Exhibit 10.6
EXECUTION COPY
FORBEARANCE AND DEBT PAYMENT AGREEMENT
This FORBEARANCE AND DEBT PAYMENT AGREEMENT (this "Agreement") is
entered into as of the ____ day of December, 2006, by and between Eastech
Electronics (Taiwan) Inc. ("Eastech") and SOYO Group, Inc. ("Soyo)").
RECITALS
--------
A. Soyo is indebted to Eastech for goods purchased pursuant to purchase
orders and related documents (as amended and modified from time to
time prior to the date hereof, the "Documents"). As of the date of
this Agreement, the indebtedness is in the amount of US $3,785,280.28
(the "Indebtedness"). The Indebtedness to Eastech is unsecured and is
not evidenced by an instrument.
B. The Indebtedness was due in full prior to the date hereof and was not
paid when due.
C. Soyo and Eastech are parties to that certain Confidentiality and
Non-Disclosure Agreement dated as of August 28, 2006 (the "NDA"),
which is in full force and effect.
D. Soyo has requested that Eastech agree to accept payments on account of
the Indebtedness on the terms set forth in this Agreement and the
Promissory Note, which payments Soyo would make in the ordinary course
of its business. Eastech is willing to enter into such an agreement,
on the terms and conditions set forth in this Agreement.
E. Soyo desires to obtain Eastech's agreement to forbear from the
enforcement of remedies by reason of the Existing Defaults to enable
Soyo to operate its business in the ordinary course until the Maturity
Date, and Eastech is willing to agree to forbear, on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
1. Definitions
Unless otherwise defined herein, capitalized terms used in
this Agreement shall have the meanings given to them in the Promissory
Note (as defined below).
a. "Additional Expenses" shall have the meaning given to such
term in section 11.d below.
b. "Corion" shall mean Corion Industrial Corp., USA, or any
parent, subsidiary or affiliate thereof.
c. "Documents" shall have the meaning in Recital A above.
1
d. "Existing Defaults" shall mean Soyo's failure to pay the
Indebtedness when due.
e. "Event of Default" shall have the meaning in section 9
below.
f. "Forbearance Termination Event" shall mean (i) the
occurrence of any Event of Default under this Agreement,
(ii) Soyo shall make any payment to Corion on account of
Soyo's indebtedness to Corion outstanding as of the date
hereof in excess of Fifty Thousand Dollars ($50,000) per
week on account of the principal amount of such debt or make
any payment to Corion on account of interest on such debt,
prior to the satisfaction of the Indebtedness to Eastech,
(iii) Xxxxx Xxx or Xxxx Xxxx, or any person or entity owned
or controlled by Xxxxx Xxx or Xxxx Xxxx, and which person or
entity is an equity holder of Soyo, shall, collectively, in
one or a series of related transactions, sell or transfer
title to, or beneficial ownership or control of, voting
stock of Soyo which represents, in the aggregate, twenty
percent (20%) or more of the combined voting power of all
voting stock of Soyo, to any person or any two or more
persons acting in concert, (iv) the sale of all or
substantially all of the assets constituting the operating
business of Soyo, or (v) Soyo commences or proposes to
commence any bankruptcy, reorganization, arrangement or
adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar proceeding under any
federal, state or other law for the relief of debtors (an
"Insolvency Proceeding"), Soyo fails to obtain the
dismissal, within sixty (60) days after the commencement
thereof, of any Insolvency Proceeding instituted by one or
more third parties, fails actively to oppose any such
Insolvency Proceeding, or, in any such Insolvency
Proceeding, defaults or files an answer admitting the
material allegations upon which such Insolvency Proceeding
was based or alleges its willingness to have an order for
relief entered or any receiver, trustee or custodian is
appointed to take possession of all or any substantial
portion of the assets of Soyo.
g. "Indemnified Liabilities" shall have the meaning given to
such term in section 11.e below.
h. "Indemnitees" shall have the meaning given to such term in
section 11.e below.
i. "Insolvency Proceeding" shall have the meaning given to such
term in section 1.f above.
j. "Maturity Date" means noon (Pacific Time) October 1, 2008.
k. "NDA" shall have the meaning given to such term in Recital C
above.
l. "Promissory Note" shall have the meaning given to such term
in section 3.a(2) below.
2
m. "Releasees" shall have the meaning given to such term in
section 9 hereof.
n. "Releasors" shall have the meaning given to such term in
section 9 hereof.
o. "Representatives" shall have the meaning given to such term
in section 7.d hereof.
p. "Soyo's Claims" has the meaning given to such term in
section 9 hereof.
q. "Soyo's Obligations" means all obligations of Soyo under the
Documents or related to the sale of goods, or this Agreement
or the Promissory Note, other than the obligation to pay the
Indebtedness.
r. "Termination Date" means the earlier to occur of (i) the
occurrence of a Forbearance Termination Event, and (ii) the
Maturity Date.
2. Agreement to Forbear
a. Eastech agrees to forbear from exercising any right or
remedy available to it with respect to the collection of the
Indebtedness solely by reason of the existence and
continuation of the Existing Defaults until the Termination
Date. Effective as of the Termination Date, Eastech's
agreement to forbear from exercising any rights or remedies
by reason of the Existing Defaults shall automatically
expire and be of no further force or effect.
b. Nothing in this section 2 shall be construed to be a waiver
of the Existing Defaults. The Existing Defaults shall
continue in existence subject only to Eastech's agreement,
as set forth in this Agreement, not to enforce rights or
remedies based upon such Existing Defaults prior to the
Termination Date.
c. Eastech expressly reserves all of its rights and remedies
with respect to collection of the Indebtedness and
applicable law, except as expressly limited herein. Nothing
in this Agreement shall prejudice or limit Eastech's rights
and remedies in the event any default or Event of Default
occurs under the Promissory Note or this Agreement.
d. From and after the Termination Date, Eastech shall be
entitled to enforce the Indebtedness, and all rights and
remedies with respect to such Indebtedness, by reason of the
occurrence of any defaults or Events of Default, including
the Existing Defaults.
3. Conditions to Effectiveness of Agreement
a. The effectiveness of this Agreement shall be subject to the
satisfaction of the following conditions, all in form and
3
substance reasonably satisfactory to Eastech, or the waiver
of such conditions by Eastech in its sole discretion.
(1) This Agreement shall have been executed and
delivered by Soyo and Eastech.
(2) Soyo shall have executed and delivered to Eastech
a promissory note in the form of Exhibit A
attached hereto, with all blanks filled (the
"Promissory Note").
(3) After giving effect to the transactions
contemplated by this Agreement, no Event of
Default shall exist with respect to the payment of
the Indebtedness or under the Documents, and no
event shall have occurred which, with the giving
of notice or lapse of time, or both, would become
an Event of Default, except for the Existing
Defaults.
(4) Soyo shall have delivered to Eastech a complete
copy of the debt payment agreement between Soyo
and Corion, pursuant to which Corion has agreed to
accept installment payments on account of the
indebtedness Soyo owes to Corion without the
payment of interest on a current basis, and the
terms of such agreement shall be reasonably
satisfactory to Eastech.
(5) Soyo shall have obtained a termination statement
with respect to all Uniform Commercial Code
financing statements or other notices of lien in
favor of Corion filed in the office of the
California Secretary of State, and shall have
filed all such statements and notices in the
office of the California Secretary of State to
terminate such filings.
(6) Soyo shall have delivered to Eastech such other
documents, instruments, and approvals and taken
such other actions consistent with this Agreement
as Eastech may reasonably request in order to
fulfill the obligations of Soyo under this
Agreement.
4. Conditions to Effectiveness of Agreement
a. The effectiveness of this Agreement shall be subject to the
satisfaction of the following condition, in form and
substance reasonably satisfactory to Soyo, or the waiver of
such condition by Soyo in its sole discretion.
(1) Eastech shall provide evidence that Eastech
maintains not less than US $20 million of products
liability insurance and shall name Soyo as a
Certificate Holder.
(2) Eastech shall have granted to Soyo a credit in the
amount of $330,000, which credit is reflected in
the Indebtedness.
4
5. Soyo's Representations and Warranties
As a material inducement to Eastech to enter into the
transactions contemplated hereby, Soyo represents and warrants to
Eastech that:
a. Due Authority This Agreement has been duly authorized,
executed and delivered by Soyo, is a legally valid and
binding agreement and is enforceable against Soyo in
accordance with its terms, except to the extent that such
enforcement may be limited by applicable bankruptcy,
insolvency and other similar laws affecting creditors rights
generally.
b. Acknowledgment of Indebtedness The amount of its
indebtedness to Eastech under the Documents as of the date
hereof is the Indebtedness.
c. No Defenses Soyo does not have or assert any claims,
counterclaims, defenses or rights of setoff whatsoever with
respect to the Indebtedness or to any of Soyo's Obligations,
and no event has occurred and no condition exists which
would constitute an Event of Default hereunder with the
giving of notice or lapse of time or both, except the
Existing Defaults.
d. Complete Representations No representation or warranty made
by Soyo herein or in any other document delivered to Eastech
in furtherance of this Agreement on or before the date
hereof contains any materially untrue statement or omits any
material fact necessary to make such representation or
warranty not misleading.
e. Discussions with Counsel Soyo has thoroughly discussed with
its attorneys, to the full extent that it deems it necessary
to do so, all aspects of this Agreement, including the
Release granted pursuant to section 8 hereof, has been fully
advised by its attorneys as to its rights, understands that
it may be waiving significant legal rights or Soyo's Claims,
and enters into the Release with a full and complete
understanding of its terms.
f. No Transfer of Soyo's Claims Soyo has not transferred or
assigned any interest in any Soyo's Claims which it has or
may hereafter have had against the Releasees, or any of
them.
6. Eastech's Representations and Warranties
As a material inducement to Soyo to enter into the
transactions contemplated hereby, Eastech represents and warrants to
Soyo that:
a. Due Authority This Agreement has been duly authorized,
executed and delivered by Eastech, is a legally valid and
binding agreement and is enforceable against Eastech in
accordance with its terms, except to the extent that such
enforcement may be limited by applicable bankruptcy,
5
insolvency and other similar laws affecting creditors rights
generally.
7. Covenants by Soyo
Soyo covenants and agrees that, so long as any of the
Indebtedness remains unpaid:
a. Confirmation of Obligations Soyo shall pay the Indebtedness
as provided herein and in the Promissory Note, and perform
each and all of Soyo's Obligations pursuant to the Documents
and this Agreement.
b. Payment of Indebtedness On or before the Maturity Date, Soyo
shall pay to Eastech the unpaid balance of the Indebtedness
in accordance with the terms of this Agreement and the
Promissory Note.
c. Financial Reporting Soyo shall furnish, or cause to be
furnished, the following financial information to Eastech:
(1) After the end of each calendar month and
concurrently with delivery of such information to
the senior lender to Soyo, a copy of all financial
information which Soyo is required to deliver to
its senior lender pursuant to its agreements with
such lender.
(2) As soon as practicable after the end of each
calendar quarter and not later than sixty (60)
days after the end of each quarter, to the extent
the following information has not been disclosed
by Soyo in public filings, copies of which Soyo
shall send to Eastech: (i) a schedule of aged
accounts payable by Soyo, a schedule of aged
accounts receivable of Soyo and a listing of all
payments made by Soyo in the past 90 days, or a
bring-down of payments made by Soyo since the last
such schedule delivered by Soyo to Eastech or
included in public filings, and (ii), to the
extent not included in monthly reports delivered
by Soyo to Eastech pursuant to section 7.c (1)
hereof or in public filings, a consolidated income
statement, a statement of source and application
of funds, a statement of shareholder's equity of
Soyo for the period from the beginning of the then
current fiscal year to the end of such quarterly
period, and a consolidated balance sheet of Soyo
and its consolidated subsidiaries as at the end of
such quarterly period, subject to changes
resulting from year-end adjustments, all in
reasonable detail, satisfactory in scope to
Eastech.
6
d. Access and Cooperation Soyo shall, and shall cause its
officers and advisors to, cooperate with Eastech in
furnishing information as and when reasonably requested by
Eastech regarding Soyo's financial affairs, finances,
financial condition, business and operations for the purpose
of confirming Soyo's compliance with the terms of this
Agreement. In furtherance thereof, Soyo hereby agrees to,
upon not less than five (5) business days notice, give
Eastech and its Representatives reasonable access during
normal business hours to the offices, properties, books and
records of Soyo, and to the officers and other appropriate
representatives of Soyo as may be necessary, in Soyo's
reasonable opinion, to confirm Soyo's compliance with this
Agreement, provided that at any time that an Event of
Default exists under section 10 of this Agreement, Eastech
shall only be required to give Soyo two (2) business days
notice of any required access and cooperation hereunder..
Eastech shall, in the exercise of this right, use reasonable
efforts to avoid any disruption in the business and
operations of Soyo. For purposes of this Agreement, the term
"Representatives" shall mean affiliates, officers,
employees, accountants, auditors, agents, advisors,
consultants and financing sources (including any investment
banker, financial advisor, accountant, legal counsel, agent,
representative or expert retained by or acting on behalf
Eastech). Eastech shall, and shall cause each of its
employees, accountants, auditors, counsel and other
Representatives to, comply in all respects with the NDA.
e. No liens Soyo will not grant or suffer any lien, claim or
encumbrance on any of its assets, or the legal or equitable
interest therein, whether such property is now owned or
hereafter acquired, or any income, profits or proceeds
thereof, while any of the Indebtedness remains outstanding
other than (i) the existing lien securing indebtedness in
favor of Accord Financial, Inc. or any refinancing of such
indebtedness, (ii) liens granted to any lender to secure the
repayment of indebtedness for funds borrowed by Soyo after
the date hereof in the ordinary course of business, to the
extent such new indebtedness is not a refinancing of the
Accord Financial, Inc. debt, (iii) purchase money security
interests; (iv) liens for taxes or assessments not
delinquent or being diligently contested in good faith by
appropriate proceedings, (v) liens imposed by law, such as
carriers' or mechanic's liens, incurred in the ordinary
course of business for sums not yet due or being contested
in good faith by appropriate proceedings or (vi)
non-purchase money liens in favor of Corion provided that
Eastech receives pari passu liens on the same collateral
pursuant to the same grant of liens as any lien give to
Corion and the liens given to Corion and Eastech have the
same perfection and priority.
7
f. Payments to Corion Soyo will not make any payments to Corion
in excess of Fifty Thousand Dollars ($50,000) per calendar
week on account of Soyo's indebtedness to Corion outstanding
as of the date hereof; Soyo may agree to pay interest to
Corion on account of any indebtedness owed by Soyo to Corion
as of the date hereof at a rate not in excess of the
interest rate accruing on the Indebtedness and may agree to
other non-financial terms for the repayment of such
indebtedness owed to Corion, provided such terms are no more
favorable to Corion than the terms of this Agreement are to
Eastech.
8. Covenants by Eastech
a. Honoring of Parts Warranty Eastech shall sell spare parts
and replacement parts, including remote controls and
motherboards, to Soyo, provided Soyo shall pay the standard
amounts Eastech charges for such parts and such payments
shall be made by Soyo according to normal payment terms.
b. Repair of Motherboards at Eastech Eastech will repair the
motherboards Soyo returned to Eastech prior to the date of
this Agreement and shall ship such motherboards to Soyo in
the ordinary course of Eastech's business, provided Soyo
shall pay the standard amounts Eastech charges for such
repair services and such payments shall be made by Soyo
according to normal payment terms.
c. Satisfaction of Soyo's Obligations In the event Soyo makes
all payments when due under the Promissory Note and without
default, including, without limitation, the payment in full
of the principal amount of the Indebtedness on or prior to
the Maturity Date, then Eastech shall (i) accept the
payments due under this Agreement and the Promissory Note in
full satisfaction of the Indebtedness, (ii) waive and
release Soyo of the obligation to pay the interest which
accrues on the Indebtedness under the Promissory Note after
the date hereof to the extent provided in the Promissory
Note, and (iii) return the Promissory Note to Soyo marked
"satisfied".
d. Limitation on Petitioning for Bankruptcy As long as Soyo
does not commit an Event of Default under this Agreement,
Eastech agrees not to be a petitioning creditor in
connection with any organized effort to commence an
involuntary bankruptcy case against Soyo.
9. Release by Soyo
a. Soyo on behalf of itself, and its agents, representatives,
officers, directors, advisors, employees, subsidiaries,
affiliates, successors and assigns, and any and all persons
and/or entities who may purport to claim by, through, or
for, it or them, (collectively, the "Releasors") hereby
releases and discharges Eastech and all of its officers,
directors, agents, employees, shareholders, predecessors,
successors, assigns, attorneys and legal representatives (in
their capacity as such) (collectively the "Releasees") and
8
each of them, from any and all claims, demands, actions,
causes of action, liabilities, costs, crossclaims, rights of
setoff or recoupment, expenses and damages of any kind
whatsoever, in law or in equity, past, present or future, ("
Soyo's Claims") and whether such Claims are known or
unknown, suspected or unsuspected, from the beginning of
time to the date hereof, including without limitation any
Soyo's Claims based upon, related to or arising out of the
sale of goods by Eastech or any Releasee to Soyo or any
Releasor, or actions or omissions in connection with any
such sale, or the relationship between Soyo and Eastech
prior to the date hereof, provided that this provision does
not release or discharge any claim which Soyo may hereafter
have against Eastech (i) pursuant to the terms of the NDA,
(ii) under the express terms of this Agreement, or (iii) as
a result of a class action commenced against Soyo or a claim
asserted by a governmental agency, in either case, based
upon, related to or arising out of the sale of goods by
Eastech or any Releasee to Soyo or any Releasor, or actions
or omissions in connection with any such sale.
b. TO THE EXTENT THAT SECTION 1542 OF THE CALIFORNIA CIVIL CODE
OR SIMILAR PROVISIONS OF OTHER APPLICABLE LAW APPLIES TO THE
FOREGOING RELEASE, IT IS THE INTENTION OF SOYO THAT THE
FOREGOING RELEASE SHALL BE EFFECTIVE AS A BAR TO ANY AND ALL
ACTIONS, DAMAGES, LOSSES, CLAIMS, LIABILITIES AND DEMANDS OF
WHATSOEVER CHARACTER, NATURE AND KIND, KNOWN OR UNKNOWN,
SUSPECTED OR UNSUSPECTED, HEREINABOVE SPECIFIED TO BE
BARRED. IN FURTHERANCE OF THIS INTENTION, SOYO EXPRESSLY
WAIVES ANY AND ALL RIGHTS AND BENEFITS CONFERRED ON SOYO BY
THE PROVISIONS OF SECTION 1542 OF THE CALIFORNIA CIVIL CODE,
WHICH PROVIDES AS FOLLOWS:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN
BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR."
10. Defaults and Remedies
The occurrence of any of the following (each an "Event of Default")
shall constitute an immediate Event of Default under this Agreement:
a. Any event or condition, other than any Existing Default,
shall have occurred or exist which constitutes a default by
Soyo under any of the Documents, this Agreement or the
Promissory Note or a breach of any of Soyo's Obligations,
including that any required notice shall have been given and
any cure period for the avoidance of such default shall have
expired. The cure period for any default by Soyo shall, in
the absence of a specified period or a specification that
there shall be no cure period, be ten (10) calendar days.
9
b. Any material representation made or reaffirmed by Soyo under
this Agreement shall prove to have been false in any
material respect at the time such representation was made or
reaffirmed.
c. Soyo commences or proposes to commence any Insolvency
Proceeding, Soyo fails to obtain the dismissal, within sixty
(60) days after the commencement thereof, of any Insolvency
Proceeding instituted by one or more third parties, fails
actively to oppose any such Insolvency Proceeding, or, in
any such Insolvency Proceeding, defaults or files an answer
admitting the material allegations upon which such
Insolvency Proceeding was based or alleges its willingness
to have an order for relief entered or any receiver, trustee
or custodian is appointed to take possession of all or any
substantial portion of the assets of Soyo.
Upon the occurrence of an Event of Default hereunder, (i) Eastech may,
at its option, without notice to or demand upon Soyo or any other party, declare
immediately due and payable the entire balance of the Indebtedness, together
with all accrued and unpaid interest thereon, plus Additional Expenses and any
other amounts then owing pursuant to this Agreement, whereupon the same shall be
immediately due and payable; provided that upon the occurrence of an Event of
Default under clause (c) above, the unpaid amounts of the Indebtedness and all
other indebtedness of Soyo to Eastech shall become immediately due and payable
without presentment, demand, protest or notice of any kind, and (ii) Eastech's
agreement to forbear from enforcing remedies with respect to the Indebtedness
pursuant to section 2 hereof shall immediately terminate without notice or
demand of any kind.
11. Miscellaneous
a. Parties Benefited No persons or entities other than Soyo and
Eastech shall have any rights under this Agreement or any of
the Documents, as amended hereby.
b. Notices Any notice or other communication required or
permitted herein shall be in writing or sent by regular
mail, hand delivery, overnight delivery, facsimile, portable
document file or email, and shall be effective upon receipt
in the case of hand delivery, overnight delivery, facsimile,
portable document file or email, and three (3) business days
after placement into the mails (first class, postage
prepaid) addressed as follows:
Eastech Xxxxxxx X. Xxxxxx
Vice President, Operations
Eastech Electronics (Taiwan) Inc.
Suite 4 - 481,
0000 Xxxxxxx 00 Xxxx,
Xxxxxx Xxxx, XX 00000
Email: xxxxxxx.xxxxxx@xxxxxxx.xxx
With a copy to: Xxxxxxx X. Xxxxx
Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Email: Xxxxxxx.Xxxxx@XX.xxx
10
Soyo Xxxxx Banner
SOYO Group, Inc.,
0000 X. Xxxxxxx Xxx.
Xxxxxxx, XX 00000
With a copy to: Xxxxxx X. Xxxxx
Jeffer, Xxxxxxx Xxxxxx & Xxxxxxx LLP
1900 Avenue of the Stars
Xxxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
Email: XXxxxx@xxxx.xxx
c. Governing Law This Agreement and the rights and obligations
of the parties hereunder shall in all respects be governed
by, and construed and enforced in accordance with the
domestic internal laws (but not the conflict of laws rules)
of the State of California, provided that this Agreement
does not constitute a consent to the jurisdiction of any
court of, or located in, the State of California, and, by
entering into this Agreement, Eastech is not consenting to
the jurisdiction of any court of or located in the State of
California.
d. Expenses In the event of an Event of Default hereunder, Soyo
shall pay all costs and expenses incurred by Eastech in
connection with the collection of the Indebtedness or the
enforcement of any of Soyo's Obligations, including without
limitation, fees and costs of all financial or other
professional advisors and reasonable attorneys' fees and
costs incurred by Eastech ("Additional Expenses"). The
Additional Expenses shall be payable to Eastech concurrently
with the payment of the unpaid balance of the Indebtedness,
to the extent such amounts have been determined, and shall
be paid to Eastech by Soyo promptly after such amounts are
determined if they have not been determined by the date of
the final payment of the Indebtedness.
e. Indemnity In addition to the payment of expenses pursuant to
section 11.d above, Soyo agrees to indemnify, pay and hold
Eastech and any holder of the Promissory Note, and the
officers, directors, employees, agents, and affiliates of
Eastech and such holders (collectively called the
"Indemnitees") harmless from and against any and all other
liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including,
without limitation, the reasonable fees and disbursements of
counsel for such Indemnitees in connection with any
investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnitee
shall be designated a party thereto), which may be imposed
on, incurred by, or asserted against that Indemnitee, based
upon or arising from any claim, demand or threat made by a
third party against Eastech or such Indemnitee in any manner
relating to or arising out of this Agreement, or Eastech's
agreement herein to forbear from enforcing remedies with
respect to the Indebtedness (the "Indemnified Liabilities"),
11
provided that this indemnity shall not indemnify Eastech or
any Indemnitee from or against claims, demands or threats
based upon goods sold by Eastech or any Indemnitee. To the
extent that the undertaking to indemnify, pay and hold
harmless set forth in this section may be unenforceable
because it is violative of any law or public policy, Soyo
shall contribute the maximum portion which it is permitted
to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.
f. Effect of Agreement Except to the extent expressly modified
by this Agreement, the Documents shall remain in full force
and effect in accordance with their original terms and
conditions.
g. Counterparts This Agreement may be executed in any number of
counterparts with the same effect as if all parties hereto
had signed the same document. All such counterparts shall be
construed together and shall constitute one instrument, but
in making proof hereof it shall only be necessary to produce
one such counterpart.
h. Amendments and Waivers The provisions of this Agreement,
including without limitation, the obligation of Eastech to
forbear from enforcing remedies with respect to the
Indebtedness, may be amended, modified or waived only by a
written instrument executed by the parties to this
Agreement.
i. Delay in Exercise No failure or delay on the part of Eastech
in exercising any power, right or remedy under the Documents
or this Agreement shall operate as a waiver thereof, nor
shall a single or partial exercise of any power, right or
remedy preclude any other exercise thereof or the exercise
of any other power, right or remedy.
j. Further Assurances Soyo shall take further actions as are
reasonably required and within its powers to carry out its
obligations under the Documents, except as amended hereby,
and this Agreement.
k. Time of Essence Time is of the essence of this Agreement and
each provision of this Agreement of which time is an
element, specifically including the definition of
Termination Date.
l. Successors and Assigns The obligations of the parties under
this Agreement may not be assigned without the prior written
consent of the other party to this Agreement. This Agreement
shall inure to the benefit of and be binding upon any
permitted successors or assigns of either party hereto.
m. Validity of Recitals The parties hereby agree that the
representations in the Recitals to this Agreement are true
and correct and agree to be bound thereby.
12
n. Application of NDA Any Confidential Information (as defined
in the NDA) received by Eastech pursuant to this Agreement
shall be subject to the terms of the NDA.
o. Confidentiality The parties agree to maintain the terms of
this Agreement in strict confidence and not to disclose the
terms hereof to any third parties, except that a party may
disclose the terms of this Agreement to any of its
Representatives, provided the party binds such
Representatives to secrecy with respect to the terms hereof,
and except further that a party may disclose the terms of
this Agreement to the extent required by public reporting
requirements by which such party is bound. Each party will
take at least the same degree of care it uses to protect its
own proprietary information, but no less than reasonable
care under the circumstances.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first written above.
Eastech Electronics (Taiwan) Inc. ("Eastech")
By: ______________________________
Name:
Title:
SOYO Group, Inc. ("Soyo")
By: _____________________________
Name:
Title:
13
