EXCLUSIVE DISTRIBUTOR AGREEMENT
EXHIBIT
10.23
This
Exclusive Distributor Agreement (“Agreement”), made and effective this
October
1, 2006,
by and
between Tegal
Corporation and its subsidiaries
(“Tegal”) located at 0000
X. XxXxxxxx Xxxx. Xxxxxxxx, XX XXX
and
Noah
Corporation (“Noah”)
located at 0xx
Xxxxx, 0-00-00 Xxxxx, Xxxxxxx, Xxxxx, 000-0000 Xxxxx.
NOW,
THEREFORE,
in
consideration of the mutual agreements and promises set forth herein, the
parties agree as follows:
| 1. |
Appointment.
|
| 2. |
Products.
|
2.1 Products
Defined. As
used
in this Agreement, the term “Products” shall mean the Systems Products, Spare
Parts, related service parts and accessories manufactured and/or sold by Tegal
listed in Exhibit
A
attached
hereto. Tegal may update Exhibit A from time to time in its sole discretion
upon
notice to Noah.
2.2 Commencement
Dates. Except
for those specific Systems Products opportunities listed in Exhibit
B
attached
hereto, all Systems Product sales in the Territory shall be made by Noah no
earlier than October 1, 2006. Noah may not begin the sale of Spare Parts to
its
Customers until January 1, 2007.
| 3. |
Process
and Terms of Sale and
Supply.
|
3.1 Cooperation.
Noah
and
Tegal shall cooperate and work together to develop relationships within the
Territory with Noah Customers and prospective customers.
3.4 Shipment,
Title and Risk of Loss. Tegal
agrees to ship the Products to Noah or directly to the Customers, as agreed
upon
by the parties on a case-by-case basis. Delivery shall be ex
works (Incoterms 2000) Tegal’s
shipping point. Title and risk of loss for the Products will transfer to Noah
at
the shipping point. Tegal shall select the shipper in its reasonable judgment.
Noah shall bear all costs associated with shipment of the Products and insurance
of the Products during shipment. All Products shall be deemed accepted upon
delivery.
3.6 Rescheduling.
Re-schedule
requests must be made in writing at least thirty (30) days prior to the
scheduled shipment date. Any order may be re-scheduled only once. Requests
to
delay shipments may not exceed ninety (90) days from the original acknowledged
delivery date. Any re-scheduled order may not thereafter be canceled or further
modified, and is subject to full payment by Noah of the selling
price.
3.7 Tegal’s
Standard Terms and Conditions. All
sales
of Products to Noah during the term of this Agreement shall be subject to the
terms and conditions of this Agreement and to Tegal’s Standard Terms and
Conditions of Sale in effect at the time of each such purchase. A copy of
Tegal’s current Standard Terms and Conditions of Sale is attached as
Exhibit
C. Tegal
may
update its Standard Terms and Conditions of Sale from time to time in its sole
discretion by providing written notice to Noah. Tegal will use reasonable
efforts to provide such notice at least sixty (60) days in advance of their
effectiveness. In the event of any conflict between the terms of this Agreement
and the Standard Terms and Conditions of Sale then in effect, this Agreement
shall control.
3.8 Terms
and Conditions Applicable to Customers. Noah
agrees to include in all Product sales agreements with its Customers provisions
consistent in all material respects with the following provisions of Tegal’s
Standard Terms and Conditions of Sale set forth in Exhibit
C:
Confidential Information, Warranty Disclaimer, Limitation of Liability, Software
and No License by Implication provisions.
4.2 Marketing
and Promotion
a. Marketing
Plan. On
the
first day of November of each calendar year, Noah will submit to Tegal for
Tegal’s approval a marketing plan outlining Noah’s planned marketing and
promotional activities for the Products for the coming year. Noah shall work
in
good faith to revise or modify the marketing plan in accordance with Tegal’s
reasonable requests. If the parties disagree regarding the elements of the
marketing plan, the parties agree to discuss in good faith and resolve any
issues prior to implementation of Noah’s Product marketing plan.
4.3 Installation
and Warranty Services.
a. Scope
of Services.
Noah
shall have the responsibility to install, service, and maintain the Products
sold to its Customers, subject to service policies reasonably satisfactory
to
Tegal, and in doing so shall use qualified personnel. Noah shall perform all
necessary warranty work for the Products pursuant to Tegal’s warranty
obligations to Customers and provide installation and other related services
to
the Customer at no charge to the Customer during the warranty periods applicable
for each Product. Noah represents and warrants that its provision of such
services shall be prompt and of the highest quality and shall be performed
only
by properly trained personnel of Noah. Noah shall be responsible for any and
all
training and instruction of those of its personnel providing technical support
for the Products, unless otherwise agreed by Tegal. Noah shall at all times
employ a minimum of ***** (*****) full-time ***** dedicated exclusively to
supporting the Systems Products in the Territory, unless otherwise agreed in
writing between Tegal and Noah. In addition, Noah shall employ a minimum of
***** full-time *****, qualified to develop and support applications on the
Systems Products and ***** part-time *****, qualified to develop and support
PVD
applications, and such support shall be performed on the Systems Products at
either Noah’s or Customer’s facilities, as determined by Noah in its reasonable
judgment.
4.4 Former
Tegal Employees. As
partial consideration for the grant of territorial exclusivity as a distributor
of Tegal Products, Noah
shall, upon entering into this Agreement and in accordance with the schedule
set
forth in Exhibit
D,
employ
personnel previously employed by Tegal Japan Inc. in the Territory. Noah agrees
to use all reasonable efforts to employ such personnel for ***** following
the
date of their employment by Noah, with salaries and benefits consistent with
the
salaries and benefits provided to such employees in the six month period
immediately preceding this Agreement.
4.7 Reporting
Requirements.
a. Sales
Reports. Noah
shall submit written sales reports to Tegal within five (5) days after the
end
of each calendar quarter, setting forth net sales of the Products in value
and
units and stock levels for the prior quarter.
4.10 Expenses.
Noah
will
pay and is responsible for all expenses incurred in connection with its
activities under this Agreement.
| 5. |
Duties
of Tegal
|
5.2 Assistance.
Tegal
will respond promptly and constructively to requests by Noah for technical
or
application assistance.
5.3 Referrals.
Tegal
will refer all potential purchasers of the Products in the Territory to the
Noah.
| 6. |
Pricing
and Payment
|
6.1 Systems
Products Pricing. For
reference purposes only, Tegal will supply Noah with a confidential Tegal price
list for Systems Products. The initial price list for Systems Products and
Spare
Parts is attached hereto as Exhibit
E.
Tegal
may change the price list and the prices set forth therein from time to time
in
its sole discretion upon at least sixty (60) days prior written notice to Noah.
Noah acknowledges and agrees that the price list for the Territory may differ
from price lists Tegal provides for different regions. Given the nature of
the
sales process for Systems Products, the parties will have to work together
in
all sales efforts for System Products in the Territory. All prices and discounts
offered to Noah are net of and do not include the costs for shipping, insurance
and any additional services or products offered by Noah to a Customer. Unless
Tegal agrees to a different discount rate for a particular sale of System
Products to a Customer, Tegal agrees to sell System Products to Noah at a
*****
percent
(*****%) discount from the listed price on the Tegal price list. Tegal agrees
to
consider in good faith deviations from the standard discount rate upon request
from Noah for particular Customer opportunities but shall not be obligated
to
offer greater discount rates.
6.2 Spare
Parts Pricing. Noah
may
purchase Spare Parts from Tegal at a discount of ***** percent (*****%) off
of
the prices set forth in the price list attached hereto as Exhibit
E.
6.3 Pricing
of Products to Customers.
Noah
shall have full discretion to set its own prices for the Products it sells
to
Customers.
6.4 Invoicing;
Payment. If
agreed
upon in advance by Tegal on a case-by-case basis, Tegal may invoice Noah for
sales of Systems Products based on a payment plan of ***** percent (*****%)
of
the discounted sales price payable upon delivery and ***** percent (*****%)
payable upon Customer acceptance. Noah
shall pay all charges due hereunder within thirty (30) days after the date
of
Tegal’s invoice. If Noah fails to meet its payment obligations when due or if
Noah’s financial condition, in the reasonable opinion of Tegal, becomes
impaired, then Tegal shall have the right to refuse any orders placed by Noah,
in whole or in part. In addition, if Noah shall fail to make any payment due
hereunder on the date such payment is due and payable, then such portion that
remains outstanding shall bear simple interest until paid in full at a rate
equal to the lesser of (i) *****% per month and (ii) the maximum interest rate
permitted under applicable law. Noah shall not be entitled to set off any amount
owed by Noah to Tegal against any amount owed by Tegal to Noah pursuant to
this
Agreement or otherwise. Noah shall reimburse Tegal for any costs or expenses
incurred by Tegal in seeking recovery from Noah of any amounts due hereunder.
6.7 Currency.
All
payments due hereunder shall be made in United States Dollars.
| 7. |
Financial
Obligations and
Policies
|
7.2 Financial
Statements. Noah
will
furnish Tegal with financial statements in such form as Tegal may reasonably
require from time to time for credit purposes.
| 8. |
Intellectual
Property and Software
|
8.2 License
Restrictions.
The
license granted to Noah under Section 8.1 shall be subject to the following
restrictions:
(A) Noah
shall not modify or alter the Products in any way, or offer the Products in
combination with any other products or services of Noah or any third party,
except as may be expressly set forth in this Agreement, without the prior
written consent of Tegal. All such requests shall be in English.
(B) Noah
agrees that except as may be expressly permitted by applicable law, Noah will
not cause or permit the reverse engineering, translation or disassembly of
the
Products. If a jurisdiction in the Territory expressly permits by applicable
law
any of the foregoing activities regardless of contractual restriction, then
Noah
agrees that prior to engaging in any such activity Noah will first notify Tegal
of its desire to reverse engineer the Products, and Tegal may, in its
discretion, either provide such information to Noah or impose reasonable terms
and conditions on such use of the Products to ensure that Tegal proprietary
rights are protected.
(C) The
license granted in Section 8.1 above is granted solely to Noah, and not, by
implication or otherwise, to any parent, subsidiary or affiliate of
Noah.
(D) Noah
shall not remove, obscure, or alter any Tegal or other proprietary rights notice
affixed to or contained within the Products or associated
documentation.
8.3 Intellectual
Property Protection.
Noah
will immediately bring to the attention of Tegal any improper or wrongful use
of
Tegal’s trade marks, emblems, designs, models or other intellectual property
rights which come to the notice of Noah and will in the performance of its
duties under this Agreement use every effort to safeguard the property rights
and interests of Tegal.
8.5 Ownership.
Noah
acknowledges that any and all intellectual property rights in or related to
the
Products are and shall remain the property of Tegal or Tegal’s licensors, and
Noah shall not at any time during or after the expiration or termination of
this
Agreement in any way question or dispute the ownership thereof by Tegal. All
software, even if embedded in the Products, is licensed not sold by Tegal.
All
rights not expressly granted under this Agreement are reserved.
| 9. |
Confidential
Information
|
9.3 Exclusions.
The
obligations of Section 9.2 shall not apply, however, to any information
which:
(A) is
already in the public domain or becomes available to the public through no
breach of this Agreement or other confidentiality obligation by the receiving
party;
(B) was
in
the receiving party’s possession prior to receipt from the disclosing party as
proven by the receiving party’s written records; or
(C) is
received independently on a non-confidential basis from a third party free
to
disclose such information to the receiving party.
| 10. |
Relationship
of the Parties
|
11.1 General
Representations.
The
parties hereby represent and warrant:
b. Due
Authorization.
It is
duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder.
c. Binding
Agreement.
This
Agreement is a legal and valid obligation binding upon it and enforceable in
accordance with its terms. The execution, delivery and performance of this
Agreement by such party does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound, nor violate and law or regulation of any court, governmental body or
administrative or other agency having jurisdiction over it.
11.5 No
Illegal Activity. The
parties represent and warrant that each shall at all times refrain from engaging
in any illegal, unfair, deceptive or unethical business practices whatsoever,
whether with respect to the Products or otherwise.
| 12. |
Limited
Liability
|
IN
NO
EVENT SHALL TEGAL SHALL BE LIABLE TO NOAH, OR TO ANY PARTY CLAIMING THROUGH
OR
UNDER NOAH, FOR ANY LOST PROFITS, LOSS OF DATA, LOSS OF GOODWILL, OR FOR ANY
INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, EVEN IF
TEGAL HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING OUT OF OR
RELATED TO THE SALE OF PRODUCTS TO OR BY NOAH. TEGAL’S TOTAL CUMULATIVE
LIABILITY UNDER THIS AGREEMENT EXCEPT FOR AMOUNTS PAYABLE PURSUANT TO ITS
INDEMNITY OBLIGATIONS UNDER SECTION 13 OR WITH RESPECT TO THE PRODUCTS SHALL
NOT
EXCEED THE AMOUNTS PAID BY NOAH TO TEGAL DURING THE 12 MONTHS PRECEDING THE
CLAIM. Noah acknowledges that the foregoing limitations are an essential element
of the Agreement between the parties and that in the absence of such limitations
the pricing and other terms set forth in this Agreement would be substantially
different.
| 13. |
Indemnification
|
13.4 Sole
Obligation. The
foregoing Tegal indemnity states the sole obligation and exclusive liability
of
Tegal, and Noah’s sole recourse and remedy for any claim of infringement or
misappropriation of an intellectual property right or proprietary right by
the
Products.
| 14. |
Term
and Termination
|
14.1 Term.
This
Agreement shall become effective as the date first shown above and
shall
continue for a period of three (3) years thereafter. This Agreement may be
renewed for additional one year periods solely upon the mutual written agreement
of the parties.
14.2 Termination
for Convenience. Either
party may terminate this Agreement at any time by written notice given to the
other party not less than one hundred and eighty (180) days prior to the
effective date of such termination.
14.4 Effect
of Termination.
On
termination of this Agreement, Noah shall cease to be an authorized distributor
of Tegal and:
a. Amounts
Due. All
amounts owing by Noah to Tegal shall, notwithstanding prior terms of sale,
become immediately due and payable.
c. Resale
of Products to Tegal. Noah
will resell to Tegal on demand, free and clear of liens and encumbrances, all
Products in Noah’s inventory as Tegal shall elect to repurchase, at a mutually
agreed price, but not in excess of Tegal’s current price to distributors for
such products and materials, and deliver to Tegal all materials bearing Tegal’s
name. Notwithstanding the foregoing, Noah shall be required to deliver to Tegal
and Tegal shall not be obligated to pay Noah for any item originally provided
to
Noah by Tegal free of charge, including, but not limited to Consignment
Stock.
| 15. |
Compliance
with Law.
|
15.1 Legal
Compliance. In
performing its duties under this Agreement, Noah shall at all times comply
with
all applicable international, federal, state and local laws and shall not engage
in any illegal or unethical practices. Noah agrees that any sums paid to Noah
under this Agreement are for Noah’s own account, and that except as appropriate
to carry out Noah’s duties set forth herein in a legal manner, Noah has not, has
no obligation to and shall not, directly or indirectly, give, offer, pay,
promise to pay, or authorize the payment of money or any thing of value to
any
other person in connection with the transactions for which commissions hereunder
are to be paid. Noah agrees not to take any actions that would cause it or
Tegal
to violate the U.S. Foreign Corrupt Practices Act of 1977, as amended. Noah
further agrees that no officer, director, employee, or agent of Noah is an
“official” of any government located within the Territory as that term is
defined in such Act, nor shall Noah employ any such “official”. Noah agrees that
Noah shall not download, export, or re-export any software or technical data
received hereunder, regardless of the manner in which received, (i) into, or
to
a national or resident of, any country to which the United States has embargoed
goods, or (ii) to anyone in the United States Treasury Department’s list of
Specially Designated Nationals or the U.S. Commerce Department’s Table of Denial
Orders. Noah shall indemnify and hold Tegal harmless from and against any
liabilities, damages, costs and expenses, including without limitation
attorneys’ fees and costs, resulting from any breach by Noah of this Section
15.
| 16. |
Acknowledgments
|
| 17. |
Final
Agreement
|
| 18. |
Assignment
|
Neither
this Agreement nor any interest in this Agreement may be assigned by Noah
without the prior express written approval of Tegal, which may be withheld
by
Tegal at Tegal’s absolute discretion. Notwithstanding the foregoing, this
Agreement is binding upon and shall inure to the benefit of its successors
and
assigns. Any assignment in violation of the foregoing shall be null and
void.
| 19. |
Force
Majeure
|
| 20. |
No
Implied Waivers
|
| 21. |
Notices
|
Any
notice required by this Agreement or given in connection with it, shall be
in
writing and shall be given to the appropriate party by personal delivery or
by
certified mail, postage prepaid, or recognized overnight delivery services
as
set forth below:
If
to Tegal:
Tegal
Corporation
Attn:
President & CEO
0000
X.
XxXxxxxx Xxxx.
Xxxxxxxx,
XX 00000 XXX
If
to Noah:
Noah
Corporation
1-19-19
Ebisu, Shibuya
Tokyo
Japan
| 22. |
Governing
Law
|
The
rights and obligations of the parties under this Agreement shall not be governed
by the provisions of the 1980 United Nations Convention on Contracts for the
International Sale of Goods or the United Nations convention on the Limitation
Period in the International Sale of Goods, as amended; rather, this Agreement
shall be governed by and construed under the laws of the State of California,
USA, without regard to conflicts of law principles. Upon Tegal’s request, Noah
hereby expressly consents to: (i) the personal jurisdiction of the federal
and
state courts within California and (ii) service of process being effected upon
it by registered mail sent to the address set forth at the beginning of this
Agreement.
| 23. |
Governing
Language.
|
| 24. |
Severability
|
| 25. |
Headings;
Construction
|
The
headings to the clauses, sub-clause and parts of this Agreement are inserted
for
convenience of reference only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement. Any ambiguity in this Agreement
shall be interpreted equitably without regard to which party drafted the
Agreement or any provision thereof. The terms “this Agreement,” “hereof,”
“hereunder” and any similar expressions refer to this Agreement and not to any
particular Section or other portion hereof. The parties hereto agree that any
rule of construction to the effect that ambiguities are to be resolved against
the drafting party will not be applied in the construction or interpretation
of
this Agreement. As used in this Agreement, the words “include” and “including,”
and variations thereof, will be deemed to be followed by the words “without
limitation” and “discretion” means sole discretion.
IN
WITNESS WHEREOF,
the
parties have executed this Agreement as of the date first above
written.
Tegal
Corporation (“Tegal”)
By:
/s/ Xxxxxx X. Mikas_________________________ Date:
October
20, 2006
Xxxxxx
X.
Xxxx, President and CEO
Noah
Corporation (“Noah”)
By:
/s/
Hiroshi Tabira___________________________ Date:
October20,
2006
Xxxxxxx
Xxxxxx, President & CEO