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EXHIBIT 10.10
DEPOT REPAIR, PRODUCT REFURBISHMENT,
AND WARRANTY ADMINISTRATION AGREEMENT
BETWEEN
FEDERAL TECHNOLOGY CORPORATION AND EPSON AMERICA, INC.
An AGREEMENT entered into between Federal Technology Corporation a Virginia
corporation, located at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000
("FTC") and Epson America, Inc. located at 00000 Xxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxx 00000 ("Epson").
RECITALS
In the course of its North American distribution and sale of personal
computer systems and imaging products, Epson provides warranty repair services
and warranty administration for sub-assembly parts, as well as end-user
technical support, at a depot facility in Carson, California. Epson determined
that it is in Epson's best interest to contract for such services, and FTC has
indicated a willingness to undertake such responsibility on an independent
contractor basis. The changeover contemplated will involve the transfer of a
number of Epson employees.
Now, therefore, in consideration of the premises, and of the mutual
covenants and conditions contained herein, the parties agree as follows:
1. TERM. The term of this Agreement shall be for five (5) years from the
date executed by FTC ("Effective Date"); the first year as an initial
term, followed by automatically renewable one (1) year terms unless a
written notice of non-renewal is provided by either party to the other
at least ninety (90) days prior to the next anniversary of the
Effective Date.
2. CHANGEOVER AND FTC'S PROVISION OF SERVICES. FTC will provide depot
repair, product refurbishment and warranty administration services
(the "Services") for Epson at Epson's Carson, California facility in
accordance with the terms of this Agreement and its Attachments.
2.1. Changeover. The changeover from an Epson-operated function to
one supplied by FTC shall take place by mutual agreement, but in any
event no later than January 14, 1991 (the "Changeover Date"). Prior
to the Changeover Date, Epson will review its depot operation and
employees and inform the employees of the pending changeover. Epson
will inform FTC of the Epson employees Epson plans to terminate in
connection with the changeover, and of the ones recommended to be
reemployed by FTC. Before the Changeover Date, but after FTC has
received the foregoing information from Epson, FTC will make a
presentation to all affected Epson depot employees regarding the terms
and conditions of their prospective employment by FTC. FTC will, in
cooperation with Epson, exert its best efforts to ensure a smooth
changeover on or as of the Changeover Date.
2.2. Responsibility for Employees.
(a) Epson will remain fully responsible for all of its
employees affected by this Agreement, for all employment-related
claims, duties and obligations, up to the Changeover Date.
Thereafter, Epson will be responsible for and indemnify FTC from and
against any and all claims, charges, cost and expense attributable to
said employees arising from the period of their
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employment before the Changeover Date, and status as Epson employees.
FTC has no liability for any Epson employees terminated by Epson.
(b) To the extent reasonably possible, FTC will offer
comparable employment to the Epson employees at the depot affected by
this Agreement. As of the Changeover Date, FTC will be fully
responsible for all of its employees, including former Epson employees
hired by FTC. FTC hereby indemnifies Epson and holds it harmless,
from and against any and all claims, loss, cost and expense
attributable to FTC's employees during the period after the Changeover
Date and their status as FTC employees.
2.3. Services. FTC shall provide the services to Epson as an
independent contractor in accordance with the terms and conditions of
this Agreement (as more fully described in the Attachment A hereto).
Epson retains full management control over its warranty service terms
and programs, as well as Epson's customer and end-user relations. For
all practical purposes, FTC's provision of the services shall be
invisible to Epson's customers and end-users. FTC shall have full
daily operational control over FTC's employees and the manner and
means by which said employees fulfill FTC's obligations to Epson under
this Agreement. Epson shall retain end-result Quality Approval
authority consistent with its obligations as a licensee of Seiko Epson
Corporation.
FTC, on a quarterly basis, or sooner, shall provide Epson a value
engineering change proposal which shall identify methodologies that
may result in increased Epson Customer Service and/or cost reductions.
All proposals which are accepted and incorporated by Epson, and result
in either increased customer service and/or cost reductions shall
result in a negotiated distribution of savings between FTC and Epson.
2.4. Lease Responsibilities. Epson is the lessee of the depot
facility at Carson, California. Epson will continue as lessee after
the Changeover Date, providing the leased space and facilities to FTC
reasonably necessary for the services at no charge to FTC during the
term of this Agreement. In addition to offering use of the leased
premises, Epson will pay for all utilities associated with the
facility and the Services (heat, ventilation, air-conditioning, water,
and electricity). FTC will reimburse EAI for all FTC telephone
charges (excluding TTS phone charges). FTC will, however, be
responsible for its proportional share of personal property taxes
assessed against FTC attributable to FTC assets used for the services,
and will promptly reimburse EAI for same.
Both parties shall have a mutual and affirmative obligation to
maintain the integrity and security of the Xxxxxx depot facility.
Both parties will take all reasonable steps to assure the security of
the facility and its contents.
2.5. Insurance. FTC will obtain and maintain in effect at all
times such insurance as will protect FTC and Epson from any and all
claims under (1) Worker's Compensation Acts, (2) Personal Liability
(including theft coverage), (3) Property Damage and all other claims
for damages, including personal injury and death which may arise from
FTC's operations under this Agreement. FTC will provide Epson with
certificates of insurance confirming the foregoing with minimum policy
limits of $1,000,000.
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In addition, the FTC employee(s) who will be responsible for issuing
warranty reimbursement checks to Epson customers will be bonded and
insured at commercially reasonable (and mutually agreeable) limits and
coverages.
2.6. Operating Assets and Equipment. As of the Changeover Date,
FTC will succeed to the possession and use of Epson's existing assets
and equipment, including all available hardware and firmware
specifications, diagnostics, specifications, drawings (including
assemblies and subassemblies), manufacturing procedures (including
production planning), and quality control procedures, bills of
materials, and vendor arrangements necessary for the repair,
refurbishment, and retrofit of the products included within the scope
of this Agreement (the "Epson Assets" more fully described in
Attachment D hereto). Epson warrants that as of the Changeover Date
the Epson Assets will be in good working order, normal wear and tear
excepted.
FTC represents that it has had the opportunity to inspect the Epson
Assets prior to the Changeover Date. After the Changeover Date, FTC
has full responsibility, at FTC's cost and expense, to obtain,
maintain and replace operating assets and equipment reasonably
sufficient to provide the Services. FTC is also responsible for the
care and maintenance of the Epson Assets, including risk of loss or
damage thereto.
2.7. Parts, Inventory and Ordering. Epson will provide all parts
necessary for the services at no cost to FTC. FTC will order parts
from Epson on an as-needed basis in conformance with Epson's existing
parts and accounting procedures. Epson will use its best efforts to
deliver stock items to FTC in two working days, and non-stock items in
ten working days. All expenses of parts shipment and delivery to FTC
shall be born by Epson.
2.8. Records and Audit Rights.
(a) FTC agrees to keep and maintain commercially
reasonable records of the costs and charges associated with FTC's
provision of the Services. Epson retains the right to have a
representative of Coopers & Xxxxxxx, Epson's certified public
accounting firm, inspect and audit FTC's books and records pertaining
to the Services upon notice to FTC, at Epson's expense.
(b) FTC agrees to furnish to Epson a statement within
fifteen (15) days following the end of each month identifying the
items repaired/refurbished during the proceeding month. The report
shall include product type, and quantity, as well as ready-for-issue
and not-ready-for-issue status of component inventory provided by
Epson. FTC shall keep and maintain true and accurate records
regarding all information and data reasonably necessary or required
for the computation and verification of all amounts payable to FTC
hereunder.
3. USE OF EPSON TRADEMARKS AND LOGOS. During the term of this Agreement,
FTC is authorized to use the Epson trademarks, proprietary logos, and
designations applicable to the Products as may be necessary for FTC to
provide the Services, in conformity with Epson's written guidelines
for trademark usage. Upon expiration or termination of this
Agreement, FTC shall cease all references and use of any and all Epson
names, trademarks, logos and designations. FTC shall not use Epson
trademarks, logos, or designations in any advertising materials, nor
publicize the Agreement without prior written authorization from
Epson.
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4. PROPRIETARY NATURE OF PRODUCTS.
(a) Epson Rights. No title to or ownership of Epson's
products, including software or any of the parts, is transferred to
FTC by this Agreement or the provision of the services by FTC. Title
to all applicable rights and patents, copyrights and trade secrets in
Epson's products shall remain with Epson, and FTC agrees to respect
and observe the proprietary nature thereof. FTC agrees to take
appropriate action by instructions or agreement with its employees,
agents, and contractors who are permitted access to the Epson products
or other proprietary information to fulfill its obligations hereunder.
Notwithstanding any provision of this Agreement, Epson owns and
retains all title and ownership of all intellectual property rights;
all software; all firmware; all master diskettes; and related
materials provided by Epson to FTC hereunder.
(b) Reverse Engineering, Etc. FTC agrees not to
decompile, reverse engineer, reverse compile, modify, or perform any
similar type of operation on products, parts, software or furniture
furnished by Epson without the express prior written consent of Epson.
5. TECHNICAL SUPPORT. Epson shall make technical support available to
FTC during the term of this Agreement without cost to FTC, to answer
questions and provide support for FTC in connection with the services.
6. INTELLECTUAL PROPERTY RIGHTS, INDEMNIFICATION.
(a) By Epson. Epson shall indemnify, defend,and hold FTC
harmless from any and all damages, liabilities, costs, and expenses
incurred by FTC as a result of any claims, judgments, or adjudication
against FTC that Epson products infringe any U.S. patent or copyright
of any third party, provided: (i) FTC shall promptly notify Epson in
writing of such claim; and (ii) Epson shall have the sole control of
the defense of any such action and all negotiations for its settlement
and compromise.
(b) By FTC. FTC shall indemnify, defend, and hold Epson
harmless from any and all damages, liabilities, costs, and expenses
incurred by Epson as a result of any claims, judgments, or
adjudication against Epson that Epson products modified by FTC
infringe any U.S. patent or copyright of any third party, provided:
(i) Epson shall promptly notify FTC in writing of such claim; and (ii)
FTC shall have the sole control of the defense of any such action and
all negotiations for its settlement and compromise.
7. CONFIDENTIALITY. Both parties acknowledge that confidential
information provided hereunder, including the transfer of technology
and software, constitute a trade secret and, as such, shall be held
and maintained in confidence, as set forth in the Confidentiality and
Non-Disclosure Agreement, Attachment C hereto.
8. WARRANTIES AND DISCLAIMERS.
(a) Warranty. FTC warrants that the depot repairs,
product refurbishment, product retrofits and Services will be
performed in accordance with the repair and refurbishment criteria for
the applicable service provided by Epson, and industry standards. In
the event any such repair, refurbishment, or retrofit does not perform
in accordance with the applicable specifications
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in Attachment A for a period of ninety (90) days after shipment
thereof by Epson to a customer, FTC will remedy such failure by repair
at no additional cost to Epson.
(b) DISCLAIMER. FTC EXPRESSLY DISCLAIMS ALL WARRANTIES
EXCEPT THE LIMITED WARRANTY SET FORTH ABOVE. FTC WILL NOT BE LIABLE
TO EPSON OR ANY THIRD PARTY FOR ANY SPECIAL, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES ARISING OUT OF THE SERVICES PERFORMED OR NOT
PERFORMED OR THE USE OF OR INABILITY TO USE SUCH PRODUCTS EVEN IF FTC
HAD BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
9. Payment. Epson agrees to pay for the Services at those rates set
forth in Attachment B hereto. FTC shall invoice Epson monthly in
arrears for applicable Services performed and other related charges,
accompanied by the report described in section 2.8(b) above. Said
invoices shall be paid in full within thirty (30) days after receipt.
Any invoices which are unpaid after this thirty (30) day period will
be amended to include interest charges of 1.5% (percent) a month on
the invoice amount from the thirty-first (31st) day following invoice
date to date of payment to FTC, or the highest amount allowed by law,
whichever is applicable. Further, FTC reserves the right to suspend
all services provided under this Agreement or require payment in
advance in the event any two consecutive invoices are not paid in full
within forty-five (45) days after the second invoice date. The
charges for all services annually, identified herein, shall be
reviewed and negotiated, for the next twelve (12) month period,
commencing ninety (90) days prior to the next anniversary and renewal
date of this Agreement.
10. TAXES. Epson shall be responsible for the payment of all sales, use
and personal property taxes assessed on products provided or sold in
connection with this Agreement, excluding taxes based upon the net
income of FTC. FTC shall be responsible for any and all taxes
attributable to the provision of Services by FTC as any independent
contractor.
11. TERMINATION AND DEFAULT.
(a) Without Cause. Either party may terminate this
Agreement at any time upon 90 days written notice of termination to
the other. Upon the effective date of such termination, Epson will
resume possession and control over the Epson Assets, and is free to
hire or rehire any and all of FTC's employees used in the provision of
the Services.
(b) For Cause. Either party may terminate this Agreement
upon written notice to the other party in the event that such other
party fails to cure a material breach within ninety (90) days after
notice of breach from the nonbreaching party. This Agreement shall
automatically be canceled if either party becomes insolvent or makes
an assignment for the benefit of creditors or if any insolvency
proceeding is initiated by or against it. All unpaid charges accrued
under this Agreement shall become immediately due and payable upon the
happening of such event of termination. The aforesaid rights shall be
in addition to all other rights and remedies provided at law, in
equity, or hereunder. In the event of termination for any of the
foregoing reasons, Epson will resume possession and control over the
Epson Assets, and is free to hire or rehire any and all of FTC's
employee's used in the provision of the Services.
(c) In the event that Epson resumes possession and
control of the Epson Assets, FTC agrees to sell and assign a complete
copy of FTC's automated claims review system and depot
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tracking systems to Epson. FTC further agrees to assist Epson in
obtaining any necessary consents from third parties with rights in
said software.
12. FORCE MAJEURE. If either party shall be prevented from performing any
portion of this Agreement (except the payment of money) by causes
beyond its reasonable control, including, without limitation, labor
disputes, civil commotion, war, governmental regulations or controls,
casualty, inability to obtain materials or services, or acts of God,
such party shall be excused from performance for the period of the
delay.
13. NOTICE. Unless otherwise agreed to by the parties, all notices
required hereunder shall be made in writing by certified mail, return
receipt requested, to the addresses first above written and to the
attention of the parties executing this Agreement or their
successor(s) in office.
14. WAIVER. No waiver of any right or remedy on one occasion shall be
deemed a waiver of such right or remedy on any other occasion or of
any other right or remedy.
15. SEVERABILITY. If any provision(s) of this Agreement is held to be
illegal, unenforceable, or invalid by a court of competent
jurisdiction, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby, so long as the verifiable intent of the parties is not
materially affected thereby.
16. INDEPENDENT CONTRACTORS. Both parties hereto are independent
contractors and neither party shall represent itself as an agent or
legal representative of the other. As an independent contractor, FTC
reserves the right to preserve the organizational integrity of FTC
with regard to maintaining.positive management control of the total
depot repair operation.
17. COMPLIANCE WITh LAWS. Each party shall comply, at its own expense,
with all statutes, regulations, rules, ordinances, and orders of any
governmental body, department, or agency thereof, which apply to or
result from its obligations hereunder.
18. ATTACHMENTS. The attachments referred to in the body of this
Agreement are an integral part of this Agreement and reference to this
Agreement shall be deemed to include all the attachments.
19. HEADINGS. The headings of this Agreement are included solely for
convenience of reference and shall not control the meaning or
interpretation of any provision of the Agreement.
20. ENTIRE AGREEMENT/GOVERNING LAW. This document constitutes the entire
Agreement between the parties regarding the subject matter hereof. No
agent, employee, or representative of FTC has any authority to bind
FTC to any affirmation, representation, or warranty concerning the
products or services furnished under this Agreement, unless the same
is expressly included within this written Agreement. This Agreement
may be modified only by a written instrument signed by both parties
hereto or by their duly authorized agents. The terms and conditions
herein shall govern with respect to the subject matter hereto and
shall override all terms and conditions contained on any purchase
order or acknowledgement form, previous letters, etc.,issued by the
parties hereto. This Agreement shall be governed by the laws of the
State of California. The individuals signing this Agreement on behalf
of each party represents and warrants that he/she has the power and
authority to sign.
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FEDERAL TECHNOLOGY CORPORATION EPSON AMERICA, INC.
By: /s/ X. Xxxx D'Allesio By: /s/ Xxxx Xxxx
---------------------------------- -------------------------------
Authorized Signature Authorized Signature
R. Xxxx X'Xxxxxxx Xxxx Xxxx
Vice President Executive Vice President
General Counsel Finance & Corp. Support
December 13, 1990 December 13, 1990
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ATTACHMENT A
STATEMENT OF WORK
SERVICES
A. WARRANTY ADMINISTRATION. During the term of the Agreement, FTC will
provide administrative services involving warranty and Epson Extra
Care (service contract) claims from authorized servicers and the
processing of billable repair/exchange orders. These services
include:
1. Warranty claims and billable exchange part order receipt,
review, and processing.
2. Preparation and submission of applicable parts orders.
3. generation and distribution of Epson warranty payment checks
to authorized service providers as scheduled by Epson.
4. Maintain warranty payment register.
5. Record and maintain FTC billable services for submission to
Epson.
6. Sort received warranty and billable exchange parts.
7. Above services to be performed according to mutually
agreed-upon standards and average processing time of three (3)
days or less to be attained within ninety (90) days of start
of performance.
8. Warranty service provided by FTC shall meet or exceed a 98%
rate of correct processing on a six month rolling average, as
determined by monthly audit carried out by Epson. This
requirement shall begin 90 days after the execution date of
this Agreement.
B. CLAIMS REVIEW SYSTEM. FTC will develop and implement an automated
claims review system that would meet the following requirements:
1. System will interface with both Epson's Cambar and FTC's depot
tracking systems.
2. Inquiry capability will be available internal to the Xxxxxx
facility and other sites as agreed upon.
3. System will track on a real-time basis, the current status of
claims in process at the Xxxxxx facility. Also available will
be:
- Warranty activity and exceptions (summary and by
account).
- Quarterly services Warranty Activity Reports (summary
and by account).
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- Component/parts failure analysis compiled in
conjunction with depot tracking system information.
- The system is intended to provide increased
productivity. This increase in productivity is to be
included in annual review of performance and pricing
standards.
C. REPAIR DEPOT SERVICES. FTC will perform all depot repair and
associated administrative functions for all Epson business products,
consumer products and OEM products, to include whole units and
subassemblies, under the following provisions and conditions:
PCB/Sub-Assembly Repair:
1. Average monthly quality for ill repairs will ramp up over a
six-month period to less than a 1% failure rate out-of-box and
will be maintained thereafter.
2. Epson will provide to FTC at no cost all parts required for
repairs, both generic and proprietary, and packing materials.
3. FTC may identify for scrap up to a maximum of 7% of
PCBs/subassemblies received for repair during any given month.
There will be no penalty for scrapping, however, repair
charges may only be assessed for completed repair work.
4. The quoted flat rate charges, as shown in Attachment B, are
based on Epson replacement costs. The quoted repair prices
include all labor costs associated with test, repair, quality
assurance test and packaging.
5. Sorting of PCB/Sub-Assemblies is performed under Warranty
administration services.
6. Turnaround time not to exceed thirty (30) days during first
ninety (90) days of contract performance with a revised
turnaround time to be mutually agreed upon and subject to
Epson's provisioning of material in a timely fashion.
Hard Disk Drives:
1. FTC will provide test/reformat and repair services for hard
disk drive units at the prices shown in Attachment B. Quoted
prices are inclusive of shipping costs.
Whole Unit and Accessory Repair:
1. FTC will repair to the subassembly/pluggable chip level for
electronics and to the component part for mechanics as done by
Epson authorized dealers, with reimbursement at the current
Level I/EEC labor rate.
2. Defective subassemblies that are removed will be processed
through subassembly repair at the appropriate charge, as
listed attachment B.
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3. From time to time Epson may request whole unit repair, on a
product-by-product basis, with a specially negotiated rate.
Screen for Yield
1. FTC will screen and adjust to original specifications OEM
products (typically flexible diskette drives).
2. Items found to require additional repair beyond screen and
adjustment will be repaired at the prices listed in Attachment
B, less the flat rate screening charge.
3. FTC will screen other products designated by Epson for a
negotiated flat rate.
D. FLAT RATE CHARGE. For any technical or administrative services
performed by FTC which are outside those services already specified
herein, hourly charges will be submitted to Epson in accordance with
the rates shown in attachment B.
E. END USER TELEPHONE TECHNICAL SUPPORT (TTS). During the term of this
agreement, FTC will provide complete telephone technical support on
configuration, installation and operation of Epson products to end
users of Epson products under the following conditions:
1. Epson will provide at no charge to FTC the required telephone
equipment and TTS phone service at the Xxxxxx Facility.
2. TTS support will be provided by FTC at mutually agreed upon
times, but no less than 7:00 a.m. and 4:00 p.m. Pacific Time on
scheduled working days at Epson.
3. FTC will provide Call Tracking and TTS Management Reports at
mutually agreed-upon times; the call tracking software and hardware to
be provided by Epson.
4. TTS performance standards, response times, and quality of
technical support will be in accordance with mutually
agreed-upon criteria, including the attainment within 90 days
of 15-second average caller queue wait time delay prior to
response by a TTS representative.
5. Epson will provide technical assistance as requested by FTC to
enable resolution of more difficult questions.
6. Epson will provide, at no charge to FTC, on-going training and
documentation for new Epson products as they are released.
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ATTACHMENT B
SCHEDULE OF PRICES
GENERAL
Under the terms of this agreement, the services to be provided by
Federal Technology Corporation, as outlined in both the basic
agreement and Attachment A, will be performed according to the
following Price schedule:
A. Warranty Administration. Federal Technology Corporation will provide
the previously detailed warranty administration services outlined in
Attachment A of this agreement at a flat rate per warranty claim
action as indicated. Postage, envelopes, shipping materials and other
direct cost items will be furnished by Epson.
Each warranty claim processed $2.85 per claim
For any given calendar month where FTC's claim processing rate is less
than 96% successful, a two percent penalty of the monthly warranty
administration revenue (amount billed for the defaulting month) will
be paid Epson by FTC.
B. Claims Review System. As noted, Federal Technology corporation will
implement the above system, however, until more detailed information
concerning the required interfaces, on-line inquiry, response times,
etc., is made available, it is FTC's intention to implement this
system at no cost to Epson. However, any cost billed to Epson must be
agreed to in advance.
C. Repair Depot Services. Federal Technology Corporation will provide
all depot repair services and appropriate administrative functions as
detailed in this agreement in accordance with the below price
schedule:
PCB/Subassembly Repair
----------------------
Epson Replacement Cost FTC Repair Price
---------------------- ----------------
Less than $70.00 $ 25.50
$70.00 - $124.99 $ 29.00
$125.00 - 249.99 $ 32.50
$250.00 and greater $ 41.00
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Hard Disk Drive
---------------
Drive Description Test/Reformat Price Repair
----------------- ------------------- ------
Price
-----
Standard 20MB $ 8.00 $ 98.50
AT-interface 20MB $ 8.00 $ 186.00
Standard 40MB $ 10.00 $ 277.00
AT-interface 40MB $ 10.00 $ 266.00
Standard 90MB $ 12.00 $ 410.00
AT-interface 100MB $ 12.00 $ 425.00
Whole Unit and Accessory Repair
1. Federal Technology will repair to the subassembly/pluggable
chip level for electronics and to the component part for
merchandise as performed by Epson authorized dealers at the
Level I/EEC Labor Rate.
2. Defective subassemblies will be repaired at the above listed
subassembly rates.
3. Screen For Yield
Screen for yield is at a flat rate charge of $7.50 each OEM product as
per Attachment A.C. "Screen for Yield."
After the first six calendar months following the Execution Date of this
Agreement, FTC agrees to meet or exceed a 99% successful repair standard, and
agrees to pay a matching penalty of the monthly amount billed for depot repair
services for every percentage point (or part thereof) below the 99% standard in
the defaulting month
For new Epson products and technologies, the parties agree that new repair
prices will be negotiated if necessary at commercially reasonable rates.
D. Flat Rate Charge.
Any technical administrative services performed by Federal Technology
Corporation at the specific request of Epson, but not within the scope
of this agreement will be performed at the below rates:
- senior Level Computer Technician $ 50.00/hr.
- Computer Technician $ 35.00/hr.
- Administrative Support $ 20.00/hr.
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E. END-USER TELEPHONE TECHNICAL SUPPORT
Federal Technology will provide the previously detailed end-user
telephone technical support services at a flat rate charge for each
call minute of support provided, as follows:
Each call minute per month $1.40
There will be no charge for incidental outgoing calls required to
complete responses to incoming TTS calls.
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ATTACHMENT C
CONFIDENTIALITY AND NON-DISCLOSURE AGREEMENT
This Agreement is made as of the 13th day of December, 1989, by and between
Epson America incorporated, a California corporation with its principal place
of business at 00000 Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000 ("Epson") and
Federal Technology corporation, a Virginia corporation with its principal place
of business at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 ("FTC").
Whereas Epson will disclose to FTC certain information relating to its
products, parts, customers and business practices for the purpose of enabling
FTC to perform various maintenance, repair and distribution services pertinent
to certain Epson products and sub-assemblies sold by Epson and it's other
appointees in the marketplace. Epson desires that any confidential and/or
proprietary information ("Information") disclosed to FTC be used only to
further the business relationship between the parties hereto.
In order to ensure that the Information disclosed by Epson to FTC is used only
in accordance with the purposes stated above, the parties agree to the
following:
I. This Agreement shall be in effect for five (5) years ,
beginning on the date of its execution by the parties hereto
and will have an initial term of two (2) years ("Initial
Term"). This agreement will continue from year to year after
the Initial Term but shall be terminable by either party as of
the end of the Initial Term, or as the end of any anniversary
thereof, upon not less than ninety (90) days prior written
notice.
II. FTC shall prevent the disclosure to others of Information
transmitted to FTC where such Information is prominently
designated as confidential, and is disclosed in the
performance of, or in connection with, FTC services performed
for Epson. Any Information delivered by Epson to FTC marked
"secret", "confidential", or with words of similar meaning,
shall be conclusively deemed, as between the parties,
confidential and trade secret information of Epson. Any
Information not bearing such marking shall not, however, be
deemed to be non-secret or non-confidential but any such
unmarked Information shall be subject to the same restrictions
as contained herein.
III. Epson warrants that no restriction is made upon FTC relating
to FTC's freedom to offer services to any other persons or to
transmit any Information to other persons where such
Information (a) shall have been in its possession prior to the
disclosure by Epson, (b) shall have become part of the public
domain through no fault of FTC, (c) shall have been developed
subsequent to, and independent of, the disclosure by Epson, or
(d) shall have been released in writing by Epson so that FTC
may make public disclosure or otherwise deemed no longer to be
confidential.
IV. FTC shall not use such confidential Information itself,
disclose it to others or permit the disclosure. of such
Information to others, and will prevent FTC employees (so long
as they shall remain employed by FTC) from divulging,
publishing or using such Information, except as is necessary
to perform the aforementioned maintenance repair and
distribution services.
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V. All Information disclosed by Epson to FTC shall remain the
property of Epson. At Epson's request, the Information
tangible from shall be promptly returned or destroyed,
together with all copies thereof. Upon request, FTC shall
provide written certification of the destruction.
VI. Any notice or other communication provided under this
Agreement will be in writing and be sent via telex, telefax or
certified or registered mail, return receipt requested, to the
respective addresses as either. party has designated to the
other by notice in writing. Any such notice will be deemed
given when received by the other party, attention directed to
the individual signing this Agreement.
VII. This Agreement will be governed by the laws of the State of
California and constitutes the entire Agreement between Epson
and FTC pertaining to the subject matter hereof. No
provisions of this Agreement will be deemed waived, amended or
modified by either party unless such waiver, amendment or
modification be in writing signed by the party against whom it
is sought to enforce the waiver, amendment or modification.
If any provision if this Agreement is held to be illegal or
unenforceable, such shall not effect the balance thereof.
VIII. The parties hereto acknowledge that they have read this Agreement,
understand it, and agree to be bound by its terms and conditions.
Further, the parties acknowledge that this Agreement supersedes all
prior agreements, oral or written, and all other communications
between the parties relating to the subject matter of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed. The persons signing warrant that they are
authorized to sign for, and on behalf of, the respective parties.
Accepted By: Accepted By:
EPSON AMERICA, INCORPORATED FEDERAL TECHNOLOGY CORPORATION
BY: /s/ Xxxx Xxxx BY: /s/ R. Xxxx X'Xxxxxxx
---------------------------------- -------------------------------
TITLE: Exec. Vice President TITLE: Vice President & General
Finance & Corp. Support Counsel
DATE: 12/13/90 DATE: 12/13/90
--------------------------- -----------------------------
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AMENDMENT 6
to that Certain Depot Repair
Product Refurbishment and Warranty Administration Agreement
Between
MICRODYNE CORPORATION
(Formerly Federal Technology) Corporation)
and
EPSON AMERICA, INC.
RECITAL
Epson America, Inc. ("EAI") and Federal Technology Corporation ("FTC") were
parties to that certain Depot Repair, Product Refurbishment and Warranty
Administration Agreement dated as of December 13, 1990 (the "Agreement"). As
of June 21, 1991, FTC changed its name to Microdyne Corporation ("Microdyne").
The Agreement has been amended five times. Changes in the parties' business
relationship mandate a further amendment to the Agreement.
NOW THEREFORE, in consideration of the premises and of the mutual covenants and
conditions contained herein, the parties hereto agree as follows:
1. Effective Date. The effective date of this Amendment is October 1,
1994 (the "Effective Date").
2. Attachment B, Section E, End User Telephone Technical Support.
Section 4 of Attachment B, Section E is amended by deleting the
existing text and replacing it with the following:
1) The initial number of TTS representatives is set at 61.
Epson may request additional TTS representatives. Charges for
these representatives will start on their first day of work.
Over time, some TTS representative losses may occur do to
attrition. If this occurs, Epson will evaluate the number TTS
representatives needed, and may decide to continue at a
reduced level or authorize hiring of a replacement. Xxxxxxx
for replacement TTS representatives hired in each calendar
year will start on their first day of work for a quantity up
to 10% of the number of TTS representatives authorized on
January 1 of each calendar year, rounded to the nearest whole
number. For calendar year 1994, this number shall be 7.
Charges for additional replacement TTS representatives in a
calendar year will start at the completion of training.
Epson may elect to reduce the number of TTS representatives at
any time with 30 days written notification. Should the number
of authorized TTS representatives fall below 61, the monthly
billing rate will adjust to $5,400 per TTS representative
through March, 1994, and $5.575 per TTS representative
thereafter.
2) TTS representatives will be designated to support product or
skill areas; currently advertising reply, customer relations,
laser printers ink jet printers, impact printers, scanners,
portable computers and desktop computers, or assigned to
special projects.
17
Product or skill areas may be added or changed in the future
subject to mutual agreement by Epson and Microdyne.
Each TTS representative will be rated according to skill level
as follows:
Level 1 - Capable of supporting one or more product or skill
areas.
Level 2 - A minimum of 6 months experience at Level 1
including 2 or more months of demonstrated capability to
support 3 or more product or skill areas.
Level 3 - A minimum of 18 months experience at Level 2
including 2 or more months of demonstrated capability to
support all product or skill areas.
Special Project - Special assignment to projects other than
telephone support.
Epson and Microdyne will strive to achieve and maintain the
following skill level allocation of TTS representatives,
excluding those assigned to special projects:
Xxxxx 0 20%
Level 2 70%
Level 3 10%
Epson may redefine the percentage of TTS representatives
allocated to Xxxxx 0 and Level 2 skill levels. However, if the
required Level 1 allocation percentage exceeds 20%, the stated
monthly charge per Level 1 TTS representative will be
increased by $150.
Changes in skill level designation for individual TTS
representatives will be made subject to mutual agreement by
Epson and Microdyne, and will occur on the first day of any
billing month.
3) Effective December 1, 1993:
Skill Level Monthly Charge per TTS Representative
----------- -------------------------------------
Level 1 $4,725
Level 2 $5,150
Level 3 $5,600
Special Project $5,400
4) Effective April 1, 1994, and April 1, 1995, prices will adjust
as indicated below based on the total number of TTS
representatives authorized and their skill level. Subsequent
adjustments may occur each month with pricing based on the
number of TTS representatives authorized on the first day of
the billing month.
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Effective Effective
TTS 10/1/94 - 4/1/95 -
Representative Skill Current 3/31/95 3/31/96
Authorized Level Price Price Price
-------------------------------------------------------------------------------------------------------
61 - 65 1 $4,890 $4,743 $4,910
2 $5,330 $5,170 $5,351
3 $5,796 $5,622 $5,819
*Sp. P. $5,589 $5,421 $5,611
66 - 70 1 $4,867 $4,721 $4,886
2 $5,305 $5,146 $5,326
3 $5,768 $5,595 $5,791
Sp. P. $5,562 $5,395 $5,584
71 - 75 1 $4,843 $4,698 $4,838
2 $5,279 $5,121 $5,274
3 $5,740 $5,568 $5,735
Sp.P. $5,535 $5,369 $5,530
76 - 80 1 $4,820 $4,675 $4,793
2 $5,253 $5,095 $5,222
3 $5,712 $5,541 $5,679
Sp. P. $5,508 $5,343 $5,477
81 - 85 1 $4,796 $4,652 $4,745
2 $5,227 $5,070 $5,172
3 $5,684 $5,513 $5,624
Sp.P. $5,481 $5,317 $5,423
86 - 90 1 $4,772 $4,629 $4,699
2 $5,202 $5,046 $5,122
3 $5,656 $5,486 $5,569
Sp. P. $5,454 $5,290 $5,370
91 - 95 1 $4,749 $4,607 $4,652
2 $5,176 $5,021 $5,071
3 $5,628 $5,459 $5,513
Sp. P. $5,427 $5,264 $5,317
96 - 100 1 $4,725 $4,583 $4,607
2 $5,150 $4,995 $5,021
3 $5,600 $5,432 $5,459
Sp P. $5,400 $5,238 $5,264
101 Rates will be negotiated
* Special Projects
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5) Monthly charges for TTS representatives include necessary
overhead and support personnel as determined by Microdyne.
These minimally include: 1 manager, 4 team leaders, and 1
trainer.
6) Microdyne will be expected to maintain acceptable levels of
employee attendance as follows:
#TTS Rep days worked in month = Monthly Attendance %
--------------------------------
#TTS Reps x # work days in month
A rolling six month minimum monthly attendance average of 94%
must be maintained for the immediate preceding six months. In
any month where the six month average falls below 94% the
monthly invoice will be reduced in percentage by the amount
that the six month average is below 94%. For example, a six
month average attendance percent of 92.5% would cause a 1.5%
decrease in the invoice for that month.
7) Epson will not be charged for TTS representatives who are
absent due to short or long term disability, leave of absence,
or jury duty; nor will these absences be counted against
Microdyne attendance percentages.
8) TTS representatives will collectively meet monthly time
allocation standards for either on line time or incoming time
allocation percentage as follows:
Dec 1993-Mar 1994 Apr 1994-Mar 1995 Apr 1995-Mar 1996
----------------- ----------------- -----------------
On Line Time 75.0% 78.0% 80.0%
or
Incoming Time 60.0% 62.4% 64.0%
Should the monthly time allocation standard not be met,
Microdyne will deduct 2.5% from the monthly invoice for
telephone technical support.
NOTE: Time Allocation
Time is allocated as percentage of telephone log on time. TTS
representatives should log on when their shift starts, and log
off when it ends, the exceptions being scheduled lunch break,
assignment to a training class, or other non-phone related
duties, where the ITS representative should be in a log off
condition.
Log on time is broken down into the following components:
-Available - On the phone and ready to take a
call.
-Incoming - Talking on a call.
-On Line - The sum of available and incoming
time.
-Work - After call work required to complete
or prepare for a call, return calls.
or call escalation.
-Break - Break, or restroom time where the
TTS representative is away from
his/her workstation.
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On Line Time x 100 = percent On Line Time
------------
Log on Time
Incoming Talk Time x 100 = percent Incoming Time
------------------
Log on Time
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed in counterparts. The persons signing warrant that they are authorized
to sign on behalf of the respective parties.
Accepted by: Accepted by:
EPSON AMERICA, INC. MICRODYNE CORPORATION
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxx Xxxxxxxx
---------------------------------- -------------------------------
Title: VP Service & Support Title: VP Operations
-------------------- --------------------------------
Date: 10/17/94 Date: 11/1/94
---------------------------------- -------------------------------
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