Exhibit 10.5
MANUFACTURING AGREEMENT
This Agreement is entered into by and between Who? Vision Systems, Inc., a
Delaware corporation, with its principal place of business at 000 Xxxxxxxxxxx
Xxxxx, Xxxx Xxxxxxx, Xxxxxxxxxx (hereafter referred to as "WVS"), and SILITEK
Corporation, a Taiwanese corporation, with its principal place of business at
00X, 00 Xxx Xxx Xxxx, Xxx. 0, Xxxxxx, Xxxxxx, (hereafter referred to as
"SILITEK").
BACKGROUND
WHEREAS, WVS has certain expertise in fingerprint solutions and has
proprietary technical information in the areas of fingerprint acquisition,
processing and verification that may be used to create complete fingerprint
solutions for the computer industry, and is developing a finger print module
(hereafter referred to as "FPM");
WHEREAS, SILITEK has developed expertise in manufacturing computer related
equipment and peripherals in significant volumes;
NOW THEREFORE, in consideration of the mutual covenants and conditions set
forth herein, and intending to be legally bound hereby, the parties agree as
follows:
AGREEMENT
1.0 Definitions. As used in this Agreement, the following terms shall have the
respective meanings assigned to them below:
1.1 Calendar. The calendar used herein is the western calendar currently in
common use in the United States. For the purposes of this Agreement, quarters
are defined as:
Q1 January 1 - March 31
Q2 April 1 - June 30
Q3 July 1 - September 30
Q4 October 1 - December 31
Should these dates fall on non-working days, the quarter shall begin on the
first working day following the date shown and end on the last working day
before the date shown.
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1.2 "FPM" shall mean WVS's finger print module comprised of:
a) A finger sensing surface that generates an image of the
fingerprint.
b) An image sensor that can translate the finger image to an
electronic signal.
c) Lens-based air gap optics that translates the image from the
finger surface to the sensor.
d) A signal processing and interface chip, that processes the
fingerprint image into a form suitable for transportation to
a PC host via USB and/or parallel port.
e) Firmware for the signal processing and interface chip.
f) An API that runs on the PC and allows development of PC
applications that makes use of the FPM. The API will include
fingerprint matching functions and functions for accessing
the FPM hardware via USB and/or Parallel Port.
1.3 "Object Code" shall mean computer programming code, routines and
programs in machine executable form.
1.4 "Third Party Software" shall mean the computer programming code,
routines and programs in Object Code form (and also in Source Code if
available), and the documentation thereof, which make up part of the FPM, and
which are owned by, or proprietary to persons other than WVS or any of its
affiliates.
2.0 Responsibilities.
2.1 WVS Design and Manufacturing Responsibilities
a) WVS shall work with SILITEK to provide mechanical interface
drawings and information to SILITEK on the FPM no later than
July 1, 1998.
b) WVS shall work with SILITEK to provide a complete design and
documentation package to SILITEK for use in manufacturing.
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c) WVS is responsible for providing SILITEK a design of the FPM
described in 1.2 of this agreement. The annual Average Xxxx
of Material (ABOM) of the WVS design will not exceed the
following costs based on the following volumes:
1998 [xxxxxx]
1999 [xxxxxx]
2000 [xxxxxxx]
2001 [xxxxxxx]
These are approximate BOM numbers based on
approximately [xxxxxxx] units in 1998 and [xxxxxxxxxxxxxx]
unit and up volumes in later years - exact numbers will be
calculated based on WVS' proposed volumes in each year.
Note that ABOM is defined as follows:
ABOM = (volume1 X BOM1 + volume2 X BOM2 + ... + ...)/(volume1
+ volume2 + ... + ...)
Where volume N is the number of units in any year
manufactured with BOMN. The total annual volume will then be
(volume1 + volume2 + ... + ...)
d) WVS agrees to establish a manufacturing transfer team with
qualified engineers no later than July 1, 1998.
e) WVS shall prepare and deliver to SILITEK prior to
commencement of production, quality control procedures to be
applied to manufactured units.
f) WVS will negotiate in good faith to provide SILITEK access
to manufacture any further fingerprint technologies
developed by WVS.
2.2 SILITEK's Engineering and Manufacturing Responsibilities
a) SILITEK shall participate with WVS in understanding WVS's
designs and drawings for the FPM and the component piece
parts in order to ensure compatibility with SILITEK's
industrial design and manufacturing requirements.
[Confidential Treatment requested for redacted portion of document]
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b) SILITEK shall produce the overall industrial design and the
package drawings and specifications for the FPM. SILITEK
shall complete the process of developing a manufacturing
prototype. SILITEK shall be responsible for all engineering
work necessary to manufacture the FPM in accordance with the
designs, drawings, and specifications delivered by WVS.
SILITEK will be responsible for ensuring cost effectiveness,
quality and reliability of the manufacturing process and the
manufactured products.
c) SILITEK shall ensure that its facility and systems comply
with ISO 9002 standards.
d) SILITEK shall provide or obtain at its own expense all
tooling and equipment necessary to fulfill its obligations
under this Agreement.
e) SILITEK recognizes that several component parts within the
FPM are proprietary to WVS and contain intellectual property
that WVS considers critical to the proper operation of the
FPM. Therefore, SILITEK agrees that it recognizes that
several component parts within the FPM are proprietary to
WVS and contain intellectual property that WVS considers
critical to the proper operation of the FPM. Therefore,
SILITEK agrees that it shall only use WVS approved vendors
for the Tactile Sense material, FPM lens and imaging device.
WVS shall supply SILITEK with a drawing/specification that
specifies the part to be procured and an authorized list of
vendors from which it may be purchased. SILITEK agrees to
attach a copy of such specification which acknowledges that
the information is proprietary to WVS with each purchase
order. WVS will work with SILITEK on approving any
additional vendors identified by SILITEK for these
components. SILITEK agrees that from time to time WVS may
request certification from these vendors as to the quantity
and quality of the parts being procured and that SILITEK
agrees to instruct the vendors to release of such
information.
f) SILITEK shall sell and/or deliver FPMs only to WVS or
persons designated by WVS, and not to any other person or
entity.
g) SILITEK shall perform quality control procedures developed
by WVS on all manufactured units. In the event more than a
specified number or percentage of units do not pass the
quality control tests, product acceptance and shipping shall
be suspended until SILITEK determines the source of the
failure and takes appropriate corrective action at its own
expense.
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h) SILITEK shall certify to WVS that it has performed WVS's
quality control procedures on all manufactured units.
i) SILITEK agrees that it will cooperate with WVS in
establishing a quality program consistent with industry
standards and that sufficient samples will be provided to
WVS to accomplish this objective. WVS and SILITEK jointly
agree to let the review team designated in paragraph 3.0
establish such program.
j) SILITEK shall obtain at its own expense all approvals,
certificates, permits and licenses as may be required by the
Taiwanese government to manufacture and ship the FPMs.
k) SILITEK shall establish a manufacturing transfer team with
qualified engineers no later than July 1, 1998.
2.3 Forecasts, Orders, Purchases and Deliveries
2.3.1 FORECASTS
a) FORECASTS
WVS will provide SILITEK with a rolling 4-month forecast, by
part number and by eligible buyer. The forecast will be
provided to SILITEK on the first week of each calendar
month, by fax, from WVS. The forecasts will cover the
following 4 month period. The forecasts should specify the
quantity of products, by WVS part number, and by eligible
buyer, which WVS expects to call for delivery each forecast
month. Forecasts are "Non-binding Forecasts", provided as
good-faith estimates to help SILITEK plan production, and
manage inventory levels to meet WVS's requirements.
b) FORECAST ACKNOWLEDGMENT
Acknowledgment of receipt and confirmation of SILITEK's
ability to meet forecast should be returned to WVS within
five(5) working days of receipt of the said forecasts.
SILITEK should also provide information on
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planned production for the 2 months following receipt of
such Forecasts, once their monthly production planning has
been completed.
c) PARTS LIABILITY
In the event that WVS ceases FPM production orders to
SILITEK, WVS shall be liable for the value of all FPM unique
parts and raw materials still in inventory or in process at
that time and produced according to WVS forecast estimates.
In the event of a failure by WVS to pay such amounts and
take delivery of such inventory within 30 days after notice
and invoice from SILITEK, SILITEK shall have all of the
rights of a seller under the California Uniform Commercial
Code in the event of a repudiation by the buyer.
2.3.2 ORDERING PROCEDURES
a) ORDER PLACEMENT
Individual employees designated by the CEO or COO of WVS as
authorized buyers will place 8-weeks purchase orders on a
weekly-rolling basis. SILITEK is not authorized to accept
purchase orders from any other entity. A 8-weeks P.O. will
reflect the quantity WVS commits to buy from SILITEK, in
accordance with the cancellation and flexibility conditions
described in this document and on which WVS and SILITEK have
agreed. No different or additional terms and conditions in
any P.O. shall be effective unless specifically accepted by
SILITEK. All P.O.s shall specify a price, delivery date and,
if available, destination. All requested delivery dates will
be subject to reasonable approval by SILITEK. All FPMs
produced under P.O.s without a specified destination will be
warehoused by SILITEK in accordance with Section 2.3.4(a).
b) ORDER ACKNOWLEDGMENT
An acknowledgment of purchase orders will be returned to the
ordering authorized buyer within two(2) working days of
receipt of an order. If SILITEK is unable to comply with
some conditions of the order, for example, the delivery date
in an allocation situation, SILITEK should still acknowledge
orders, confirming all accepted data (quantity, price, etc)
and informing the authorized buyer of the issue.
c) LEAD TIME
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"Lead Time" means the time between receipt of Purchase
Order, by SILITEK, and delivery of PRODUCT to the agreed FOB
point for the ordering authorized buyer.
d) ORDER STATUS REPORTS-AUTHORIZED BUYERS
SILITEK will provide a weekly "Open Order Status Report" to
WVS with the following information.
PO Number
WVS Part Number
Name of Authorized Buyer for each order
Requested delivery date (to WVS)
Planned delivery date (to WVS)
Planned delivery quantity
Comments:
e) ORDER STATUS REPORTS- WORLDWIDE PLANNING
The same "Open Order Status Report" information,
consolidated worldwide, should be sent to WVS along with:
The worldwide inventory, split by PRODUCT and region
including in-transit inventory and future manufacturing
plans.
On Time delivery performance
Total amount invoiced for the month worldwide
2.3.3 INVOICES
a) INVOICING
SILITEK will invoice WVS the value of each P.O. delivery
pulled by WVS from a SILITEK location once POD (Proof of
Delivery) documents have been signed by a WVS authorized
representative.
b) INVOICE DELIVERY
SILITEK shall send all invoices for FPMs shipped to WVS.
c) INVOICE PERIOD AND PAYMENT PROCEDURE
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Payment by WVS shall be due NET 15 days after receipt of
invoice. All invoices and payments shall be in U.S. dollars.
Payment shall be by wire transfers. Late payments shall bear
interest at 1% per month.
2.3.4 INVENTORY: TITLE AND LIABILITY
a) TITLE TO INVENTORY
For all Purchase Orders without a specified destination,
SILITEK shall deliver the FPMs to its own warehouse,
segregated from SILITEK inventory, until WVS provides
SILITEK with delivery instructions. Title to the FPMs shall
pass to WVS upon notice to WVS of delivery to the warehouse
with appropriate papers evidencing WVS ownership. SILITEK
shall insure the FPMs against loss while stored in its
warehouse.
b) TITLE TO SHIPMENTS
All shipments of FPMs shall be made F.O.B. manufacturer's
origin. Title for FPMs (if not passed per paragraph (a)
above) and risk of loss for FPMs shall pass to WVS when the
FPMs are placed on board the ship or other shipping mode.
c) INVENTORY LIABILITY
WVS will be charged interest of 1% monthly upon the P.O.
value of FPM inventory still not pulled by WVS from SILITEK
warehouse 1 month after the Delivery Date specified on the
P.O. for such inventory.
d) SILITEK shall comply with U.S. and other applicable laws and
regulations regarding export controls covering the FPM.
e) The price at which SILITEK will sell FPMs to WVS or its
designated subsidiary or affiliate (the "SILITEK Sell
Price") shall be equal to: [xxxxxxxxxxxxxxxxxxxxxxxxxxxx].
This price covers SILITEK's costs, overhead, expenses, and
profit. BOM means Xxxx of Material for the FPM. All prices
shall be calculated in U.S. dollars. Both parties recognize
that market conditions may require altering this formula.
Hence the parties agree to negotiate in good faith changes
to the above.
f) SILITEK shall provide to WVS on a monthly basis with its 4
month rolling unit prices for FPMs based on WVS' forecasted
volume requirements. SILITEK shall provide supporting detail
for its prices to confirm compliance with the formula in
paragraph (e) above or such changed formula as the parties
may agree to in any case.
[Confidential Treatment requested for redacted portion of document]
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2.4 Exclusivity
SILITEK will be world-wide exclusively licensed as the only major
keyboard manufacturer permitted to manufacture the FPM. Silitek
recognizes that WVS has granted certain manufacturing rights to
SPOT and that nothing in this agreement is intended to conflict
with such rights.
3.0 Project Managers; Personnel; Progress Reports.
3.1 WVS Project Manager and Personnel
a) WVS shall appoint a project manager to coordinate WVS's
activities and responsibilities relating to SILITEK. WVS
shall provide written notice to SILITEK of the name and
business address, daytime telephone number and telefax
address of the WVS Project Manager. The initial WVS Project
Manager shall be Tzu-Chiang Xxxxx. WVS shall also appoint a
full time manufacturing liaison, who will be responsible for
the transition of the WVS FPM design to SILITEK for
manufacture, and will assist in its initial implementation.
b) From time to time, personnel of WVS may perform work at the
facilities of SILITEK. WVS shall be solely responsible for
any and all losses, liabilities, suits, claims, and expenses
incurred by any of its personnel for damage to property or
bodily injury, unless such damage to property or bodily
injury was caused by the gross negligence or intentional
misconduct of SILITEK. While at the facilities of SILITEK,
all WVS personnel shall observe and follow the work rules,
policies, and standards of SILITEK.
3.2 SILITEK Project Manager and Personnel
a) SILITEK shall appoint a project manager to coordinate
SILITEK's activities and responsibilities relating to WVS.
SILITEK shall provide written notice to WVS of the name and
business address,
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daytime telephone and telefax number of the SILITEK Project
Manager. The initial SILITEK Project Manager shall be Xxxx
Xxx. SILITEK shall appoint a full time manufacturing
liaison, who will be responsible for the transition of the
WVS FPM design to SILITEK for manufacture, and will
coordinate with WVS on all engineering and manufacturing
issues.
b) From time to time, personnel of SILITEK may perform work at
the facilities of WVS. SILITEK shall be solely responsible
for any and all losses, liabilities, suits, claims, and
expenses incurred by any of its personnel for damage to
property or bodily injury, unless such damage to property or
bodily injury was caused by the gross negligence or
intentional misconduct of WVS. While at the facilities of
WVS, all SILITEK personnel shall observe and follow the work
rules, policies and standards of WVS.
3.3 Technical Review Meetings; Manufacturing Review Board
a) WVS and SILITEK shall each appoint at least two qualified
technical personnel with appropriate decision-making
authority to participate in Technical Review Meetings to
review and take appropriate action on all design,
engineering and manufacturing issues. Technical Review
Meetings shall be held periodically and may be initiated by
either party.
b) WVS and SILITEK shall each appoint at least two qualified
technical personnel to participate on a joint Manufacturing
Review Board ("MRB"). The MRB will be responsible for
reviewing the ongoing manufacturing process, all claimed
product defects, and design/engineering issues. The MRB
shall meet in Taiwan once per month beginning in July 1998.
The MRB shall be responsible for identifying the cause of
all claimed defects and determining and implementing
appropriate corrective measures.
c) WVS and SILITEK shall each provide to the other a monthly
written progress report, at least one week before each
Technical Review Meeting and MRB meeting. Reports shall be
in Microsoft Office format and shall indicate the following:
Status of progress to current scheduled milestones.
Short description of problems in meeting such milestones.
Proposed recovery method to meet next milestone.
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Probability of meeting next milestone.
Any other information reasonably requested by either party
with respect to the Project.
4.0 Deliverables; Training
4.1 The deliverables from WVS for the manufacturing effort are as follows:
Theory of Operation - a detailed, written description of the functional
nature of the FPM design. It shall include functional and circuit block
diagrams, data flow and timing diagrams, and a detailed description of the
functional flow.
Schematic Diagrams - a full set of electronic schematic circuit diagrams.
The drawings for these items shall be in the OrCad DSN format.
Mechanical Drawings - These shall include all relevant drawings required to
implement the design into SILITEK's manufacturing process. Included will be
detailed drawings for piece parts designed by WVS, source control documents for
all components specified by WVS, and a preliminary Xxxx of Materials. These
documents will be created and delivered in the AutoCad DWG format. WVS will
participate with SILITEK in reviewing industrial Design and package drawings and
will determine how the overall Industrial Design will impact the design and
layout of specific piece parts (for instance, Printed Circuit Boards), but WVS
shall not be responsible for providing overall envelope drawings. Since SILITEK
will be responsible for the implementation of the FPM into other parties'
industrial designs, WVS will provide only the mechanical drawings necessary to
support SILITEK's industrial design and manufacturing requirements.
Software - All firmware and interface drivers will be developed by WVS and
delivered to SILITEK. This delivery shall be in the form of executable code.
4.2 Orientation and Training Program. WVS shall provide an orientation and
training program for the purpose of educating SILITEK's personnel in the use,
operation, technical support, maintenance, management, and assistance for
manufacturing of the FPM.
5.0 Proprietary Rights
5.1 Proprietary Rights of WVS
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a) Design and Configuration of FPM - All right, title and
interest in and to (i) the design and configuration of the
FPM, including all deliverables, (ii) all updates to the
design and configuration of the FPM, (iii) all documentation
for the FPM, and (iv) any and all intellectual property
rights inherent in the FPM design and configuration ('i',
'ii', and 'iii' are collectively the FPM design and
configuration), including without limitation all patent
rights, copyrights, trademarks, know-how and trade secrets,
does and shall belong exclusively to WVS.
b) Developed Software - All right, title and interest in and to
(i) software developed for incorporation into the FPM, (ii)
all of such, (iii) all documentation and (iv) any and all
intellectual property rights relating to the foregoing, does
and shall belong exclusively to WVS.
c) Third Party Software - WVS has at its own expense secured
the rights to fingerprint matching software. WVS shall pass
through (in whatever form) licensing rights and
restrictions, which pertain to third party software and
technology.
5.2 Confidentiality. The FPM design and configuration and the Developed
Software, and each item included in such, and all materials and copies
containing any part of such, shall be maintained as confidential by SILITEK,
shall be disclosed by SILITEK only to its employees who need such materials and
information for SILITEK to fulfill its obligations and not to any other person
or entity, and shall not be used by SILITEK for any other purpose. SILITEK's
obligation shall not apply to any information which becomes part of the public
domain other than as a result of SILITEK's breach of its obligations under this
paragraph. SILITEK shall be responsible for ensuring that its employees comply
with its confidentiality obligations.
SILITEK initiated engineering work, and all materials and copies containing any
part of such, shall be maintained as confidential by WVS, shall be disclosed by
WVS only to its employees who need such materials and information for WVS to
fulfill its obligations and not to any other person or entity, and shall not be
used by WVS for any other purpose. WVS obligation shall not apply to any
information which becomes part of the public domain other than as a result of
WVS breach of its obligations under this paragraph. WVS shall be responsible for
ensuring that its employees comply with its confidentiality obligations.
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5.3 Trademarks. Neither SILITEK nor WVS shall use the other party's
trademarks or tradenames without prior written consent.
6.0 Licenses
6.1 Manufacturing Rights. WVS grants to SILITEK, during the term of this
Agreement, the non-exclusive license to use the FPM design and configuration and
the Developed Software to manufacture FPMs in accordance with this Agreement.
SILITEK may make copies of the materials representing the FPM design and
configuration and of the Developed Software and Third Party Software as
necessary to perform under this Agreement.
6.2 Right to Sub-license. SILITEK shall not have the right to sub-license
or discuss the potential to sub-license, any of the rights, privileges and
licenses granted hereunder without the express written consent of WVS. Any
agreement to sub-license shall be incorporated as an amendment to this agreement
and therefore carry all requirements as stated herein.
7.0 Term and Termination
7.1 Term. The term of this Agreement shall commence on the date hereof and
continue through December 31, 2001, subject to earlier termination pursuant to
Sections 7.2 and 7.3. The term shall be renewed for additional one year terms
unless either party gives written notice at least 60 days before expiration of
any term of its intent not to renew.
7.2 WVS's Right to Terminate. WVS shall have the right to terminate this
Agreement if:
a) SILITEK materially breaches its confidentiality obligations
under Section 5.2;
b) SILITEK sells or delivers any FPMs or other fingerprint
sensing/reading device to any unauthorized person in
violation of Section 2.2(f); or
c) SILITEK materially breaches any other obligation under this
Agreement and the breach remains uncured for 90 days after
written notice of the breach is given by WVS.
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d) If SILITEK should become bankrupt or insolvent, or shall
file a petition in bankruptcy, or if the business of SILITEK
shall be placed in the hands of a receiver, assignee or
trustee for the benefit of creditors, whether by the
voluntary act of SILITEK or otherwise, this Agreement shall
automatically terminate.
7.3 SILITEK Right of Termination. SILITEK shall have the right to terminate
this Agreement if:
a) WVS materially breaches its confidentiality obligations
under Section 5.2;
b) WVS fails to pay any amount when due to SILITEK which
failure remains uncured for 30 days after written notice by
SILITEK; or
c) WVS materially breaches any other obligation under this
Agreement and the breach remains uncured for 90 days after
written notice of the breach is given by SILITEK.
d) If WVS should become bankrupt or insolvent prior to
completing its obligations under the Agreement, or shall
file a petition in bankruptcy, or if the business of WVS
shall be placed in the hands of a receiver, assignee or
trustee for the benefit of creditors, whether by the
voluntary act of WVS or otherwise, this Agreement shall
automatically terminate.
7.4 Effect of Termination
a) Upon termination of this Agreement, SILITEK shall
immediately: (i) turn over to WVS all materials and copies
containing the FPM design and configuration, the Developed
Software, and the Third Party Software, and (ii) arrange for
delivery to a location specified by WVS of all WVS inventory
held by SILITEK; in each case provided that WVS pays to
SILITEK all money due and owing to SILITEK under valid
invoices previously issued by SILITEK. All outstanding
amounts payable shall be payable immediately at termination.
The parties may but are not required to mutually agree to
permit SILITEK to complete and deliver any outstanding P.O.s
subject to satisfactory payment arrangements before SILITEK
turns over such materials and copies.
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b) SILITEK's obligations under Sections 2.2(f) and 8.1 - 8.4,
and WVS's obligations under Sections 2.3(l) and 8.1 and 8.4
shall survive termination of the Agreement for one year
after the termination of the Agreement. SILITEK's and WVS's
obligations under Section 5.2 shall survive termination of
the Agreement for three years after the termination of the
Agreement.
c) If SILITEK terminates the Agreement under Section 7.3,
SILITEK may complete production and delivery of any units
necessary to fulfill outstanding purchase orders as of the
time of termination generated by SILITEK or its affiliates
under the Distribution Agreement, before the effect of
Section 7.4(a), provided that SILITEK makes satisfactory
arrangement to pay WVS or credits against amounts due from
WVS the net amounts which SILITEK and its affiliates would
owe to WVS if such sales were made under this Agreement and
the Distribution Agreement.
d) If WVS repudiates a P.O. which had been previously accepted
by SILITEK, SILITEK shall have all of the rights of a seller
under the California Uniform Commercial Code in the event of
a repudiation by the buyer.
8.0 Warranties; Product Returns
8.1 Warranties by WVS. WVS warrants to SILITEK that the deliverables
defined in Section 4 above do not infringe on the intellectual property rights,
including patent, copyright, or proprietary rights, of any third party.
8.2 SILITEK Warranty. SILITEK warrants that all FPMs will be free from
defects in workmanship or materials and will comply with WVS's specifications
for a period of 12 months after delivery to WVS or to WVS's customer. Units will
be considered delivered for this purpose only upon shipment from SILITEK's
warehouse. SILITEK also warrants that all FPMs will be free from liens.
8.3 Mutual Indemnification. WVS agrees to indemnify, defend, and hold
harmless SILITEK and its affiliates and their respective directors, officers,
shareholders, employees and agents from and against any and all claims, demands,
suits, actions, judgments, costs and liabilities relating to third party claims
of patent infringement by the design of the FPM as delivered by WVS to SILITEK.
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SILITEK agrees to indemnify, defend, and hold harmless WVS and its affiliates
and their respective directors, officers, shareholders, employees and agents
from and against any and all claims, demands, suits, actions, judgments, costs
and liabilities relating to (i) third party claims of patent infringement by any
SILITEK-initiated engineering or design efforts under this agreement, and (ii)
for damages attributed to manufacturing and any SILITEK initiated engineering or
design efforts, and to any breach of SILITEK's warranty.
8.4 Product Returns.
a) All product returns shall be handled directly by SILITEK,
with a copy of all paperwork to be delivered to WVS.
b) SILITEK shall replace all defective products which are
returned under warranty, at its own expense including cost
of shipping replacements to the customer.
9.0 Dispute
Any dispute arising in connection with this agreement will be resolved in
the following order;
1) Face to Face negotiations between senior executives of each
company.
2) By mediation in Southern California with a mediator selected
in accordance with procedures of the American Arbitration
Association.
3) If no resolution is achieved within 60 days after mediation
is requested, then both parties agree to binding arbitration
in Southern California in accordance with commercial
arbitration rules of the American Arbitration Association.
This agreement shall be governed by the laws of the state of
California without regard to choice of law rules.
10.0 Assignability
SILITEK and WVS both have the right to assign this agreement to any of
their affiliated companies, with the consent of the other party. Consent may not
be unreasonably denied.
11.0 Entire Agreement
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This Agreement constitutes the entire agreement between the parties and
there are no representations, warranties, covenants, or obligations except as
set forth herein. This Agreement supersedes all prior and contemporaneous
agreements, purchase orders, understandings, negotiations, and discussions,
written or oral, of the parties hereto.
12.0 Notices.
Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing, sent by certified mail to the respective parties at
the address below, or to such other address as each party may hereafter specify
in writing to the other.
If to WVS: Who? Vision Systems, Inc.
000 Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 00000
Attn: CEO
Phone: 000-000-0000
Fax: 000-000-0000
If to SILITEK: SILITEK Corporation
00X, 00 Xxx Xxx Xxxx, Xxx. 0,
Xxxxxx, Xxxxxx
13.0 Relationship of Parties
In making and performing this Agreement, the parties are acting and shall
act as independent contractors. Nothing in this Agreement shall be deemed to
create an agency, joint venture or partnership relationship between the parties
hereto. At no time shall either party make commitments or incur any charges or
expenses for, or in, the name of the other party.
14.0 Amendments.
These terms and conditions may be amended only in writing by an authorized
officer of each party to this document.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representative as of the 1st day of July,
1998.
Who? Vision Systems, Inc. SILITEK Corporation
By: /s/ Xxxx Xxxxxxxxx By: /s/ Xxxx Ke
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Name: Xxxx Xxxxxxxxx Name: Xxxx Ke
Title: Chief Executive Officer Title: Vice President
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