EXHIBIT 10.23
CONFIDENTIAL TREATMENT REQUESTED
FORM FACTOR, INC.
AUTHORIZED INTERNATIONAL DISTRIBUTOR AGREEMENT
This Authorized International Distributor Agreement ("Agreement"),
effective as of June 1, 2000 ("Effective Date"), is made between Form Factor,
Inc., a Delaware corporation with its principal place of business at 0000
Xxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000, ("Company"), and Spirox Corporation, a
Taiwan Corporation with its principal place of business at 6F-1, Xx. 00, Xxx Xxx
Xxxx, Xxxxxxx Xxxx, Xxxxxx, X.X.X. ("Distributor").
RECITALS
A. Company manufactures and distributes certain computer hardware
products, including the products listed in Exhibit A ("Company
Products"). This Agreement pertains only to "Company Products" as
listed in Exhibit A and not to any other products manufactured or
distributed by Company.
B. Distributor has 14 years of experience in distributor business in
Taiwan, has particular expertise in working with Taiwan-based
companies, and desires to be a distributor for Company's Product
and Services.
C. Company and Distributor desire that Distributor be authorized to
act as Company's sole independent distributor of Company Products
under the terms and conditions set forth below.
NOW, THEREFORE, Company and Distributor agree as follows:
1. Appointment as Authorized Company Distributor.
(a) Appointment. Subject to the terms of this Agreement, Company
appoints Distributor, and Distributor accepts such appointment, as the sole
independent distributor of Company Products as set forth in Exhibit A in and
limited to the territory set forth in Exhibit B (the "Territory"). Nothing in
this Agreement shall prohibit Company from making sales of Company Products
directly into the Territory, or permitting an entity that manufactures
semiconductor test equipment with which Company Products are used, from selling
Company Products directly into the Territory.
(b) Company's Reserved Rights. Company reserves the rights from
time to time, in its sole discretion and without liability to Distributor, to
change, or to add to or delete from the list of, Company Products by written
notice to the Distributor at least thirty (30) days prior to the effective date
of the change, addition, or deletion.
(c) Additional Distributors. With respect to the appointment of
additional distributors in the Territory, Company agrees that, provided
Distributor is meeting its obligations
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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hereunder and is not in breach of this Agreement, Company will not appoint a
second distributor in the Territory. Further, in the event that Company
reasonably believes Distributor is not meeting its obligations set forth
hereunder, prior to the appointment of any second distributor in the Territory,
Company will identify the inadequacies of Distributor's efforts and permit
Distributor thirty (30) days within which to cure the inadequacies. During the
30-day cure period, and thereafter assuming the deficiency(ies) were cured,
Company will not appoint any such second distributor.
2. Obligations of Distributor.
(a) Promotion Efforts. Distributor will use its best efforts to
(i) vigorously promote the distribution of Company Products in the Territory in
accordance with the terms and policies of Company as announced from time to
time; and (ii) satisfy those reasonable criteria and policies with respect to
Distributor's obligations under this Agreement communicated in writing to
Distributor by Company from time to time, including but not limited to Company's
style guide.
(b) Adaptation For Local Market. Distributor will be responsible
for translating, at its expense, all Company manuals, advertising and
promotional materials used in connection with Company Products into the
language(s) of the Territory if so instructed by Company in writing. Distributor
will consult with Company as to what changes need to be made to Company written
materials pursuant to this Section 2(b), and will obtain Company's prior written
consent to each such change to Company related written materials.
(c) Inventory. Distributor will maintain an inventory of Company
Products and warehousing facilities in the Territory sufficient to serve
adequately the needs of its customers on a timely basis.
(d) Personnel, Training and Support. Distributor will retain
personnel and institute and maintain programs sufficient to meet the standards
and obligations set forth in Exhibit C.
(e) Distributor Financial Condition. Distributor will maintain
and employ in connection with Distributor's business under this Agreement such
working capital and net worth as may be required in Company's reasonable opinion
to enable Distributor to carry out and perform all of Distributor's obligations
and responsibilities under this Agreement. From time to time, on reasonable
notice by Company, Distributor will furnish to Company a complete set of audited
financial statements, including a balance sheet, income statement and cash flow
statement, on an annual basis, and a copy of the summary financial documents
that Distributor routinely prepares in its ordinary course of business on a
quarterly basis. In the event that Distributor becomes a public company, the
foregoing financial condition disclosure requirement shall be replaced by the
requirement that Distributor provide to Company copies of all financial
documents Distributor publicly files.
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(f) Company Packaging. Except as provided in section 2(b),
Distributor will distribute Company Products with all packaging, warranties and
disclaimers intact as shipped from Company.
(g) No Competing Products. Except for Company Products,
Distributor will not represent or distribute during the term of this Agreement
any * * *-device or greater in-parallel (* * *) probe card products, or any
probing technology that competes with Company Products. Distributor warrants
that Exhibit D lists all of the manufacturers and distributors, and their
respective products, that Distributor represents or distributes as of the date
of full execution of this Agreement.
(h) Distributor Covenants. Distributor will:
(i) conduct business in a manner that reflects
favorably at all times on Company Products and the
good name, good will and reputation of Company;
(ii) avoid deceptive, misleading or unethical practices
that are or might be detrimental to Company,
Company Products or the public;
(iii) make no false or misleading representations with
regard to Company or Company Products;
(iv) not publish or employ, or cooperate in the
publication or employment of, any misleading or
deceptive advertising material with regard to
Company or Company Products;
(v) make no representations, warranties or guarantees
to customers or to the trade with respect to the
specifications, features or capabilities of Company
Products that are inconsistent with the literature
distributed by Company;
(vi) not enter into any contract or engage in any
practice detrimental to the interests of Company in
Company Products; and
(vii) not sell Company Products to entities outside of
the Territory, or to an entity which it knows or
reasonably should know will resell or transfer the
Company Products outside of the Territory.
(i) Compliance with Law. Distributor will comply with all
applicable international, national, state, regional and local laws and
regulations in performing its duties hereunder and in any of its dealings with
respect to Company Products.
(j) Compliance with U.S. Export Laws. Distributor agrees to
comply with all applicable international, national, state, regional and local
laws and regulations in performing its duties hereunder and in any of its
dealings with respect to the technical information and technology disclosed
hereunder or direct products thereof. In addition to such compliance and in
particular:
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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(i) Distributor agrees that it will not reexport or
release the software or technology it receives from
Company to any party involved in sensitive or
unsafeguarded nuclear activities, or activities
related to chemical or biological weapons or
missiles unless authorized by the U.S. Export
Administration Regulations or a license from the
U.S. Department of Commerce ("DOC"); and,
(ii) Without limiting the generality of Sections 2(m)
and 2(m)(i) immediately above, Distributor agrees
that it will not reexport or release any technical
information or technology it receives from Company,
including under License Exception TSR, 15 C.F.R.
Section 740.6, to a national of the countries named
in Section 2(m)(iv) below without a license
exception or a license from DOC; and,
(iii) Without limiting the generality of Sections 2(m)
and 2(m)(i) above, Distributor agrees that it will
not export the direct product of the technical
information or technology it receives from Company,
including under License Exception TSR, to a country
named in Section 2(m)(iv) below without a license
exception or a license from DOC if such foreign
produced direct product is subject to national
security controls as identified on the Commerce
Control List, 15 C.F.R. Supp. No. 1 to Part 774.
(iv) Albania, Armenia, Azerbaijan, Belarus, Bulgaria,
Cambodia, Cuba, Estonia, Georgia, Iran, Iraq,
Xxxxxxxxxx, Xxxxxxxxxx, Xxxx, Xxxxxx, Libya,
Lithuania, Moldova, Mongolia, North Korea, Romania,
Russia, Rwanda, Sudan, Syria, Tajikstan,
Turkmenistan, Ukraine, Uzbekistan and Vietnam.
(k) Governmental Approval. If any approval with respect to this
Agreement, or the notification or registration thereof, will be required at any
time during the term of this Agreement, with respect to giving legal effect to
this Agreement in the Territory, or with respect to compliance with exchange
regulations or other requirements so as to assure the right of remittance abroad
of U.S. dollars pursuant to Section 5(e) hereof or otherwise, Distributor will
immediately take whatever steps may be necessary in this respect, and any
charges incurred in connection therewith will be for the account of Distributor.
Distributor will keep Company currently informed of its efforts in this
connection. Company will be under no obligation to ship Company Products to
Distributor hereunder until Distributor has provided Company with satisfactory
evidence that such approval, notification or registration is not required or
that it has been obtained.
(l) Market Conditions. Distributor will advise Company promptly
concerning any market information that comes to Distributor's attention
respecting Company, Company Products, Company's market position or the continued
competitiveness of Company Products in the marketplace. Distributor will confer
with Company on a monthly basis concerning matters relating to market
conditions, sales forecasting and product planning relating to Company Products.
Distributor will also advise Company in writing on no less frequently than a
monthly basis as to competing products and technologies, and potentially
competing products and technologies.
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(m) Costs and Expenses. Except as expressly provided herein or
agreed to in writing by Company and Distributor, Distributor will pay all costs
and expenses incurred in the performance of Distributor's obligations under this
Agreement.
3. Inspections, Records and Reporting.
(a) Reports. Within 3 days of the end of each month, Distributor
will provide to Company a written report showing, for the time periods Company
reasonably requests, (i) Distributor's shipments of Company Products by dollar
volume, both in the aggregate and for such categories as Company may designate
from time to time, (ii) forecasts of Distributor's anticipated orders by Company
Product, (iii) Distributor's current inventory levels of Company Products, in
the aggregate and by Company Product and (iv) all purchase orders from
Distributor's customers of Company Products.
(b) Notification. Distributor will: (i) notify Company in writing
of any claim or proceeding involving Company Products within ten (10) days after
Distributor learns of such claim or proceeding; (ii) report to Company all
claimed or suspected product defects within 72 hours of Distributor's notice
thereof; and (iii) notify Company in writing not more than thirty (30) days
after any change in the management of Distributor or any transfer of more than
twenty-five percent (25%) of Distributor's voting control or a transfer of
substantially all its assets.
4. Order Procedure.
(a) Company Acceptance. All orders for Company Products placed by
Distributor to Company shall be in writing and shall be subject to acceptance in
writing by Company.
(b) Controlling Terms. The terms and conditions of this Agreement
and of the applicable Company Invoice or confirmation will apply to each order
accepted or shipped by Company hereunder. The provisions of Distributor's form
of purchase order or other business forms will not apply to any order
notwithstanding Company's acknowledgment or acceptance of such order.
(c) Cancellation. This Section 4(c) shall govern any and all
cancellation of orders accepted by Company. While Distributor is not obligated
to provide to Company a binding forecast for Company Products, this Section 4(c)
is intended to encourage Distributor to place orders at least * * * (* * *)
weeks before any scheduled delivery date for unforecasted orders and at least
* * * (* * *) weeks before any scheduled delivery date for forecasted orders.
(i) Company reserves the right to cancel any orders
placed by Distributor and accepted by Company as
set forth above, or to refuse or delay shipment
thereof, if Distributor (x) fails to make
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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any payment as provided in this Agreement (through
no fault of Company), or (y) otherwise fails to
comply with any of the material terms and
conditions of this Agreement, including by way of
example but not of limitation, Sections 2, 3 and 5.
No such cancellation, refusal or delay will be
deemed a termination (unless Company so advises
Distributor) or breach of this Agreement by
Company.
(ii) Company's acceptance of an order from Distributor,
consistent with Section 4(a), Distributor's
cancellation of such order, in whole or in part, is
subject to the non-refundable payment obligation(s)
of this Section 4(c)(ii). For orders involving new
designs for Products ("First Article Order"), if
the cancellation is (i) * * * prior to the
scheduled delivery date ("Delivery Date"), then
Distributor will have no cancellation payment
obligation, except for * * *, (ii) * * * prior to
the Delivery Date, then Distributor shall pay * * *
percent (* * * %) of the First Article Order, plus
* * *, (iii) * * * prior to the Delivery Date, then
Distributor shall pay * * * percent (* * * %) of
the First Article Order plus * * *, and (iv) * * *
prior to the Delivery Date, then Distributor shall
pay * * * percent (* * * %) of the First Article
Order plus * * *. All * * * submitted by Company to
Distributor should be in the amounts that are
reasonable and actual, and in no circumstance
exceeding the amount specified in the original
order. For orders involving repeat orders (i.e.,
Company Products identical to a Company Product
contained in a delivered and non-rejected First
Article Order), if the cancellation is (i) * * *
prior to the Delivery Date, then Distributor will
have no cancellation payment obligation, (ii) * * *
prior to the Delivery Date, then Distributor shall
pay * * * percent (* * * %) of the value of the
order, (iii) * * * prior to the Delivery Date, then
Distributor shall pay * * * percent (* * * %) of
the value of the order, and (iii) * * * prior to
the Delivery Date, then Distributor shall pay * * *
percent (* * * %) of the value of the order.
5. Prices and Payment.
(a) Prices to Distributor and Commissions on Third Party Sales
Into Territory.
(i) Prices. During the term of this Agreement, Company
shall inform Distributor of the current base prices
it will charge Distributor for Company Products.
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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(ii) Commissions on Third Party Sales Into the
Territory. If Company Products are sold within the
Territory by any third party based outside the
Territory ("Outside Products"), and Distributor
does not take title to or deliver the Outside
Products, Company will pay Distributor a commission
of at least * * * % but not more than * * * % of
the sales price of the Outside Products,
conditioned on (x) the sale into the Territory
occurring within * * * of the original sale by
Company to the third party, and (y) Distributor's
provision of the post-sale support described in
Exhibit C of this Agreement with respect to such
Outside Products and on the other terms and
conditions of this Agreement. In the event that
Company Products are shipped, or designated for
shipment, by a specific third party into the
Territory after the * * * time period, the * * *
time period shall be automatically extended to
* * * for all future sales by such third party.
(iii) Commissions to Third Parties. If Company, in its
sole discretion, determines that the sale or
license of Company Products within the Territory is
the result of the combined efforts of Distributor
and any third party, Company may increase the base
price to cover commissions payable to such third
party in such amount as Company determines to be
equitable, and Company's decision to do so and the
manner in which it does so will be final and
binding on all parties involved. The base price
increases and commission payable will be split
between the ship to site, the xxxx to site, and the
design win site on a percentage to be determined by
the Company at the time of the order.
(iv) Payments for Extraterritorial Shipments. If Company
Products are sold to Distributor and, then, after
re-sale by Distributor to its customer, shipped out
of the Territory for use within * * * of
Distributor's sale, or designated for such shipment
within the * * * time period, Distributor shall be
required to pay an amount equal to a * * * %
commission of the sale price to such entity as
designated by Company in consideration for support
and service of the Company Product outside of the
Territory. In the event that Company Products are
shipped, or designated for shipment, out of the
Territory after the * * * time period, the * * *
time period shall be automatically extended to
* * * for all future sales by Distributor to such
customer.
(b) Price Increase. In the event Company increases the base price
to Distributor for any class of Company Product, the increase shall apply to any
order received by
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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Company on or after the effective date of the increase. Company shall endeavor
to give Distributor as much notice as possible regarding a price increase, but
in all events at least twenty (20) days notice.
(c) Price Decrease. In the event that Company decreases the price
to Distributor for any Company Product, the decrease shall apply to any order
received by Company on or after the effective date of the decrease.
(d) Taxes. If any withholding or similar tax must be paid under
the laws of any country outside of the U.S. based on the payments to Company in
this Agreement, then Distributor will pay such taxes and such taxes shall be
deducted from the payments to Company. Distributor will provide Company with
written documentation, including but not limited to copies of receipts, of any
and all such taxes paid in connection with this Agreement. Distributor will pay
all sales, use and other taxes imposed by any applicable laws and regulations as
a result of the payments under this Agreement, other than taxes based upon
Company's net income.
(e) Payment Terms. Company shall issue an invoice to Distributor
upon shipment of the Company Products ("Invoice"). All payments shall be Net
* * * (* * *) days after the date of the Invoice assuming the shipment is void
of any major fault of Company, payable in United States dollars, free of any
currency control or other restrictions to Company at the address designated by
Company. Distributor shall at all times remain obligated to make payments to
Company regardless as to whether Distributor receives payment from a third party
to whom Distributor may resell Products. Unless otherwise agreed by Company in
writing, Distributor will pay all Invoices by:
(i) Wire transfer to a bank account designated by
Company the amount of the aggregate prices of the
Company Products ordered (plus any applicable
taxes, shipping and other charges); or,
(ii) Letter of credit payment wherein Distributor shall
cause to be issued by a bank acceptable to Company,
and confirmed by a bank designated by Company, one
or more irrevocable letters of credit to be equal
to the aggregate prices of the Company Products
ordered (plus any applicable taxes, shipping and
other charges) and to provide for payment at sight
upon presentation of Company's Invoices and
receipted shipping documents evidencing delivery of
the invoiced Company Products to the carrier or
freight forwarder; or,
(iii) A check drawn upon a U.S. bank; provided, however,
that if any such check tendered by Distributor
under this Section 5(e)(iii) is returned for
insufficient funds or dishonored in any way for any
reason, even without fault of Distributor, upon
written notice to
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* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
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Distributor Company may in its sole discretion void
this Section 5(e)(iii) and require that payment be
made under Sections 5(e)(i) or 5(e)(ii) only; and
provided, however, that the event Company in its
discretion voids this Section 5(e)(iii) according
to its terms, all other terms and conditions of
this Agreement shall remain in full force and
effect.
(f) Credit Terms. At Company's option, shipments may be made on
Company's credit terms in effect at the time an order is accepted. Company
reserves the right at all times either generally or with respect to any specific
order by Distributor to vary, change or limit the amount or duration of credit
to be allowed to Distributor. Distributor agrees to pay for Company Products as
invoiced.
(g) No Setoff. Distributor will not setoff or offset Company's
Invoices amounts that Distributor claims are due it. Distributor will bring any
claims or causes of action it may have in a separate action and waives any right
it may have to offset, setoff or withhold payment for Company Products delivered
by Company.
6. Shipment, Risk of Loss and Delivery.
(a) Shipment. All Company Products will be shipped by Company
F.O.B. Company's Livermore, California facility. All international shipments are
FCA Company's Livermore, California facility (ICC Incoterms, 2000). Shipments
will be made to Distributor's identified warehouse facilities or freight
forwarder, subject to approval in writing by Company in advance of shipment.
Unless specified in Distributor's order, Company will select the mode of
shipment and the carrier. Distributor will be responsible for and pay all,
shipping, freight and insurance charges, which charges Company may require
Distributor to pay in advance.
(b) Title and Risk of Loss. Title and all risk of loss of or
damage to Company Products will pass to Distributor upon delivery by Company to
the carrier, freight forwarder or Distributor, whichever first occurs.
(c) Partial Delivery. Company may make partial shipments on
account of Distributor's orders, to be separately invoiced and paid for when
due. Delay in delivery of any installment shall not relieve Distributor of its
obligation to accept the remaining deliveries.
(d) Delivery Schedule; Delays. Company will use commercially
reasonable best efforts to meet Distributor's requested delivery schedules for
Company Products as are mutually agreed upon between Distributor and Company,
but Company shall not be liable for any failure(s) to meet such dates. Any
request by Distributor for Company to delay a scheduled delivery shall be
subject to Company's approval, in its reasonable discretion. Company reserves
the right to refuse, cancel or delay shipment to Distributor when Distributor's
credit is impaired, when Distributor is delinquent in payments or fails to meet
other credit or financial requirements established by Company, or when
Distributor has failed to perform its obligations under this Agreement. Should
orders for Company Products exceed Company's available inventory, Company will
allocate its available inventory and make deliveries on a basis Company deems
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equitable, in its sole discretion, and without liability to Distributor on
account of the method of allocation chosen or its implementation.
7. Intentionally Blank.
8. Trademarks, Trade Names, Logos, Designations and Copyrights.
(a) Use During Agreement. During the term of this Agreement,
Distributor is authorized by Company to use the trademarks, trade names, logos
and designations Company uses for Company Products in connection with
Distributor's promotion and distribution of Company Products. Distributor's use
of such trademarks, trade names, logos and designations will be in accordance
with Company's policies in effect from time to time, including but not limited
to trademark usage policies. All such use by Distributor, and the goodwill
arising therefrom, shall inure to the benefit of Company. Distributor agrees not
to attach any additional trademarks, trade names, logos or designations to any
Company Product. Distributor further agrees not to use any Company trademark,
trade name, logo or designation in connection with any non-Company Product.
(b) Copyright, Patent, Trademark and other Proprietary Notices.
Distributor will include on each Company Product that it distributes, and on all
containers and storage media therefor, all trademark, copyright, patent and
other notices of proprietary rights included by Company on such Company Product.
Distributor agrees not to alter, erase, deface or overprint any such notice on
anything provided by Company. Distributor also will include the appropriate
trademark notices when referring to any Company Product in promotional
materials.
(c) Distributor Does Not Acquire Proprietary Rights. Distributor
has paid no consideration for the use of Company's trademarks, trade names,
logos, designations, copyrights, or patents, and nothing contained in this
Agreement will give Distributor any right, title or interest in any of them.
Distributor acknowledges that Company owns and retains all trademarks, trade
names, logos, designations, copyrights, patents, and other proprietary rights in
or associated with Company Products, and agrees that it will not at any time
during or after this Agreement assert or claim any interest in or do anything
that may adversely affect the validity of any trademark, trade name, logo,
designation, copyright, or patent belonging to or licensed to Company
(including, without limitation any act or assistance to any act, which may
infringe or lead to the infringement of any of Company's proprietary rights).
(d) No Continuing Rights. Upon expiration or termination of this
Agreement, Distributor will immediately cease all display, and use of all
Company trademarks, trade names, logos and designations and will not thereafter
use, advertise or display any trademark, trade name, logo or designation which
is, or any part of which is, similar to or confusing with any trademark, trade
name, logo or designation associated with any Company Product. The sale of
Company Products hereunder by Company does not convey any license to
Distributor, expressly or by implication, estoppel or otherwise, under any
patent, copyright, trade secret, trademark or other intellectual property right.
Company expressly reserves all of its rights with respect to such patent,
copyright, trade secret, trademark and/or other proprietary rights.
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(e) Obligation to Protect. Distributor agrees to use reasonable
efforts to protect Company's proprietary rights and to cooperate at
Distributor's expense in Company's efforts to protect its proprietary rights.
Distributor agrees to promptly notify Company of any known or suspected breach
of Company's proprietary rights that comes to Distributor's attention.
9. Assignment.
Company has entered into this Agreement with Distributor because
of Distributor's commitments in this Agreement, and further because of Company's
confidence in Distributor, which confidence is personal in nature. This
Agreement will not be assignable by either party, and Distributor may not
delegate its duties hereunder without the prior written consent of Company;
provided, however, that Company may assign this Agreement to a subsidiary or
entity controlling, controlled by or under common control with Company. The
provisions hereof shall be binding upon and inure to the benefit of the parties,
their successors and permitted assigns.
10. Duration and Termination of Agreement.
(a) Term.
(i) This Agreement is for a term of two (2) years
commencing upon the Effective Date. At the end of
such two-year period, this Agreement shall renew
automatically for additional one (1) year periods,
unless one party notifies the other of its
intention to terminate this Agreement at least
sixty (60) days prior to the end of the
then-current term.
(ii) Notwithstanding the provisions of this Section
10(a), or any other provisions of this Agreement,
this Agreement may be terminated prior to the
expiration of its stated term consistent with
Section 10(b), below.
(b) Company Termination For Cause or Convenience. Company may
terminate this Agreement at any time prior to the expiration of its stated term
in the event that:
(i) Distributor defaults in any payment due to Company
and such default continues unremedied for a period
of twenty (20) days following written notice of
such default.
(ii) Distributor fails to perform any other obligation,
duty or responsibility or is in default with
respect to any term or condition undertaken by
Distributor under this Agreement and such failure
or
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default continues unremedied for a period of thirty
(30) days following written notice of such failure
or default;
(iii) Distributor is merged, consolidated, sells all or
substantially all of its assets, or implements or
suffers any substantial change in management or
control; or
(iv) Any xxxx or regulation granting Distributor
extra-contractual compensation upon termination or
expiration of this Agreement is introduced into or
passed by the legislature or other governing body
of the Territory.
Additionally, Company may terminate this Agreement at any time upon 90
days written notice to Distributor.
(c) Automatic Termination. This Agreement terminates
automatically, with no further act or action of either party, if a receiver is
appointed for Distributor or its property, Distributor makes an assignment for
the benefit of its creditors, any proceedings are commenced by, for or against
Distributor under any bankruptcy, insolvency or debtor's relief law, or
Distributor is liquidated or dissolved.
(d) Orders After Termination Notice. For all orders submitted by
Distributor after notice of termination, or a notice of default, but prior to
the actual effective date of the termination, the provisions of this Section
10(d) shall apply.
(i) If the order was submitted by Distributor and
accepted in writing by Company, then Company shall
be obligated to meet its delivery obligations
consistent with Section 6, even if the agreed upon
delivery date falls after the date of termination;
provided, however, that if the notice of
termination, or notice of default, as the case may
be, was sent by Company to Distributor pursuant to
any of Subsections 10(b)(i), Company may require,
in its reasonable and sole discretion, that
Distributor pay in advance by a method of
Subsection 5(e)(i)-(iii), as selected by Company.
(ii) If the order was submitted by Distributor but not
accepted in writing by Company, Company may accept
or reject all or part of the order consistent with
its rights under Section 4 and Subsection 10(e)(v),
even if the ultimately agreed upon delivery date
falls after the date of termination; provided,
however, that if the notice of termination, or
notice of default, as the case may be, was sent by
Company to Distributor pursuant to any of
Subsections 10(b)(i), Company may require, in its
reasonable and sole discretion, that
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Distributor pay in advance by a method of
Subsection 5(e)(i)-(iii), as selected by Company.
(iii) If the order was submitted by Distributor after the
date of termination, then the provisions of Section
10(e) shall control.
(e) Effect of Termination or Expiration. Upon termination or
expiration of this Agreement:
(i) In the event that this Agreement is terminated by
Company for other than a breach by Distributor
under Section 10(b)(i) or (ii), Company will
reacquire Company Products then in Distributor's
possession at prices equal to the lesser of book
value based upon a straight-line * * * depreciation
schedule, or fair market value as determined
jointly by Company and Distributor. In no event
will such reacquiring prices be greater than the
prices originally paid by Distributor for
purchasing such Products.
(ii) For all orders or portions thereof which were
submitted to Company by Distributor prior to the
effective date of termination, the provisions of
Section 10(d) shall control. Additionally, Company
shall have the right to demand from Distributor
written assurances that Distributor will meet all
of its obligations under Section 2(d) with respect
to the Company Product for which the orders were
submitted and, if Distributor fails to provide
adequate assurances that it will meet its
obligations, Company may, sell Company Product
directly to Distributor's customers and treat
Distributor, after termination or expiration, as an
independent representative. In such an event,
Distributor shall be relieved of its Section 2(d)
obligations, and Company shall pay to Distributor a
commission of * * * % of the actual price paid by
the customer to Company for such Company Products.
(iii) Distributor shall cease using any Company
trademark, trade name, logo or designation.
(iv) Within one month after termination, Distributor
will provide, in writing: (w) all relevant
information, to the extent Distributor has the
same, concerning all customer contacts for Company
Products, including but not limited to the name,
title, company, address, phone number and e-mail
address if such contacts; (x) a report on the
status of all pending and prospective orders at
customers in the Territory, including the main
customer contact, product requirements, delivery
requirements and key decision makers, as well as
any commitments on price, specifications, or terms;
(y) a list of all installed Company Product and
their locations, with location contacts, in the
Territory; and (z) any open support issues
regarding such installed Company Products.
Additionally, within
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-13-
10 days of its provision of the information
described in (iv)(w)-(z), above, Distributor will
make any sales and support personnel Company deems
necessary for a smooth business transfer available
to meet with Company representatives for up to
three (3) days at Distributor's site. Distributor
shall instruct such personnel to fully cooperate in
good faith with the Company's representatives at
such meetings, and to fully and truthfully answer
all questions relevant to effecting a smooth
transfer of business.
(v) At Company's request upon the event of any
expiration or termination other than termination
due to an uncured breach by Distributor of its
Exhibit C obligations, Distributor is obligated to
continue to meet its Exhibit C obligations for a
period of no less than six (6) months after such
termination or expiration. Notwithstanding the
foregoing, in the event that termination is the
result of an uncured breach by Distributor relating
to Distributor's failure to meet its Exhibit C
obligations, then Distributor, at its election,
shall either: (x) for a period of * * * (* * *)
months after termination continue to conduct itself
in accordance with the no-compete provision of
Section 2(g), above; or (y) pay to Company an
amount equal to * * * percent (* * * %) of
Distributor's probe card purchases from Company for
the * * * (* * *) months immediately preceding
termination.
(f) No Damages For Termination or Expiration. NEITHER COMPANY NOR
DISTRIBUTOR SHALL BE LIABLE TO THE OTHER FOR DAMAGES OF ANY KIND, INCLUDING
INCIDENTAL OR CONSEQUENTIAL DAMAGES, ON ACCOUNT OF THE TERMINATION OR EXPIRATION
OF THIS AGREEMENT IN ACCORDANCE WITH THIS SECTION 10. DISTRIBUTOR WAIVES ANY
RIGHT IT MAY HAVE TO RECEIVE ANY COMPENSATION OR REPARATIONS ON TERMINATION OR
EXPIRATION OF THIS AGREEMENT UNDER THE LAW OF THE TERRITORY OR OTHERWISE, OTHER
THAN AS EXPRESSLY PROVIDED IN THIS AGREEMENT. Neither Company nor Distributor
will be liable to the other on account of termination or expiration of this
Agreement for reimbursement or damages for the loss of goodwill, prospective
profits or anticipated income, or on account of any expenditures, investments,
leases or commitments made by either Company or Distributor or for any other
reason whatsoever based upon or growing out of such termination or expiration.
Distributor acknowledges that (i) Distributor has no expectation and has
received no assurances that any investment by Distributor in the promotion of
Company Products will be recovered or recouped or that Distributor will obtain
any anticipated amount of profits by virtue of this Agreement, and (ii)
Distributor will not have or acquire by virtue of this Agreement or otherwise
any vested, proprietary or other right in the promotion of Company Products or
in "goodwill" created by its efforts hereunder. THE PARTIES ACKNOWLEDGE THAT
THIS SECTION HAS BEEN INCLUDED AS A MATERIAL INDUCEMENT FOR COMPANY TO
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-14-
ENTER INTO THIS AGREEMENT AND THAT COMPANY WOULD NOT HAVE ENTERED INTO THIS
AGREEMENT BUT FOR THE LIMITATIONS OF LIABILITY AS SET FORTH HEREIN.
(g) Survival. Company's rights and obligations and Distributor's
obligations to pay Company all amounts due hereunder, as well as Distributor's
rights and obligations under Sections 2(d) (and 2(g), if so elected by
Distributor under Section 10(e)(v)(x)), 3(b), 5(d), 5(e), 5(f), 5(g), 8, 9,
10(e), 10(f), 10(g), 12, 13, 14, 15, 16 and 17 shall survive termination or
expiration of this Agreement.
11. Relationship of the Parties.
Distributor's relationship with Company during the term of this
Agreement will be that of an independent contractor. Distributor will not have,
and will not represent that it has, any power, right or authority to bind
Company, or to assume or create any obligation or responsibility, express or
implied, on behalf of Company or in Company's name, except as herein expressly
provided.
12. Indemnification.
(a) Indemnification of Distributor. Subject to Sections
12(b)-(d), Company will, at its expense, defend
Distributor and its customers against and, subject to the
limitations set forth herein, pay all costs and damages
made in settlement or awarded against Distributor or its
customers resulting from or based upon any third party
claims that the Company Products sold hereunder, or any
part thereof constitutes an infringement of any patent,
trademark, copyright or other intellectual property right.
(i) Company's obligations under this Section 12(a)
shall arise only if Distributor promptly notifies
Company when any such claim is made, cooperates in
all regards with Company, as Company may reasonably
request, and does not engage in activities,
directly or indirectly, which frustrate or hinder
Company's efforts.
(ii) Company has sole control of the defense and
settlement of any such claim, including by way of
example, (x) the decision to procure for
Distributor the right to continue use or sale of
the Company Products, (y) the replacement of such
Company Products with non-infringing products,
and/or (z) the modification of such Company
Products so that they become non-infringing.
(iii) Distributor shall furnish such information and
assistance as Company may reasonably request in
connection with the defense, settlement or
compromise of such claim; provided, however, that
Company shall pay Distributor's reasonable
out-of-pocket costs associated therewith. If a
final injunction is obtained in an action
-15-
based on any such claim against Distributor's
distribution of a Company Product or Distributor's
customers' use of a Company Product by reason of
such infringement, or if in Company's opinion such
an injunction is likely to be obtained, Company
may, at its sole option, either (x) obtain for
Distributor the right to continue distributing the
Company Product or the right for Distributor's
customers to continue using the Company Product,
(y) replace or modify the Company Product so that
it becomes non-infringing, or (z) if neither (x)
nor (y) can be reasonably effected by Company,
Company will reimburse Distributor the prices paid
for the Company Product during the twelve (12)
months prior to the final injunction or decision
(eighteen (18) months for processor products,
unless actual use indicates the 12-month period is
appropriate), pro-rated over the useful life of
such Company Products, provided that such Company
Products are returned to Company in an undamaged
condition, and, in its discretion, terminate this
Agreement.
(b) No Combination Claims or Customer-Based Claims.
Notwithstanding subpart (a) of this Section 12, Company shall not be liable to
Distributor or its customers for any claim arising from or based upon: (i) the
combination, operation or use of any Company Product with equipment, data or
programming not supplied by Company; (ii) any alteration or modification of
Company Products; and/or (iii) a specification or design characteristic supplied
by Distributor or its customers.
(c) Limitation. THE PROVISIONS OF THIS SECTION SET FORTH THE
ENTIRE LIABILITY OF COMPANY AND THE SOLE REMEDIES OF DISTRIBUTOR WITH RESPECT TO
INFRINGEMENT AND ALLEGATIONS OF INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OR
OTHER PROPRIETARY RIGHTS OF ANY KIND IN CONNECTION WITH THE INSTALLATION,
OPERATION, DESIGN, DISTRIBUTION OR USE OF COMPANY PRODUCTS.
(d) Indemnification of Company. Distributor agrees to indemnify
Company (including paying all reasonable attorneys' fees and costs of
litigation) against and hold Company harmless from, any and all claims by any
other party resulting from Distributor's acts (other than the mere marketing of
Company Products), omissions or misrepresentations, regardless of the form of
action.
13. Limited Warranty; Disclaimer of Warranties.
(a) Limited Warranty. COMPANY MAKES NO WARRANTIES OR
REPRESENTATIONS AS TO PERFORMANCE OF COMPANY PRODUCTS OR AS TO SERVICE TO
DISTRIBUTOR OR TO ANY OTHER PERSON, EXCEPT AS SET FORTH IN COMPANY'S LIMITED
WARRANTY ACCOMPANYING DELIVERY OF COMPANY PRODUCTS ("LIMITED COMPANY PRODUCT
WARRANTY"). COMPANY RESERVES THE RIGHT TO CHANGE THE WARRANTY AND SERVICE POLICY
SET FORTH
-16-
IN THE LIMITED COMPANY PRODUCT WARRANTY, OR OTHERWISE, AT ANY TIME, WITHOUT
FURTHER NOTICE AND WITHOUT LIABILITY TO DISTRIBUTOR OR TO ANY OTHER PERSON;
PROVIDED, HOWEVER, THAT ANY SUCH CHANGES SHALL BE PROMPTLY COMMUNICATED TO
DISTRIBUTOR AND SHALL BE EFFECTIVE ONLY FOR FUTURE ORDERS FOR COMPANY PRODUCT
AND NOT FOR ORDERS ALREADY PLACED WITH COMPANY BY DISTRIBUTOR.
(b) Disclaimer of Warranties. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, AND SUBJECT ONLY TO THE LIMITED COMPANY PRODUCT WARRANTY, ALL
IMPLIED WARRANTIES, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT, ARE
HEREBY EXCLUDED BY COMPANY.
(c) Distributor Warranty. Distributor will make no warranty,
guarantee or representation, whether written or oral, on Company's behalf.
14. Limited Liability.
(a) REGARDLESS WHETHER ANY REMEDY SET FORTH HEREIN OR IN
COMPANY'S LIMITED WARRANTY ACCOMPANYING DELIVERY OF COMPANY PRODUCTS FAILS OF
ITS ESSENTIAL PURPOSE OR OTHERWISE, COMPANY WILL NOT BE LIABLE FOR ANY LOST
PROFITS OR FOR ANY DIRECT, INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR
OTHER SPECIAL DAMAGES SUFFERED BY DISTRIBUTOR, ITS CUSTOMERS OR OTHERS ARISING
OUT OF OR RELATED TO THIS AGREEMENT OR COMPANY PRODUCTS, FOR ALL CAUSES OF
ACTION OF ANY KIND (INCLUDING TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY AND
BREACH OF WARRANTY), EVEN IF COMPANY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
(b) EXCEPT FOR LIABILITY FOR PERSONAL INJURY OR PROPERTY DAMAGE
ARISING FROM COMPANY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, AND FOR CLAIMS
ARISING UNDER SECTION 12, IN NO EVENT WILL COMPANY'S TOTAL CUMULATIVE LIABILITY
IN CONNECTION WITH THIS AGREEMENT OR COMPANY PRODUCTS, FROM ALL CAUSES OF ACTION
OF ANY KIND, INCLUDING TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY AND BREACH
OF WARRANTY ASSERTED BY DISTRIBUTOR AGAINST COMPANY, EXCEED 5% OF COMPANY'S
ANNUAL EARNINGS. THIS LIMITATION OF COMPANY'S LIABILITY IS CUMULATIVE, WITH ALL
PAYMENTS FOR CLAIMS OR DAMAGES IN CONNECTION WITH THIS AGREEMENT BEING
AGGREGATED TO DETERMINE SATISFACTION OF THE LIMIT. THE EXISTENCE OF ONE OR MORE
CLAIMS WILL NOT ENLARGE THE LIMIT. FURTHER, THE FOREGOING 5% OF COMPANY'S ANNUAL
EARNINGS LIMITATION SHALL NOT APPLY TO THOSE CLAIMS BROUGHT BY DISTRIBUTOR
AGAINST COMPANY IN WHICH: (I) THE CLAIM SEEKS INDEMNIFICATION FOR AN ACTION
FILED BY A DISTRIBUTOR END-CUSTOMER AGAINST DISTRIBUTOR; AND (II) THE END
CUSTOMER'S CLAIM AGAINST DISTRIBUTOR IS
-17-
BASED UPON AN ACT OR OMISSION OF COMPANY OR UPON COMPANY PRODUCTS, AND IS NOT
BASED UPON AN ACT OR OMISSION OF DISTRIBUTOR; SUCH CLAIMS SHALL BE LIMITED BY
THE LESSER OF THE LIABILITY CAP PLACED BY DISTRIBUTOR ON ITS END-CUSTOMERS, THE
AMOUNT OF THE TOTAL PURCHASES OF COMPANY PRODUCTS FROM DISTRIBUTOR BY
DISTRIBUTOR'S END-CUSTOMER FOR THE PRIOR TWELVE (12) MONTHS OR US$2,000,000.
(c) Distributor agrees that the limitations of liability and
disclaimers of warranty set forth in this Agreement, including those referenced
herein, will apply regardless of whether Company has tendered delivery of
Company Products or Distributor has accepted any Company Product. Distributor
agrees to communicate all Company Product Warranties to Distributor's customers.
Distributor acknowledges that Company has entered into this Agreement in
reliance on the disclaimers of warranty and the limitations of liability set
forth in this Agreement, and that the same form an essential basis of the
bargain between the parties.
15. Confidentiality.
(a) As used in this Agreement, "Confidential Information" means
all information disclosed by one party ("Discloser") to the other party
("Recipient") in tangible form that is marked "Proprietary" or "Confidential."
Oral information is Confidential Information only if designated as proprietary
or confidential by Discloser at the time of disclosure, and summarized and
identified as proprietary or confidential in a document sent to Recipient within
thirty (30) days of the disclosure.
(b) Neither party shall disclose the other party's Confidential
Information to any third party, nor use the Confidential Information for any
purpose other than is expressly contemplated by this Agreement. Recipient shall
use the same degree of care to protect Discloser's Confidential Information as
it uses to protect its own Confidential Information, but no less than reasonable
care, to prevent unauthorized disclosure, use, or publication of Discloser's
Confidential Information. Recipient may disclose Discloser's Confidential
Information only to Recipient's employees, contractors, or other agents who have
been previously bound in writing to a non-disclosure agreement that protects the
Confidential Information. Each party agrees to notify the other immediately in
the event of an unauthorized disclosure or use of any Confidential Information.
(c) The parties' duty to protect Confidential Information shall
survive any expiration or termination of this Agreement, and shall extend for a
period of five (5) years from the date of disclosure of the Confidential
Information.
(d) This Agreement imposes no duty upon Recipient with respect to
information that: (i) is or becomes generally known to the public without
violation of this Agreement; (ii) was in Recipient's lawful possession prior to
its disclosure hereunder and was not obtained by Recipient either directly or
indirectly from Discloser; (iii) is lawfully disclosed to Recipient by a third
party without restriction on its disclosure; or (iv) is independently developed
by Recipient without use or reference to any of Discloser's Confidential
Information.
(e) Recipient shall return to Discloser all Confidential
Information promptly upon expiration or termination of this Agreement, or upon
any earlier request to do so made in writing by Discloser.
---------------------
*** Confidential treatment has been requested for portions of this exhibit. The
copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with The Securities and Exchange Commission.
-18-
(f) Neither party shall disclose the fact of this Agreement or
any of its terms and conditions to any third party without the other party's
prior approval in writing. Notwithstanding the foregoing, each party may
disclose the existence and content of this Agreement in confidence to its legal
counsel, accountants, bankers and financing sources as necessary in connection
with obtaining services from such third parties, provided such third parties are
bound to confidentiality no less stringent than the provisions of this
Agreement. Further, each party may disclose the existence and contents of this
Agreement as required by the applicable rules and regulations of the Securities
Exchange Commission or equivalent authority in any other relevant jurisdiction;
subject, however, to the party taking reasonable steps consistent with such
rules and regulations to minimize the scope and extent of the disclosure.
(g) Distributor agrees to require all of its customers or
potential customers of Company Products to execute with Company the
Non-Disclosure Agreement attached hereto as Exhibit E before discussing,
describing or disclosing any non-published information concerning Company
Products with or to such customers or potential customers.
16. Arbitration.
(a) Each party will make reasonable best efforts to resolve
amicably any disputes or claims under this Agreement among the parties. Except
for claims regarding either party's Intellectual Property Rights and
Confidential Information, to which this Section 16 will not apply, and subject
to Section 17(g), in the event that a resolution is not reached among the
parties within thirty (30) days after written notice by any party of the dispute
or claim, the dispute or claim shall be finally settled by binding arbitration
in Pleasanton, California. Such arbitration shall be conducted in accordance
with the rules of the American Arbitration Association ("AAA"), except where the
provisions of this Section 16 provide contrary or additional rules. Each of the
parties shall appoint one arbitrator and the two so nominated shall, in turn,
choose a third arbitrator. If the arbitrators chosen by the parties cannot agree
on the choice of the third arbitrator within a period of thirty (30) days after
their nomination, then the third arbitrator shall be appointed consistent with
the Rules of the AAA. The arbitration shall be administered out of the local San
Francisco, California office of the AAA. The award of arbitration shall be final
and binding upon both parties, and judgment on the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. Any monetary
award shall be payable in United States dollars.
(b) The arbitration shall be conducted in the English language.
Relevant documents in other languages shall be translated into English if the
arbitrators so direct. The law of the State of California, U.S.A., excluding the
Convention on Contracts for the International Sale of Goods and that body of law
known as conflicts of laws, shall be the applicable substantive law. The
applicable procedural law shall be the law of the place of arbitration. The
parties agree that they will, before the hearing of any dispute, make discovery
and disclosure of all materials relevant to the subject matter of such dispute.
(c) A written transcript in English of the hearing will be made
and furnished to the parties. Examination of witnesses by the parties and by the
arbitrators will be permitted.
-19-
(d) The arbitrators will decide in accordance with the terms of
this Agreement and will take into account any appropriate international trade
usages applicable to the transaction. The arbitrators will state in writing the
reasons upon which the award is based.
(e) The award of the arbitrators will be final and binding upon
the parties. Judgment upon the award may be entered in any court having
jurisdiction. An application may be made to any such court for judicial
acceptance of the award and an order of enforcement.
17. General.
(a) Waiver. The waiver by either party of any default by the
other shall not waive subsequent defaults of the same or different kind, and all
waivers must be in writing.
(b) Notices. All notices and demands hereunder will be in writing
and will be served by personal service, mail or confirmed facsimile transmission
at the address of the receiving party set forth in this Agreement (or at such
different address as may be designated by such party by written notice to the
other party). All notices or demands by mail shall be by certified or registered
airmail, return receipt requested, and shall be deemed complete upon receipt.
(c) Attorneys' Fees. In the event any litigation is brought by
either party in connection with this Agreement, the prevailing or substantially
prevailing party in such litigation shall be entitled to recover from the other
party all the costs, attorneys' fees and other expenses incurred by such
substantially prevailing party in the litigation.
(d) Execution of Agreement, Controlling Law,
Jurisdiction and Severability. It shall be governed by and construed in
accordance with the laws of the State of California, excluding the Convention on
Contracts for the International Sale of Goods and that body of law known as
conflicts of laws. Any suit hereunder will be brought in the federal or state
courts in the Northern District of California and Distributor hereby submits to
the personal jurisdiction thereof. The English-language version of this
Agreement controls when interpreting this Agreement. Distributor consents to the
enforcement of any judgment rendered in the United States in any action between
Distributor and Company. Any and all defenses concerning the validity and
enforceability of the judgment shall be deemed waived unless first raised in a
court of competent jurisdiction in the United States.
(e) Severability. In the event that any of the provisions of this
Agreement shall be held by a court or other tribunal of competent jurisdiction
to be unenforceable, such provision will be enforced to the maximum extent
permissible and the remaining portions of this Agreement shall remain in full
force and effect.
(f) Force Majeure. Company shall not be responsible for any
failure to perform due to unforeseen circumstances or to causes beyond Company's
reasonable control, including but not limited to acts of God, war, riot,
embargoes, acts of civil or military authorities, fire, floods, accidents,
strikes, failure to obtain export licenses or shortages of transportation,
-20-
facilities, fuel, energy, labor or materials. In the event of any such delay,
Company may defer the delivery date of orders for Company Products for a period
equal to the time of such delay.
(g) Equitable Relief. Distributor acknowledges that any breach of
its obligations under this Agreement with respect to the proprietary rights or
Confidential Information of Company will cause Company irreparable injury for
which there are inadequate remedies at law, and therefore Company will be
entitled to equitable relief in addition to all other remedies provided by this
Agreement or available at law.
(h) Entire Agreement. This Agreement, including Exhibits A
through E appended hereto, constitute the complete and exclusive agreement
between the parties pertaining to the subject matter hereof, and supersedes in
their entirety any and all written or oral agreements previously existing
between the parties with respect to such subject matter. Distributor
acknowledges that it is not entering into this Agreement on the basis of any
representations not expressly contained herein. Any modifications of this
Agreement, or special terms and conditions for a particular and unique purchase
order that are necessary and appropriate in view of the totality of the
circumstances, must be in writing and signed by both parties hereto. Any such
modification or special terms and conditions shall be binding upon Company only
if and when documented in a separate writing signed by one of Company's duly
authorized officers.
(i) Release of Claims. Any and all claims against Company arising
under prior agreements, whether oral or in writing, between Company and
Distributor are waived and released by Distributor by acceptance of this
Agreement.
(j) Choice of Language. The original of this Agreement has been
written in English. Distributor waives any right it may have under the law of
Distributor's Territory to have this Agreement written in the language of
Distributor's Territory.
(k) Due Execution. The party executing this Agreement represents
and warrants that he or she has been duly authorized under Distributor's charter
documents and applicable law to execute this Agreement on behalf of Distributor.
[Signatures on next page]
-21-
IN WITNESS WHEREOF, the parties hereto have caused their respective duly
authorized officers to execute this Agreement.
COMPANY
SIGNATURE: /s/ Xxxxx X. Xxxxxxx
----------------------------------
PRINTED NAME: Xxxxx X. Xxxxxxx
-------------------------------
TITLE: VP - Sales
--------------------------------------
DISTRIBUTOR
SIGNATURE: /s/ Xxxxx Xxxx
----------------------------------
PRINTED NAME: Xxxxx Xxxx
-------------------------------
TITLE: President
--------------------------------------
(Signature Page to FormFactor Authorized International Distributor Agreement)
-22-
EXHIBIT A
COMPANY PRODUCTS
All MicroSpring(TM) contact probe cards
COMPANY DISTRIBUTOR
SIGNATURE: /s/ Xxxxx X. Xxxxxxx SIGNATURE: /s/ Xxxxx Xxxx
------------------------ -----------------------------
-00-
XXXXXXX X
XXXXXXXXX
XXXXXX, XXXXXXXXX
&
PEOPLES REPUBLIC OF CHINA (INCLUDING HONG KONG)
COMPANY DISTRIBUTOR
SIGNATURE: /s/ Xxxxx X. Xxxxxxx SIGNATURE: /s/ Xxxxx Xxxx
------------------------ -----------------------------
-24-
EXHIBIT C
PERSONNEL AND SUPPORT REQUIREMENTS
(1) Distributor Personnel and Staffing. Company and Distributor agree
that to ensure purchasers and potential purchasers of Company Products realize
the full and complete value of Company Products, Distributor shall dedicate a
certain minimum level of full-time resources to Company Products during the term
of this Agreement. It is understood that these Distributor individuals will work
closely with Company, including with a Company Field Marketing Manager or other
employee(s) who reside(s) in the Territory. Based upon the currently projected
level of business, Distributor shall train and maintain at least:
(a) * * * (* * *) full-time * * * stationed within the
Territory who shall be responsible for the support of (i)
the installed base of Company Products, (ii) preventive
maintenance, (iii) product support (trouble shooting),
(iv) reporting, and (v) installations;
(b) * * * (* * *) full-time * * * stationed within the
Territory who shall be responsible for (i) addressing
complex customer satisfaction issues, e.g., ***
that will require tester and test programming
experience, (ii) introducing new technologies such as
* * *, that will require engineering skills to set up
experiments, advanced troubleshooting, electrical
engineering, test integration, and (iii) project
management to develop and document plans with customers.
(c) * * * (* * *) full-time dedicated * * * stationed within
the Territory who shall be responsible for (i)
establishing and advancing culture, structure, alignment
with Company strategy and plans, and (ii) providing
project management support and escalation for Distributor
engineering resources.
(d) * * * (* * *) full-time * * * stationed at Company's
facility in Livermore, CA, who shall be the "voice" of the
Territory customer and be responsible for (i) establishing
enhancement projects, (ii) leading product margin
improvements, (iii) gathering information to support and
close Taiwan support issues on an efficient and expedited
basis, (iv) developing Taiwan specific products and
features together with Company engineering resources, and
(v) establishing technical/support/application strategy
with Company sales and marketing team.
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-25-
It is agreed by Company and Distributor that the * * * of Section 1(d)
need not be assigned as of the Effective Date. The need for * * * shall
be revisited on a quarterly basis and the parties shall determine,
through good faith discussions, when the appointment of such * * * is
appropriate.
(2) Technical Expertise. As a general matter, Distributor and its staff
will be conversant with the technical language conventional to Company Products
and similar products in general, and will develop sufficient knowledge of the
industry, of Company Products, and of products competitive with Company Products
(including specifications, features and benefits) so as to be able to explain in
detail to its customers the differences between Company Products and competitive
products. Without limiting the foregoing, Distributor's (i) product support
engineers shall have sufficient expertise regarding (x) Process Knowledge, i.e.,
customer interaction, installation, trouble shooting, care and handling,
auditing, maintenance/user training delivery, (y) Product Knowledge, i.e.,
fabrication processes, probe card assembly and test, probe card knowledge,
probing, mechanical/test cell, and (z) Failure Analysis; and (ii) application
support engineers shall have sufficient expertise regarding (x) applications,
***, (y) Product Knowledge, i.e., fabrication processes, probe card assembly and
test, probe card knowledge, and (z) Process Knowledge (i.e., problem solving
skills, troubleshooting, experiment design.
(3) Training. Distributor will send the individuals described in
Sections 2(a) and (b) of this Agreement to Company's facility in Livermore, CA
for training on Company Products and services. The training will be provided
free of charge at the Company offices in Livermore. The length of the training
time will be reasonable and appropriate in Company's judgment, all such training
will be in English, and Distributor will bear all travel and living expenses for
such personnel sent to Company for training.
(4) Service and Support. Distributor will provide prompt pre- and
post-sales service and support for all Company Products located in the
Territory. Distributor will provide necessary and useful installation assistance
and consultation on the use of Company Products, timely respond to customers'
general questions concerning use of Company Products, and assist customers in
the diagnosis and correction of problems encountered in using Company Products.
Additionally, Distributor will provide the following design assistance during
design of new versions of Company Products:
(a) Daily technical interface to customers and Company for
electrical and physical design of the probe head and PCB;
(b) Regular reporting of technical issues raised by the
customer during the design process;
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-26-
(c) Be responsible for completing all tasks requested by the
Company to obtain customer approval of the design; and
(d) Provide a daily interface to customer purchasing so that
timely orders may be obtained.
(5) Culture and Management Style. Distributor shall:
(a) Endeavor to provide local problem solving by taking
ownership for customer problem and, whenever reasonably
possible, resolve problems locally;
(b) Engage in pro-active activities and actively support and
promote Company Products and solutions;
(c) Take the initiative to suggest improvements to Company's
structure and processes and shall engage in global
knowledge sharing within the Company technical resource
community; and
(d) Dedicate resources to enable initiative and ownership
beyond the next, Taiwan specific support task.
(6) Quantifiable Metrics. In providing the support and assistance
described in this Exhibit C, the following sets forth the agreed upon
goals for the second half of 2001:
(a) * * *;
(b) * * * reduction by * * * % in Q4 of 2001 from the levels
in Q3 of 2001;
(c) * * * to be determined by the end of the second week of Q4
of 2001;
(d) * * *;
(e) Contribution of * * * per quarter to Company (shared with
Company's global customer base);
(f) * * *, as quantified by measures to be determined by the
end of Q4 of 2001;
(g) Local execution of customer support processes:
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-27-
(h) * * * according to fully documented process/expectations;
(i) Consistent doc/reporting of service incidents (DOAs,
SARs);
(j) * * * following documented process (1st pass completed in
Q4 of 2001) * * *;
(k) * * * (documented process); and
(l) Identification of a metric * * * by Q4 of 2001.
(7) Updating Metrics. Company and Distributor shall meet on no less than
a quarterly basis to address the metrics and set new metrics for the
then-remaining term of the Agreement.
COMPANY DISTRIBUTOR
SIGNATURE: /s/ Xxxxx X. Xxxxxxx SIGNATURE: /s/ Xxxxx Xxxx
-------------------- -----------------------------
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
-28-
EXHIBIT D
MANUFACTURERS AND DISTRIBUTORS
[insert Distributor's line card)
COMPANY DISTRIBUTOR
SIGNATURE: /s/ Xxxxx X. Xxxxxxx SIGNATURE: /s/ Xxxxx Xxxx
------------------------ -----------------------------
* * * 2 1/2 pages * * *
--------------
* * * Confidential treatment has been requested for portions of this exhibit.
The copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as *****. A complete version of this exhibit
has been filed separately with the Securities and Exchange Commission.
EXHIBIT E
COMPANY NON-DISCLOSURE AGREEMENT
SEE ATTACHED NDA AND CITR
COMPANY DISTRIBUTOR
SIGNATURE: /s/ Xxxxx X. Xxxxxxx SIGNATURE: /s/ Xxxxx Xxxx
------------------------ -----------------------------
AGREEMENT DATE: 6/1/2000 CNDA #
-------------- ----------------------------
(Filled In by FFI Legal)
FORMFACTOR, INC.
CORPORATE NON-DISCLOSURE AGREEMENT
This Corporate Non-Disclosure Agreement (this "Agreement") is entered into and
made effective as of the date set forth above, by and between: FORMFACTOR, INC.,
a Delaware corporation having a principal place of business at: 0000 Xx Xxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000 ("FormFactor ");
and Spirox , a Taiwan corporation, having a principal
-------------- --------------------------
(State of Incorporation)
place of business
at 6F-1, No. 69, Tze You Road Xxxx Xxx City, Tzian ROC , ("Company")
----------------------------------------------------------------
(Xxxxxx Xxxxxxx, Xxxx, Xxxxx, Zip Code, Country)
FormFactor and Company (also referred to individually as a "Party" and
collectively as the "Parties") agree as follows:
1. CONFIDENTIAL INFORMATION.
1.1 "Confidential Information" means any confidential or proprietary
information, technical data, or know-how relating to the disclosing
Party's business, including, but not limited to, that which relates to
research, products, services, customers, markets, software,
developments, formulas, ideas, inventions (patentable or otherwise),
processes, designs, drawings, engineering, marketing, finances,
customers and/or to technical, business, financial or product
development plans, forecasts or strategies.
1.2 All Confidential Information disclosed by FormFactor and/or Company, as
the case may be, shall be accompanied by a completed Confidential
Information Transmittal Record ("CITR") form, a copy of which is
appended hereto. The Parties shall execute a CITR contemporaneous with
each disclosure of Confidential Information. The CITR shall indicate the
disclosing Party(ies), a description of the Confidential Information
disclosed, the names of the representatives of the Parties and the date
when the disclosure covered by the CITR commenced. All CITRs and
Confidential Information (or copies thereof) shall be directed to the
attention of the "Contact Individual" identified in the signature block
below. All information described in a CITR and marked with the legend
"Confidential," "Proprietary" or a similar legend, will be deemed
Confidential Information. The failure to complete a CITR contemporaneous
with the disclosure of Confidential Information shall not be deemed to
constitute an admission that information is, in fact, not Confidential
Information.
1.3 All Confidential Information received from the disclosing Party will be
in tangible form or reduced to a tangible form thereafter. A summary of
verbal disclosures of Confidential Information shall be reduced to
writing, marked "Confidential" and delivered to the receiving Party
within thirty (30) days of the verbal disclosure (if not addressed in a
CITR).
1.4 Confidential Information does not include information, technical data or
know-how or know-how which, through extant, contemporaneously prepared
written records:
(a) Is rightfully in the possession of the receiving Party at
the time of disclosure as shown by the receiving Party's files and
records immediately prior to the time of disclosure;
(b) Is or becomes part of the public knowledge or literature,
not as a result of any inaction or action of the receiving Party:
(c) Is approved for release by the disclosing Party;
(d) Is rightfully received from a third party without any
obligation of confidentiality; or
(e) Is independently developed by employees of the receiving
Party without reliance or reference to the disclosure by the disclosing
Party.
1.5 Each Party acknowledges and agrees that all Confidential Information is
provided "AS IS" and without any warranty, whether express or implied,
as to its accuracy or completeness, non-infringement or use for a
particular purpose. Neither Party has an obligation to disclose any
particular or specific Confidential Information, even if it falls
generally within the scope of the materials and information described in
Paragraph 1 of a CITR, or relates thereto.
2. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION.
2.1 FormFactor and Company each agree not to use the Confidential
Information disclosed to it by the other for any purpose other than for
its internal evaluation in relation to a potential business relationship
with the other Party and, then, solely with respect to those specific
activities mutually proposed or contemplated by the Parties
("Purposes"). FormFactor and Company will disclose the other Party's
Confidential Information only to those of its own employees, consultants
or independent contractors, who are required to have the information in
order to carry out the Purpose. The Parties acknowledge and agree that
certain Confidential Information may be of such a highly sensitive and
proprietary nature that disclosure and use of the same shall be further
narrowed and limited as may be described in Paragraph 3 of a CITR. All
employees, consultants and independent contractors to whom Confidential
Information of the party is disclosed shall have signed a Non-Disclosure
Agreement that binds such employees, consultants or independent
contractors to confidentiality obligations at least as restrictive as
those set forth herein. Neither Party shall use Confidential Information
for the benefit of any other entity or a third party, or disclose,
publish, disseminate or copy Confidential Information or any part
thereof, to any other person, corporation or other organization without,
in each case, obtaining the prior written consent of the other Party.
2.2 FormFactor and Company each agree that it will take all reasonable steps
to protect the secrecy of and avoid disclosure or use of Confidential
Information of the other in order to prevent it from falling into the
public domain or the possession of unauthorized persons FormFactor and
Company each agree to notify the other in writing of any misuse or
misappropriation of such Confidential Information of the other which may
come to its attention. If any Party (the "Requested Party") receives
notice of a request by any court, regulatory agency or tribunal for
production of any Confidential Information of the other Party, the
Requested Party shall promptly notify the other Party and shall use
reasonable efforts to limit disclosure and to obtain confidential
treatment or a protective order and shall allow the disclosing Party to
participate in the proceeding If requested, the disclosing Party shall
assist (at the Requested Party's expense) in resisting the request for
production.
3. RETURN OF MATERIALS. Any materials or documents which have been
furnished by one Party to the other will be promptly returned, accompanied by
all copies of such documentation promptly upon request. Upon demand, any
materials prepared by a Party containing the Confidential Information of the
other Party shall be destroyed, and a certificate executed by an officer of the
Party confirming such destruction shall be promptly delivered.
4. INTELLECTUAL PROPERTY RIGHTS. Nothing in this Agreement is intended to
grant or does grant, either expressly or by implication, to either Party any
rights in or to the other Party's Confidential Information, except the limited
right to review such Confidential Information solely for the Purpose. FormFactor
and Company, and each of them, understand and acknowledge that no license under
any patent, copyright, trade secret or other intellectual property right is
granted to or conferred upon either Party under this CNDA, and/or based upon any
disclosure under a CITR, either expressly, by implication, inducement, estoppel
or otherwise, and that any license under such intellectual property rights must
be express and in writing. I no event shall this Agreement, or any disclosure of
Confidential Information made hereunder, obligate or require either Party to
enter into any other business relationship. The terms and conditions of any such
relationship shall be subject to separate negotiation and agreement of the
Parties.
5. TERM. All obligations of confidentiality and restrictions on use of
Confidential Information created under and by this Agreement shall remain in
force and effect for five (5) years from the date any Confidential Information
is or was disclosed by FormFactor to Company or by Company to FormFactor, as the
case may be. All other terms and conditions of this Agreement shall survive the
termination of this Agreement.
6. REMEDIES: Each Party agrees that its obligations hereunder are necessary
and reasonable in order to protect the other Party and the other Party's
business, and expressly agrees that monetary damages would be inadequate to
compensate the other Party for any breach of any covenants or agreement set
forth herein. Accordingly, each Party agrees and acknowledges that any such
violation or threatened violation will cause irreparable injury to the other
Party and that, in addition to any other remedies that may be available, in law,
in equity or otherwise, the other Party shall be entitled to obtain injunctive
relief against the threatened breach of this Agreement or the continuation of
any such breach, without the necessity of proving actual damages.
7. MISCELLANEOUS.
7.1 This Agreement may not be assigned by either Party without the express
written consent of the other Party, which may be given or withheld at
the sole discretion of the other Party. This Agreement shall be binding
upon and for the benefits of the undersigned Parties, and any permitted
successors or assigns.
7.2 Each Party agrees that it will not in any form export, re-export,
resell, ship or divert or cause to be exported, re-exported, resold,
shipped or diverted, directly or indirectly, any Confidential
Information to any country for which the United States Government or any
agency thereof at the time of export or re-export requires an export
license or other government approval without first obtaining such
license or approval.
7.3 Failure to enforce any provision of this Agreement shall not constitute
a waiver of any term hereof.
7.4 This Agreement shall be governed by and construed under the laws of the
State of California, without regard to its conflict of laws principals.
The federal and state courts within Santa Xxxxx County, California shall
have exclusive jurisdiction to adjudicate any dispute arising out of
this Agreement.
7.5 This Agreement and any CITRs executed from time to time hereafter
constitute the entire agreement, written or verbal, between the Parties
with respect to the disclosure(s) of information described in each CITR.
7.6 This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which, taken together,
shall constitute one and the same instrument. Any counterpart signed by
an authorized representative of a Party and delivered to the other Party
by facsimile transmission shall be deemed an original counterpart and
duly delivered.
"FORMFACTOR": "COMPANY":
FormFactor, Inc. a Delaware corporation
-------------------------------------------
Represented by: Represented by:
Signature: /s/ Xxxxxx X. Xxxxxxxxx Signature: /s/ Xxxxx Xxxx
-------------------------------- --------------------------------
Print Name: Xxxxxx X. Xxxxxxxxx Print Name: Xxxxx Xxxx
------------------------------- -------------------------------
Title: VP Intellectual Property Title: President
------------------------------------ ------------------------------------
(VP level or higher) (Authorized Representative)
Date: Date:
------------------------------------- -------------------------------------
Contact Individual: Contact Individual:
------------------------ ------------------------
------------------------ ------------------------
Contact Address: Contact Address:
------------------------ ------------------------
------------------------ ------------------------
------------------------ ------------------------
Contact Phone: Contact Phone:
------------------------ ------------------------
2
FORMFACTOR, INC.
CONFIDENTIAL INFORMATION TRANSMITTAL RECORD ("CITR")
CITR DATE: CNDA NO.:
--------------------------------- -----------------------
(Date Disclosure is made/commenced) (Fill in Number from
Executed CNDA)
This Confidential Information Transmittal Record ("CITR") identifies the
specific Confidential Information that is being disclosed by FormFactor and/or
Company, as the case may be, under the terms and conditions of that certain
Corporate Non-Disclosure Agreement ("CNDA") bearing the CNDA No. set forth above
and entered into by and between FormFactor and Company. A completed CITR should
accompany each separate disclosure of Confidential Information by and between
FormFactor and Company.
1. Describe the Confidential Information disclosed by each Party. (Be specific;
include subject or product, any document title, drawing/document number,
date, revision, etc.) Identify visuals, foils, and verbal disclosures (use
additional sheets if necessary).
FORMFACTOR Confidential Information:
---------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
FormFactor Representatives Present During Disclosure:
----------------------
----------------------------------------------------------------------------
COMPANY Confidential Information:
------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Company Representatives Present During Disclosure:
-------------------------
----------------------------------------------------------------------------
2. This CITR covers the Confidential Information described in Paragraph 1
above, to be conveyed commencing on the CITR Date stated above.
3. Disclosure and use of the Confidential Information described in Section 2 of
the CNDA shall be further limited as follows:
[ ] Not Applicable
--------------
[ ]
---------------------------------------------------------------------------
4. Consistent with Section 3 of the CNDA, notwithstanding the utilization of
this CITR, the disclosing Party may at any time request in writing the
immediate return of all or part of its Confidential Information disclosed
hereunder, and all copies thereof, and the receiving Party shall promptly
comply with such request.
5. All terms and conditions of the executed CNDA shall remain in full force and
effect and are incorporated herein as if fully set forth. Nothing contained
herein shall be construed as amending or modifying the terms of the CNDA
(except and solely as may be provided in Paragraph 3 above) and, in the
event of any inconsistency between the CNDA and this CITR, the terms and
conditions of the CNDA shall control.
"FORMFACTOR": "COMPANY":
FORMFACTOR, INC. -------------------------------------------
0000 Xxxxxxxx Xxxxx (Company Name, Division/Sub, if applicable)
Xxxxxxxxx, XX 00000 Address:
US -----------------------------------
City, State, Zip:
--------------------------
Country:
-----------------------------------
Contact Individual: Contact Individual:
---------------- ------------------------
Represented by: Represented by:
Signature: Signature:
------------------------ ---------------------------------
Print Name: Print Name:
------------------------ --------------------------------
Title: Title:
----------------------------- -------------------------------------
Date: Date:
------------------------------ --------------------------------------
