania, regardless of the law that might be applied under
principles of conflict of laws, except to the extent that the corporate law of the State of
Delaware specifically and mandatorily applies.

SARS: July 1, 2008 Issuance

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          (f) Section and Other Headings, etc. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or interpretation of
this Agreement. In this Agreement all references to “dollars” or “$” are to United States dollars.

          (g) Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and all of which together shall constitute one and the
same instrument.

          (h) Delegation by the Board. All of the powers, duties and responsibilities of the
Board specified in this Agreement may, to the full extent permitted by applicable law, be exercised
and performed by any duly constituted committee thereof to the extent authorized by the Board to
exercise and perform such powers, duties and responsibilities.

[SIGNATURE PAGE FOLLOWING]

SARS: July 1, 2008 Issuance

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IN WITNESS WHEREOF, the Company and the Grantee have executed this Agreement as of the date first
above written.

	 	 	 	 	 	 	 
	 	 	WESCO INTERNATIONAL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Stephen A. Van Oss 

Senior Vice President and Chief 
Financial
and Administrative Officer	 	 
	 
	 	 	 	 	 	 
	 	 	THE GRANTEE:	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	XXXXXX	 	 
	 
	 	 	 	 	 	 
	 

	 	Address of the Grantee:	 	 
	 

	 	 	 	xxxxxx	 	 
	 

	 	 	 	xxxxxx	 	 

Total Number of Stock

Appreciation Rights Awarded: XXXX

Exercise Price: $40.04

Grant Date: July 1, 2008

SARS: July 1, 2008 Issuance

- 8 -

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