EXHIBIT 10.3
(Certain portions have been omitted pursuant to a request for confidentiality
and have been separately filed with the Securities and Exchange Commission)
Marketing and Technology Agreement
This Marketing and Technology Agreement (hereinafter
"Agreement") is made and entered into this 13th day of July 1998,
by and between:
Telenetics Corporation, a corporation of California
(hereinafter "Telenetics") and
Duquesne Light Company, a corporation of Pennsylvania,
(hereinafter "DLC");
WITNESSETH:
WHEREAS, DLC has expertise in electric power distribution,
metering and outage analysis which it has developed on its own and
in cooperation with its vendors;
WHEREAS, Telenetics has expertise in data communications
including various types of modems;
WHEREAS, with the encouragement, advice and technical
information supplied by DLC, Telenetics has developed new
technology embodied in a series of Communication Interface
Cabinets, more particularly described in specifications and
agreements between Telenetics and DLC or Xxxxxxx Electric Company,
for interfacing electric meters with certain central meter data
management systems;
WHEREAS, Telenetics and DLC mutually desire to set forth in
this Agreement certain terms for their future joint testing and
marketing of the Communications Interface Cabinets;
WHEREAS, the parties desire to pursue the deployment of the
new technology developed by Telenetics to provide reliable wireless
and land line communication interfaces between advanced meter
devices and central meter data management systems;
WHEREAS, the parties desire to validate the new Telenetics
technology developments by successfully implementing advanced
metering capabilities through an initial field Beta test program
and then a field deployment of Telenetics Communication Interface
Cabinets; and
WHEREAS, the parties desire to take mutual advantage of the
resulting technology advancements through joint efforts to market
the communications interface equipment and other automated metering
solutions;
NOW, THEREFORE, DLC and Telenetics, intending to be legally
bound, hereby agree as follows:
Section 1
DEFINITIONS
1.0 Definitions. In this Agreement, the following words and
expressions will have the following meanings:
"Products" mean Telenetics' Omega Interface Communication
Cabinets (as described more fully in the specification attached as
Exhibit B hereto) and variations and improvements thereof sold for
the purpose of automating utility, supplier and meter data
management agency meter reading functions.
"Affiliate" of a company shall mean a corporation or other
legal entity the majority of whose shares or other securities
entitled to vote for directors (or other managing authority) is now
or hereafter controlled by such company.
"Gross Sales" shall mean amounts billed by Telenetics (or any
Affiliate) to customers for Products, less customary trade
discounts and allowances, returns, and other deductions generally
allowed by its customers.
Section 2
2.1 Purchases. Telenetics will deliver Products in accordance
with and as described more fully in Exhibit B and in the June 10,
1998 Subcontract between Xxxxxxx Electric Company and Telenetics
and the purchase orders and related attachments which are included
as Exhibit A hereto (the "Subcontract").
2.2 Primary Supplier. DLC will consider Telenetics as its
primary supplier of the Products and associated products for
automated meter reading, substation automation and other similar
uses and Telenetics will sell Products to DLC from time to time at
DLC's request at the most favorable price, terms and conditions
offered any other customer in the last six (6) months prior to such
request.
Section 3
JOINT TESTING AND DEVELOPMENT
3.1 Beta Testing. Telenetics will deliver to Xxxxxxx
Electric Company ten (10) each of the following Products sometimes
referred to as Omega 1, Omega 2 and Omega 3 (as more specifically
set forth in the Subcontract):
(a) single meter - cell phone communications interface
cabinet,
(b) multiple meter - land line communications interface
cabinet, and
(c) multiple meter - cell phone communications interface
cabinet.
Reasonably promptly thereafter, DLC or its contractor, Xxxxxxx
Electric Company or another designated installation subcontractor,
will install a sufficient number of each type Product for metering
electrical usage by commercial or industrial customers of DLC and
interface said Products to DLC's central meter data management
system (the ITRON/UTS MV-90 System) for the purpose of Beta
Testing, that is, testing in the actual environment of intended use
to establish that the Products comply with the specifications
(Exhibit B) and operate in a flawless manner to transfer data from
electric meters to the central meter data management system. DLC
will share all data concerning the operation of the prototype
Products (to the extent no agreement with another vendor or
customer would be violated) with Telenetics and will cooperate with
Telenetics to validate the successful operation of the Products.
3.2 Approval. Upon approval by DLC of the operation and
function of the Products, DLC, either directly or through Xxxxxxx
Electric Company or another designated installation subcontractor,
will proceed with the general installation of the Products as more
specifically provided for in the Subcontract. DLC will continue to
share data (to the extent no agreement with another vendor or
customer would be violated) concerning the operation of the
installed Products for the term of this Agreement.
Section 4
JOINT MARKETING
4.1 Joint Marketing Activities. DLC and Telenetics agree to
consult and cooperate with each other in the interest of promoting
the Products. It is envisioned that the primary marketing efforts
will be made by Telenetics. To that end, each party shall:
(a) Become familiar with the technical and operational
functions and features of the Products;
(b) Host visits of potential customers for marketing presentations
upon reasonable request; and
(c) Conduct demonstrations and performance benchmarks of
the Products.
Additionally,
(d) DLC agrees to support Telenetics' efforts with
respect to trade show presentations, provided that the same
does not interfere with DLC's ability to fulfill its electric
service requirements;
(e) DLC agrees to notify Telenetics of the presentation
of papers by its employees that pertain to the system that
include the Products in advance of presentation so that
Telenetics can use the opportunity to prospect for customers;
(f) DLC will attempt to establish a preferred
arrangement with ITRON for use of the Products for ITRON
installations in the Pittsburgh area, through North America
and the world, however, Telenetics acknowledges that whether
or not ITRON becomes a party to such an agreement is
exclusively under ITRON's control, and DLC makes no warranty
or other promise that such an agreement will be executed,
delivered or performed by ITRON; and
(g) DLC will promote the Products outside of its service
areas for advanced metering solutions, and will provide the
necessary knowledge base with respect to utility operation and
regulation to sell the Products in a regulated utility
environment.
4.2 Marketing Materials. Telenetics shall submit all
marketing literature, arrangements and other materials regarding
the Products that contain the name of DLC to DLC for its review and
approval prior to use.
Section 5
ROYALTY PAYMENTS
5.1 Royalties. In consideration of DLC's assistance in
developing the Products, in continuing to provide information on
the operation of the Products and further in view of DLC's
participation in the joint marketing activities set forth in
Section 4 of this Agreement, Telenetics will pay DLC a royalty on
Products sold by Telenetics (except Products sold to DLC) as
follows:
CATEGORY ROYALTY PAYMENT
A. Category I. Products sold to [Confidential portion omitted and
any and all utility companies filed separately with the
located in Pennsylvania and Securities and Exchange Commission]
the six (6) contiguous states. % of gross sales
B. Category II. Products sold to [Confidential portion omitted and
owners of ITRON automatic filed separately with the
meter reading installations in Securities and Exchange Commission]
North America, outside of % of gross sales
Pennsylvania and the six (6)
contiguous states.
C. Category III. Products sold to [Confidential portion omitted and
utility, supplier or meter data filed separately with the
Securities and Exchange Commission]
% of gross sales
management agencies (other than
owners of ITRON automatic meter
reading installations) located in
North America, outside of
Pennsylvania and the six (6)
contiguous states.
5.2 Reports and Payments. Payment of the royalties specified
by paragraph 5.1 shall be made by Telenetics to DLC within sixty
(60) days after March 31, June 30, September 30 and December 31 of
each year during the term of this Agreement covering the quantity
of Products sold by Telenetics and its Affiliates during the
preceding calendar quarter. Each quarterly payment shall be
accompanied by a written statement of gross sales of Products
during such quarter. Such written statements shall show the gross
sales of Products broken out according to Categories I, II and III,
the gross sales during the calendar quarter and the amount of
royalties payable.
5.3 Records and Inspection. Telenetics shall maintain or
cause to be maintained a true and correct set of records pertaining
to the gross sales of Products by Telenetics or Affiliates under
this Agreement. During the term of this Agreement and for a period
of six (6) months thereafter, Telenetics agrees to permit a
certified public accountant paid by DLC to have access during
ordinary business hours to such records as are maintained by
Telenetics as shall be necessary in the opinion of such accountant
to determine the correctness of any report or payment made under
this Agreement. Such accountant shall maintain in confidence, and
shall not disclose to DLC, any information concerning Telenetics or
its operations or properties other than information directly
relating to the correctness of such reports and payments.
Section 6
PROPRIETARY PROTECTION
6.1 Confidentiality. All technical information of a
confidential nature associated with the Products or this Agreement
shall be protected by both parties. The financial terms of this
Agreement shall be kept confidential; provided, however, that
either party may disclose the financial terms of this Agreement if
required to be disclosed pursuant to applicable law (including,
without limitation, the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended) or court order.
6.2 No Implied Rights. Except for the rights and licenses
expressly confirmed and granted by this Agreement, nothing in this
Agreement shall be deemed to create a license from either party to
the other of any trade secret, patent, copyright, trademark or
other intellectual property right.
6.3 Indemnification.
(a) Telenetics will hold DLC harmless against all
claims, liabilities, demands, damages, expenses or losses
including, but not limited to, claims based upon product
liability laws and trade secret, patent, copyright, trademark
and other intellectual property laws, which claims (1) arise
out of use by DLC or Telenetics' customers of the Products or
(2) arise out of warranties or representations made by
Telenetics for the Products; and
(b) DLC shall hold Telenetics, its officers and
employees, harmless against all claims, liabilities, demands,
damages, expenses (including reasonable attorneys' fees) and
losses as a result of errors, omissions, negligence,
misrepresentations or false or wrongful actions of any of DLC,
DLC's Affiliates or any of their respective agents or
employees in the performance of this Agreement.
Section 7
TERM
7.0 Term. This Agreement shall take effect upon the date set
forth above and, unless earlier terminated pursuant to Section 7.1
below, shall remain in effect for an initial period of ten (10)
years; this Agreement shall automatically extend for successive
two-year periods unless either party shall have provided written
notice of its intention to terminate at least six (6) months prior
to the end of the initial period or any renewal period.
7.1 Termination. A party may terminate this Agreement upon
thirty (30) days written notice if any of the following occurs:
(a) the other becomes insolvent, or any person seeks the
dissolution, winding-up, liquidation, reorganization or
similar arrangement with respect to such party under any law
relating to bankruptcy, insolvency or similar relief;
(b) the other party merges or combines with another
entity (except that DLC may merge or combine with any
Affiliate of DLC); and
(c) the other party fails to pay any amounts owed
hereunder when due, and such failure has not been cured within
thirty (30) days of such payment due date.
Section 8
MISCELLANEOUS
8.1 Compliance With Laws. The parties agree that they shall
comply with all applicable laws and regulations of governmental
bodies or agencies in their performance under this Agreement.
Without limiting the generality of the foregoing, neither party
shall knowingly export or re-export, directly or indirectly, any
technical data (as defined by the U.S. Export Administration
Regulations) produced or provided under this Agreement, or export
or re-export, directly or indirectly, any direct product of such
technical data, including software, to a destination to which such
export or re-export is restricted or prohibited by U.S. or non-U.S.
law, without obtaining prior authorization from the U.S. Department
of Commerce and other competent government authorities to the
extent required by those laws.
8.2 No Agency. Nothing herein shall be construed to create
a partnership, joint venture, or agency relationship between the
parties hereto.
8.3 Counterparts. This Agreement may be executed in one or
more counterparts, all of which together shall constitute a single
Agreement.
8.4 Governing Law. The validity, construction and performance
of this Agreement shall be governed by the laws of the Commonwealth
of Pennsylvania, USA. Any litigation shall be filed and pursued in
either state or federal court in Pittsburgh, Pennsylvania.
8.5 Amendments; Waiver. This Agreement may be amended only
by an instrument in writing executed by both parties to this
Agreement. Waiver of any provision of this Agreement shall not be
deemed a waiver of any other provision, and any failure to act in
response to a breach or insist on strict performance of any
provision of this Agreement shall not be deemed a waiver of any
such breach or of any later breach or failure to perform any
provision of this Agreement.
8.6 Notices. All notices, requests, demands and other
communications required or permitted by this Agreement shall be in
writing and shall be deemed to have been duly given if sent by
personal delivery, by facsimile, by express courier service, or, if
mailed, postage prepaid, first-class, certified mail, return
receipt requested, on the third day after mailing, to the following
addresses or to such other address as a party may specify to the
other in writing:
To Telenetics: President
Telenetics Corporation
00000 Xxxxx Xxxxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxxxx 00000
To DLC: Vice President Operations
Duquesne Light Company
0000 Xxxxxx Xxxxxx
Mail Drop M-GSU
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
8.7 Severability. A decision by any arbitrator or court of
competent jurisdiction invalidating or holding unenforceable any
part of this Agreement shall not affect the validity and
enforceability of any other part of this Agreement.
8.8 Entire Agreement. This Agreement is the entire agreement
between the parties and supersedes all prior discussions and
agreements between the parties with respect to the matters it
addresses.
8.9 No Assignment. Without the prior written consent of the
other party (which consent may not be withheld without reason),
neither party may sell, assign or divide its rights under this
Agreement except DLC may assign this Agreement to an Affiliate of
DLC.
IN WITNESS WHEREOF, DLC and Telenetics have caused this
Agreement to be signed and delivered by their duly authorized
officers, all as of the date first hereinabove written.
DUQUESNE LIGHT COMPANY TELENETICS CORPORATION
By: /s/ XXXXXXX X. XXXXXXX By: /s/ XXXXXXX X. ARMANI
---------------------- ---------------------
Xxxxxxx X. Xxxxxxx Xxxxxxx X. Armani
Title: General Manager Title: President and
Customer Operations Unit Chief Executive Officer
Date: July 9, 1998 Date: July 13, 1998
EXHIBIT A
TO
MARKETING AND TECHNOLOGY AGREEMENT
SUBCONTRACT
DATE: ___June 10, 1998_____
SECTION 1.
CONTRACTOR: Xxxxxxx Electric Company
ADDRESS: 00xx xxx Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
--------------------------------------------------------
SUBCONTRACTOR Telenetics
--------------------------------------------------------
ADDRESS: 00000 Xxxxx Xxxxxxx Xxxxx, Xxxx Xxxxxx, XX 00000
--------------------------------------------------------
DESCRIPTION: JOB NO: U5079-0161
-------------------------- ---------------------
OWNER: Duquesne Light Company
--------------------------------------------------------
Owner:
--------------------------------------------------------
ADDRESS: 000 0xx Xxxxxx, Xxxxxxxxxx, XX 00000
--------------------------------------------------------
PLANS & SPECIFICATIONS
ENTITLED:
--------------------------------------------------------
PREPARED BY: Xxxxx Xxxxxx DATED: June 10, 1998
-------------------------- ----------------------
SECTION 2. ________ Telenetics__________________(hereinafter "Subcontractor")
and Xxxxxxx Electric (hereinafter "Xxxxxxx") agree that the equipment to be
furnished and the work to be done by the Subcontractor are as follows:
Deliver the first 1,830 Omega 1, 2, & 3 Interface Cabinets per the attached
Duquesne Light Company-Telenetics shipping schedule (Attachment A)
and riders Telenetics General Conditions of Purchase (Attachment B) attached
hereto, ALL IN ACCORDANCE WITH DUQUESNE LIGHT COMPANY/ TELENETICS SPECIFICATIONS
(ATTACHMENT C), THEREFOR AS DEFINED IN SECTIONS 1, 2 AND 3 OF THE ATTACHED
ADDITIONAL PROVISIONS OF SUBCONTRACT (HEREINAFTER "GENERAL CONTRACT").
SECTION 3. This contract shall be subject to all of the "ADDITIONAL PROVISIONS
OF SUBCONTRACT" which are hereby expressly incorporated herein and made a part
hereof.
SECTION 4. The Subcontractor agrees: (1) to keep himself thoroughly informed as
to the progress of the job; (2) to begin work upon notification by Xxxxxxx; (3)
to prosecute the work as and when directed by Xxxxxxx; (4) to perform the work
in accordance with the highest professional standards applicable to the
performance of like work; (5) and to perform the full extent of the work covered
by this Subcontract so as to assume all the obligations of Xxxxxxx therefor.
Subcontractor further acknowledges that time is of the essence in performance of
the work and failure to perform the work within the time specified shall be
grounds for termination by Xxxxxxx. Subcontractor specifically agrees to provide
all necessary coordination required to fully complete the work in accordance
with the scheduling requirements of the project set forth in the Duquesne Light
Company Schedule.
An Equal Opportunity Employer
06/10/98 Page 1 of 6
SECTION 5. IN CONSIDERATION WHEREOF, Xxxxxxx agrees to pay the Subcontractor for
the full and faithful performance of its work the sum of [Confidential portion
omitted and filed separately with the Securities and Exchange Commission] in
current funds, subject to additions and deductions for changes as may be agreed
upon, provided that no payments are to be made unless the Subcontractor's rate
of progress, work done and material furnished are satisfactory to Xxxxxxx and
the Owner, and as herein agreed upon. Payments shall be made as follows:
. A payment of $ [Confidential portion omitted and filed separately with
the Securities and Exchange Commission] to cover start-up costs shall be
paid upon acceptance of this subcontract.
. Delivery of 10 each of Omega 1, 2, & 3 Communication Interface Cabinets.
. Functional Acceptance Testing and Acceptance by Duquesne Light Company.*
. A progress payment of $ [Confidential portion omitted and filed
separately with the Securities and Exchange Commission] shall be paid
upon receipt of the next 1,000 units (on or about July 17).
. A second progress payment of $ [Confidential portion omitted and filed
separately with the Securities and Exchange Commission] shall be paid
upon receipt of the next 800 units (partial shipment on of about July
24, balance on or about July 31).
. Should the value of the products contemplated by this Agreement be less
than the sum of the above start-up and progress payments, said amount
shall be credited to future invoicing.
*Note: No equipment delivery will be accepted, nor progress payment due
until Duquesne Light Company acceptance of the initial 30 units.
NOTE: Subcontractor must file a Certificate of Insurance with Xxxxxxx prior to
starting work, (naming Xxxxxxx and Duquesne Light Company as an additional
insured). All invoices must be submitted in duplicate and signed "APPROVED" by
the Xxxxxxx and Duquesne Light Company project managers prior to processing for
payment.
Subcontractor represents that it has examined this Subcontract and the
referenced contract documents and understands the Owner's expected functionality
for the subcontracted Equipment, and that it enters this Subcontract on the
basis of its own examination and evaluation and not any representations of
Xxxxxxx.
IN WITNESS WHEREOF, The parties hereto have executed this agreement for
themselves, their heirs, executors, successors, administrators and assigns, on
the day and year first above written.
CONTRACTOR: Xxxxxxx Electric Company Telenetics Corporation
--------------------------------
SUBCONTRACTOR
BY /s/ ILLEGIBLE SIGNATURE /s/ XXXXXXX X. ARMANI
------------------------------------------ --------------------------------
General Manager/utility President
------------------------------------------ --------------------------------
TITLE TITLE
/s/ ILLEGIBLE SIGNATURE /s/ ILLEGIBLE SIGNATURE
------------------------------------------ --------------------------------
WITNESS WITNESS
An Equal Opportunity Employer
06/10/98 Page 2 of 6
XXXXXXX ELECTRIC COMPANY
Standard Subcontract Form
ADDITIONAL PROVISIONS OF SUBCONTRACT
1. The phrase "General Contract" shall be deemed to mean the contract
between Xxxxxxx and the Owner with reference to the work described in Section 1
of this Subcontract, together with Attachments A, B, and C therein, all of which
are made a part of this Subcontract and fully incorporated herein by reference.
Whenever the requirements of the General Contract are more inclusive
or more restrictive than the terms of this Subcontract, the provisions of the
General Contract shall apply and the foregoing shall include but are not limited
to quantities, dates, tests, insurance, warranties, etc.
2. The Subcontractor agrees to furnish the Equipment required by this
Subcontract strictly in accordance with all plans and specifications of the
General Contract.
3. The Subcontractor agrees that he will so perform this agreement as not
to violate any term, covenant or condition of said General Contract. The
relationship of the Subcontractor hereunder towards Xxxxxxx shall be the same as
that of Xxxxxxx towards the Owner under said General Contract and the
relationship of Xxxxxxx hereunder to the Subcontractor shall be the same as that
of the Owner towards Xxxxxxx under said General Contract.
4. The Subcontractor shall submit to Xxxxxxx'x Office, requisitions for
payment, covering the value of the work completed to the satisfaction of the
Owner during that month. Such invoice shall be submitted in time for processing
and submission to the Owner.
5. The Subcontractor shall furnish Xxxxxxx with such partial releases and
waivers of lien from Subcontractor's materialmen and creditors as Xxxxxxx may
request from time to time on labor and/or material and/or other claims, and
final releases and waivers of lien at the time of final payment on this
Subcontract.
6. The Subcontractor shall furnish, if requested by Xxxxxxx, sworn
affidavits from time to time, in accordance with the form provided by Xxxxxxx,
which shall state amounts due or to become due, amounts paid, and any other
information clearly to indicate the financial condition of the Subcontractor,
insofar as it relates to labor and material furnished, under this Subcontract,
and Xxxxxxx may take such steps as he may deem necessary to protect itself
against any claims including the withholding of payment and the right to issue
joint checks, until satisfactory evidence is received indicating all claims have
been satisfied. If at any time Xxxxxxx shall determine that the Subcontractor's
financial condition has become, in his opinion, unsatisfactory the Subcontractor
shall furnish satisfactory security to Xxxxxxx within three days after written
notice to his last known address and in default of furnishing said security,
Xxxxxxx shall have the option to cancel this contract. In case of such
cancellation the rights of Xxxxxxx shall be the same as if the Subcontractor had
failed to perform this contract in whole or in part.
An Equal Opportunity Employer
Page 3 of 6
XXXXXXX ELECTRIC COMPANY
Standard Subcontract Form
7. The Subcontractor agrees that monies received for the performance of
this contract shall be held in trust for payment for labor and material entering
into this work and said monies shall not be diverted to satisfy obligations of
the Subcontractor on other contracts.
8. The right is reserved by Xxxxxxx to require changes in, deviations
from, additions to, and omissions from, the work herein contracted, and the
subcontract price shall be adjusted accordingly. Before proceeding with any
change, deviation, addition or omission, the Subcontractor will first obtain
written authorization from Xxxxxxx, which authorization will state the amount by
which the Subcontract will be adjusted, if any.
9. Subcontractor shall comply with all federal, state and municipal laws,
codes, regulations and ordinances effective where the work under this contract
is to be performed, and same shall govern where more restrictive than as set out
in plans or specifications.
10. This Subcontract shall supersede and take precedence over any and all
proposals, correspondence, and oral agreements made prior to the date hereof.
11. This Subcontract shall not be altered, modified or amended except by
further written agreement signed by both parties hereto.
12. The Subcontractor shall not sublet any portion of this subcontract
without the written consent of Xxxxxxx first had and obtained.
13. Subcontractor shall not assign, or attempt to assign in any manner at
any time any funds accrued or to accrue under this subcontract without prior
written consent of Xxxxxxx, and no such assignment shall be binding on Xxxxxxx
unless and until accepted in writing by Xxxxxxx.
14. The Subcontractor agrees to prosecute his work, and the several parts
thereof at such times and in such order as defined in Attachment to avoid any
delay in the completion of the project as a whole. The Subcontractor shall
reimburse Xxxxxxx for any loss, damage or extra expense paid or incurred by
Xxxxxxx, subject to the terms set forth in Attachment B. In case Xxxxxxx or the
Owner deems this procedure necessary for proper conduct of the work, all monies
expended therefor shall be deducted from the contract price herein stated, and
if such expenditures exceed the amount otherwise due to the Subcontractor
hereunder the Subcontractor agrees to pay to Xxxxxxx on demand the full amount
of such excess, together with interest thereon at the rate of__18_________
percent (_18__%) per annum, until paid.
15. The Subcontractor shall promptly amend and make good any defective
equipment to the entire approval and acceptance of the Owner. Telenetic's
obligation and liability shall be as set forth in Attachment B.
16. The Subcontractor shall furnish all guarantees, warranties and
operating instructions, etc., as required by the Attachment B.
17. To the fullest extent permitted by law, Subcontractor shall indemnify,
defend and save Xxxxxxx and Owner harmless from and against all suits, claims,
damages or expenses
An Equal Opportunity Employer
Page 4 of 6
XXXXXXX ELECTRIC COMPANY
Standard Subcontract Form
(including attorneys fees), arising from any act, omission or negligence of
Subcontractor, its agents, employees, suppliers or subcontractors in connection
with Equipment supplied under this Subcontract, for or on account of any claim
arising out of: (1) any personal injury or death, including claims by any of
Subcontractor's employees for which Subcontractor would otherwise be immune by
virtue of any state workers' compensation law; (2) any damage to property; (3)
anything to be supplied hereunder infringing or being covered by a patent not
owned by Subcontractor; (4) the filing of any claims or liens by anyone
furnishing labor and/or materials to the Project; or (5) the breach of any
federal, state or local statute, ordinance or regulation.
18. Anti-Discrimination (a) The Subcontractor, in performing the work
required by this contract, shall not discriminate against any employees or
applicants for employment because of race, religion, creed, sex, national
origin, age, veteran status, and non-job related disability. The Subcontractor
is required to pursue actively a policy of non-discrimination in accordance with
directives of the Owner and a failure to do so may result in a cancellation of
this Subcontract.
(b) The Subcontractor agrees that the provisions of paragraph (a)
above and any other provisions required by the General Contract to be included
will be inserted in all of its subcontracts or in its purchase orders or
contracts if so required by the General Contract.
(c) Xxxxxxx shall not be liable to Subcontractor for any delay to
Subcontractor's work resulting from the act, negligence or default of the Owner,
or on account of any acts of God or any other cause beyond Xxxxxxx'x control; or
on account of any circumstances caused or contributed to by Subcontractor.
(d) Should the Owner delay Subcontractor's work, then and in such
event Xxxxxxx shall owe Subcontractor therefor only an extension of time for
completion equal to the delay caused, and then only if written claim is made to
Xxxxxxx within forty-eight (48) hours from the beginning of the delay and only
to the extent Xxxxxxx receives an extension of time from the Owner.
19. Subcontractor agrees to guarantee its work against all defects in
materials or workmanship, as called for in Attachment B.
20. Notwithstanding any other provision herein to the contrary, and in
addition to any other provision herein provided for cancellation, it is
expressly agreed by Subcontractor that if at any time prior to final completion
of the work Subcontractor is in default in any respect in performance or in
compliance with any requirement of this Subcontract, Xxxxxxx may give written
notice to Subcontractor stating the nature of the default, and if such default
has not been remedied within twenty-four (24) hours from the time of delivery of
such notice to Subcontractor. Xxxxxxx may thereafter at any time, so long as
such default continues, cancel this Subcontract forthwith, without further
notice to Subcontractor. And it is expressly agreed that no prior failure to
exercise this right of cancellation shall ever be construed as a waiver of this
right of cancellation. In the event of such cancellation, terms set forth in
Attachment B shall apply.
21. Subcontractor agrees to exhaust the remedies available to Xxxxxxx under
the General Contract prior to commencing any separate arbitration against
Xxxxxxx for recovery. Subcontractor agrees to be bound to Contractor to the same
extent as Xxxxxxx is bound to Owner by the final
An Equal Opportunity Employer
Page 5 of 6
XXXXXXX ELECTRIC COMPANY
Standard Subcontract Form
decision of any court or arbitration panel, whether or not Subcontractor is a
named party to any such proceeding.
Any claims asserted by Subcontractor for additional compensation or
damages for extra work directed by Owner or project delays caused by Owner will,
at Xxxxxxx'x option, be passed through to Owner, in Xxxxxxx'x name, and
Subcontractor will prosecute such claims at its cost.
At Xxxxxxx'x option, Subcontractor agrees to a joint arbitration with
Owner, Xxxxxxx and Subcontractor in Pittsburgh, Pennsylvania with respect to any
claim, dispute or other matter substantially involving the rights, duties and
obligations of each such party if complete relief is to be obtained.
No arbitration or court proceeding may be commenced by Subcontractor
later than one year following delivery of last unit.
Any controversies arising between the parties to this contract and not
resolved in normal negotiations shall be settled under the principles
established by the arbitration clause of the General Contract, if any. In the
absence of such arbitration provision in the General Contract, disputes shall be
settled under the rules of the American Arbitration Association.
22. Subcontractor hereby waives and releases all liens or right of liens
now existing or that may hereafter arise for any and all work or labor performed
or material furnished under this Subcontract, upon said facility, or monies due
or to become due to Xxxxxxx and agrees to furnish a good and sufficient waiver
of lien in proper form for filing from every person or entity furnishing labor
or materials for this Project under Subcontractor.
23. It is further understood that Owner has the right to approve or
disapprove of all Subcontractors and in the event Owner does not approve of this
Subcontract it shall become null and void. If Owner subsequently terminates the
General Contract, Xxxxxxx may in turn terminate this Subcontract by giving
Subcontractor written notice. In such case, Xxxxxxx will pay Subcontractor
pursuant to the term of Attachment B.
An Equal Opportunity Employer
Page 6 of 6
(Attachment A)
--------------
DUQUESNE LIGHT COMPANY
Customer Advanced Reliability System
PROJECTED OMEGA CABINET DELIVERY SCHEDULE
THROUGH FIRST TWO PURCHASES
June July August September October
------------------------------------------------------------------------------------------------------------------------------------
Omega 6/19 6/26 7/3 7/10 7/17 7/24 7/31 8/7 8/14 8/21 8/28 9/4 9/11 9/18 9/25 10/2 Total
Cabinet
------------------------------------------------------------------------------------------------------------------------------------
1 10 500 500 400 200 200 200 200 200 200 200 2,810
------------------------------------------------------------------------------------------------------------------------------------
11 10 400 400 200 400 400 400 400 400 400 400 3,810
------------------------------------------------------------------------------------------------------------------------------------
111 10 400 200 200 200 200 200 200 200 200 200 2,210
------------------------------------------------------------------------------------------------------------------------------------
Total 10 20 500 500 400 400 600 800 800 800 800 800 800 800 800 8,830
------------------------------------------------------------------------------------------------------------------------------------
6/11/98
Purchase Order No.___U5079-0161_______________________Dated:__June 10, 1998_____
(Attachment B)
--------------
GENERAL CONDITIONS OF PURCHASE
1. PAYMENT
Start-up and progress payments shall be as detailed in the governing
subcontract.
Unit prices for quantities of interface cabinets shall be as follows for
quantities delivered through the end of 1998:
Omega 1 Communication Interface Cabinet - $ [Confidential portion omitted
and filed separately with the Securities and Exchange Commission] Plus
Shipping
Omega 2 Communication Interface Cabinet - $ [Confidential portion omitted
and filed separately with the Securities and Exchange Commission]Plus
Shipping
Omega 3 Communication Interface Cabinet - $ [Confidential portion omitted
and filed separately with the Securities and Exchange Commission]Plus
Shipping
The above unit prices assume that the minimum delivered quantity of
Interface Cabinets shall not be less than 10,000 units for use on the
Duquesne Light Company Project in 1998.
Terms of payment against shipments are net fifteen (15) days after the date
of the Telenetic's invoice. Amounts not paid when due shall bear interest at
the lesser of one and one-half (1.5%) percent per month and the highest
legal rate, and may result in the imposition by Telenetics of modified
credit terms.
2. PRICES AND TAXES
Prices are exclusive of all federal, state, municipal or other government
excise, sales, use, occupational or like taxes or duties now in force or
enacted in the future. Any such tax, fee, or charge of any nature whatsoever
imposed by any governmental authority on or measured by the transaction
between Telenetics and Xxxxxxx Electric shall be paid by the Xxxxxxx
Electric in addition to the prices quoted or invoiced. In the event
Telenetics is required to pay any such tax, fee, or a charge, at the time of
sale or thereafter, Xxxxxxx Electric shall reimburse Telenetics thereof.
3. SHIPMENT AND DELIVERY
All shipments herein shall be F.O.B. Jobsite (Greater Pittsburgh, PA area)
via ground freight using a Common Carrier, unless otherwise requested by the
Xxxxxxx Electric. The time of delivery is the time the Product is delivered
to the first jobsite by the carrier. All shipping charges shall be paid by
Telenetics, and set forth as a separate item on the Telenetics invoice.
4. TITLE AND RISK OF LOSS
Title to the Product shall pass to Xxxxxxx Electric upon delivery thereof by
the carrier to the jobsite and upon delivery Xxxxxxx Electric shall be
responsible for and bear all future risk of loss or damage to the Products.
Telenetics shall be responsible for shipping damage,
1
General Conditions of Purchase
--------------------------------------------------------------------------------
and retain a security interest in the Products until payment in full.
5. PROPRIETARY INFORMATION
Products contain valuable proprietary programs and data. Telenetics retains
for itself all title and proprietary rights in and to all designs,
engineering details, software resident in Read-Only Memories (ROM's), and
other program data contained in any Product sold.
Xxxxxxx Electric shall treat any information disclosed to Xxxxxxx Electric
hereunder, which is identified as confidential or proprietary, in strict
confidence and shall not disclose such information to third parties or use
it for any purpose other than the purpose for which it was disclosed to
Xxxxxxx Electric.
6. LIMITED PRODUCT WARRANTY
Telenetics warrants that the Product sold will be free from defects in
material and workmanship and perform to Telenetics' applicable published
specifications for a period of 18 months from the date of delivery to
Xxxxxxx Electric or 12 months from placement into service, whichever occurs
first. The liability of Telenetics hereunder shall be limited to replacing
or repairing, at its option, any defective Products which are returned
F.O.B., Telenetics' facility, Lake Forest, California (or, at Telenetics'
option refunding the purchase price of such products). In no case are
Products to be returned without a Xxxxxxx Electric return order number from
Telenetics. Telenetics shall not be liable for any consequential or
incidental damages, except in the case of equipment failure in excess of 5%
(of the installed units), at which time Telenetics shall be liable for
shipping and in and out charges in addition to the above stated remedy (or
other mutually agreed upon method of remediation). In and out charges shall
be fixed at $50.00 per occurrence.
Products that have been subject to abuse, misuse, accident, alteration,
neglect, unauthorized repair or installation are not covered by the
warranty. Telenetics shall make the final determination as to the existence
and cause of any alleged defect. No liability is assumed for expendable
items such as lamps and fuses. No warranty is made with respect to custom
except as specifically stated in writing by Telenetics in the agreement for
such custom products. For the purposes of this Agreement, no products
delivered for the Duquesne Light Company Project shall be considered custom
products.
This warranty is the only warranty made by Telenetics with respect to the
goods delivered hereunder, and may be modified or amended only by a written
instrument signed by a duly authorized officer or Telenetics and accepted by
Xxxxxxx Electric.
This warranty and limitation extends to Xxxxxxx Electric, Duquesne Light
Company, and to users of the product and is in lieu of all warranties with
respect to the product whether express, implied, or statutory, including
without limitation the implied warranties of merchantability and fitness for
a particular purpose, provided, however, that all advertised functionality
is delivered. This advertised functionality includes, but is not necessarily
limited to, specific Alpha meter outage notification to Duquesne Light
Company's MV-90 system, and Alpha meter serial number recognition and
automated modem port assignment/reporting.
2
General Conditions of Purchase
--------------------------------------------------------------------------------
7. PATENT AND COPYRIGHT INDEMNITY
Telenetics warrants that the use of the Products and documentation furnished
to Xxxxxxx Electric shall be free and clear of infringement of and United
States patent or registered copyright covering the structure of such
articles or documentation. In the event of a claim, suit or action against
Xxxxxxx Electric alleging such infringement, Telenetics shall defend and
save Xxxxxxx Electric harmless from liability, as finally determined by a
court of competent jurisdiction, for such infringement, provided that
Xxxxxxx Electric shall have made timely payment of all amounts due for the
article involved in the claim, suit or action, that Xxxxxxx Electric shall
have notified Telenetics promptly in writing of such claim, suit or action,
that Xxxxxxx Electric shall have given Telenetics all proper information and
assistance requested by Telenetics and full and exclusive control of the
defense thereof, and that Telenetics shall have the sole right to settle or
compromise such claim, suit or action. In the event that a final injunction
is obtained in such action against the use of the Products or any part
thereof by reason of infringement of a United States patent or otherwise
within the scope of this Paragraph, Telenetics will, at its option either:
(a) Procure for Xxxxxxx Electric, at Telenetics' expense, the right to
continue using the Products;
(b) Replace or modify the same so that it shall be non-infringing; or
(c) Direct Xxxxxxx Electric to return such Products to Telenetics, and
refund to Xxxxxxx Electric the purchase price originally paid less a
use credit equal to the depreciation of the installed units based on a
10-year straight lined depreciation method. in addition to the above
purchase price rebate, less use fee, Telenetics shall be liable for all
in and out and shipping fees arising out of above said injunction.
Telenetics shall only resort to option (c) after having exerted reasonable
effort to remedy the situation by first utilizing option (a) or (b).
Telenetics has no liability for any claim, suit or action pursuant to this
Paragraph based upon or arising out of the combination, operation or use of
the Products with Products or items not furnished by Telenetics. The
foregoing states Telenetics' entire liability and obligations and Xxxxxxx
Electric's exclusive remedy with respect to any claim, suit or action
alleging infringement of any intellectual property rights.
8. SOFTWARE AND PRODUCT LICENSE
Program and product will be licensed to Xxxxxxx Electric and Duquesne Light
Company pursuant to the terms and conditions of Telenetics' Software
Products License. These general terms and conditions shall not be valid
until a mutually acceptable software and product license is executed by all
parties.
9. LIMITATION OF LIABILITY
Telenetics shall not be liable for any loss, damages, or penalty resulting
from delay in delivery when such delay is due to causes beyond the
reasonable control of Telenetics,
3
General Conditions of Purchase
--------------------------------------------------------------------------------
including but not limited to supplier delay, force majeure, act of God,
labor unrest, fire, explosion, or earthquake. In any such event, the
delivery date shall be deemed extended for a period equal to the delay.
Telenetics' liability under, for breach of, or arising out of this Purchase
Order shall be limited to refund of the purchase price, except for in and
out and shipping costs listed in Sections 6. and 7. above. In no event
shall Telenetics be liable for costs of procurement of substitute goods by
the Xxxxxxx Electric. In no event shall Telenetics be liable for any
consequential, or incidental, damages (including without limitation loss of
profit) whether or not Telenetics has been advised of the possibility of
such loss. The essential purpose of this provision is to limit the
potential liability of Telenetics arising out of this Purchase Order.
10. ACCEPTANCE BY XXXXXXX ELECTRIC - ENTIRE AGREEMENT
The terms and conditions as set forth herein shall compliment the governing
Subcontract. This Agreement shall not be modified, supplemented, qualified,
or interpreted by any trade usage or prior course of dealing not made a
part of the Purchase Order Subcontract by its express terms.
The failure by Telenetics to enforce at any time any of the provisions of
this Agreement, or to exercise any election or portion provided herein,
shall in no way be construed as a waiver of such provisions or options, nor
in any way to affect the validity of this Purchase Order or any part
thereof, or the right of Telenetics thereafter to enforce each and every
such provision.
Xxxxxxx Electric hereby acknowledges that it has not entered into this
Agreement in reliance upon any warranty or representation by any person or
entity except for the warranties or representations specifically set forth
herein, or within the governing Subcontract.
11. CANCELLATION AFTER ACCEPTANCE
This Agreement may be cancelled by Xxxxxxx Electric only upon the payment
of reasonable cancellation charges. For the purposes of this agreement,
reasonable cancellation charges shall be fixed at 20% of the selling price
for all cancelled units. Upon cancellation Xxxxxxx Electric shall have no
rights to partially completed products.
12. TERMINATION
Xxxxxxx may terminate this agreement without cause upon written notice to
Telenetics. In the event of termination without cause, the above Section
11. cancellation fees shall apply. Xxxxxxx shall also have the right to
terminate this agreement immediately in the event contractor fails to
comply with the material provisions of this agreement and all reasonable
attempts to cure such breach within 30 days have failed. In the event of
termination with cause, the above cancellations fees shall not apply.
4
General Conditions of Purchase
--------------------------------------------------------------------------------
13. SUBSTITUTIONS AND MODIFICATIONS
Telenetics shall have the right to make substitutions and modifications in
the specifications of Products sold by Telenetics provided that such
substitutions or modifications will not materially affect overall Product
performance, and are acceptable to Duquesne Light Company Company.
14. ASSIGNMENT
Without consent of Telenetics in writing, Xxxxxxx Electric may not assign
any transactions associated herewith, except to an entity to which Xxxxxxx
Electric assigns, transfers, and conveys substantially all of its assets
into which it is merged or with which it is consolidated.
15. BANKRUPTCY
If Xxxxxxx Electric shall become bankrupt or insolvent or compounds with
his creditors or commences to be wound up or suffers a receiver to be
appointed, Telenetics shall be at liberty by notice in writing to cancel
this Purchase Order without judicial intervention or declaration of default
of Xxxxxxx Electric and without prejudice to any remedy which shall have
accrued or shall accrue thereafter to Telenetics, subject to applicable
federal and state law.
16. MISCELLANEOUS
Paragraph headings are provided for convenience of reference only and shall
not limit of modify any term hereof. Stenographic and clerical errors are
subject to corrections.
The Agreement between the parties is made, governed by, and shall be
construed in accordance with the laws of the State of PA.
The governing subcontract shall identify the terms by which to pursue
settlement of disputes.
5
EXHIBIT B
TO
MARKETING AND TECHNOLOGY AGREEMENT
________________________________________________________________________________
Telenetics
Communication Interface Cabinets for Duquesne Light
General Description
-------------------
Telenetics Communication Interface Cabinets provide the dial-up communication
interface between the ABB Alpha Meters and the Public Switched Telephone Network
(PSTN). Three models are available (See Page 2)...
Type I: For use with a single Alpha Meter (Type M) with internal 2400bps
modem. Provides a cellular interface with the PSTN.
Type II: For use with multiple Alpha Meters (Type X) with no internal 2400bps
modem. Provides a direct connection with the PSTN.
Type III: For use with multiple Alpha Meters (Type X) with no internal 2400bps
modem. Provides a cellular interface with the PSTN.
Outage Reporting
----------------
Type II and Type III provide the Outage Reporting capability not available with
the ABB Alpha Meter Type X (without internal modem).
The Type II and Type III cabinets can be connected to up to 8 Alpha Meters.
Telenetics' Check Ports logic monitors each port's DTR control pin for power
loss. In the event of a power loss at one or more of the ports, the modem
will...
(a) Automatically dial out to a phone number stored in the modem;
(b) Transmit a message identifying the modem location;
(c) Append message (b) with a port number identifying the failed meter.
For Example;
Power Out at Carnegie for Meters: 378
Reports that meters 3, 7 and 8 have failed at the Carnegie site.
The phone number and message up to the colon-blank (: ) are stored in the
modem's directory #1. The port number(s) identifying the failed meter(s) are
generated by the Telenetics Check Ports routine.
The message can be sent as DTMF tones to a pager, or as ASCII characters for
hard copy displays.
If the primary power to the Communication Interface Cabinet fails, the unit
switches to battery back up and transmits the message "Power Out at Carnegie for
Meters: 0"
________________________________________________________________________________
May 5, 1998 Page 1
________________________________________________________________________________
Telenetics
[Schematic diagram of Type III dial-up communication interface]
[Schematic diagram of Type II dial-up communication interface]
[Schematic diagram of Type I dial-up communication interface]
________________________________________________________________________________
May 5, 1998 Page 2
________________________________________________________________________________
Telenetics
Product Specifications
Dial Modem [Type II & III]
---------- ---------------
Model: Telenetics PE14.4-D0
Modulation: X.00xxx, X.00, X.00xxx, X.00, Xxxx 212, Xxxx 103
Line Speed 14400, 9600, 4800, 2400, 1200, 300bps
DTE Rates: 57600, 38400, 19200, 9600, 4800, 2400, 1200, 300bps
EC/DC: MNP2, 3, 5 & 10; X.00, X.00xxx
Configuration: Xxxxx(TM) Extended AT Command Set
Analog Connector: RJ11 Modular [to Internal Cellular Transceiver or
External Telco]
Digital Data Ports [Type II & III]
------------------ ---------------
Quantity: 8
Data Interface: RS232
Drive Capability: 300 feet
Control Signals: TxD, RxD, CD, RTS, CTS, DSR, DTR
Connector: RJ45 Modular, 8-Pin
Isolation: TBA
Analog Data Port [Type I]
---------------- --------
Quantity: 1
AC Line Impedance: 600 Ohms
Operating Current: 20mA min.
Ring/Tip DC Impedance: On-hook: 50M Ohms / RENS (Xxxx Spec.)
Off-hook: 120 - 410 Ohms with a 25mA loop
Connector: RJ11 Modular
________________________________________________________________________________
May 5, 1998 Page 3
________________________________________________________________________________
Telenetics
Cellular Transceiver [Type I & II]
-------------------- -------------
Model: Motorola S5690B (3 Watt) with S1936D Data Module
Frequency Range: 824.030 - 848.980 MHz Transmit
869.030 - 893.930 MHz Receive
Number of Channels: 832
Frequency Stability: +/- 2.5ppm
Operating Voltage: 10.9 - 16.3VDC
Current Drain: Transmit, @ max. power level: 2.0A
Idle: 100mA max.
RF Power Output: 3.0 Watt max.
Channel Spacing: 30kHz
Duplex Spacing: 45MHz, Modulation Type F3 +/- 12kHz for 100% @ 0xXx
Xxxxxxxxx Chnl Sel: -60dB +/- 60kHz AMPS
Audio Distortion: Less than 5% @ 1kHz, +/- 8kHz Deviation
Audio Response: 6dB/octave pre-emphasis Tx
6dB/octave de-emphasis Rx
Power Range: 6.77dBm nominal to 34.77dBm nominal in 8 power steps
with 4dB separation between adjacent steps
Audio Sensitivity: Greater than -116dBm (C-MSG weighted) @ 12dB SINAD SAT
Sensitivity.
Greater than -116dBm @ 12dB SINAD
Signaling Sensitivity: Greater than -110dBm
Input/Output Impedance: 50 ohms nominal
Emissions: Conducted/Radiated/Spurious: Less than -60dB below
carrier
Hum & Noise: 32dB below 8kHz deviation @ 1kHz
________________________________________________________________________________
May 5, 1998 Page 4
________________________________________________________________________________
Telenetics
Data Connector: RJ11 Modular
To Internal Modem [Type III]
To External Modem [Type I]
Handset Compatibility: Compatible with bag phone type of handset (not
included). Typical Motorola Part S6038C
Antenna [Type I & III]
------- --------------
Type: Coil-based
Omni-Directional
50 Ohm
928 MHz
Power Supply [Type I, II & III]
------------ ------------------
Input: 90 - 264VAC
Fuses: 1.0 Amp
Replaceable 5 x 20mm
Output: 8.0VDC +/- 5% @ 250mA to Modem [Type II & III]
12.6VDC +/- 5% @ 2.1A to Cellular Xceiver [Type I & II]
Current Limited
Power Transformer: 4kV Breakdown Primary to Secondary
94V-O Flame Requirements
UL, CSA & IEC Safety Standards
Input Power Connector: 3-Screw Terminal Block [UL/CSA]
________________________________________________________________________________
May 5, 1998 Page 5
________________________________________________________________________________
Telenetics
Surge Protection: Input: 1500 Watt pk @ 400V
Back Up Battery [Types I, II & III]
--------------- -------------------
Type: Maintenance-Free, Rechargeable, Lead-Acid
Nominal OC Voltage: 12.7 VDC
Nominal Working Voltage: 11.9 VDC
Nominal Capacity: 2.6 Ampere-Hours (20 Hour Rate)
Recharging Method: Float Charging
General [Type I, II & III]
------- ------------------
Enclosure: Material: Polystyrene
Protection: NEMA 4X / IP66
Size: 10 x 7 x 4-3/8 inches
Operating Temperature: Type I: -30 to 60 C
Type II: -40 to 85 C
Type III: -30 to 60 C
Operating Humidity: 0 to 90% non-condensing
Weight: Type I: 4.5 lbs
Type II: 5.8 lbs
Type III: 7.0 lbs
________________________________________________________________________________
May 5, 1998 Page 6
