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ACCOUNTS PAYABLE SERVICE AGREEMENT
THIS ACCOUNTS PAYABLE SERVICE AGREEMENT (the "Agreement") dated as of
August 11, 1997 is entered into by and between AlliedSignal Avionics Inc., a
Kansas corporation ("Avionics") and EFTC Corporation, a Colorado corporation
("EFTC") with reference to the following facts:
WHEREAS, Avionics, AlliedSignal, Inc. operating through its Aerospace
Equipment Systems Business Unit, and EFTC have entered into a MASTER AGREEMENT
REGARDING ASSET PURCHASE AND RELATED TRANSACTIONS dated July 15, 1997, as
amended, providing, in part, for the sale of certain assets related to the
manufacture of electronic circuit card assemblies to Avionics (the "Master
Agreement"); and
WHEREAS, Avionics and EFTC have entered into a LONG TERM PURCHASE
AGREEMENT dated July 15, 1997 (LTA no. R20046) in which EFTC agrees to provide
electronic circuit card assemblies to Avionics;
WHEREAS, in order to provide for an orderly transition of the business
sold, Avionics and EFTC entered into a TRANSITION SERVICES AGREEMENT dated
August 11, 1997 providing for certain transition services to be provided to
EFTC by Avionics and providing for the use of Avionics material resources
planning system ("Mac Pac") for a transitional period;
WHEREAS, in order for Mac Pac to function properly, purchase orders
for materials and related invoice payments will need to be processed through
Mac Pac and the parties desire to enter into this Agreement to set forth the
terms and conditions by which Avionics will provide support to EFTC in this
regard.
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Accounts Payable Service. This Agreement applies to the
processing of orders for materials required in connection with the manufacture
of goods for Avionics at the EFTC Ft. Lauderdale site only and for no other
purpose. The process by which materials will be ordered and paid for during
the Term is as follows:
1.1 Mac Pac will generate order requests based on
production forecast, stock in hand and projected lead times;
1.2 EFTC will collect such order requests and promptly
process them and place orders as directed by Mac Pac through the Mac
Pac system in coordination with Avionics;
1.3 Avionics will invoice EFTC for the cost of the
materials at actual cost and such payments are due net 45 days from
EFTC's receipt of invoice;
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1.4 Avionics will timely pay the material vendor based on
the information provided through the Mac Pac system.
2. Term. The term of this Agreement will commence as of the date
hereof and continue for such time as EFTC continues to have the use of the Mac
Pac system under the Transition Services Agreement. The parties acknowledge
and agree that they intend for such services to extend for up to nine months
from the date hereof. This agreement may be extended by mutual agreement in
writing signed by both parties.
3. Invoicing. Avionics will invoice EFTC for material utilized
by the EFTC Florida operations on a daily basis. The invoice is triggered by
receipt of a part into Procurement D (purchasing module within Mac Pac). The
invoice will be generated based on a report generated from MacPac. The invoice
will include the following information: purchase order number, part number,
line item number, quantity received, unit price, extended price, date received,
vendor name, vendor number and payment terms. Invoices will be submitted to
the following address:
EFTC Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxx, XX 00000
Customer Code 086015
Attention Xxxxxx Xxxxxx
4. Payment Terms. All payments are due net 45 days from EFTC's
receipt of invoice. Remittance shall be paid by check and sent to the
following lock box location:
AlliedSignal Aerospace
XX Xxx 00000
Xxxxxxx, XX 00000-0000
The invoice number must be indicated on the remittance check. In the event
EFTC does not timely pay such invoices, Avionics may at its discretion either:
(i) require EFTC to pay for all materials ordered through the Mac Pac system in
advance or (ii) offset amounts due from EFTC against any amounts owed to EFTC.
5. Limitations on Part Numbers. For the period of time that
EFTC is operating within MacPac no additional part numbers shall be added into
the system unless the part number is an Avionics part number required for
Avionics assemblies.
6. Limitation of Liability. Avionics is providing this service
as a convenience to EFTC for a limited period in connection with the transition
of operations and Avionics is not in the business of providing such services to
third parties. Avionics makes no representation or warranty of any kind
regarding the Mac Pac system or any data contained in the Mac Pac system and
the provisions of this Agreement will not be construed as such. EFTC agrees
not to hold Avionics responsible for any particular result or for the failure
of the system to operate as planned. EFTC will indemnify,
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defend and hold Avionics harmless from and against any and all claims against
Avionics arising from or in connection with the services it is performing
hereunder. EFTC acknowledges and agrees that it is responsible for the payment
of the materials ordered and that Avionics is merely acting as a paying agent
of EFTC and does not have privity of contract or responsibility to the material
vendors.
7. Arbitration.
7.1 Any controversy, claim or dispute arising out of or
relating to this Agreement or the transactions contemplated hereby or the
breach, termination, enforcement, interpretation or validity hereof, including
the determination of the scope or applicability of this agreement to arbitrate
(collectively "Dispute"), shall be determined by arbitration in Phoenix,
Arizona before a sole arbitrator. The following shall apply to any such
arbitration:
7.2 The arbitration shall be administered by the American
Arbitration Association ("AAA") pursuant to its Commercial Rules and
Supplementary Procedures for Large, Complex Disputes.
7.3 The arbitrator shall not be an officer, employee,
director or affiliate of any party hereto or of its affiliates. If the parties
are unable to agree on an arbitrator within 30 days of the filing of the Demand
for Arbitration, an arbitrator shall be selected pursuant to the rules and
procedures of the AAA.
7.4 Any party may seek from any court interim or
provisional relief that is necessary to protect the rights or property of that
party, pending the appointment of the arbitrator or pending the arbitrator's
determination of the merits of the controversy.
7.5 The parties shall bear their own costs and expenses,
including attorneys' fees, but the arbitrator may, in the award, allocate all
of the administrative costs of the arbitration, including the fees of the
arbitrator and mediator, against the party who did not prevail.
7.6 The arbitration award shall be in writing and shall
specify the factual and legal bases for the award. Judgment on the award may
be entered in any court having jurisdiction.
8 Miscellaneous.
8.1 Notices. Whenever notice is to be served hereunder,
service shall be made personally, by facsimile transmission or by overnight
courier. All delivery charges shall be prepaid by the party sending the
notice. Notice shall be effective only upon receipt by the party being served.
All notices shall be sent to the addresses described in the Master Agreement.
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8.2 Entire Agreement. This Agreement, the Master
Agreement (including any documents or agreements contemplated thereby)
constitute the entire agreement between the parties with respect to the subject
matter hereof and supersede all prior communications, representations,
agreements and understandings between the parties hereto, whether oral or
written.
8.3 Construction. When the context so requires,
references herein to the singular number include the plural and vice versa and
pronouns in the masculine or neuter gender include the feminine. The headings
contained in this Agreement and the Schedules hereto are for reference purposes
only and shall not affect the meaning or interpretation of this Agreement.
8.4 Assignment. This Agreement, and all rights and
obligations hereunder, shall not be assignable by any party in whole or in
part, except that (a) either party may assign this Agreement and its rights and
obligations hereunder with the other's prior written consent, (b) either party
may assign this Agreement without the prior written consent of the other party
to a subsidiary, parent or affiliated entity, (c) Avionics may perform any of
the services required hereunder through a subsidiary or affiliate of Avionics
without the prior written consent of EFTC, and (d) Avionics may subcontract any
of the services required of it hereunder to any party Avionics contracts with
for services for its own account now or in the future without the prior written
consent of EFTC. For any such assignment, EFTC or Avionics, as the case may
be, shall remain obligated hereunder unless the other party shall consent
otherwise. Any purported assignment inconsistent with this Section 8.4 shall
be void and of no effect. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns.
8.5 Amendment. This Agreement may be amended only by
written agreement duly executed by representatives of both the parties hereto.
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8.6 Applicable Law. This Agreement shall be construed in
accordance with the laws of the State of Florida, disregarding its conflicts of
laws principles which may require the application of the laws of another
jurisdiction.
8.7 No Third Party Rights. This Agreement is not
intended and shall not be construed to create any rights in any parties other
than Avionics and EFTC and no other person shall assert any rights as a third
party beneficiary hereunder.
8.8 Waivers. Any waiver of rights hereunder must be set
forth in writing. A waiver of any breach or failure to enforce any of the
terms or conditions of this Agreement shall not in any way affect, limit or
waive a party's rights at any time to enforce strict compliance thereafter with
every term and condition of this Agreement.
8.9 Independent Contractor. The parties intend to create
an independent contractor relationship and nothing contained in this Agreement
shall be construed to make either Avionics or EFTC a partner, joint venturer,
principal, agent or employee of the other. Neither party shall have any right,
power or authority, express or implied, to bind the other.
8.10 Force Majeure. If a party is unable to meet its
obligations under this Agreement as a result of flood, earthquake, storm, other
act of God, fire, strike, war, riot, embargo, act of government or governmental
agency or any other similar cause beyond the reasonable control of such party
("Force Majeure"), the obligations of the parties hereto shall be suspended for
the duration of the Force Majeure. The party claiming Force Majeure shall,
within five (5) days from the date of disability, excluding Saturdays, Sundays
and holidays, notify the other party of the existence of a Force Majeure
condition and will similarly notify the other party within a period of five (5)
days, excluding Saturdays, Sundays and holidays, when the Force Majeure has
ended.
IN WITNESS WHEREOF, Avionics and EFTC have duly executed and delivered
this Agreement as of the date first written above.
ALLIEDSIGNAL AVIONICS, INC.,
a Kansas corporation
By: /s/ W. Xxx Xxxxxx
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Title: Subcontracts Program Manager
EFTC CORPORATION,
a Colorado corporation
By: /s/ Xxxxxx Xxxxxxxxxx
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Xxxxxx Xxxxxxxxxx
Title: Chief Financial Officer
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