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Exhibit 10.8
Seller TPA No.__________
Buyer TPA No.__________
TERM PURCHASE AGREEMENT
AGREEMENT made this 7/25/95 between ANALOG DEVICES, INC. having a principal
place of business at Norwood, MA (hereinafter Seller) and MERCURY COMPUTER
SYSTEMS, INC., Chelmsford, MA (herein-after Buyer).
1. TERM
Unless earlier terminated as provided herein, this Agreement shall commence on
the effective date hereof and continue thereafter for a period of three (3)
years. During the term, Buyer will exert its best efforts to purchase and Seller
agrees to sell the quantity of semiconductor devices set forth on the attached
Schedule. Purchases credited against this Agreement will be only those entered
during the effective term with shipment scheduled according to the acknowledged
Market Leadtime.
2. PRICES
The prices for the applicable quantity of all devices purchased hereunder shall
be set forth on the Schedule attached hereto and made a part hereof Said prices
shall remain firm for the term of three years. Seller reserves the right to
renegotiate pricing should Buyer fail to meet the scheduled shipments as
detailed in Section 4.
If this Agreement is renewed beyond three (3) years, the devices, quantities and
prices on the attached Schedule shall be subject to review, adjustment or
renegotiation for each succeeding period. Any changes shall be negotiated within
thirty (30) days before or after the expiration of each period.
3. CANCELLATION/TERMINATION
Buyer may cancel orders placed in accordance with the provisions of this
Agreement subject to the following restrictions and the SHIPMENT SCHEDULE
detailed in Item 4.
STANDARD PRODUCT
Cancellation of standard product (resalable in its original condition)
without charge back requires written notice to Seller sixty (60) days
or more prior to the scheduled ship date.
If Buyer terminated individual orders in whole or in part because of
Seller's failure to deliver acceptable units in accordance with the
requirements and terms of this Agreement,
CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
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STANDARD PRODUCT (Continued)
the undelivered quantity shall be applied against the total quantities
of this Agreement in the same manner as if the purchase transaction had
actually been completed.
4. SCHEDULED SHIPMENTS
Buyer agrees to place orders and accept shipments, contingent upon Buyer's
written acceptance of the semiconductor devices to Seller's production design
specifications, for a minimum of the following, as further described in the
attached Schedule of Pricing:
1. * units within one (1) year of Buyer's written acceptance.
2. * additional units (or * cumulative units) within two (2) years of
Buyer's written acceptance.
3. * additional units (or * cumulative units) within three (3) years of
Buyer's written acceptance.
Written notice shall be given sixty (60) days or more prior to rescheduling
orders. Seller will accommodate pull-ins on a best effort basis
5. MINIMUM ORDER
The minimum order or release hereunder shall be * units per purchase order.
Preproduction quantities may be released in smaller increments based on Buyer's
needs.
6. MARKET LEADTIME
Leadtimes for product covered in the Schedule will be eight (8) weeks.
7. FORECAST
Buyer will provide Seller each month with a forecast of unit demand, on a best
effort basis, for a rolling six month window.
8. ADDITIONS
By mutual agreement of Buyer and Seller, additional quantities, devices and
schedules may be added during the term of this Agreement.
*Information omitted for confidential treatment.
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9. AUTHORIZED PURCHASES
Only bonafide divisions, wholly-owned or majority owned subsidiaries of Buyer,
may enter purchase orders with Seller under the terms of this Agreement. Such
purchases shall be credited against this Agreement.
10. CONDITION OF SALE OR PURCHASE
Conditions governing purchases hereunder shall be this Agreement, together with
Analog's standard terms of sale modified herein as follows:
Item IA: Price adjustment, is nullified by the Purchase
Agreement since prices will remain fixed for 3 years.
Item 2. Delete the requirement for a finance charge on
overdue payments.
Item 3B: Delete the requirement that the Buyer grants to
Analog Devices security interest.
Item 3E: Second sentence is deleted. Buyer shall have the
right to terminate the contract should shipments be
delayed by more than 30 days.
Item 7b: Table I modified as follows:
0-30 days *% charge
31-60 days *% charge
61 and over *%
Item 7d. Restocking fee modified to *%
Other applicable conditions shall be those mutually agreed upon as they relate
to specific orders at the time of entry and acknowledgment. Additional or
superseding conditions to this Agreement shall be incorporated only be amendment
or a separate agreement duly executed.
11. TERMS OF SALE
All deliveries will be made F.O.B. Seller's point of shipment. Each such
delivery will be separately invoiced and payment shall be due and payable
without regard to other deliveries.
12. EXPORT/REEXPORT
Buyer 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 product or technical data or software furnished
hereunder or the direct product of such technical data or software 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 governmental approval
without first obtaining such license or approval.
*Information omitted for confidential treatment.
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13. DISTRIBUTOR PARTICIPATION
When the Buyer has critical and urgent need and Seller unable to accept Buyer's
purchase order(s) for standard product incorporated within this Agreement, Buyer
will have the option of placing required order(s) through Seller's authorized
distributor outlet(s) at prices negotiated with such outlet(s) to cover service
rendered. Such quantities so purchased shall be accrued against this Agreement.
This provision shall apply to Buyer's domestic divisions and subsidiaries only.
Non-USA distributor participation shall be subject to negotiation and mutual
agreement of the respective international buying and selling locations.
14. PRODUCT CHANGE NOTIFICATION
If during the term of this Agreement, Seller proposes to change any product
covered by this Agreement which would materially affect form, fit or function or
supersede the current die revision, Seller shall notify Buyer in writing sixty
(60) days prior to implementation of such change. Further, Seller shall not ship
such product until authorized by Buyer in writing. In the event that it is
determined that the change is not acceptable to Buyer, then the item will be
dispositioned in accordance with Item 15, Product Discontinuance.
15. PRODUCT DISCONTINUANCE
If, during the term of this Agreement, Seller deems it necessary to withdraw on
a product offering, any of the products specified in this Agreement, Seller
shall notify Buyer in writing a minimum of one hundred and eighty (I 80) days
prior to such withdrawal. Buyer, within such one hundred and eighty (I 80) day
period, shall then have the option to place additional noncancelable orders for
such products with delivery up to one (1) year from date of order.
16. NOTICES
Written notices hereunder are deemed to be given when telexed, faxed or air
mailed first class, postage prepaid to the addresses of the parties set forth
herein, or such other addresses shall be furnished in writing, by either party.
This Agreement supersedes any previous agreements, either oral or written,
relating to the subject matter herein. No alterations or modifications to this
Agreement shall be binding upon either Buyer or Seller unless made in writing
and signed by an authorized representative of each.
IN WITNESS WHEREOF, the parties hereto have cause this Agreement to be executed
by their duly authorized representatives as of the day and year first written
herein.
SELLER: BUYER:
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ANALOG DEVICES, INC. MERCURY COMPUTER SYSTEMS, INC.
By /s/ By /s/
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(authorized signature (authorized signature
TITLE: Senior Sales Engr. TITLE: Vice President & CFO
--------------------------- ---------------------------------
DATE: 7/25/95 DATE: 7/25/95
---------------------------- ----------------------------------
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SCHEDULE OF PRICING
Quantity Item Unit Price
-------- ---- ----------
[*] [*] [*]
[*] [*] [*]
[*] [*] [*]
[*] [*]
*Information omitted for confidential treatment
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ANALOG DEVICES
TERMS AND CONDITIONS
1. PRICES
A. All prices are subject to adjustment on account of specifications,
quantities, shipment arrangements or other terms and conditions which
are not a part of the original price quotation.
B. Prices are exclusive of all federal, state, municipal or other
government excise, sales use, occupational or like taxes, tariffs,
customs, duties and importing fees. Prices are consequently subject to
increase by the amount of any such tax, tariff, duty or fee which Analog
Devices pays or is required to pay or collect upon same or delivery of
the products. Any certificate of exemption or similar document or
proceeding required to exempt the sale of products from sales or use for
liability shall be obtained by Buyer at its expense.
2. TERMS OF PAYMENT
Terms are cash upon delivery, except where satisfactory open account
credit established in which case terms of payment are net thirty (30)
days from the date of invoice. Analog Devices reserves the right at any
time to revoke any credit extended to the Buyer for any risk deemed good
and sufficient by Analog Devices. Analog Devices will issue invoices on
delivery in the case of all products and if delivers are authorized in
installments each shipment shall be invoiced and paid when due without
regard to other scheduled deliveries. Overdue payments shall be subject
to finance charges computed at a periodic rate to the extent permitted
by law of 15% per month (18% per year). Amounts owed by the Buyer with
respect to which there is no dispute shall be paid without set off for
any amounts which the Buyer may claim are owed by Analog Devices and
regardless of any other controversies which may exist.
3. DELIVERY
A. All products will be shipped FOB Point of Origin.
B. Ownership of and risk of loss with respect to the products shall
pass to Buyer upon delivery thereof by Analog Devices to Buyer
or to a carrier for shipment to Buyer, whichever is earlier,
regardless of whether Analog Devices will install or supervise
the installment of the products Buyer does hereby grant to
Analog Devices a security interest in the products as security
for the performance by Buyer of its obligations hereunder.
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C. Products held or stored by Analog Devices for the Buyer shall be
at the sole risk of Buyer, and Buyer shall be liable for the
expense to Analog Devices of holding or storing products at
Buyer's request.
D. Analog Devices shall make deliveries in installments and shall
xxxx partial shipments as made.
E. All products will be scheduled for shipment in accordance with
Analog Devices applicable shipment sequence and Analog Devices
will confirm in writing and amend as appropriate, the shipment
schedule. Under no circumstances shall Analog Devices be liable
to Buyer for any delay either in shipment or in delivery.
4. SOURCE INSPECTION
Source Inspection by Buyer or Buyer's customer must be stipulated in
writing at the time of ordering and is subject to reasonable charges and
safety and security conditions. Buyer shall have no right of access to
Analog Device's plant except as specifically authorized in advance by
Analog Devices. Buyer or Buyer's agent shall indemnify and hold Analog
Devices harmless from any and all suits, damages and expenses of Buyer,
his agent or his customer resulting from personal injury including death
or loss or damage of property occurring during or in connection with any
visit to Analog Devices' plant.
5. SHIPMENT
Unless specific instructions to the contrary are supplied by the Buyer,
Analog Devices will select the carrier and ship the products to the
Buyer's address indicated on the Buyer's purchase order. Analog Devices
will not assume any liability in connection with the shipment nor
constitute any carrier as its agent. Buyer shall be responsible for
making all claims with carriers, insurers, warehouses and others for
non-delivery, loss damage or delay. All claims for damage to the product
or shortages must be made within thirty (30) days of shipment.
6. OFFER/ACCEPTANCE
Analog Devices offers to sell and deliver the products and services
specified hereunder in accordance with the terms and conditions hereof.
THIS OFFER EXPRESSLY LIMITS ACCEPTANCE TO THE TERMS HEREOF AND ANY
ADDITIONAL OR DIFFERENT TERMS PROPOSED BY THE BUYER ARE HEREBY OBJECTED
TO AND REJECTED UNLESS EXPRESSLY ASSENTED TO IN WRITING BY ANALOG
DEVICES.
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7. CANCELLATION, RESCHEDULING, RETURNS AND MODIFICATIONS
Any request for order cancellation, rescheduling, return or modification
must be made in writing and such action must be approved in writing by
an authorized agent of Analog Devices at its principal office in
Massachusetts. Such requests are subject to processing charges as
outlined below. Payment of charges applied by Analog Devices as a result
of such request shall be made within thirty (30) days of receipt an
invoice for charges. Overdue payments shall be subject to finance
charges as set forth herein.
7a. Cancellation Charges
If the Buyer cancels the delivery of any products, the Buyer shall pay
to Analog Devices the cancellation charges as set forth in Table 1 in
addition to any charges for unearned discounts (billbacks). For
non-standard products built to Buyer's specifications or pursuant to
Analog Devices design Buyer shall have no right to cancel or reschedule
the delivery of any such non-standard products.
7b. Rescheduling Charges
Delivery reschedules requested by Buyer are subject to the charges set
forth in Table 1.
The charges listed below relate to standard products:
Table 1
Intervals in Days Between Charges Expressed as
Receipt of Notice of Percentage of Invoice
Cancellation or Reschedule Prices of Standard Products
and Schedule Shipment Date Schedule for Delivery
-------------------------- ---------------------------
0-30 50%
31-60 25%
61-90 20%
91 and over 0%
7c. Returns
Buyer shall not return any products for any reason without the prior
authorization of Analog Devices and issuance of a Material Return
Authorization (MRA) number. This MRA number shall specify the terms and
conditions upon which return may be made. Returns made without obtaining
prior authorization shall be returned to sender at Buyer's expense.
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7d. Returns for Credit
Analog Devices, at its option, may accept or reject any request by Buyer
to return products for credit If authorization is granted, Buyer shall
pay to Analog Devices a restocking fee equal to 35% of the current list
price for standard products for each product(s) returned in addition to
charges for unearned discounts and any other reasonable charges. Buyer
guarantees that any product returned is in original condition and
packaging and is free from any liens. Buyer shall not return materials
without first obtaining an MRA number as stated herein.
8. INSTALLATION
Analog Devices assumes no obligation to install the products or to place
them in operation at the Buyer's premises unless specifically agreed in
writing by an authorized agent of Analog Devices.
9. WARRANTY
Analog Devices warrants that each product will be free of defects in
materials and workmanship for the period set forth in its published user
manual for its system products and for a period of one (1) year for its
component products. The warranty commences on the date the product is
shipped by Analog Devices. Analog Devices' sole liability and
responsibility under this warranty as to repair or replace any product
which is returned to it by Buyer and which Analog Devices determines
does not conform to the warranty. Products returned to Analog Devices
for warranty service will be shipped to Analog Devices at BUYER's
expense and will be returned to BUYER at Analog Devices' expense. In no
event shall Analog Devices be responsible under this warranty for any
defect with is caused by the negligence, misuse or mistreatment of a
product or for any unit which has been altered or modified in any way.
The warranty of replacement products shall terminate with the warranty
of the product.
10. WARRANTY DISCLAIMER
ANALOG DEVICES EXPRESS WARRANTY TO BUYER CONSTITUTES ANALOG DEVICES'
SOLE LIABILITY AND THE BUYERS SOLE REMEDY WITH RESPECT TO THE PRODUCTS
AND IS IN LIEU OF ALL OTHER WARRANTIES, LIABILITIES AND REMEDIES EXCEPT
AS THUS PROVIDED. ANALOG DEVICES DISCLAIMS ALL WARRANTIES EXPRESS OR
IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
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11. INTELLECTUAL PROPERTY RIGHTS INDEMNITY
Analog Devices agrees to indemnify and defend Buyer against any claim
that a product as delivered infringes United States Patent, United
States covenant, United States trademark or other United States
intellectual property right provided Analog Devices is promptly advised
of any such claim or action and has such control of the defense of any
such actions and has sole control of the defense of any such actions and
all negotiations for its settlement or compromise. If at any time use of
the product is expired or is discontinued because of a settlement,
Analog Devices shall have the right but not the obligation at its sole
option and expense to enter procedure for Buyer the right to continue
using the product, replace or modify the product so that it becomes
non-infringing or grant Buyer a credit for the product as depreciated
and accept its return. Analog Devices shall not have any liability to
BUYER at the infringement of other violation of a third party right as
based in any way upon (i) the use of a product in combination with other
components, equipment or software not furnished by Analog Devices; (ii)
use of a product in performing any process (iii) any product which has
been modified or altered (iv) the manner in which the product is used
even if Analog Devices has been advised of such use; or (v) Analog
Devices compliance with Buyer's design specifications or instructions in
no event shall Analog Devices' total liability to Buyer under this
section exceed the aggregate sum paid to Analog Devices by Buyer for the
products hereunder.
12. INDEMNIFICATION
Unless otherwise expressly provided in a writing signed by both parties,
Analog Devices does not indemnify, nor does it hold Buyer harmless
against any liabilities, losses, charges and expenses including
attorneys fees relating to any claims whatsoever, including without
limitation claims for personal injuries, death or property damage
relating to the products sold hereunder.
13. SUBSTITUTIONS AND MODIFICATIONS OF SPECIFICATIONS
Analog Devices assumes the right to make substitutions and modifications
in the specifications of any of the products or parts thereof described
by Analog Devices provided such substitutions or modifications will not
materially affect the performance of such products.
14. ASSIGNMENT
This Contract is not assignable by Buyer and any attempt to assign any
rights, duties or obligations arising hereunder shall be void.
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15. FORCE MAJEURE FORCE OF NATURE??
Analog Devices shall not be liable for any loss or damage resulting from
any delay in delivery or failure to give notices of delay when such
delay is due to any cause or event beyond Analog Devices' control,
including without limitation, act of nature, unavailability of supplies
or source of energy, riots, wars, fires, strikes, labor difficulties,
delays in transportation, delays in delivery or defaults by Analog
Devices' vendors or acts or omissions of the Buyer. In the event of
delay due to any such causes, time for delivery shall be extended for a
period of time equal to the duration of such delay and the Buyer shall
not be entitled to refuse delivery or otherwise be relieved of any
obligations as a result of the delay. If as a result of any such cause,
any scheduled delivery is delayed for a period in excess of one hundred
twenty (120) days, Analog Devices or BUYER shall have the right by
written notice to the other to cancel the order for the products subject
to the delayed delivery without further liability of any kind.
16. LIMITATIONS OF LIABILITY
IN NO EVENT SHALL ANALOG DEVICES BE LIABLE FOR SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES DUES TO ANY CAUSE WHATSOEVER. NO SUIT OR ACTION
SHALL BE BROUGHT AGAINST ANALOG DEVICES MORE THAN ONE YEAR AFTER THE
RELATED CAUSE OF ACTION HAS ACCRUED. IN NO EVENT SHALL THE ACCRUED TOTAL
LIABILITY OF ANALOG DEVICES FROM ANY LAWSUIT, CLAIM, WARRANTY OR
INDEMNITY EXCEED THE AGGREGATE SUM PAID TO ANALOG BY BUYER UNDER THE
ORDER THAT GIVES RISE TO SUCH LAWSUIT, CLAIM, WARRANTY OR INDEMNITY.
17. WAIVERS
All rights and remedies of Analog Devices hereunder shall be cumulative
and may be exercised singularly or concurrently. In the event that
either party shall on any occasion fail to perform any term herein and
the other party shall not enforce that term, failure to enforce on that
occasion shall not prevent enforcement on any other occasion.
18. GOVERNING LAW
This Contract is made, governed by and shall be construed in accordance
with the laws of the Commonwealth of Massachusetts without resort to the
Commonwealth a conflict of issues statutes. If the products purchased
hereunder are purchased by a Buyer residing in a country other than the
United States, then the parties agree that the United Nations Convention
on Contracts for the International Sale of Goods is hereby excluded in
its entirety from the Contract.
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19. EXPORT
Buyer certifies that it will not export or re-export the products
furnished hereunder unless it complies fully with all laws and
regulations of the United States relating to such export or re-export.
Including but not limited to applicable U.S. Export Administration rules
and regulations.
20. ENTIRE AGREEMENT AND AMENDMENTS
The terms and conditions herein constitute the entire Contract between
the parties and supersede all previous communications whether oral or
written. Any change to the Contract may be made only upon mutual
agreement of the parties in writing.
21. FEDERAL CONTRACT TERMS
FEDERAL CONTRACT TERMS
In any Contract entered into with the federal government or in any
Contract entered into with any other party which is a subcontractor at
any party of one entered into with the federal government (a) only those
clauses of the federal acquisition regulations which the regulations
themselves manage for a party in Analog Devices position given all
relevant limitations including Analog Devices' status as a customer or a
subcontractor and the size and type of Contract apply; and (b) Analog
Devices retains proprietary rights in all technical data and computer
software provided under such Contract. Only limited rights or restricted
rights are provided to the federal government under the narrowest
provision of these rights that the regulations allow and no rights
including rights of audit of Seller's cost or pricing data are provided
to any other party including the prime contractor or any higher tier
subcontractor.
22. USE IN LIFE SUPPORT APPLICATIONS
Products sold by Analog Devices are not designed for use in the support
equipment where malfunction of the product can reasonably be expected to
result in personal injury or death. Buyer uses or sells such products
for use in the support applications at Buyer's own risk, and agrees to
indemnify and hold harmless Analog Devices from any and all damages,
claims, suits or expense resulting from such use.
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