pr LY AGREEMENT
This Division Supply Agreement is entered into pursuant and subject to the terms and conditions of the Master
Supply Agreement (the “Master Agreement”) dated (2S , 2007 between Emerson Electric Co., a Missouri
corporation, and Kerkau Manufacturing, a Michigan edrporation (“Seller”). All capitalized terms used in this
Agreement will have the meanings given them in the Master Agreement.
Division/Buyer: Rosemount, Inc.
Term: Beginning on April 1, 2007 and ending March 31, 2009.
Products: See Schedule 1 of this Division Supply Agreement.
Prices: As set forth in Schedule I of this Division Supply Agreement, subject to the price
adjustments set forth in Schedule 1 of this Division Supply Agreement.
Price Reductions: The price of the Products due to Conversion Cost, as specified in Attachment 1,
will be reduced on each anniversary of the effective date of the Division Supply
Agreement as follows:
Anniversary of Effective Date Percent ion
* 2%
Quantity: Buyer shall purchase a minimum quantity of Products (set forth on Schedule 1 of
this Division Supply Agreement) equal to 75% of Buyer’s requirements for such
Products.
‘Lead Times. Part Specific; See Schedule 1
Tit jod: 5 Days Early; 0 Days Late
livery Charges: Seller is responsible for the expedited freight charges due to Seller late delivery.
If Seller consistently does not meet the on-time delivery criteria noted above, the Buyer will have the right to
terminate this Division Supply Agreement on 30 days notice.
Pacl Terms: Per Procurement Specification #25
‘Quality Standards,
Goals and Charges: 98% Acceptance Rate
If Seller consistently does not meet the quality standards and goals noted above, the Buyer will have the right to
terminate this Division Supply Agreement on 30 days notice.
IN WITNESS WHEREOF, this Division Supply Agreement is executed as of Mey 43 we
SELLER,
KERKAU MANUFACTURING
By:
Nam
Title:
SSTLDOI-1166017-5
Approved 6206 Dniton Supply darementSchedule 1
to the
Division Supply Agreement
(Attached as an Excel Spreadsheet)
Any cash discount normally provided by Seller to any buyer shall apply to the Products. If at any time
during the Term of this Agreement, Seller offers to sell comparable quantities of similar Products at a
price lower than Seller's price to Buyer, or upon other terms more favorable to a buyer than the terms
hereof, Seller shall promptly notify Buyer thereof and offer such lower price or such other more favorable
terms to Buyer during the period in which such lower price or such other more favorable terms are in
effect,
Raw Material Adjustment Clause:
For all stainless flanges, raw material prices may be adjusted monthly. Starting with the effective date of
this contract a beginning MEPS index will be established as the average of the Asian 316 SS MEPS index
for the bid month and the three following months. If the three month rolling average deviates from the
‘current material base price by 10% or more a Change Triggering Event (CTE) will have occurred. After &
CTE, the current index rolling average will become the new base price and the price of the Products
shipped in the next month and thereafter will be adjusted as follows.
For all carbon flanges, raw material prices will be adjusted yearly. Starting with the effective date of this
contract a heginning MEPS index will be established as the average of the Asian CS MEPS index for the
bid month and the three following months. If the three month rolling average deviates from the current
material base price by 10% or more a Change Triggering Event (CTE) will have occurred. After a CTE,
the current index rolling average will become the new base price and the price of the Products shipped in
the next month and thereafter will be adjusted as follows.
CTE Example:
Part number “J” has a current raw material price of $51.00. If the Asian MEPS index three month
rolling average increases by 10.2%, the new raw material price will be calculated by multiplying.
the current price, $51.00, times 1.102. The new raw material price would then be $56.20.ae =
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