MANUFACTURING SERVICES FRAMEWORK AGREEMENT
Exhibit
10.9
Between
the undersigned
INTERMEC
TECHNOLOGIES CORPORATION
and
VENTURE
CORPORATION LIMITED
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 1 of
37
TABLE OF
CONTENTS
Article
|
Page
|
Article
1 – Definitions
|
4
|
Article
2 – Purpose And Term
|
4
|
Article
3 – Scope And Precedence
|
5
|
Article
4 – Program And Project Management
|
6
|
Article
5 – Transitional Arrangements
|
6
|
Article
6 – Baseline Prices
|
6
|
Article
7 – First Year [***
Redacted]
|
8
|
Article
8 – Second Year [***
Redacted]
|
8
|
Article
9 – Third Year [***
Redacted]
|
9
|
Article
10 – [***
Redacted]
|
9
|
Article
11 – Value Engineering Efforts
|
9
|
Article
12 – [***
Redacted]
|
10
|
Article
13 – Forecasts, Inventory And Tooling
|
10
|
Article
14 – Purchase Orders, Reschedules, Cancellations
|
10
|
Article
15 – Quality Assurance
|
13
|
Article
16 – Epidemic Failure
|
14
|
Article
17 – Packaging
|
15
|
Article
18 – Compliance, Insurance And Disaster Recovery
|
15
|
Article
19 – Shipping, Delivery, Acceptance
|
16
|
Article
20 – Invoices And Payments
|
17
|
Article
21 – Product Warranty
|
17
|
Article
22 – End-Of-Life Products
|
19
|
Article
23 – Component End Of Life
|
20
|
Article
24 – Software
|
20
|
Article
25 – Special Provisions Relating To Spare Parts
|
20
|
Article
26 – Confidentiality
|
21
|
Article
27 – Intellectual Property Rights
|
21
|
Article
28 – Intellectual Property Indemnities
|
22
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 2 of
37
Article
29 – General Indemnities
|
23
|
Article
30 – Limitation Of Liability
|
24
|
Article
31 – Reporting
|
24
|
Article
32 – Document Repository
|
24
|
Article
33 – Force Majeure
|
25
|
Article
34 – Termination And Expiration
|
25
|
Article
35 – Change Of Control
|
27
|
Article
36 – General Provisions
|
27
|
Exhibit
A – Definitions
|
31
|
Exhibit
B – Guaranty
|
37
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 3 of
37
This
Manufacturing Services Framework Agreement is effective as of November 1, 2008
(“Effective Date”) and is made by and between Intermec Technologies Corporation
and its Affiliates, with offices at 0000 00xx Xxxxxx
Xxxx, Xxxxxxx, Xxxxxxxxxx 00000 XXX ("Intermec”), and Venture Corporation
Limited and its Affiliates, with offices at 0000 Xxx Xx Xxx Xxxxxx 0 #00-00/00,
Xxxxxxxxx XX, Xxxxxxxxx 000000 ("Venture"). Intermec and Venture are
referred to either individually as a "Party” or together as the
“Parties”.
WHEREAS,
Venture provides design, engineering and manufacturing services for electronic
products and devices;
WHEREAS,
Venture wishes to sell to Intermec and Intermec wishes to purchase,
manufacturing and engineering services for certain electronic products and
devices on the terms and conditions set forth in this Agreement;
NOW
THEREFORE, the Parties agree as follows:
ARTICLE 1
- DEFINITIONS
Unless
otherwise defined in this Agreement, capitalized terms have the meanings set
forth in Exhibit A.
ARTICLE 2
– PURPOSE AND TERM
2.1 The
purpose of this Agreement is to set forth the terms and conditions under which
Venture will provide Services which may, from time to time, be ordered by
Intermec during the Term.
2.2 This
Agreement will remain in effect from the Effective Date through December 31,
2011 unless earlier terminated as provided herein (the
“Term”). Intermec may, at its discretion, extend the Term for two
additional one-year periods upon written notice to Venture at least ninety (90)
days prior to the expiration of the Term or any anniversary thereafter while the
Agreement is still in effect.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 4 of
37
ARTICLE 3
– SCOPE AND PRECEDENCE
3.1 This
Agreement applies to Existing Products only. If the Parties wish to
make similar arrangements with respect to New Products, those arrangements will
be documented in a new Schedule to this Agreement. New Product
pricing will be negotiated on a case-by-case basis. If both Parties
agree, New Products will be incremental in the calendar year following their
introduction to the marketplace and will be included in mutually-agreed
aggregate spending and cost savings.
3.2 This
Agreement does not constitute a Purchase Order or create any obligation for
Intermec to issue any Purchase Orders. Intermec commits to purchase
Products exclusively from Venture unless this Agreement is otherwise terminated
or expired.
3.3 Forecasts
are for Venture’s planning purposes only and do not constitute Purchase Orders
or create any obligation for Intermec to issue any Purchase Orders.
3.4 No
Service may be supplied by Venture without a corresponding Purchase Order from
Intermec.
3.5 If
special or additional terms and conditions are necessary or appropriate with
respect to a Product or Service, those special or additional terms and
conditions will be set forth in a new Schedule to this Agreement.
3.6 No
Schedule to this Agreement will have any force or effect unless signed by an
authorized representative of each Party.
3.7 Unless
a Schedule expressly provides otherwise, terms and conditions contained in that
Schedule govern the subject matter of that Schedule and override conflicting
terms and conditions in this Agreement with respect to the subject matter of
that Schedule.
3.8 Unless
a Schedule expressly provides otherwise, terms and conditions contained in that
Schedule apply only to the subject matter of that Schedule and do not alter or
amend any terms or conditions of this Agreement which are consistent with such
Schedule.
3.9 This
Agreement replaces and supersedes the Manufacturing Services Agreement between
Intermec and Venture dated as of September 30, 2002.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 5 of
37
ARTICLE 4
– PROGRAM AND PROJECT MANAGEMENT
4.1 To
facilitate the efficient and cost-effective administration of this Agreement,
the Parties will make a good faith effort to develop, agree upon, implement and
make appropriate adjustments in KPIs, ROEs and Customer Need Dates.
4.2 Each
Party will also each appoint program and project management
teams. Those teams will meet at least monthly to review the ROEs,
review progress against the KPIs and Customer Need Dates and to address issues
in a timely, cost-effective and efficient manner.
4.3 Each
Party will make a commercially reasonable effort to provide sufficient qualified
labor and other resources to fulfill its obligations under and the overall
purpose of this Agreement.
ARTICLE 5
– TRANSITIONAL ARRANGEMENTS
5.1 Venture
agrees to purchase active and good quality inventory (on a BOM)
until Intermec's stock is exhausted or until Intermec directs Venture to
purchase material directly from the supplier. Any objection to the
quality of goods must be made according to Intermec’s standard return material
authorization process or alternate process as defined and agreed in the
ROEs. Failure to object to the quality of inventory purchased in the
manner set forth in the ROEs will be grounds for rejecting a return credit
claim. Inventory purchased from Intermec will be purchased to
initially support [***
Redacted] Products in the Forecast. Venture will pay Intermec
for the inventory [***
Redacted]. Intermec will invoice for the inventory upon
shipment to Venture. Venture will pay such invoices according to the
terms of this Agreement. Intermec will be liable for any obsolete or poor
quality materials in the inventory sold by Intermec to Venture.
5.2 If
the parties mutually agree to change the location of manufacture of Products,
Intermec will provide qualification support for the new
location. Prior to such a transfer, the Parties will mutually agree
in writing on the allocation of costs related to the
transfer. Intermec will use its best efforts to support the transfer
of the manufacturing of Products [*** Redacted] with the
exception of Products to be sold [*** Redacted].
5.3 During
the First Year, Intermec will pay up to [*** Redacted] per month in
freight costs for certain Components to be selected by mutual agreement of the
Parties. Venture will lead the [*** Redacted] effort for
these Components and Intermec will use its best efforts to support that [*** Redacted]
effort.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 6 of
37
ARTICLE 6
– BASELINE PRICES
6.1 On
or before December 1, 2008, Intermec will prepare a BOM for each
Product. The final decision about the content of a BOM is Intermec’s
decision but Intermec will consult in good faith with Venture before finalizing
a BOM. Once a BOM has been established, no changes may be made to the
BOM without Intermec’s prior written consent. Venture will maintain
an updated version of the BOM for each Product and will provide such BOM’s to
Intermec upon request.
6.2 On or before December 10,
2008, Venture and Intermec will finalize the Baseline Unit Price for each
Product. “Baseline Unit Price” means the [*** Redacted]. For avoidance of
doubt, the Baseline Unit Prices for Products moved to Venture before
[***
Redacted]. The
final decision on Baseline Unit Prices is Intermec’s decision but Intermec will
consult in good faith with Venture before finalizing a Baseline Unit
Price. Once a Baseline Unit Price has been established, no changes
may be made in the Baseline Unit Price without mutual agreement.
6.3 On
or before December 15, 2008, Intermec will provide Venture with the Baseline
Forecast and will determine and inform Venture of the Baseline Unit Price for
each Product.
6.4 The
Baseline Product Spend will be equal to the [*** Redacted].
6.5 The
Baseline Aggregate Spend will be [***
Redacted]. Once the Baseline Aggregate Spend has been
established, no changes may be made in the Baseline Aggregate Spend without
mutual agreement.
ARTICLE 7
– FIRST YEAR [***
Redacted]
7.1 On
or before December 15, 2008, Venture will issue a quote for each Product. Each
such quote will include the BOM listing all material costs. If Intermec has
accepted or failed to reject the quote within thirty (30) days of receipt, the
quote will be deemed accepted as the “First Year Unit Price.”
7.2 The
“First Year Product Spend” will be equal to the [*** Redacted].
7.3 The
“First Year Aggregate Spend” will be the [***
Redacted].
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 7 of
37
7.4 The
“First Year Aggregate Spend” will be [*** Redacted]. Both Intermec
and Venture will work together and agree on the [*** Redacted] by December 15,
2008.
7.5 The
total per unit prices set forth in the quotes described in paragraph 7.2 will
apply [*** Redacted]
unless the Parties mutually agree otherwise.
ARTICLE 8
– SECOND YEAR [***
Redacted]
8.1 On
or before December 15, 2009, Venture will issue a quote for each Product. Each
such quote will include the BOM listing all material costs.. If
Intermec has accepted or failed to reject the quote described above within
thirty (30) days of receipt, the quote will be deemed accepted as the “Second
Year Unit Price.”
8.2 The
“Second Year Product Spend” will be [*** Redacted].
8.3 The
“Second Year Baseline Spend” will be the [*** Redacted].
8.4 The
“Second Year Aggregate Spend” will be [*** Redacted].
8.5 The
total per unit prices set forth in the quotes described in paragraph 8.2 will
apply [*** Redacted]
unless the Parties mutually agree otherwise.
ARTICLE 9
– THIRD YEAR [***
Redacted]
9.1 On
or before December 15, 2010, Venture will issue a quote for each Product. Each
such quote will include the BOM listing all material costs.. If
Intermec has accepted or failed to reject the quote described above within
thirty (30) days of receipt, the quote will be deemed accepted as the “Third
Year Unit Price.”
9.2 The
“Third Year Product Spend” will be [*** Redacted].
9.3 The
“Third Year Baseline Spend” will be the sum [***
Redacted].
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 8 of
37
9.4 The
“Third Year Aggregate Spend” will be [*** Redacted].
9.5 The
total per unit prices set forth in the quotes described in paragraph 9.1 will
apply [*** Redacted],
unless the Parties mutually agree otherwise.
ARTICLE
10 – [***
Redacted]
10.1 To
achieve [*** Redacted],
Venture and Intermec will jointly negotiate with [*** Redacted] and
[***
Redacted].
10.2 To
achieve [*** Redacted],
Venture and Intermec will jointly also negotiate [*** Redacted] and [*** Redacted].
10.3 The
final decision on the release of new ECNs to achieve [*** Redacted] is Intermec’s
decision but Intermec will consult in good faith with Venture on such
decisions.
ARTICLE
11 – VALUE ENGINEERING EFFORTS
11.1 The
Parties will use their best efforts to expand [*** Redacted] through joint
Value Engineering efforts [***
Redacted]. Intermec will [*** Redacted] the joint Value
Engineering efforts on terms and conditions to be mutually agreed in new
Schedules to this Agreement. Venture will provide dedicated Value
Engineering resources for the joint Value Engineering efforts on terms and
conditions to be mutually agreed in new Schedules to this
Agreement. Unless the Parties expressly agree otherwise, Value
Engineering will not include [*** Redacted].
11.2 Venture’s
estimated [*** Redacted]
due to joint Value Engineering efforts will be [*** Redacted].
11.3 The
final decision on the release of new ECNs related to joint Value Engineering
efforts is Intermec’s decision but Intermec will consult in good faith with
Venture on such decisions.
11.4 Any
[*** Redacted] achieved
through joint Value Engineering efforts will be reflected in all subsequent
[***
Redacted].
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 9 of
37
11.5 For
avoidance of doubt, the [***
Redacted] pursuant to this Article 11 [*** Redacted] and are not to
be considered [***
Redacted].
ARTICLE
12 – [***
Redacted]
12.1 Throughout
the Term, the Parties will use their best efforts to [*** Redacted]. The
Parties will also take the appropriate steps to exploit those opportunities as
quickly as possible.
12.2 Each
Party will bear its own costs with respect to the efforts described in paragraph
12.1 unless they expressly agree otherwise in a new Schedule to this
Agreement.
12.3 Venture’s
estimated [*** Redacted]
due to the efforts described in paragraph 12.1 will be mutually identified,
quantified and agreed on a quarterly basis. [*** Redacted] for the
Products resulting from the efforts described in paragraph 12.1 whether [*** Redacted].
12.4 For
avoidance of doubt, [***
Redacted] pursuant to this Article 12 are [*** Redacted] are not to be
considered when determining whether the [*** Redacted].
ARTICLE
13 – FORECASTS, INVENTORY AND TOOLING
13.1 Venture
will use the Forecasts and Purchase Orders to plan its Component purchases and
other operations so that it can manufacture and deliver the types and quantities
of Products at the times specified in the Forecasts and consistent with the Lead
Time and the Customer Need Date. Venture will purchase additional Components if
instructed to do so by Intermec in writing in order to address special market or
customer situations.
13.2 Intermec
and Venture will review Venture's Component and Product inventory on a monthly
basis and mutually determine what portion of that inventory constitutes Slow
Moving Inventory, if any. "Slow Moving Inventory" means Components
and Products that are [***
Redacted]. In accordance with Article 20.1, Venture will
invoice Intermec for and Intermec will pay a monthly carrying cost of [***
Redacted].
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 10 of
37
The
carrying cost rate on Slow Moving Inventory will be reviewed by the Parties
every six (6) months after the Effective Date and may be changed if both Parties
agree that it is necessary or appropriate to do so.
13.3 Intermec
and Venture will review Venture's Slow Moving Inventory, if any, on a monthly
basis and mutually determine what portion of that inventory constitutes Obsolete
Inventory, if any. "Obsolete Inventory" means Components or Products in
Venture's inventory that have no future demand based on the current
Forecast. On terms and conditions to be mutually agreed by the
Parties, [*** Redacted]
that has been previously identified by the Parties as [*** Redacted] during a
monthly review.
13.4 Intermec
will use is its best efforts to promptly notify Venture when Intermec
believes that it will be necessary or appropriate to discontinue a
Product or Component. In those cases, Venture will
use its best efforts to eliminate or reduce its purchase
of Components or eliminate or reduce its manufacture of Products
or re-direct Components or Products that would otherwise become Slow
Moving Inventory or Obsolete Inventory.
13.5 For
avoidance of doubt, [***
Redacted] will be financially responsible for the [*** Redacted] that
has been classified as [***
Redacted] in accordance with Article 13.2 and for inventory that has been
classified as [***
Redacted] in accordance with Article 13.2 .
13.6 Parties
may mutually agree in writing that certain inventory will be treated as
consignment inventory. Any inventory so designated will be Intermec
property until such a time as Venture utilizes the inventory in the production
of Products. Venture will be solely responsible for shrinkage and risk of loss
while the consignment inventory is physically located in a Venture facility or
another Venture- designated location. Consignment inventory will not
be included as Slow Moving Inventory. Consignment inventory will
become Venture’s inventory upon submission of that inventory to the
manufacturing line. Venture will notify Intermec immediately after
conversion of consignment inventory to Venture inventory.
13.7 All
drawings, specifications, tools, dies, jigs, fixtures, patterns or other
equipment or technical information supplied by or on behalf of Intermec or
prepared or fabricated by Venture (under Intermec Purchase Orders) specifically
in connection with the performance of this Agreement (hereinafter "Property")
will remain Intermec’s Property. Venture will not use such Property for any
purpose other than in the manufacture of Product for Intermec without Intermec’s
prior written consent. Upon Intermec’s request, the Property and all
copies of it will be returned to Intermec at Intermec’s expense. Venture will
maintain all Intermec Property per Intermec’s or manufacturer’s
recommendations. Any property taxes on the Property will be paid by
Venture. Upon termination or expiration of this
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 11 of
37
Agreement,
the Property will be returned to Intermec in the same condition as received,
except for ordinary wear and tear, unless otherwise agreed to by the
Parties. Venture will not modify any custom equipment or related
software without the prior written consent of Intermec. Intermec
reserves the right to inspect any Intermec-owned equipment at any time but with
advance notice to Venture.
ARTICLE
14 – PURCHASE ORDERS, RESCHEDULES, CANCELLATIONS
14.1 Purchase
Orders may be placed by any Intermec OE. Each Purchase Order issued
by Intermec to Venture for Products will reference this Agreement and the
relevant quote(s) and will identify the Intermec OE. The Purchase Order will
also include (i) the name and part number of the Product being ordered, (ii) the
number of units of the Product being ordered, (iii) the Delivery Date, (iv) the
Ship To Information, (v) the Shipping Information, (vi) the Xxxx To Information
and (vii) any other information reasonably required for Venture to process the
Purchase Order in a timely manner.
14.2 For
Purchase Orders within the Forecast and consistent with the Lead Time and the
Customer Need Date, Venture will send an acknowledgment to Intermec [*** Redacted] after receiving
a Purchase Order. For other orders, [*** Redacted] after receiving
a Purchase Order, Venture will send an acknowledgement to
Intermec. The acknowledgement will either accept or reject the
Purchase Order and, in the case of a rejection, provide the reasons for the
rejection. Notwithstanding the foregoing, Venture will not be
entitled to reject any Purchase Order if (i) the Product quantity specified in
that Purchase Order is consistent with Intermec's most recent Forecast and (ii)
the Delivery Date is consistent with the Lead Time and the Customer Need
Date. If Venture fails to acknowledge a Purchase Order as provided in
this paragraph, the Purchase Order is deemed to have been accepted by
Venture.
14.3 An
Intermec OE may change the Delivery Date on an Open Purchase Order at no
additional cost to the Intermec OE as long as the change is within the
parameters set forth in the following table:
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
[***
Redacted]
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 12 of
37
14.4 If
a Purchase Order is not consistent with Intermec’s most recent Rolling
Forecast, the Lead Time or the Customer Need Date or if a change in
the Delivery Date on an Open Purchase Order exceeds the parameters set forth in
the table set forth in paragraph 14.3, the Parties will determine whether any
special charges are appropriate and, if so, agree on the amount of those charges
in writing before the Purchase Order is processed or the change is
implemented.
14.5 At
no additional cost, an Intermec OE may cancel any Open Purchase Order upon
written notice to Venture [***
Redacted] prior to the date on which Venture delivers the Products
covered by that Purchase Order to a transportation firm.
14.6 The
Parties may agree in writing that the reschedule and cancellation policy and/or
Lead Times do not apply to a particular customer, Purchase Order or
delivery.
ARTICLE
15 – QUALITY ASSURANCE
15.1 Venture
will maintain a documented quality control system acceptable to Intermec, which
will assure that all materials and services conform to the Specifications
whether Venture manufactures or procures the materials or performs the services
directly or indirectly. Venture will perform all inspections and
tests required to substantiate conformance to the Specifications and Purchase
Order requirements. Intermec may assist with the creation of test or
inspection criteria or may require specific test or inspection criteria for
particular Products. The test and inspection criteria provided by
Intermec are not exclusive. Test and inspection criteria will be made
available by Venture to Intermec upon request. Venture remains solely
responsible for material, and workmanship, for the manufacturing process and
composition of the Components, including documentation required to certify
compliance with environmental or other regulations for any Product which Venture
designed or co-designed. For any Product not designed or co-designed
by Venture, Venture will promptly provide certification in whatever form
requested by Intermec which states that Venture’s products, material and
workmanship meet the Specifications provided by Intermec and that the Products
meet the standards for manufacturing processes or Component composition to the
extent the Specifications reflect those standards.
15.2 Venture
will achieve a [***
Redacted] first pass yield against the Specification and a [*** Redacted] final audit
yield.
15.3 Sampling
inspection methodology may be used to determine the acceptability of Product
shipments. Intermec reserves the right to reject all or any part of
any order which is initially accepted based on a sample inspection methodology
if defects are discovered after initial acceptance.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 13 of
37
15.4 Intermec
may require design acceptance inspection and test results at any time upon
reasonable notice to Venture. Provision, acceptance or approval of
such design acceptance inspection and test results by Intermec does not relieve
Venture of its obligations under any other provision of this
Agreement.
15.5 A
Purchase Order for New Products may require a first article to be
submitted. Venture will provide appropriate test and inspection
results with each first article submitted which verify compliance to or
achievement of Intermec’s Specification for the Product. Initial
samples and additional first article test and inspection results will be
required if Venture produces a Product at a new location. Formal
first article submissions by Venture must reflect fully-released
Products. By signing any first article document, Intermec will only
be agreeing that the first article meets design and functional Specifications;
no other interpretation is permissible. Venture remains fully liable
for the workmanship and quality compliance of all material used to manufacture
the Product. Venture also remains solely responsible for compliance
with regulations regarding the manufacturing facilities in which Products are to
be manufactured and also for obtaining certifications of compliance with those
regulations. Promptly after receiving a request from Intermec,
Venture will provide Intermec with certifications stating that the Products and
Venture’s workmanship meet the regulations regarding manufacturing facilities in
which the Products are to be manufactured.
15.6 With
prior notification, Venture will allow Intermec escorted access to the location
where the Products are being manufactured and the manufacturing lines and
Components necessary to manufacture the Products. Venture will allow
Intermec’s designee with Venture escorts to inspect work being performed under
this Agreement. Such inspection by an Intermec designee may include
manufacturing facilities, work environment and conditions and Components being
used by Venture. Access and inspections by Intermec and its designees
will be subject to the terms of the NDAs between the Parties.
15.7 Venture
will be responsible for providing real time test and inspection information via
the IQN or other mutually agreed system at Venture’s sole expense.
ARTICLE
16 - EPIDEMIC FAILURE
16.1 Venture
will be solely responsible for remedying any epidemic failure of Product
supplied due to materials or workmanship under this
Agreement. Any type of failure, whether functional, cosmetic,
mechanical, packaging, labelling and documenting can constitute an “Epidemic
Failure” and will exist when one or more of the following occurs:
(i)
|
A
potential safety hazard exists in the Product as a direct result of
Venture’s manufacturing process, workmanship, material or failure to
conform to the Specifications.
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 14 of
37
(ii)
|
The
failure rate at Intermec, Intermec’s customers or an individual Intermec
customer [***
Redacted] due to the same or similar failure
mode.
|
(iii)
|
Dead
on arrival rates [***
Redacted] of the specific product model based on the previous three
(3) months combined actual shipments of the
Product.
|
(iv)
|
More
than [***
Redacted] of the product family are denied entry into a single
country over a [***
Redacted] due to non-compliance with local regulation or the
documents required to support an assertion of
compliance.
|
16.2 Venture
will present a corrective action plan in writing to Intermec within five (5)
days after being notified that an Epidemic Failure has occurred. The
plan must include arrangements to ensure that Intermec’s customers will be able
to use or receive the Products (either through corrective action or replacement
of affected Products) within a mutually satisfactory time frame.
16.3 Venture
will facilitate source inspections by Intermec and its
designees. Intermec will provide reasonable notice of source
inspections when possible. With advance notice, Intermec will have
the right to require, schedule and perform quality audits of Venture or any of
Venture’s suppliers or subcontractor.
ARTICLE
17 - PACKAGING
Venture
will provide outer box packaging of the necessary quality, construction and
strength to prevent damage in transit as approved by Intermec in writing. All
costs associated with packaging will be included in the cost of the Product
quoted by Venture. The Parties will work together to reduce the
environmental impact of packaging.
ARTICLE
18 – COMPLIANCE, INSURANCE AND DISASTER RECOVERY
18.1 Venture
warrants and covenants that its activities in connection with this Agreement
will comply with the laws and regulations of jurisdictions in which those
activities occur. The parties agree to abide by the principles
embodied in the UN Global Compact to the extent no conflict exists with local
law.
18.2 Venture
will, at its own cost and expense, obtain and maintain in full force and effect,
with sound and reputable insurers during the term of this Agreement, the
following insurance coverage:
|
(i)
Workers’ Compensation as required by the law of the country of
hire;
|
(ii)
Commercial General Liability insurance against all hazards including coverage
for blanket contractual liability and products and completed operations with a
minimum limit of liability for personal injury, including death resulting
therefrom, on an occurrence basis of
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 15 of
37
[*** Redacted] in the
aggregate, and with a minimum limit of liability for property damage on an
occurrence basis of [***
Redacted] in the aggregate; and
(iii) Automobile
Liability insurance against liability arising from the ownership, maintenance or
use of all owned, non-owned and hired automobiles and trucks with a minimum
combined limit of liability
of [***
Redacted];
(iv) Intermec
will be named as additional insured on the Commercial General
Liability and Automobile Liability policies;
(v) Property
Insurance against loss or damage to any Intermec property in Venture’s care,
custody and control, including but not limited to tooling, Products and
Components with limits no less than
the replacement cost value of
Intermec property at the time of the loss;
(vi) Intermec
will be named as Loss Payee on the Property Insurance policy; and
(vii) Professional
Errors and Omissions policy with a minimum limit of liability of [*** Redacted].
18.3 All
of the insurance policies described in Article 18.2 will contain a waiver of
subrogation in favor of Intermec, its Affiliates and their respective
agents.
18.4 Venture
will provide to Intermec certificates of insurance upon commencement of
this Agreement, and annually thereafter, evidencing such policies are in full
force and effect.
18.5 The
minimum limits of insurance coverage required by this Agreement will in no way
limit or diminish Venture’s liability or obligations under this
Agreement.
18.6 Venture
will submit its written disaster recovery plan to Intermec for review on or
before January 1, 2009. Venture will update the written disaster
recovery plan at least once each calendar year thereafter and provide such
updated disaster recovery plan to Intermec for review. In the event
that it is necessary for Venture to implement its disaster recovery plan,
Intermec will receive priority implementation status which will include the
right to determine the timing for any required transition. Parties
may mutually agree to changes to Venture’s disaster recovery plan to mitigate
risks to Intermec’s business.
ARTICLE
19 – SHIPPING, DELIVERY, ACCEPTANCE
19.1 Venture
will ship Products in accordance with the Shipping Information set forth in the
Purchase Orders for those Products.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 16 of
37
19.2 Except
for Force Majeure Events, Venture commits to achieve [*** Redacted] on-time
delivery of Products as measured against Customer Need Dates.
19.3 Venture
will ship all Products in accordance with the XXX, Intermec’s Routing
Guidelines, Intermec’s ISO procedures and the country-of-origin marking
requirements of the laws and regulations applicable at the Delivery
Location.
19.4 Intermec
and its customers will have [*** Redacted] after receipt
of each shipment of Products to inspect them (according to Intermec’s
requirements) for acceptance or rejection (the “Acceptance
Period”). Products that are not rejected during the Acceptance Period
are deemed to be accepted. Products that are rejected during that
period will be handled in accordance with Article 21.
ARTICLE
20 – INVOICES, PAYMENTS AND GUARANTIES
20.1 Venture
will issue invoices for Products to the Person identified in the Xxxx To
Information set forth in Intermec’s Purchase Orders. Venture will
issue invoices for any carrying cost on Slow Moving Inventory or on Obsolete
Inventory to Intermec on a monthly basis.
20.2 Venture’s
invoices will contain the information reasonably requested by the Intermec OE,
including but not limited to the information which the Intermec OE requires to
provide its customers with accurate and detailed invoices.
20.3 All
invoices issued pursuant to this Agreement will state the amount payable in U.S.
Dollars. All payments due on valid invoices issued pursuant to this
Agreement will be made in U.S. Dollars no later than [*** Redacted] after the date
of the invoice. In the event of a dispute about an Intermec or
Venture invoice, the undisputed portion (if any) will be paid within the [*** Redacted] period
specified above and the balance will be paid within [*** Redacted] after the
dispute has been resolved.
20.4 Intermec
will guaranty the financial obligations incurred by other Intermec OEs by
executing and delivering to Venture the Guaranty attached hereto as Exhibit B
within ten (10) days after the Effective Date.
ARTICLE
21 – PRODUCT WARRANTY
21.1 Venture
represents and warrants that all Products delivered under this Agreement will
conform with the Specifications, Purchase Order and industry quality standards
and be free from defects in material and workmanship. Venture’s
warranty will be effective for the period of [*** Redacted] from the date
of shipment (“Warranty Period”) and will be enforceable by Intermec OEs, their
customers,
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 17 of
37
Intermec’s
OEs and any subsequent owner or operator of the Products. Venture’s
warranty on any repaired or replaced Product will be the longer of the balance
of the Warranty Period or [***
Redacted] after the repair or replacement.
21.2 During
the Warranty Period, if the defect is found to be due to material or
workmanship, Venture will be required, at its own expense and risk to perform or
have the following actions performed by a third party:
(i) Look
for the cause of any defect, imperfection or inadequacy in the
Product;
(ii)
Repair or, at its discretion, to exchange defective Product [*** Redacted];
(iii)
Ship the repaired or exchanged Product to the Intermec OE or its customer [*** Redacted];
(iv) If
the Product is not returned within the time required by this provision, Venture
will issue a credit memo to Intermec or the Intermec OE for the defective
Product;
(v)
Notwithstanding the foregoing, the parties may mutually agree that return,
repair or replacement of any defective or inadequate product is not
cost-effective. In that event, the parties may mutually agree on an
alternate method of compensation, recycle or disposal of the affected
Products.
21.3 If
the defects of the Products are discovered within the Acceptance Period, Venture
will be responsible for the two-way shipping cost and expense for repair or
replacement if the Defect is resulting from workmanship or materials during this
period. The Intermec OE will use Venture’s return material
authorization (“RMA”) process for the return of Products during the Acceptance
Period. If the defects of the Products will be found within Warranty Period,
rather than in Acceptance Period, the Intermec OE will be liable for the
transportation, insurance and other costs of shipping the defective Products for
repair or replacement, and Venture will be liable for shipping cost and expense
of shipping the repaired or exchanged Products to the Intermec OE, its customer
or a subsequent owner or operator of the Product. If Venture alters
its RMA process, it will provide Intermec with at least thirty (30) days’
advance notice of that change.
21.4 If
the number of no-trouble-found (“NTF”) Products exceeds [*** Redacted] of all Products
returned in a particular quarter, Venture will have the right to charge the
Intermec OE for the transportation costs relating to such NTF Products and any
reasonable labor and material costs Venture may have incurred.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 18 of
37
21.5 Notwithstanding
the foregoing, Venture will have no warranty obligation with respect to any
Product to the extent the defect in the Product was caused by:
(i)
ordinary wear of the Product or its Components;
(ii)
incorrect or improper use or installation of the Product, including, by way of
example not limitation, failure to use the product in conformity with the
Specifications or the use and maintenance instructions described in the user
manual accompanying the Product;
(iii)
accident or natural causes beyond Venture’s control;
(iv)
repairs or modifications carried out without Venture’s authorization by any
party other than Venture or Intermec;
(v)
modifications carried out without Venture’s authorization with a view to
bringing the Product into conformity with local or national technical conditions
in countries for which the Product was not originally designed;
(vii) any
defect in the design of the Product if the design was created by a party other
than Venture.
21.6 If,
after the acceptance of a Product but prior to the expiration of the applicable
Warranty Period, Intermec engages a third party to perform any functional test
with respect to the Product, and if the third party recommends minor
modifications or repairs be made to the Product to successfully pass the
functional test, then (i) Intermec will cause the third party to
communicate its recommendations to Venture, (ii) Venture will approve the
minor modifications or repairs, and (iii) Venture's warranty obligation
with respect to the Product will not be affected thereby. The
same procedures will apply if Intermec performs any functional test with respect
to the Product and recommends minor modifications or repairs to the Product to
successfully pass the functional test. Any recommendations by third party must
be approved by Intermec prior to being adopted into the manufacturing process or
any changes made to the components.
21.7 In
the case of Products returned to Venture for repair or replacement after the
Warranty Period, the repair services or replacement will be billed to the
Intermec OE at mutually agreed upon rates.
ARTICLE
22 – END-OF-LIFE PRODUCTS
22.1 With
[*** Redacted] prior
written notice to Venture, Intermec will have the right to make the end-of-life
decision for their Products at which point Intermec’s volume requirement for
Product will cease (“Product EOL”).
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 19 of
37
22.2 Upon
notification of a Product EOL, the Parties will mutually agree on a phase down
plan, including the management of all inventory of that
Product. Intermec will be responsible for any Obsolete Inventory at
the end of the phase down plan, provided that Venture uses its best efforts to
mitigate losses with generally accepted purchasing practices, including without
limitation, returning Components to suppliers and using Components in other
parts of Venture’s business (“Mitigation Efforts”). Venture will have the right
to invoice Intermec for the then Obsolete Inventory and Intermec will work with
Venture to determine the appropriate disposition of such Obsolete
Inventory.
ARTICLE
23 – COMPONENT END-OF-LIFE
23.1 Venture
is responsible for monitoring and reporting the ongoing availability of all
Components utilized in the Products. Venture will make reasonable
efforts to provide written notification to Intermec [*** Redacted] in advance of
the date on which a Component will no longer be commercially available for
purchase (“Component EOL“) or, in any event, promptly when such information is
made known by the Component vendor. After receipt of such notice,
Intermec may place, and Venture will be obligated to procure, a last time
buy. Intermec will authorize last time buys via a separate Purchase
Order.
23.2 In
the event of a Component EOL, Venture may submit a part substitution
ECN. All part substitutions must be approved by Intermec in writing
prior to implementation.
ARTICLE
24 – SOFTWARE
24.1 As
an installer of [***
Redacted], Venture will comply with the obligations set forth in the most
current [*** Redacted]
in the Repository.
24.2 The
Parties may mutually agree that Venture will install additional third party
software. In the event that any software licensor to Intermec
requires the flow down of obligations to Venture, Intermec will document such
obligations and post the document to the Repository. Notification
will be deemed acceptance by Venture of the flow down obligations.
24.3 Venture
will adhere to the reporting, tracking and security requirements of any third
party software licensor.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 20 of
37
24.4 Venture
will indemnify Intermec for any penalty, damage or costs Intermec may incur due
to Venture’s failure to meet its obligations under Article 24.3.
ARTICLE
25 – SPECIAL PROVISIONS RELATING TO SPARE PARTS
25.1 Spare
Part availability for each Product will be planned by both parties eg. Tooling
maintenance, material life time buy or as advised by suppliers etc so that Spare
Parts are available
from Venture for a minimum period of [*** Redacted] from Venture’s
last delivery of that Product (“Spare Parts Supply Period”) in whatever
quantities are required to support both in-warranty and out-of-warranty repair
of the Products.
25.2 If
both Parties agree that it is appropriate to do so, an end-of-life or last-time
buy of Spare Parts may be structured as a consignment in accordance with Article
13.6.
25.3 In
the event of a Component EOL during the Spare Parts Supply Period, the Parties
will respond in accordance with Article 21.
ARTICLE
26 – CONFIDENTIALITY
26.1 Except
as required by law, neither Party will disclose the terms and conditions of this
Agreement to any third party without the written consent of the other
Party. The executed Mutual Non-Disclosure Agreement (“NDA“)
dated January 23, 2007, and any other NDA(s) executed during the Term, are
incorporated herein by reference.
26.2 In
the event that a Party is required by applicable securities laws to make a copy
of this Agreement or a summary thereof available to the public, that Party will
use its best efforts to get government approval to keep [*** Redacted]
confidential. Each Party will give the other Party as much as advance
notice as possible of a potential public disclosure of the [*** Redacted] to that the
other Party may the steps it deems necessary or appropriate to prevent public
disclosure of that information.
ARTICLE
27 – INTELLECTUAL PROPERTY RIGHTS
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 21 of
37
27.1 Except
as otherwise expressly provided in this Agreement, nothing in this Agreement is
intended or will be construed to grant to either Party any right, title or
interest in or to any intellectual property right of the other
Party. “Intellectual Property Right” (“IPR”) means, with respect to
Products, Components and systems that include such Products or Components, any
and all patents (including patent applications, reissues, divisions,
continuations and extensions thereof in any jurisdiction), utility models, and
registered and unregistered designs, including mask works, copyrights, trade
secrets, and every other form of protection afforded by law to inventions,
models, designs, works of authorship, databases or technical information and
applications therefor.
27.2 Subject
to the express licenses referenced or set forth herein, each Party will own all
right, title and interest in and to its pre-existing
IPRs. “Pre-Existing IPR” means any IPR which is owned by a Party,
existing as of the initial production date of a Product and independently
developed by owner without using any IPR owned by the other Party as proven by
contemporaneous documents.
27.3 Venture’s
obligations under this Article 27 include, but are not limited to Venture’s
agreement to obtain and assign to Intermec software licenses from Venture’s
software suppliers.
27.4 Subject
to the terms and conditions of this Agreement, Intermec hereby grants to Venture
a non-exclusive, non-transferable, non-sublicensable, royalty-free license under
Pre-Existing IPR which is necessary for the manufacture of the Products and
solely for Venture’s use in performing its obligations under this
Agreement.
27.5 Venture
hereby grants to Intermec OEs and their customers, distributors, resellers and
end users a non-exclusive, irrevocable, perpetual, transferable, fully paid-up,
worldwide and unlimited right and license under all Venture Pre-existing IPR
required to sell, offer to sell, lease, offer to lease and use the Products
manufactured by Venture, and under third party IPR which Venture has the right
to sublicense for the same purposes to Intermec OEs, and their customers,
distributors, resellers and end users.
ARTICLE
28 – INTELLECTUAL PROPERTY INDEMNITIES
28.1 INTERMEC
AND VENTURE EACH DISCLAIMS ALL LIABILITY FOR PATENT, COPYRIGHT, TRADEMARK OR
OTHER ALLEGED INFRINGEMENT OF THE RIGHTS OF THIRD PARTIES, EXCEPT AS PROVIDED
HEREIN.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 22 of 37
28.2 Intermec
agrees to defend at its expense any suits against Venture to the extent that
such suit is based upon a claim that any design, Specification or modification
for a Product provided by Intermec hereunder directly infringes the patent,
copyright or other intellectual property right of a third
party. Intermec agrees to pay costs and damages finally awarded
against Venture as a result of such suit, provided that Intermec has been
notified by Venture, within 10 days of learning of the claim, in writing by
facsimile or other electronic transmission, and furnished a copy of each
communication, notice or other action relating to the alleged infringement and
is given full control, authority, information and assistance necessary to defend
or settle such claim. Intermec will not be liable to indemnify
Venture for payment of any damages or costs in any settlement unless Intermec
has given its express written consent to such settlement. Intermec’s
indemnity does not extend to any suit based upon any infringement or alleged
infringement arising out of:
(i) The
combination of any design furnished by Intermec with other
elements;
(ii) Any
Product based on Venture’s specifications or design;
(iii) Any
design which has been modified by Venture without Intermec’s written consent;
or
(iv) Any
process used by Venture, unless specifically required by Intermec.
28.3 Venture
agrees to defend at its expense any suits against Intermec to the extent that
such suit is based upon a claim that any Specification, design, modification or
manufacturing process for a Product provided by Venture hereunder directly
infringes the patent, copyright or other intellectual property right of a third
party. Venture agrees to pay costs and damages finally awarded
against Intermec as a result of such suit, provided that Venture has been
notified by Intermec, within ten (10) days of learning of the claim, in writing
by facsimile or other electronic transmission, and furnished a copy of each
communication, notice or other action relating to the alleged infringement and
is given full control, authority, information and assistance necessary to defend
or settle such claim. Venture will not be liable to indemnify
Intermec for payment of any damages or costs in any settlement unless Venture
has given its express written consent to such settlement. Venture’s
indemnity does not extend to any suit based upon any infringement or alleged
infringement arising out of Intermec’s Specifications.
28.4 Except
as provided in Articles 27 and 28 of this Agreement nothing herein grants to
Intermec either directly or by implication, estoppel or otherwise, any license
or other right under any IPRs owned or licensed by Venture, including any
patents or patent applications owned or licensed by Venture or its
Affiliates.
28.5 Venture’s
obligations under this Article 28 include, but are not limited to Venture’s
agreement to obtain and its assignment to Intermec of patent defense and
indemnification rights (equal to those described in this Article 24) from and
against Venture’s suppliers of Components included in any
Products.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 23 of
37
28.6 Except
as provided in Articles 23 and 24 of this Agreement, nothing
herein, grants to Venture either directly or by implication, estoppel
or otherwise, any license or other right under any IPRs owned or licensed by
Intermec including any patents or patent applications owned or licensed by
Intermec or its Affiliates.
ARTICLE
29 --GENERAL INDEMNITIES
29.1 Product
Liability. Intermec or Venture, or both of them, as the case
may be, will upon prompt and timely notice defend the other Party against any
third party claim, suit, action or demand (“Claim”) arising out of, relating to,
or resulting from property damage and/or injury to persons caused by a defect in
the Product and compensate the other Party for damages, liabilities and
reasonable costs resulting from such Claim as follows:
(i) To
the extent a Claim arises from damage to property and/or injury to persons that
is attributable to (a) the manufacture of the Products not in conformance with
Intermec’s Technology or Specifications, or (b) a defect in the workmanship of
Venture, Venture will defend Intermec against such Claim and pay such damages,
liabilities and reasonable costs as Intermec may have been ordered to pay to a
third party by any competent court or by settlement out of court as a result of
such Claim.
(ii) To
the extent a Claim arises from damage to property and/or injury to persons that
is attributable to a defect attributable to Intermec Specifications or design of
the Product, Intermec will defend Venture against such Claim and pay such
damages, liabilities and reasonable costs as Venture may have been ordered to
pay to a third party by any competent court or by any Intermec-approved
settlement out of court as a result of such Claim.
29.2 Epidemic Failure.
Venture will indemnify Intermec against all reasonable direct costs and labor
costs that Intermec incurs in remediating an Epidemic Failure unless Venture can
establish that the Epidemic Failure is caused solely by Intermec’s design or
Specification. Direct costs covered by this indemnity will include
any costs associated with determining a root cause analysis as well as costs
associated with remediation of Products affected by the Epidemic
Failure. Labor costs covered by this indemnity include any amount
attributable to salary of Intermec employees and third party labor costs for the
time spent pursuing a root cause analysis or repairing or replacing the affected
Products either on or off a customer’s site as well as related expenses such as
travel. While Intermec will endeavour to mitigate the costs
associated with remediation or resolution of an Epidemic Failure, this indemnity
is not be limited to resolutions that require return of the units to
Venture.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 24 of
37
29.3 Intermec
will indemnify Venture against all reasonable direct costs and labor costs that
Venture incurs in remediating an Epidemic Failure caused by Intermec’s design or
Specification. Direct costs covered by this indemnity will include
any costs associated with determining a root cause analysis as well as costs
associated with remediation of Products affected by the Epidemic
Failure. Labor costs covered by this indemnity include any amount
attributable to salary of Venture employees and third party labor costs for the
time spent pursuing a root cause analysis or repairing or replacing the affected
Products either on or off a customer’s site as well as related expenses such as
travel. While Venture will endeavour to mitigate the costs
associated with remediation or resolution of an Epidemic Failure, this indemnity
is not limited to resolutions that require return of the units to
Venture.
29.4 The
Parties understand and agree that the overall business impact to a customer is a
key factor in determining the most reasonable corrective action in the event of
an Epidemic Failure.
ARTICLE
30 – LIMITATION OF LIABILITY
NEITHER
PARTY WILL BE LIABLE FOR ANY LOSS OF PROFITS, SPECIAL, INDIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES SUSTAINED BY THE OTHER, INCLUDING THOSE DAMAGES ARISING
FROM OR MEASURED BY LOST REVENUES OR PROFITS UNDER ITS CONTRACTS WITH THIRD
PARTIES EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES
OR FOR ANY CLAIM AGAINST CUSTOMER BY ANY OTHER PARTY.
ARTICLE
31 – REPORTING
Venture
will provide quarterly reporting, or more often upon request, necessary for
Intermec to review Venture’s performance under this
Agreement. Venture will provide the reports in a mutually acceptable
format and manner. The format and manner for reporting will be
included in the Repository.
ARTICLE
32 - DOCUMENT REPOSITORY
The
Parties will place documentation including but not limited to the ROEs, Customer
Need Dates, Intermec’s Routing Guidelines, Intermec’s ISO procedures, reporting
formats, quarterly business reviews and other agreed documents in the
Repository. Only authorized representatives may place documents in
the Repository and then may only place such documents after written notification
to the
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 25 of
37
other
Party. Each Party has fifteen (15) days after receipt of notification
that documentation has been placed in the Repository to object to any changes
reflected in that documentation.
ARTICLE
33 – FORCE MAJEURE
33.1 Neither
Party will be liable in any manner for failure or delay in fulfilment of all or
part of this Agreement directly or indirectly owing to any cause or circumstance
beyond its control, including, but not limited to, acts of God, governmental
order or restrictions, war, war-like conditions, hostilities, sanctions,
revolution, riot, looting, strike, lockout, terrorism, plague or other
epidemics, fire and flood (“Force Majeure Event”); provided, however, that the
affected Party: (a) promptly gives the other Party written notice of such cause,
and (b) uses its reasonable best efforts to correct such failure or delay in its
fulfilment.
33.2 In
any event, the Party affected by the occurrence of a Force Majeure Event will do
everything in its power to avoid, eliminate or reduce the causes of delay and
will resume the discharge of its obligations as soon as the occurrence concerned
has disappeared or abated.
33.3 If
the Force Majeure Event affecting one Party’s obligations of this Agreement is
anticipated to last for more than thirty (30) days from the date of the
notification referred to in paragraph 33.1 above, and the Force Majeure Event is
impairing Venture’s ability to provide Product to Intermec, the Disaster
Recovery Plan described in paragraph 18.6 will be initiated. The
Parties will negotiate in a good-faith to reduce each Party’s losses from a
Force Majeure Event.
ARTICLE
34 – TERMINATION AND EXPIRATION
34.1
If Venture commits any material breach of any material covenant, representation,
warranty or agreement herein contained and Venture will have failed to remedy
any such material breach within one hundred eighty (180) days after receipt by
Venture of written notice thereof by Intermec, Intermec may terminate this
Agreement and, at its discretion, terminate all or part of the Purchase Orders
in force at the time, simply by sending Venture a registered letter with
acknowledgement of delivery to this effect. The said registered letter will
indicate the scope of the termination with regard to the Purchase Orders in
force at the time and the effective date of termination.
34.2
If Intermec commits any material breach of any material obligation herein
contained and Intermec will have failed to remedy any such material breach
within one hundred eighty (180) days
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 26 of
37
after
receipt by Intermec of written notice thereof by Venture, Venture may terminate
this Agreement and, at its discretion, terminate the Purchase Order concerned
simply by sending Intermec a registered letter to this effect with request for
acknowledgement of delivery, it being understood that the services carried out
and the Product supplied will remain payable.
34.3 A
Party will provide written notice (the “Notice”) to the other Party immediately
upon the occurrence of any insolvency, bankruptcy or liquidation or filing of
any application thereof, or other commitment of an affirmative act of insolvency
(“Events”). Either Party will also have the right to terminate this
Agreement with immediate effect by giving written notice of termination to the
other Party at any time upon or before the later of (i) sixty (60) days after
the occurrence of any of the Events with respect to such other Party (unless
such event ceases within such period), or (ii) sixty (60) days after receipt of
the Notice (unless such event ceases within such period).
34.4 Intermec
may terminate this Agreement, or any portion thereof, for convenience upon one
hundred eighty (180) days advance written notice to Venture.
34.5 If
this Agreement is terminated by Venture or Intermec for material breach,
Intermec will be liable for all Components on-hand and on-order as of the effective date
of termination, and Venture will invoice Intermec no earlier than sixty (60)
days after the effective date of termination, as follows:
(i) Total
of the then-current Product price in Venture’s inventory, and
(ii) the
total price of work-in-process Products, pricing will be proportional to the
stage of completion to the finished Product pricing, and
(iii)
Total of Venture’s
then-current quoted BOM price for all Components on-hand and on-order procured specifically
for Intermec, and,
(iv) any
unamortized investment made by Venture specifically for the manufacture of
Products provided that Intermec has agreed to such investment and the
appropriate amortization rate in writing prior to the investment being made by
Venture.
Notwithstanding
the foregoing, Venture will use its best efforts to mitigate the amounts
required to be paid by Intermec under this provision.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 27 of
37
34.6 Unless
otherwise expressly agreed, the expiration or termination of this Agreement will
be without effect on Open Purchase Orders in force on the effective date of the
expiration or termination of this Agreement. The provisions of this Agreement
will survive to the extent necessary to complete the Performance of such Open
Purchase Orders until the last such Purchase Order is terminated or arrives at
its expiry date.
34.7 Upon
termination or expiration of this Agreement:
(i)
Venture will cease all manufacture of Products, excluding Products to be
delivered under Purchase Orders issued and accepted prior to the termination
date unless otherwise directed by Intermec.
(ii)
Venture will return all tooling, fixtures and any other items provided by
Intermec or procured by Venture and paid for by Intermec. Such items
will be returned in working condition. Shipment of such property will
be at the expense and risk of Intermec.
34.8 Notwithstanding
the foregoing, if this Agreement is terminated or expires for any reason, the
Parties will, at Intermec’s option, continue to perform as if the Agreement were
still in force for a transition period up to two (2) years after such
termination or expiration, provided that Intermec requests such a transition
period and specifies the term of such transition in a written notice to Venture
prior to such termination or expiration of the Agreement.
ARTICLE
35 – CHANGE OF CONTROL
In the
event that a change of control of Venture takes place, Intermec will have the
right to terminate this Agreement. A change of control of Venture will be
deemed to occur if more than fifty percent (50%) of the outstanding shares or
securities of Venture (representing the right to vote for the election of
directors or other managing authority) hereafter becomes owned or controlled,
directly or indirectly, by a third party. If Venture does not have
outstanding shares or securities, a change of control will be deemed to occur if
more than fifty percent (50%) of its assets are, or an ownership interest
representing the right to make decisions for it is acquired by or merged into
such a third party. Venture will provide Intermec with written notice of at
least ten (10) days after the effective date of a change of
control.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 28 of
37
ARTICLE
36 - GENERAL PROVISIONS
36.1 Assignment. Neither
Party will assign this Agreement or any right or interest under this Agreement,
nor delegate any obligation to be performed under this Agreement, without the
other Party’s prior written consent, which consent will be at such other Party’s
sole discretion. Any other attempted assignment will be
void. Notwithstanding the foregoing, Intermec will have the right,
without obtaining the Venture’s consent, to delegate its duties and obligations
and/or assign its rights and privileges hereunder in full or in part, to an
Affiliate or a legal successor to all or substantially all of Intermec’s
business or assets. In such event, Intermec will promptly notify
Venture in writing of any such delegation and/or assignment and such assignment
will not affect in any way Venture’s rights hereunder. The legal
successor will be contractually obligated to assume all of Intermec’s
obligations.
36.2 Mirror
Agreement. Venture will, upon the request of Intermec,
execute a contract with the same terms and conditions as this Agreement directly
with any Intermec Affiliate provided such Intermec Affiliate has adequate
capitalization.
36.3 Set-Off. Either
Party may, upon written notice to the other, set off any financial obligation to
the other Party or any Affiliate of the other Party against any financial
obligation owed by the other Party or any Affiliate of the other Party provided
that both financial obligations have existed for more than ninety (90)
days.
36.4 Intermec
has the right, upon reasonable notice, through an independent third party or
using its own personnel, during usual business hours and not more than once per
year, to audit the records of Venture relating to its labor practices, working
conditions, environmental practices and procurement
practices. Venture will assemble in paper and electronic form
all documents that may be necessary or desirable for such
audit. Intermec will bear the cost of such audits.
36.5 Applicable
Law. This Agreement and will be governed by and construed and
enforced in accordance with the laws of the state of Washington, U.S.A. without
regard to its choice of laws or conflict of laws principles. Any
dispute, claim or controversy arising out of or relating to this Agreement, or
the breach or validity hereof will be adjudicated only by a court of competent
jurisdiction in the state of Washington, U.S.A.
36.6 Notice. Except
otherwise set out in this Agreement, any notification, request, certification or
communication sent or made under this Agreement will be effected in writing and
delivered by hand, or sent by registered letter with acknowledgement of
delivery, or by fax to the address of the Party
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 29 of
37
concerned
indicated below, or to any other address which may be indicated in writing to
the other Party.
If the notice is sent to
Intermec:
Intermec
Technologies Corporation
0000
00xx
Xxxxxx Xxxx
Xxxxxxx,
XX 00000
Attn: Legal
Department
FAX: 000-000-0000
If the notice is sent to
Venture:
The name,
address and fax number may be modified at any time upon fifteen (15) days'
notice, in accordance with the provisions of this article. Any notification,
formal notice or other communication so sent will be deemed to have been
received, in the event of hand delivery, at the moment of hand-over or, in the
event of dispatch by post, upon the expiry of a period of seven (7) days of the
envelope having been placed in the mail for this purpose or, in the case of
dispatch by fax, the date of transmission, provided that the confirmed
transmission report is followed by notice by post.
36.7 No
Waiver. Failure by one of the Parties to assert a right or
delay in doing so will not be construed as a renunciation or waiver of such
right. Neither Party will be deemed to have waived any right acquired
under the terms of this Agreement and/or a Purchase Order unless unless they
have signed a written waiver. No failure or successive failures to perform an
agreement or any subsequent waiver by a Party will be deemed to make those
agreements or terms invalid or null and void or affect the right of the
beneficiary Party to have them performed.
36.8 Severability. In
the event that any provision of this Agreement will be held to be invalid or
unenforceable, the same will not affect in any respect whatsoever the validity
or enforceability of the remainder of this Agreement.
36.9
Independent
Contractor. The Parties will act as independent contractors in
the performance of this Agreement. Neither Party will act as, or be
deemed to be, an agent for or partner of the other Party for any purpose
whatsoever nor will either Party have the authority to bind the other in any
respect.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 30 of
37
36.10
Costs And Attorney's
Fees. In the event of default by either Party to this
Agreement, the prevailing Party will be entitled to reimbursement for all costs
and expenses, including reasonable attorney's fees, incurred by the prevailing
Party in exercising any of its rights or remedies hereunder or enforcing any of
the terms, conditions or provisions hereof.
36.11
Choice of
Language. The language of this Agreement and correspondence
will be English. In the event that this Agreement is translated into other
languages, the English version alone will be authoritative.
IN
WITNESS WHEREOF, this Agreement has been executed as of the Effective Date
by each of the Parties on its own behalf and on behalf of its
Affiliates:
INTERMEC
TECHNOLOGIES CORPORATION
Signature:
/s/ Xxxxxx Xxxxxxx
|
VENTURE
CORPORATION LIMITED
Signature:
/s/ Choon Huat Tan
|
Name:
Xxxxxx Xxxxxxx
|
Name:
Xxxxx Huat Tan
|
Title:
Senior Vice President, Global Operations
|
Title:
Executive Director
|
Date:
12/3/2008
|
Date:
12/3/2008
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 31 of
37
EXHIBIT
A
Definitions
In all
cases, (i) capitalized terms in the singular include the plural and vice-versa,
where the context requires and (ii) the words “day,” “week” or “month” mean
respectively calendar day, calendar week or calendar month unless this Agreement
specifically stipulates a working day, week or month.
1.1 “2010
Unit Forecast” means a forecast to be prepared by Intermec by December 15, 2009
showing Intermec’s forecast of the Product units likely to be sold by Intermec
during 2010.
1.2 “2011
Unit Forecast” means a forecast to be prepared by Intermec by December 15, 2010
showing Intermec’s forecast of the Product units likely to be sold by Intermec
during 2011.
1.3 “Acceptance
Period” has the meaning set forth in Article 19.4.
1.4 “Affiliate”
means a Person that Controls or is Controlled by or is under common Control with
another Person.
1.5 “Agreement”
means this Manufacturing Services Framework Agreement with its Schedules, if
any.
1.6 “Baseline
Aggregate Spend has the meaning set forth in Article 6.5.
1.7 [*** Redacted] established by
mutual agreement of Venture and Intermec for an [*** Redacted].
1.8 “Baseline
Forecast” means Intermec’s forecast of the required number of units of the
Products for the First Year.
1.9 [*** Redacted] has the meaning
set forth in Article 6.2.
1.10 [*** Redacted] described in
Articles 7.4, 8.4 and 9.4.
1.11 “Baseline
Product Spend” has the meaning set forth in Article 6.4.
1.12 “Baseline
Unit Price” has the meaning set forth in Article 6.2.
1.13 “Xxxx
To Information” means the name, address and telephone number of the Person which
should be invoiced for Components, Products or Services pursuant to this
Agreement.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 32 of
37
1.14 “BOM”
means a Xxxx of Material which specifies the Components to be used in the
manufacture or production of a Product.
1.15 “Claim
has the meaning set forth in Article 29.1.
1.16 “Component
EOL” has the meaning set forth in Article 23.1.
1.17 “Components”
means raw materials, parts, assemblies, sub-assemblies, and/or software to be
incorporated in or loaded into a Product.
1.18 “Current
Supplier” means a firm that was supplying a Component for an Existing Product
prior to November 1, 2008.
1.19 “Customer
Need Date” means the date specified by a customer of an Intermec OE for delivery
of Products to that customer’s desired Delivery Location.
1.20 “Delivery
Date” means the date specified in a Purchase Order for delivery of a Product to
the Person identified in the Ship To Information.
1.21 “Delivery
Location” means the address of the Person identified in the Ship To
Information.
1.22 “ECN”
means engineering change notice.
1.23 “Effective
Date” has the meaning set forth in Article 2.2.
1.24 “Epidemic
Failure” has the meaning set forth in Article 16.1.
1.25 “Existing
Product” means a Product first introduced to the marketplace in commercial
quantities by Intermec or its Affiliates on or prior to November 1,
2008.
1.26 “First
Year” means the period beginning on January 1, 2009 and continuing through
December 31, 2009.
1.27 “First
Year Aggregate Spend” has the meaning set forth in Article 7.3.
1.28 “First
Year Product Spend” has the meaning set forth in Article 7.2.
1.29 “First
Year Unit Price” has the meaning set forth in Article 7.1.
1.30 “Forecast”
means the Baseline Forecast and/or Rolling Forecasts.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 33 of
37
1.31 “Force
Majeure Event” has the meaning set forth in Article 33.1.
1.32 “Insolvency
Event” has the meaning set forth in Article 34.3.
1.33 “Intermec
OE” means Intermec or any Intermec Affiliate that issues a Purchase Order to
Venture under this Agreement.
1.34 “IQN”
means the Intermec Quality Network.
1.35 “IPR”
has the meaning set forth in Article 27.1.
1.36 “KPI”
means a key performance indicator used as a performance metric.
1.37 “Lead-Time”
means the minimum amount of time Venture has to deliver a Product to a
transportation firm for delivery to the Delivery Location after Venture receives
a Purchase Order from Intermec but not to exceed [*** Redacted].
1.38 “Marking”
means attaching, embedding or otherwise including with a Product (i) the
trademarks, trade names or logos of Intermec and its Affiliates and (ii) the
serial numbers of patents owned or otherwise controlled by Intermec and its
Affiliates.
1.39 “Mitigation
Efforts” has the meaning set forth in Article 22.2.
1.40 “NDA”
has the meaning set forth in Article 26.
1.41 “New
ECN” means an ECN released on or after November 1, 2008.
1.42 “New
Product” means a Product first introduced to the marketplace in commercial
quantities by Intermec or its Affiliates after November 1, 2008.
1.43 “New
Supplier” means a firm that supplies a Component for an Existing Product for the
first time on or after November 1, 2008.
1.44 “NTF”
has the meaning set forth in Article 21.4.
1.45 “Obsolete
Inventory” has the meaning set forth in Article 13.3..
1.46 “Open
Purchase Order” means a Purchase Order which (i) has been accepted and
acknowledged by Venture pursuant to Article 14.2 of this Agreement but (ii) has
not yet been
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 34 of
37
completed
in that the Product described in the Purchase Order has not been delivered to a
transportation firm or the Services described in the Purchase Order have not
been completed.
1.47 “Order
Entity (OE)” means any affiliate of Intermec who may place Purchase Orders on
its own account subject to the terms of this Agreement.
1.48 "Person"
means an individual, a corporation, a limited liability company, a partnership,
an association, a trust or any other entity or organization, including a
government or political subdivision or any agency or instrumentality
thereof.
1.49 “Pre-Existing
IPR” has the meaning set forth in Article 27.2.
1.50 “Product”
means a product manufactured or produced by or for Intermec or its
Affiliates.
1.51 “Product
EOL” has the meaning set forth in Article 22.1.
1.52 “Purchase
Order” means a written or electronic document issued by an Intermec OE to
Venture that references this Agreement and requests that Venture provide one or
more of the Products or Services.
1.53 “Repository”
means the location determined by the parties, whether physical or virtual, for
the collection of documentation governing or applicable to this
Agreement.
1.54 “RMA”
has the meaning set forth in Article 21.3.
1.55 “Rolling
Forecast” means a forecast of the types and number of units of Products which
Intermec believes it will require during the next 12 months.
1.56 “Rules
of Engagement (XXX)” means all business processes incorporated into a mutually
available location and/or any conduct regularly engaged in by both parties to
resolve issues as they arise or otherwise refine the scope of the parties
responsibilities.
1.57 “Second
Year” means the period beginning on January 1, 2010 and continuing through
December 31, 2010.
1.58 “Second
Year Aggregate Spend” has the meaning set forth in Article 8.4.
1.59 “Second
Year Baseline Spend” has the meaning set forth in Article 8.3
1.60 “Second
Year Product Spend” has the meaning set forth in Article 8.2.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 35 of
37
1.61 “Second
Year Unit Price” has the meaning set forth in Article 8.1.
1.62 “Services”
means Product engineering or manufacturing services.
1.63 “Ship
To Information” means the name and address of the Person identified in a
Purchase Order for a Product as the Person to whom the Product should be
delivered.
1.64 “Shipping
Information” means the applicable Incoterms 2000 (e.g., Ex Works) for the
shipment and the insurance coverage to be purchased for the Products being
shipped.
1.65 “Slow
Moving Inventory” has the meaning set forth in Article 13.2.
1.66 “Spare
Part” means an unused Component that can be used to replace or upgrade a
Component previously incorporated or loaded into a Product.
1.67 “Spare
Part Supply Period” has the meaning set forth in Article 25.1.
1.68 “Specifications”
means the technical specifications and drawings for the Products supplied by
Intermec to Venture.
1.69 “Term”
has the meaning set forth in Article 2.2.
1.70 “Third
Year” means the period beginning on January 1, 2011 and continuing through
December 31, 2011.
1.71 “Third
Year Aggregate Spend” has the meaning set forth in Article 9.4.
1.72 “Third
Year Baseline Spend” has the meaning set forth in Article 9.3.
1.73 “Third
Year Unit Price” has the meaning set forth in Article 9.1.
1.74 “Unit
Price” means the Product price established in any contract year.
1.75 “Value
Engineering” means any re-engineering or other activity which requires a new ECN
and [***
Redacted].
1.76 [*** Redacted] described in
Article 11.1.
1.77 “Warranty
Period” has the meaning set forth in Article 21.1.
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 36 of
37
EXHIBIT
B
Guaranty
1. This
Guaranty is related to, is to be governed by and is to be interpreted in
accordance with the Manufacturing Services Framework Agreement dated as of
November 1, 2008 by and between Venture Corporation Limited and Intermec
Technologies Corporation (the “Agreement”) which is incorporated by reference
herein.
2. Intermec
Technologies Corporation (“Intermec”) irrevocably guarantees to Venture
Corporation the obligations of each Intermec Affiliate under the Agreement if
such Intermec Affiliate:
(a) Files
any voluntary petition of bankruptcy or any petition for similar relief under
any bankruptcy or insolvency law;
(b) Is
the subject of any involuntary petition in bankruptcy or insolvency filed by any
third party if such petition is not dismissed within thirty (30) days after the
filing date;
(c) Has
a receiver appointed for a third party or any material portion of the property
of a third by any court of competent jurisdiction and such receivership has not
been dismissed within thirty (30) days from the date of its
creation;
(d) Makes
an assignment for the benefit of its creditors;
(e) Admits
in writing its inability to meet its debts as they mature;
(f) Files
for legal dissolution; or
(g) Otherwise
ceases to do business.
INTERMEC
TECHNOLOGIES CORPORATION
Signature:
/s/ Xxxxxx Xxxxxxx
|
Name:
Xxxxxx Xxxxxxx
|
Title:
Senior Vice President, Global Operations
|
Date:
12/3/2008
|
***
Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Securities and Exchange
Commission.
Page 37 of
37