[FORTRON/SOURCE LETTERHEAD]
MANUFACTURING/RESALE AGREEMENT
Between: Digital Power Corp. And Fortron/Source Corp.
PURPOSE:
Fortron/Source and Digital Power wish to capitalize on each other's
strengths, which are respectively, high volume, cost-effective
manufacturing, and development/marketing of new, innovative products.
Accordingly, Fortron/Source agrees not to sell any Digital Power designs
(or modifications of the base design) to any entity other than Digital
Power, unless specifically agreed to, in advance, in writing.
INITIAL AGREEMENT:
Fortron/Source agrees (upon receipt of firm PO from Digital) to build a
test run of 1000 units of a particular model to be determined by Digital
Power, but in all likelihood, a US50-341. These units will be stocked
locally and exclusively for Digital Power, and delivered, as required at a
cost of $22.00 (or less if similar power supply), FOB Fremont, California.
Digital Power agrees to take delivery over a maximum of one year. from the
date originally received at Fortron/Source's Fremont facility. Based upon
the cost analysis provided by this initial test run, Fortron/Source will
then provide Digital Power with a firm quote for volume production.
Digital Power agrees to allow Fortron/Source to manufacture and sell the
model US155-201 (as F/S # SU150D23) to Standard MicroSystems, located in
N.Y. with Engineering in Mass. The cost for the first 250 kits on this
product, if purchased through Digital Power, will be $35.00. Also, the
Magnetic set will be available for $5.00 each. Any other kits purchased
through Digital Power will be available at $38.00 up to a maximum of 1000
pieces. Digital Power agrees to maintain current safety agency
requirements and multiple list Fortron/Source on the model. All agency
listing cost for this will be paid by Fortron/Source. Digital Power agrees
to ~protect~ Fortron/Source at this account for the duration of this
agreement by : not quoting on this model at SMC and not allowing another
Private label company to quote.
DESIGN OWNERSHIP:
This agreement does not constitute a transfer of ownership of the power
supply designs or their derivatives or yet to be developed products. As
such, Digital Power is authorizing only an alternate or secondary
manufacturing location with respect to the appropriate safety agency
certifications. Fortron/Source is not authorized to seek their own safety
agency certifications on these designs.
[FORTRON/SOURCE LETTERHEAD]
Digital agrees to provide all BOM's (with individual component prices),
AVL's, artwork, test procedure or any such documentation necessary to
manufacture the product. Fortron/Source understands that this information
is proprietary and will abide by the Nondisclosure Agreement previously
signed.
NON-COMPETITIVE STRUCTURE:
Xxxxxxx agrees not to pursue any account with a Digital Power product
without written authorization, in advance, to do so. If given,
Fortron/Source will provide: Digital Power model number, price and volume
quoted and the customer name and address.
Fortron agrees to an inspection of its China facility by a Digital Power
representative when requested. Should any documents be needed to assure
shipments or agency compliance, they will be provided then.
COMMISSIONS AND ROYALTIES:
Each party will be responsible for paying their own sales representatives,
unless otherwise agreed upon.
Fortron/Source agrees to pay Digital Power $13.80 per US155-201 sold to
Standard MicroSystems. Once a cost analysis can be provide showing a
reduction in raw material cost (presently $35ea.), Xxxxxxx agrees to split
this difference with Digital Power. This difference is figured from $35 to
actual finished goods cost. Royalties will accrue and be due immediately
upon payment from third party customers.
TERMINATION:
Either party may terminate this agreement at will, effective any time, with
or without cause by written notice given to the other party not less than
one hundred and twenty (120) days prior to the effect of such notice. At
that time, each party agrees to release any and all proprietary documents.
Also, each party agrees to allow the other to minimize losses due to excess
inventory.
[FORTRON/SOURCE LETTERHEAD]
SUMMARY:
This agreement is intended to be a start for future projects between
Fortron/Source and Digital Power. Digital Power desires to cost reduce
products, which Fortron/Source can provide. While Digital Power can
provide Fortron/Source with an expanded product line. Any future products
or agreements must be done in writing. May both parties enjoy mutual
profit and benefit with this partnership.
X /S/ XXXXXXX XXXX X /S/
PRESIDENT CEO
Date 10/7/94 Date 10/11/94
For: Fortron/Source Corp. For: Digital Power Corp.
0000 Xxxxxxx Xx. 00000 Xxxxxxx Xx.
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
000-000-0000 000-000-0000
