EXHIBIT 10.19
PRODUCTION AGREEMENT
MADE AND ENTERED BY AND BETWEEN
ENDWAVE CORPORATION
AND
TRW INC.
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Development Agreement 2(21)
58 GHz Module 28.1.1999
TABLE OF CONTENTS
PREAMBLE
ARTICLE 1 OBJECT OF THE AGREEMENT
ARTICLE 2 SPECIFICATIONS
ARTICLE 3 PROJECT PLAN
ARTICLE 4 DIVISION OF RESPONSIBILITIES
ARTICLE 5 MILESTONES
ARTICLE 6 PROTOTYPES
ARTICLE 7 CERTIFICATE OF ACCEPTANCE
ARTICLE 8 CHANGES
ARTICLE 9 WARRANTIES
ARTICLE 10 CANCELLATION OF THE DEVELOPMENT WORK
ARTICLE 11 RESERVED
ARTICLE 12 RESERVED
ARTICLE 13 TERMS OF DELIVERY
ARTICLE 14 PACKING
ARTICLE 15 DELIVERY TIMES AND DELAYS
ARTICLE 16 PURCHASE OF THE PARTS
ARTICLE 17 QUALITY MANAGEMENT PLAN
ARTICLE 18 FACILITY SURVEYS
ARTICLE 19 ENVIRONMENTAL MANAGEMENT
ARTICLE 20 MANUFACTURING RIGHTS AND INTELLECTUAL PROPERTY RIGHTS
ARTICLE 21 CONFIDENTIALITY
ARTICLE 22 FORCE MAJEURE
ARTICLE 23 EFFECTIVE DATE AND TERM
ARTICLE 24 PREMATURE TERMINATION
ARTICLE 25 APPLICABLE LAW AND SETTLEMENT OF DISPUTES
ARTICLE 26 FINAL PROVISIONS
ARTICLE 27 LIMITATION OF LIABILITY
APPENDIX 1 Product Pricing
APPENDIX 2 Product Definition, Module Test Plan, Specifications (Nokia)
APPENDIX 3 Project Plan, Milestone Schedule
APPENDIX 4 Commercial Products Quality Assurance Requirements Document
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58 GHz Module 28.1.1999
PRODUCTION AGREEMENT
THIS PRODUCTION AGREEMENT (the "Agreement"), made and entered into this 31st day
of March, 2000 by and between
ENDWAVE CORPORATION, a company incorporated in Delaware with its principal
office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to as
'Endwave') of the first part
AND
TRW INC., a company incorporated in Ohio, and acting through its Space and
Electronics Group, with its principal ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇ ▇▇▇▇▇, ▇▇▇ (hereinafter referred to as 'TRW') of the second part
(hereinafter Endwave and TRW are jointly referred to as the "Parties").
WITNESSETH THAT
WHEREAS effective January 28, 1999, TRW and Nokia Telecommunications OY
("Nokia") entered into the Development Agreement (the "Nokia
Agreement"), whereby TRW agreed to develop and produce the Parts (as
hereinafter defined).
WHEREAS TRW's previously wholly owned subsidiary, TRW Milliwave Inc. ("MW"),
has merged with Endwave, effective the date hereof.
WHEREAS TRW, pursuant to the Nokia Agreement, was to develop and produce the
Parts.
WHEREAS TRW wishes to complete development work on the Parts up through the E4
milestone, after which Endwave will complete development and produce
the Parts as specified in the Nokia Agreement.
WHEREAS as provided in the Agreement and Plan of Merger, dated as of February
28, 2000 (the "Merger Agreement"), by and among TRW, Endwave (f.k.a.
Endgate Corporation) and MW, TRW will bear all costs of development of
the Parts up through the E4 milestone (after which Endwave shall be
responsible for all remaining development costs); provided, however,
that if the E4 milestone criteria change after the date hereof,
Endwave shall be responsible for all costs of E4 milestone development
after the date of such change.
NOW THEREFORE THE PARTIES HERETO HEREBY AGREE AS FOLLOWS:
ARTICLE 1
OBJECT OF THE AGREEMENT
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The purpose of this Agreement is to agree on the terms and
conditions under which Endwave undertakes the development work after the E4
milestone or for the E4 milestone in the event of a Change (as hereinafter
defined) in the E4 milestone criteria after the date hereof (hereinafter
referred to as 'Development Work') of the transceiver modules and the production
of the Parts hereunder.
ARTICLE 2
SPECIFICATIONS
The Parties have jointly agreed on the specifications and the
test plan for the final acceptance (hereinafter jointly referred to as
'Specifications'), as attached hereto as APPENDIX 2, to which the 58 GHz
millimeter wave transceiver modules (hereinafter referred to as 'Parts') shall
strictly conform.
Furthermore, the requirements in respect of the test plan,
test specifications and the test reports, that verify the functionality of the
Parts, shall be delivered and completed in accordance with the milestone
schedule (hereinafter referred to as the 'Milestone Schedule') attached hereto
as APPENDIX 3.
ARTICLE 3
PROJECT PLAN
Endwave shall perform the Development Work of the Parts in
accordance with the project plan (hereinafter referred to as the "Project Plan")
contained in APPENDIX 3.
The Milestone Schedule shall specify, among other agreed
issues, the agreed date of completion in respect of each Milestone, the criteria
for each Milestone and the items to be delivered upon each Milestone.
ARTICLE 4
DIVISION OF RESPONSIBILITIES
The Parties shall co-operate in carrying out the Development
Work. The division of responsibilities (hereinafter referred to as 'Division of
Responsibilities') in respect of the Development Work is contained in APPENDIX 3
hereto. The Parties shall adhere to their respective duties and obligations.
ARTICLE 5
MILESTONES
5.1 The Development Work is divided into various milestones
(hereinafter referred to as 'Milestone'), which in turn may be divided into
various phases, as specified in the Project Plan.
5.2 Upon the completion of each Milestone the Parties and
Nokia shall review the results thereof on the basis of a written report
submitted by Endwave.
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5.3 If the results fulfill the criteria set forth for the
respective Milestone under this Agreement, a certificate of approval
(hereinafter referred to as 'Certificate of Approval') of the respective
Milestone shall be signed by TRW promptly following TRW's receipt of a
Certificate of Approval from Nokia under the terms of the Nokia Agreement. In
the event Nokia's Certificate of Approval is not signed and TRW is not notified
by Nokia in writing of any specific deficiencies which do not fulfill the
criteria within 30 days after TRW's completion of the corresponding milestone
under the Nokia Agreement, the impact on the time schedule and/or on the
Agreement shall be reviewed between the Parties in accordance with Clause 8.1
below. The signing of such certificate shall be without prejudice to any of
Endwave's obligations under this Agreement.
ARTICLE 6
PROTOTYPES
6.1 Endwave shall provide TRW with functionally working and
properly tested prototypes of the Parts corresponding to Endwave's Development
Work (hereinafter referred to as 'Prototypes') of the Parts in the amounts
specified in APPENDIX 1. The Prototypes shall meet the Specifications. As
provided in the Merger Agreement, TRW will bear all development responsibilities
and all costs of development of the Prototypes up through the E4 milestone
(after which Endwave shall be responsible for all remaining development costs);
provided, however, that in the event of a Change in the E4 milestone criteria
after the date hereof, Endwave shall be responsible for all development
responsibilities (which Endwave may subcontract to TRW pursuant to the Services
Agreement, dated the date hereof, between TRW and Endwave) and all costs of E4
milestone development after the date of such ▇▇▇▇▇▇.▇▇ payments shall be owing
to Endwave on account of the Prototypes, except according to the parties'
agreement upon a Change.
6.2 To the extent that there are Prototypes after the E4
milestone or to the extent that there is a Change in the E4 milestone criteria
after the date hereof, Endwave shall test the Prototypes during their
development and prior to shipment to Nokia, as TRW's designee, in accordance
with the test plan described in APPENDIX 2 hereto. Endwave shall provide TRW and
Nokia with detailed written reports of the results of the testing.
6.3 TRW or Nokia shall test the Prototypes in order to
evaluate their conformance to the Specifications. TRW shall notify Endwave
promptly following receipt of corresponding notification from Nokia of any found
defects or failures to meet the Specifications. Nokia has agreed to inform TRW
weekly on the status of test progress; TRW will promptly pass along to Endwave
such status reports. However, the testing performed in accordance with this
Article 6.3 shall not absolve Endwave from any of its obligations under this
Agreement.
6.4 In the event the Prototypes do not meet the Specifications
as specified in APPENDIX 2, but only to the extent that there are Prototypes
after the E4 milestone or to the extent that there is a Change in the E4
milestone criteria after the date hereof, TRW shall have the right to reject the
Prototypes and Endwave shall at its own cost make the required design changes,
produce the new Prototypes and undertake any other necessary action to
manufacture Prototypes that meet the Specifications in accordance with revised
schedule mutually agreed by the Parties. Such corrective action shall be
undertaken without delay. In the event of rejection, a written report by TRW
shall be submitted to Nokia stating the reasons for rejection promptly following
TRW's receipt of a corresponding report from Nokia pursuant to the Nokia
Agreement.
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58 GHz Module 28.1.1999
6.5 Endwave shall provide to TRW in connection with the
delivery of the Prototypes all the required documentation (hereinafter referred
to as 'Documentation') specified in APPENDIX 2 hereto.
ARTICLE 7
CERTIFICATE OF ACCEPTANCE
In the event the Prototypes meet the Specifications, all
deliverables as set forth in this Agreement (including without limitation
documentation) have been delivered to TRW (or to Nokia, as TRW's designee), and
a Certificate of Approval has been issued by TRW in accordance with Article 5.3
in respect of each Milestone under this Agreement, then TRW shall sign a
certificate of acceptance (hereinafter referred to as 'Certificate of
Acceptance') promptly following TRW's receipt of a corresponding certificate of
acceptance from Nokia under the Nokia Agreement and the Development Work shall
be deemed completed without prejudice to Endwave's obligations under Article 9.
ARTICLE 8
CHANGES
8.1 TRW, on behalf of Nokia, may, at any time prior to the
signing the Certificate of Acceptance, propose changes to the Division of
Responsibilities, the Milestone Schedule, the Project Plan, to design and/or to
the Specifications of the Parts (collectively "Changes" and each a "Change") to
the extent that corresponding changes are made in connection with the Nokia
Agreement. Any addition to the Milestone Schedule beyond the E4 milestone shall
be considered a Change. Both parties agree to negotiate in good faith to
implement the Changes on reasonable terms and conditions to be agreed upon on a
case by case basis. An amendment to this Agreement shall be signed by both
Parties taking into account all of the effects of the Change to the Milestone
Schedule, Division of Responsibilities, and/or other terms of this Agreement.
Notwithstanding the foregoing, Endwave may, at its sole discretion, elect to
negotiate and contract directly with Nokia for the provision of development
services related to Parts.
Any changes that do not affect the Milestone Schedule or other
conditions of this Agreement, shall be implemented by Endwave without changing
any of the terms of this Agreement.
8.2 Notwithstanding the above in this Article 8, if a change
of the design and/or Specification of the Parts becomes necessary or if the
Prototypes have to be remanufactured in order to comply with terms and
conditions of this Agreement, the cost of such change or remanufacture shall be
borne by the Party to whose action or omission such change is attributable.
ARTICLE 9
WARRANTIES
9.1 The 58 GHz Prototype units are sold on an "as is where is"
basis and are not covered by any warranty/either express or implied.
9.2 Endwave hereby warrants that upon the issuance of the
Certificate of Acceptance, Endwave is able to manufacture Parts that meet the
Specifications (including without
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58 GHz Module 28.1.1999
limitation the figures set forth in the Specifications). Such warranty will be
superseded by the warranty contained in any Purchase Agreement for Mice 58 GHz
Parts.
9.3 Endwave warrants that the Parts shall be free from defects
(including latent defects and otherwise) in materials and workmanship and shall
conform in all material respects to the Specifications. Such warranty will be
valid for a period of [*] after the delivery of the Parts to TRW's
designee, Nokia. In the event of a breach of such warranty, then Endwave shall
be responsible at the cost of Endwave for undertaking any and all necessary
corrective action (including but not limited to redesigning the Parts) to ensure
that the Parts conform to the Specifications and that such defects do not
reoccur in the Parts. These corrective actions do not include a product recall
or retrofit unless otherwise agreed by the Parties.
THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES,
CONDITIONS OR REPRESENTATIONS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE
INCLUDING ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE OR
MERCHANTABILITY. THIS WARRANTY SHALL NOT BE VALID IF THE PRODUCTS HAVE BEEN
SUBJECTED TO ABUSE, MISUSE, ACCIDENT, ALTERATION, NEGLECT, UNAUTHORIZED REPAIR,
OR EXPOSURE TO CONDITIONS BEYOND APPLICABLE ENVIRONMENT.
ARTICLE 10
CANCELLATION OF THE DEVELOPMENT WORK
Without prejudice to Article 15.5 and Article 25, following a corresponding
cancellation of the Nokia Agreement by Nokia, TRW may at any
time at its discretion cancel the Development Work in whole or
in part upon a written notice thereof to Endwave. In the event
of cancellation, [*].
Neither TRW nor Nokia shall have any liability towards Endwave in the event of
such cancellation of the Development Work in whole or part other than what is
stated here in this Article 10.
ARTICLE 11
RESERVED
ARTICLE 12
RESERVED
ARTICLE 13
TERMS OF DELIVERY
13.1 The terms of delivery for the Prototypes and the
Documentation provided hereunder is DDU, Espoo, Nokia Telecommunications
(INCOTERMS 1990).
13.2 The risk and title in the Prototypes and the
Documentation to be delivered hereunder shall be transferred to TRW's designee,
Nokia, upon delivery in accordance with the terms of delivery defined in Clause
13.1.
13.3 The Prototypes and the Documentation shall be addressed
to a named Nokia buyer or design engineer as advised by TRW or Nokia.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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ARTICLE 14
PACKING
The Prototypes and the Documentation are to be packed (i)
properly to withstand transportation and (ii) when applicable, as required and
instructed by Nokia. Endwave agrees indemnify TRW for any damage that the
Prototypes or Documentation may suffer due to improper packing.
ARTICLE 15
DELIVERY TIMES AND DELAYS
15.1 The agreed development schedule included in the Project
Plan is of the essence in this Agreement.
15.2 If Endwave can not perform its obligations hereunder in
accordance with the agreed development schedule described in the Project Plan
and the Milestones therein, then Endwave shall as soon as Endwave is aware of
the delay inform both TRW and Nokia thereof in writing stating the reason for
the delay and propose a new date for performing its respective obligations.
15.3 If the Parties have not agreed on a new date, or in the
event Endwave can not meet its obligations on the new date, then Nokia shall be
entitled to [*].
15.4 In the event Endwave has not notified TRW and Nokia of
the delay as aforesaid in Article 15.2, then TRW shall be entitled to [*].
15.5 If Endwave is in delay for [*] or more, then TRW may,
without prejudice to its other rights and remedies, terminate this Agreement
pursuant to Article 15.5 (but only to the extent that Nokia similarly terminates
TRW under the Nokia Agreement), such termination shall be without any liability
towards Endwave, and Endwave shall have no right to make any claims arising as a
result of this termination against TRW.
* CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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ARTICLE 16
PURCHASE OF THE PARTS
16.1 Upon signing of the Certificate of Acceptance, TRW shall
Order a minimum quantity of [*] within [*] of the issuance of the Certificate of
Acceptance. Such failure to purchase shall not be considered a breach of this
agreement, provided however, in such event TRW shall pay to Endwave any indirect
and direct costs Endwave suffers as a direct result of such failure to purchase
the [*] (such costs shall not exceed [*].
ARTICLE 17
QUALITY REQUIREMENTS AND QUALITY PLAN
Endwave shall at all times strictly adhere to the quality
requirements (hereinafter referred to as 'Quality Requirements') set forth in
APPENDIX 4 hereto.
It is recorded here, that Endwave has established a quality
plan (hereinafter referred to as 'Quality Plan') which describes the various
measures Endwave shall undertake in order to meet the Quality Requirements.
Endwave shall at all times strictly adhere to the Quality Plan included in
APPENDIX 4.
ARTICLE 18
FACILITY SURVEYS
TRW reserves the right, by itself, by Nokia or through TRW's
or Nokia's appointed representative, during regular business hours and following
reasonable notice to Endwave, to inspect Endwave's physical facilities and
Endwave's quality control procedures in order to assure compliance with the
Specifications, Design Rules, Quality Requirements, Quality Plan and other
standard industry practices and procedures. Endwave shall afford a similar
inspection right to Nokia's customers upon approval by Endwave. Endwave shall
maintain quality control procedures mutually agreed upon by the Parties as a
result of such facility survey. in accordance with its ISO 9001 Certification
requirements. In the event that TRW or Nokia determines, in good faith, during
any facility survey, that the quality procedures applied by Endwave are
insufficient as to ensure consistent acceptable quality, then TRW or Nokia shall
specifically inform Endwave thereof and of the reasonable corrective measures to
be undertaken by Endwave upon mutual agreement of Endwave, TRW and Nokia as to
the actions to be taken. Endwave hereby agrees to undertake any such mutually
agreed corrective measures without delay. The Parties further agree, that the
above shall also apply to any and all sub-suppliers of Endwave involved in the
Development Work, including without limitation TRW itself. Endwave hereby agrees
to take all appropriate measures in order to ensure compliance of its respective
sub-suppliers with the foregoing.
ARTICLE 19
ENVIRONMENTAL MANAGEMENT
Endwave agrees to comply with the principles of the Business
Charter for Sustainable Development (published by the International Chamber of
Commerce in 1991) for environmental management. Nokia encourages the adoption of
the principles therein by the
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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Supplier and its sub-suppliers. TRW and Nokia may, where appropriate, request
improvements in Endwave's practices to ensure compliance with the said
principles.
ARTICLE 20
MANUFACTURING RIGHTS AND INTELLECTUAL PROPERTY RIGHTS
For the purposes of this Article 20:
"Application" shall mean applications for statutory rights in intellectual
properties, including patents, utility models, design patents, mask work
registrations, design registrations, chip topography rights, copyrights, and
other forms of statutory protection of any kind.
"Intellectual Property Rights" shall mean patents (including utility models),
design patents, mask work and designs (whether or not capable of registration),
chip topography rights and other like protection, copyright, trademark and any
other form of statutory protection of any kind and Applications for any of the
foregoing respectively, as well as any trade secrets.
"Manufacturing Documentation" shall mean all design and manufacturing
information relating to the manufacture of the Parts, including but not limited
to the drawings, specifications, standards, processes, tooling, engineering
folder, qualification data, parts lists, software and all other technical and
design information as well as data utilised in the manufacture of the Parts by
Endwave and that may be needed for the manufacture of the Parts (including any
changes thereto) by TRW, Nokia and/or by a third party.
"Nokia Background Works" shall mean the Specifications (including but not
limited to the information provided by Nokia of [*], technical data, designs,
documents, drawings, test results, software, models and samples, know-how, and
other materials to which Nokia and/or its licensors own the Intellectual
Property Rights. "Endwave Background Works" shall mean technical data, designs,
documents, drawings, test results, software, models and samples, know-how, and
other materials (a) to which Endwave either owns the Intellectual Property
Rights or has the right to sublicense same, and (b) which are either existing on
the date of this Agreement or thereafter gained other than under this Agreement.
20.1 Endwave shall not have any right to manufacture and/or
sell and/or license the Parts and/or Prototypes to third parties, or in any way
utilise the Specifications, or design or technical information provided by Nokia
without the prior written consent of Nokia. However, subject to the conditions
set forth below in this Clause 20.1, this provision does not limit Endwave's
ability to manufacture and/or sell and/or license components developed by
Endwave and included in the Parts to third parties so long as Nokia's
Intellectual Property Rights are not infringed, Nokia Background Works or the
Specifications are not utilized and the confidentiality obligations set forth
under Clause 21 are complied with.
It is expressly agreed that all rights and complete ownership
with respect to Nokia Background Works which are provided by Nokia to Endwave
shall remain vested in Nokia and/or its licensors.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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Endwave shall have a limited license to use such Nokia
Background Works (1) only for the development of the Part for TRW or Nokia in
accordance with this Agreement, and (2) in the event Nokia and Endwave execute a
purchase agreement in accordance with Article 16 above, then only for the
manufacture and supply of the Parts to Nokia in accordance with the terms and
conditions of such purchase agreement and only for the period of validity of
such purchase agreement; and for no other purpose. Such Nokia Background Works
shall be returned to Nokia immediately upon request.
Any and all Endwave Background Works shall remain the sole
property of Endwave and/or its licensors.
20.2 Subject to Clause 20.1, above, all inventions (whether or
not patentable), conceived or first reduced to practice within the scope of this
Agreement solely by Nokia personnel will be the sole and exclusive property of
Nokia, and Nokia will retain any and all Intellectual Property Rights therein as
well as the right to formally effect the vesting of such Intellectual Property
Rights in Nokia, including but not limited to by filing Applications thereon.
Intellectual property rights vis-a-vis TRW and Endwave are covered in separate
agreements (e.g., the Services Agreement).
Endwave shall have a limited license, to use the above defined
inventions (1) only for the development of the Parts for TRW and Nokia in
accordance with this Agreement, and (2) in the event the Parties execute a
purchase agreement in accordance with Article 16 above, then only for the
manufacture and supply of the Parts to TRW and Nokia in accordance with the
terms and conditions of such purchase agreement and only for the period of
validity of such purchase agreement; and for no other purpose. Any material
related to such inventions shall be returned to Nokia immediately upon request.
20.3 Subject to Clause 20.1, above, all inventions (whether or
not patentable), conceived or first reduced to practice within the scope of this
Agreement solely by Endwave's personnel will be the sole and exclusive property
of Endwave, and Endwave will retain any and all Intellectual Property Rights
therein as well as the right to formally effect the vesting of such Intellectual
Property Rights in Endwave, including but not limited to by filing Applications
thereon.
20.4 (a) Subject to Clause 20.1 above inventions (whether or
not patentable) conceived or first reduced to practice within the scope of this
Agreement jointly by Endwave and Nokia and/or TRW personnel (the "Joint
Inventions"), will be jointly owned by Endwave and Nokia and/or TRW, each party
having an equal and undivided interest therein. References in Section 20 hereof
that refer to a "Party", "Parties" or "Endwave and Nokia and/or TRW", in
connection with Joint Inventions or Joint Know-how, shall refer to (i) Endwave
and Nokia where the Joint Invention or Joint Know-how is jointly developed by
Endwave and Nokia personnel, (ii) Endwave and TRW where the Joint Invention or
Joint Know-how is jointly developed by Endwave and TRW personnel and (iii)
Endwave, TRW and Nokia where the Joint Invention or Joint Know-how is jointly
developed by Endwave, TRW and Nokia personnel.
Each Party undertakes to take all steps necessary to
allow the Parties to acquire the ownership in such Joint Inventions. The Parties
will mutually determine whether Applications will be filed on such Joint
Inventions, which Party will prepare and file such Applications, and the country
or countries in which the same are to be filed. The expenses incurred
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in connection with these Applications will be divided equally between the
Parties. With respect to rights and claims of the inventors of such Joint
Inventions, each Party undertakes (a) to take care, at its own expense, of all
rights and claims resulting from the acquisition of the ownership in such Joint
Inventions, of its own inventors and (b) to indemnify and hold the other Party
harmless with respect to such rights and claims; this applies especially to all
possible rights and claims of the inventors with respect to payments resulting
from the utilisation of such Joint Inventions and complying for example with the
"Laki tyosuhdekeksinnoista" in Finland.
For avoidance of doubt it is expressly recorded here that
each party has the right to exploit (including without limitation licensing)
such Joint Inventions at its sole discretion and shall indemnify and hold
harmless the other party for any claims (including without limitation claims
based on provisions concerning inventions made by employees) arising from such
exploitation. Notwithstanding the above in this Clause 20.4 (a) neither party
may grant any exclusive licenses without a prior written consent of the other
Party, which consent shall not be unreasonably withheld.
(b) If the Parties are not able to mutually agree to file
an Applications on a Joint Invention or to maintain such an Applications or
corresponding Intellectual Property Right, either one of the Parties may elect
to assume such expenses (the "Electing Party"). The Electing Party will control
the preparation and prosecution of any such Applications or the maintenance of
any such Applications or the respective Intellectual Property Rights. The title
in any such Applications or in any Intellectual Property Rights granted or
registered thereon will belong exclusively to the Electing Party. The Party
declining to bear its share of the expenses of prosecuting or maintaining
Applications or Intellectual Property Rights covering a Joint Invention (the
"Declining Party") agrees to execute any and all actions, declarations, forms,
assignments or other documents to effect the foregoing, whereby the Electing
Party undertakes to indemnify and hold harmless the Declining Party with respect
to any and all rights and claims arising in connection with the execution of
such aforementioned actions, declarations, forms, assignments or other
documents. Any license rights of the Declining Party to the Applications or
Intellectual Property Rights covering a Joint Invention shall be agreed in
writing between the Parties on case by case basis.
20.5 (a) Subject to Clause 20.1, above, Endwave shall retain
and maintain complete ownership of all technical data, engineering designs,
drawings, test results, computer software and similar material first produced or
generated solely by Endwave in the course of work performed pursuant to this
Agreement ("Endwave Know-how").
(b) Subject to Clause 20.1, above, TRW shall retain and
maintain complete ownership of all technical data, engineering designs, drawing,
test results, computer software and similar material first produced or generated
solely by TRW in the course of work performed pursuant to this Agreement ("TRW
Know-how").
Endwave shall have a limited license to use such TRW
Know-how (1) only for the development of the Parts for Nokia in accordance with
this Agreement, and (2) in the event the Parties execute a purchase agreement in
accordance with Article 16 above, then only for the manufacture and supply of
the Parts to TRW in accordance with the terms and conditions of such purchase
agreement and only for the period of validity of such purchase agreement; and
for no other purpose. All materials embodying such TRW Know-how shall be
returned to TRW immediately upon request.
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(c) Subject to Clause 20.1 technical data, engineering
designs, drawings, test results, computer software and similar material produced
or generated jointly by Endwave and Nokia and/or TRW in the course of work
performed pursuant to this Agreement ("Joint Know-how") will be jointly owned by
the Parties recorded here that each party has the right to exploit (including
without limitation licensing) such Joint Know-how at its sole discretion and
shall indemnify and hold harmless the other party for any claims arising from
such exploitation. Notwithstanding the above in this Clause 20.5 (c) neither
party may grant any exclusive licenses without a prior written consent of the
other party thereto, which consent shall not be unreasonably withheld.
20.6 (a) Endwave hereby grants to TRW and Nokia, under any
Application and Intellectual Property Rights which may be obtained in accordance
with Articles 20.3 and 20.4 of this Agreement and to the Endwave Know-how
generated in accordance with Article 20.5 a) and c) of this Agreement a
non-exclusive, royalty-free, irrevocable and perpetual license to make or have
made, to use, and to sell Parts developed as a result of performance under this
Agreement.
(b) Endwave agrees that, in the event:
i. Endwave is in default of a material obligation
under this Agreement and/or the purchase
agreement and fails to remedy such default
within a reasonable time fixed by TRW (which
period shall not be less than thirty (30) days)
in a written notice drawing the attention of
Endwave to the default and requiring the same to
be remedied; and/or
ii. Endwave becomes insolvent, files for any form of
bankruptcy, makes any assignment for the benefit
of creditors, has a receiver, administrative
receiver or officer appointed over the whole or
a substantial part of the assets, or ceases to
conduct business or an equivalent act to any of
the above occurs under the laws of the
jurisdiction of Endwave; and/or
iii. of discontinuation or permanent cessation of the
respective part of the business and/or of
manufacture the Parts by Endwave; and/or
iv. of an inability of Endwave or unwillingness of
Endwave to manufacture the Parts; and/or of a
change of majority ownership or majority control
to a material competitor of Nokia
v. a default by Endwave is clearly not capable of
being remedied within the period set out in
subclause 20.6.(b)i, above.
then Endwave will grant a non-exclusive and royalty-free
license under any Applications and/or Intellectual Property Rights it owns, or
is permitted to license without ownership (including but not limited to Endwave
Background Works and inventions under Article 20.3 and 20.4), and to Endwave
Know-how and Endwave's part in the Joint Know-how generated in accordance with
Clauses 20.5 (a) and (c), and to the Manufacturing Documentation, to TRW and
Nokia to make or have made, to use and to sell, Parts which are result of
performance under this Agreement, but for no other purpose.
Development Agreement 15(21)
58 GHz Module 28.1.1999
(c) The Parties agree to appoint a mutually agreeable
escrow agent, and agree to execute an Escrow Agreement acceptable to both
Parties and to the escrow agent.
Endwave shall deposit the Manufacturing Documentation to a
mutually agreed escrow agent within a period of 30 days from the date of
Certificate of Acceptance and complete the deposit upon any changes to the
Parts.
TRW and Nokia shall at any time during normal business hours
have the right to inspect the above-described deposit in order to verify that it
is complete. However such inspections shall be subject to the confidentiality
obligations set forth under this Agreement.
Nokia will carry all the cost related to the escrow if NCC
Escrow International, LTD, UK is appointed the escrow agent.
(d) Under the circumstances described in subsection 20.6
(b) above the escrow agent shall release to TRW and Nokia the deposit containing
Manufacturing Documentation to the Parts.
20.7 Endwave shall settle and/or defend at its own option and
its own expense and indemnify and hold TRW and Nokia harmless from any cost,
expense, loss, attorney's fees or damage arising out of any claim, demand, suit
or proceedings against TRW and Nokia or any customer of Nokia to the extent such
claim, demand, suit or proceedings alleges that the Parts and/or the
incorporation of the Parts in the equipment sold by TRW or Nokia, and/or the use
or sale of the Parts by TRW or Nokia or by any of Nokia's direct customers,
infringes upon any Intellectual Property Right of any third party, provided that
(1) TRW or Nokia informs Endwave in writing of any such claim, demand,
proceedings or suit without delay, (2) Endwave is given control over the defense
thereof and TRW andNokia reasonably cooperate in the defense at Endwave's
expense, and (3) neither TRW nor Nokia will agree with the third party to the
settlement of any such claim, demand, proceedings or suit prior to a final
judgment thereon without the prior written consent of Endwave which consent
shall not be unreasonably withheld. TRW and Nokia shall have the right to select
its own counsel to participate in any such defense at their expense. This
indemnification does not apply to any of the following: (1) infringement by a
combination, made by TRW, Nokia or a customer of Nokia to whom Nokia has
supplied the Parts, of Parts furnished under this Agreement with other products
not furnished hereunder by Endwave unless Endwave is a contributory infringer;
(2) infringement resulting solely from changes or modifications made to or from
the Parts by TRW or Nokia; and (3) infringements by Parts which are made in
accordance with drawings, samples or manufacturing specifications designated by
TRW or Nokia and Endwave proves that such infringements occur according to the
sole design of TRW or Nokia.
If a claim, demand, suit or proceedings alleging infringement
is brought or Endwave believes one may be brought, Endwave shall have the
option, at its expense, to (1) modify the Parts to avoid the allegation of
infringement, while at the same time maintaining compliance of the Parts with
the requirements set forth under this Agreement, (2) replace the Parts with
non-infringing but equivalent Parts which comply with the requirements set forth
under this Agreement; or (3) obtain for TRW and Nokia, at no cost to TRW and
Nokia, a license to continue using and exploiting the Parts in accordance with
this Agreement free of any liability or restriction.
In the event any Part to be furnished under this Agreement is
to be made in accordance with drawings, samples or manufacturing specifications
designated by TRW or Nokia and is not the design of Endwave, TRW agrees to
settle and/or defend, at its own option and at its own expense and indemnify and
hold Endwave harmless from any cost, expense, loss, attorney's
Development Agreement 16(21)
58 GHz Module 28.1.1999
fees or damage arising out of any claim, demand, suit or proceedings against
Endwave to the extent such claim, demand, suit or proceedings alleges that the
Parts infringes upon any Intellectual Property Rights of any third party
provided that (1) Endwave informs in writing of any such claim, demand,
proceedings or suit without delay, (2) TRW is given control over the defense
thereof and Endwave reasonably cooperates in the defense at TRW's expense, and
(3) Endwave will not agree with the third party to the settlement of any such
claim, demand, proceedings or suit prior to a final judgment thereon without the
prior written consent of TRW which consent shall not be unreasonably withheld.
Endwave shall have the right to select its own counsel to participate in any
such defense at Endwave`s expense. This indemnification does not apply to
infringement resulting from changes or modifications made to the drawings,
samples, manufacturing specifications or other information designated by TRW or
Nokia unless Endwave can prove that the non-modified parts of drawings, samples
or manufacturing specification or any other information designated by TRW or
Nokia has solely caused the infringement.
ARTICLE 21
CONFIDENTIALITY
21.1 Each Party ('Receiving Party') shall not disclose to
third parties nor use for any purpose other than for the proper fulfilment of
this Agreement any technical or commercial information ('Information') received
from the other party ('Disclosing Party') in whatever form under or in
connection with this Agreement without the prior written permission of the
Disclosing Party except information which
(a) was in the possession of the Receiving Party prior to
disclosure hereunder as proven by the written records of the Receiving Party; or
(b) was in the public domain at the time of disclosure or
later became part of the public domain without breach of the confidentiality
obligations herein contained; or
(c) was disclosed by third party without breach of any
obligation of confidentiality owed to the Disclosing Party; or
(d) was independently developed, as proven by the written
records of the Receiving Party, by personnel of the Receiving Party having no
access to the information.
21.2 In the event any governmental or judicial order requires
the disclosure of Proprietary Information, the recipient of such Proprietary
Information shall promptly but in any event prior to such disclosure notify the
originator of the Proprietary Information of the requirement and provide
reasonable aid and assistance if the originator decides to oppose such
governmental or judicial order. Disclosure will be done only to the extent
required, and subject to confidentiality protection to the extent reasonably
possible. The recipient shall not be liable for any disclosure of Proprietary
Information made pursuant to such governmental or judicial order if it has
complied with the provisions or this paragraph.
21.3 The provisions of this Article 21 shall survive the
termination of this Agreement for whatsoever reason.
ARTICLE 22
Development Agreement 17(21)
58 GHz Module 28.1.1999
FORCE MAJEURE
22.1 Neither Party shall be liable to the other for any delay
or non-performance of its obligations hereunder in the event and to the extent
that such delay or non-performance is due to an event of Force Majeure. The
Party affected by an event of Force Majeure shall inform the other Party in
writing without delay of its occurrence, probable duration and cessation.
22.2 Events of Force Majeure are events beyond the control of
the Party which occur after the date of signing of this Agreement and which were
not reasonably foreseeable at the time of signing of this Agreement and whose
effects are not capable of being overcome without unreasonable expense and/or
loss of time to the Party concerned. Events of Force Majeure shall include
(without being limited to) war, civil unrest, acts of government, natural
disasters, fire and explosions.
22.3 The Party affected by an event of Force Majeure shall
immediately take any necessary measures in order to limit and minimise the
effect of such an event on the performance of its obligations under this
Agreement.
22.4 The Party appealing to the occurrence of an event of
Force Majeure is under obligation to prove, upon request, its effect on the
performance of the said Party's obligations under this Agreement.
22.5 In the event that the delay or non-performance of either
Party hereto continues for a period of six (6) months due to reasons of Force
Majeure, then either Party shall have the right to terminate this Agreement with
immediate effect without any liability towards the other Party.
ARTICLE 23
EFFECTIVE DATE AND TERM
23.1 This Agreement shall become valid and effective on the
date of signature hereof and shall remain valid until the signing of the
Certificate of Acceptance and fulfilment of all other obligations hereunder
unless cancelled pursuant to Article 10 or Article 15.5, or terminated pursuant
to Article 24.
The obligations set forth in Articles 9, 10, 12, 16, 20,
22, 26 and 26.7 shall survive any such cancellation or termination described in
Article 23.1 above.
ARTICLE 24
PREMATURE TERMINATION
24.1 In the event that a Party hereto is in default of a
material obligation under this Agreement and fails to remedy such default within
a reasonable time fixed by the non-defaulting Party (which period shall not be
less than thirty (30) days) in a written notice drawing the attention of the
defaulting Party to the default and requiring the same to be remedied, then the
non-defaulting Party shall have the right to terminate this Agreement with
immediate effect after the expiry of the period fixed. In the event of
bankruptcy, receivership or comparable procedure under applicable Bankruptcy
Ordinance, or a change in the majority ownership or majority control of a Party
to a material competitor of a Party hereto or in case the default is not capable
of being remedied then the non-defaulting Party may terminate this Agreement
forthwith.
Development Agreement 18(21)
58 GHz Module 28.1.1999
24.2 In the event TRW terminates this Agreement pursuant to
Article 24.1, such termination shall be without any liability toward Endwave and
Endwave shall have no right to make any claims arising as a result of this
termination against TRW.
ARTICLE 25
APPLICABLE LAW AND SETTLEMENT OF DISPUTES
25.1 This Agreement shall be governed by the laws of the State
of California, excluding the conflict of laws rules thereof.
25.2 Any and all disputes arising out of or in connection with
this Agreement shall be finally settled in arbitration in accordance with the
rules of the American Arbitration Association by three (3) arbitrators appointed
in accordance with the said Rules.
25.3 The arbitration proceedings shall be conducted in Los
Angeles, California in the English language. The arbitration award shall be
final and binding on the Parties.
ARTICLE 26
FINAL PROVISIONS
26.1 Neither Party shall assign or transfer to any third
party, without the prior written consent of the other Party, this Agreement or
any of its share or interest therein. Such consent shall not be unreasonably
withheld in case of the business unit is sold or assignment to an affiliate of
the assigning Party, on condition that the assigning Party shall remain fully
responsible towards the other Party for the proper fulfilment of this Agreement.
26.2 This Agreement contains the entire understanding between
the Parties in respect of this matter and all previous correspondence,
memoranda, minutes of meetings, offers, enquiries and other documents exchanged
between the Parties prior to the date of this Agreement shall be cancelled and
superseded by this Agreement.
26.3 In addition to this Agreement, the following documents
are hereby made part of this Agreement:
APPENDIX 1 Product Pricing
APPENDIX 2 Product Definition, Module Test Plan,
Specifications (Nokia)
APPENDIX 3 Project Plan, Milestone schedule,
APPENDIX 4 Commercial Products Quality
Assurance Requirements Document--to be
negotiated at the start of production
In case of any discrepancies between the above documents,
the text of this Agreement document shall always prevail over any of the
Appendices or the Schedules thereto. The Appendices shall apply in the order set
forth above.
Development Agreement 19(21)
58 GHz Module 28.1.1999
26.4 Alterations or amendments to this Agreement shall be made
in writing with the signatures of both Parties.
26.5 The following persons shall act as the representatives of
the Parties regarding notices, performance, extension, termination and changes
in respect of this Agreement.
REPRESENTING ENDWAVE REPRESENTING TRW
Name Name ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Telephone ▇▇▇.▇▇▇.▇▇▇▇
Telefax Telefax 310.812.7011
ALL SUCH NOTICES OR CORRESPONDENCE SHALL BE TRANSMITTED
BETWEEN THE PARTIES IN WRITING.
26.6 No failure or delay of either Party in exercising its
rights hereunder (including but not limited to the right to require performance
of any provision of this Agreement) shall be deemed to be a waiver of such
rights unless expressly made in writing by the Party waiving its rights.
26.7 In the event that any provisions of this Agreement shall
be held invalid as contrary to any law, statute or regulation in that regard,
the invalidity of such provision shall in no way affect the validity of any
other provision of this Agreement and each and every provision shall be
severable from each and every other.
26.8 The headings used in this Agreement are inserted for
convenience only and shall not affect the interpretation of the respective
provisions of this Agreement.
26.9 Endwave shall notify TRW and Nokia of any export control
commodity numbers that apply to the Parts. Nokia agrees that it shall not
knowingly sell, transfer, or deliver, directly or indirectly, any part or
portion of the Products or related documentation supplied by Endwave pursuant to
this Agreement to any person or organisation in any country prohibited by the
U.S. Government (21.1.1999 under 10% restriction Iran, Iraq, Cuba, Syria, Libya,
North Korea, Sudan). Endwave is liable to give TRW and Nokia notice of any
changes in the list of prohibited countries listed above in this Clause 26.9. In
case TRW and Nokia have not received a notice from Endwave concerning any change
in the list of prohibited countries, TRW and Nokia can not be held liable not to
comply with such changes.
26.10 RESERVED
ARTICLE 27
LIMITATION OF LIABILITY
27.1 In case of breach of this Agreement, neither Party shall
be liable to the other for any amount of monies in excess of the monies paid
under this Agreement by TRW to Endwave, except in cases of intentional
misconduct or gross negligence, provided, however, the maximum
Development Agreement 20(21)
58 GHz Module 28.1.1999
liability of TRW hereunder shall be equal to the damages provided for in Article
16 hereof in the event that TRW fails to [*] as provided in Article 16 hereof.
27.2 In case of breach of Article 20.7 (Intellectual Property
Rights indemnity) hereof, and except in cases of intentional misconduct or gross
negligence, neither Party's maximum aggregate liability to the other Party shall
exceed the amount set forth below:
(a) For aggregate sales under this Agreement to customers in
the United States, Canada, and Europe, [*], a Party's maximum aggregate
liability to the other Party shall be three times such sales; or
(b) For aggregate sales under this Agreement to customers in
the United States, Canada, and Europe, [*], a Party's maximum aggregate
liability to the other Party shall be the [*]; and
(c) For sales under this Agreement to customers other than
customers in the United States, Canada, and Europe, a Party's maximum aggregate
liability to the other Party shall be one times the aggregate sales to such
country.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their
duly authorised representatives.
SIGNED FOR AND ON BEHALF OF SIGNED FOR AND ON BEHALF OF
ENDWAVE CORPORATION TRW INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------- --------------------------------
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
APPENDIX 1 - Product Pricing
THE PRICING FOR THE [*] PARTS
The Not to Exceed Price for the [*] Parts purchased under the purchase agreement
(as defined in Clause 16) shall be:
The cumulative number of
Parts purchased in
continuous delivery
Price (in USD)
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Development Agreement 22(21)
58 GHz Module 28.1.1999
TERMS OF PAYMENT
As defined in Article 12.
Development Agreement 23(21)
58 GHz Module 28.1.1999
APPENDIX 2 Product Definition, Module Test Plan,
Specifications (Nokia)
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPERATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
Development Agreement 24(21)
58 GHz Module 28.1.1999
APPENDIX 3 Project Plan, Milestone schedule,
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPERATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
Development Agreement 25(21)
58 GHz Module 28.1.1999
APPENDIX 4 Commercial Products Quality
Assurance Requirements Document--to be negotiated
at the start of production