Exhibit 10.11
SUPPLY AGREEMENT
This Agreement, effective as of September 29 1998 ("Effective Date"),
by and between,
WhoVision Systems, Inc., a corporation having its principal office at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and its wholly owned subsidiaries
(hereinafter referred to as "WhoVision" or "Buyer")
and
Philips Flat Panel Display Co (Philips FPD) B.V., which has its principal place
of business at Professor ▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
(hereinafter referred to as "Philips" or "Seller").
WhoVision and Philips are sometimes referred to herein singularly as a "Party"
and collectively as the "Parties."
WHEREAS, Philips has considerable experience in the manufacture of glass-based
components;
WHEREAS, WhoVision is active in the field of design, development, manufacture
and sale of a range of fingerprint sensor systems and is designing, with
Philips' assistance, capacitive and photo fingerprint sensors to be manufactured
by Philips for WhoVision;
WHEREAS, the parties have entered into a Technology Transfer Agreement (the
"Technology Transfer Agreement") on the date hereof which provides, among other
things, for the parties to enter into this Supply Agreement;
WHEREAS, WhoVision desires to retain from Philips on a continuous basis a
certain volume of glass-based capacitive and photo fingerprint sensors, and
Philips is prepared to supply such products to WhoVision on the basis of Rolling
Forecasts (defined in Section 3.2) submitted by WhoVision in accordance with the
provisions hereof;
NOW, THEREFORE, WhoVision and Philips hereby agree on this day of September,
1998 as follows:
1. SCOPE AND BASIC INTENT
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1.1 The purpose of this Agreement is to establish the terms and conditions
applicable to the purchase by Buyer from Seller of the products listed in
Appendix 1 hereto (the "Products") complying with the respective
specifications contained in Appendix 2 hereto (the "Specifications").
Additional Products may be added by mutual agreement of the Parties.
Appendices I and 2 will then be amended accordingly.
1.2 WhoVision is the only party that may place Purchase Orders with Philips
for Products.
1.3 Seller agrees to sell and Buyer agrees to purchase the Products described
in Appendix 1 at the prices and on the other conditions set forth therein
and in this Agreement, in order to achieve at a minimum the quantities
set forth in Appendix 1. In case of a failure of Buyer to achieve such
quantities, Seller shall have the right to terminate this Agreement in
accordance with Section 17 and to "Terminate Rights" as provided in the
Technology Transfer Agreement.
1.4 The Specifications will be as set forth in Appendix 2. The ownership of
and rights to the Specifications will be governed by the Technology
Transfer Agreement and the Technology Services Agreement. Seller shall
cooperate with Buyer to ensure that the Product is compatible with
Seller's manufacturing process and to ensure cost effectiveness, quality
and reliability of the manufacturing process and the manufactured
Products.
1.5 Seller will produce prototype Products for testing purposes before
scaling up to commercial production levels. Seller will provide
manufacturing samples as set forth in Appendix 1.
1.6 Subject to Buyer committing to provide Seller with Rolling Forecasts,
Seller will reserve capacity accordingly in Seller's Fab#0 up to the
maximum capacity of Fab#0 for fingerprint sensors.
2. PRICES, DELIVERY AND PAYMENT TERMS
2.1 The prices, delivery and payment terms as per Appendix 1 are in the
currencies identified for each Product, exclusive of sales taxes, duties
or similar levies. All prices are based upon (i) the delivery conditions
for each Product as set forth in Appendix 1, and (ii) Buyer's purchase of
the aggregate quantities of each Product stated in Appendix 1. Appendix 1
may be amended from time to time by mutual agreement between the parties.
Appendix 1 and amendments shall only be valid when duly signed by
authorized representatives of both parties.
2.2 The prices and other terms agreed upon apply to Buyer's orders placed on
or after September 30, 1998 unless differently negotiated and stated in
Appendix 1.
2.3 Seller agrees to make commercially reasonable efforts to minimize the
prices of the Products. Seller's prices shall be guided by the Pricing
Concepts as defined in Appendix 5.
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2.4 Sales taxes, duties or similar levies will be added by Seller to the
prices where Seller is required by law to pay or collect them and will be
paid by Buyer in the form of a surcharge, unless Buyer supplies Seller
with appropriate tax exemption certificates, and holds Seller harmless
from all taxes and expenses incurred or arising out of and to the extent
of the use of such certificates.
2.5 In the event of unforeseen circumstances affecting Buyer or Seller or
both and/or in the event the price/performance ratio of Products
deteriorates as compared to competitive products, the parties will
jointly review the situation and attempt to find a solution reasonably
acceptable to the parties.
2.6 After the Exclusivity Period, [xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
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2A. VOLUME COMMITMENTS
2A.1 Buyer commits to purchase at least the minimum quantities of Products
listed in Appendix 1 in the time periods set forth in Appendix 1. If
Seller is late in completing any of its development milestones, Buyer's
minimum volume commitments will be rolled over to succeeding calendar
quarters consistent with the longest period by which any of Seller's
development milestones are delayed or by which any of Buyer's development
milestones are delayed due to reasons beyond Buyer's reasonable control.
The Steering Committee (defined in the Technology Transfer Agreement) may
revise the minimum quantity commitments at any time.
2A.2 Notwithstanding Article 3.14 of the Technology Transfer Agreement, Buyer
shall in case of failure to meet the quarterly volume commitments have a
ninety (90) days period to cure such failure.
3. LEAD-TIME AND FORECASTS: RESCHEDULING AND CANCELLATION
3.1 Buyer agrees to supply to Seller's contact address identified in Appendix
4 hereto, during the Term of this Agreement on a monthly basis written
rolling non-binding Product purchase forecasts in a format as specified
in Appendix 1 indicating by Product, the quantity of Products to be
shipped in each of the next twelve (12) months ("Rolling Forecasts").
[Confidential Treatment requested for redacted portion of the document]
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Buyer's Rolling Forecasts will be used for Seller's capacity planning
purposes. The structure of each month's Rolling Forecast shall be with
due regard to the applicable lead-times.
3.2 Once per quarter the Rolling Forecast shall be accompanied by Buyer's
long term forecast in a format as specified in Appendix 1 indicating by
Product the total quantity of Products anticipated to be required for at
least each of the successive periods of three months from the twelfth
(12th)through the twenty fourth (24th) month. The long term forecast will
be for information and resource planning purposes.
3.3 Buyer will notify Seller of any deviations of more than ten percent (10%)
from the monthly and/or quarterly forecasts so provided to Seller
promptly after it becomes aware that any such major chance is likely to
occur.
3.4 Seller cannot guarantee any production capacity to Buyer to the extent
resulting from Rolling Forecasts not being provided in time. It is
understood by Buyer that the manufacture of Products can only be
initiated upon receipt by Seller of a firm Purchase Order from Buyer and
the subsequent confirmation thereof by Seller, all in accordance with
Article 4 hereof.
3.5 Buyer may request that Seller reschedules the original Scheduled Shipment
Date (defined in Section 5.3) for Products (excluding discontinued
products and warranty replacement orders) but may only do so once and
only pursuant to the criteria set forth in Appendix 1. All requests to
reschedule the original Scheduled Shipment Dates are subject to Seller's
written acceptance, which shall not be unreasonably withheld. Seller may
withhold such acceptance among other reasons, when e.g. production
capacity limitations would not allow rescheduling of production.
3.6 Buyer may not cancel a Purchase Order in whole or in part except pursuant
to the criteria set forth in Appendix . When failing to give notice in
time in accordance with Appendix 1, Seller will deliver and Buyer will
pay for any Products which are identified with Buyer's Purchase Orders.
4. PURCHASE ORDER AND ORDER CONFIRMATION
4.1 Purchase Orders for Products shall be submitted by Buyer to Seller at
Seller's contact address listed on Appendix 4, on separate Purchase Order
forms, or, if so agreed, by EDI.
4.2 Any Purchase Order issued hereunder by a Buyer to Seller shall include
the following information:
- Reference to this Agreement by its number;
- (Reference to) Identity of required Products;
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- Quantity of Products;
- Shipping and invoicing address;
- Requested delivery date(s);
- (Reference to) the applicable prices, discounts, and payment terms;
- (Reference to) any additional terms and conditions, e.g., additional
logistic information.
4.3 Unless otherwise agreed in writing between Buyer and Seller, Seller may
confirm and thereby accept each Purchase Order placed in according with
this Agreement (or advise Buyer of required clarifications) in writing
promptly, but ultimately within 10 business days, after receipt thereof.
Purchase Orders and Purchase Order confirmations shall include a
reference to this Agreement by its number and shall furthermore confirm
all of the information provided in the Purchase Order. Changes to
Purchase Orders will only be made if appropriately agreed in writing by
Buyer.
4.4 Seller shall supply and deliver to the Buyer the Products according to
the agreed Specifications as per Annex 2 hereto and in accordance with
the terms and conditions set forth in this Agreement.
4.5 Notwithstanding any provisions to the contrary that might be set forth in
a Purchase Order or in the conditions of sale or other document of Seller
submitted with the Purchase Order confirmation, the preprinted terms and
conditions on the face and reverse side of a Purchase Order or any other
document sent with or subsequent to the Purchase Order confirmation of
Seller shall not apply to or become part of the Purchase Order and/or the
delivery obligations resulting therefrom, unless any such term or
condition has been expressly agreed upon in writing by Buyer and Seller.
4.6 It is understood that Seller's supply of Products requires lead-times as
specified per Product in Annex 1. Unless agreed otherwise between Seller
and Buyer, Buyer's Purchase Order will take into account such agreed
lead-times.
4.7 In case Buyer would request additional Purchase Orders or shipments over
the ranges as specified in the Rolling Forecast, Seller may, but shall
not be obligated to, accept and confirm such additional quantities.
5. SHIPMENT AND DELIVERY
5.1 Unless otherwise agreed, the Incoterms 1990 edition issued by the
International Chamber of Commerce, Paris, France, shall apply to the
interpretation of the delivery terms with
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respect to supplies pursuant to this Agreement as mentioned in Appendix 1
or elsewhere in this Agreement.
5.2 Parties agree that delivery shall take place on an "Ex Works" basis
Seller reserves the right to store the Products in consignment at Buyer's
risk and expense as and when they are available to Buyer in accordance
with the above.
5.3 Seller shall exercise reasonable business practices to meet the scheduled
shipment date(s) as set forth in the Order Confirmation (the "Scheduled
Shipment Dates"). Where any Scheduled Shipment Date is later than Buyer's
requested shipment date, or Buyer requests an expedited shipment, Seller
will use commercially reasonable efforts to Improve its shipment to meet
Buyer's requests whenever commercially practical. In case of anticipated
shipment misses to the Scheduled Shipment Date due to any cause, Seller
shall alert Buyer in a timely manner and promptly submit a recovery plan
for all impacted shipments (which may include air/freighting to Buyer's
delivery location at Seller's expense).
5.4 Subject to the intellectual property right and title provisions in the
Technology Transfer Agreement, title and all risks of loss or damage
shall pass to Buyer at the time the Products have been placed at the
disposal of Buyer in accordance with Article 5.2 hereof and Buyer shall
bear all costs relating to the Products as from such time.
5.5 Except in the case of a notified excusable delay as referred to in
Article 8 hereof, should Seller fail to ship Products on the agreed
shipment date, Buyer will give Seller written notice of non-shipment,
allowing Seller ten (10) business days from the date of receipt of
Buyer's notice within which to cure non-shipment before Seller's delivery
shall be deemed delinquent. If the delivery is deemed delinquent, Buyer's
sole remedy shall be to cancel or reschedule, at no cost to Buyer, the
delinquent portion of the Purchase Order for the applicable Products. The
quantity of' any such canceled Products shall count towards Buyer's
committed total minimum Product quantity requirements under this
Agreement. Buyer shall be responsible for payment for goods shipped and
provided in accordance with Purchase Orders in place, according to the
terms of payment described herein.
5.6 Products shall be delivered in such packing as is suitable for the mode
of transport to be used and Seller shall provide each packing with such
indications as the Buyer may specify from time to time, at Buyer's cost.
5.7 Seller shall include one (1) copy of the packing slip with each delivery
or shipment to Buyer, and this packing slip shall contain the following
information:
- Reference to Purchase Order;
- Description of Product;
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- Numbers of containers, sizes and quantities;
- Authorizing Personnel.
Seller shall include such additional information as is necessary to
assure correct payment, accountability, and traceability to a particular
invoice.
5.8 In the event Buyer contests delivery, Buyer must request a proof of
delivery from Seller within thirty (30) days of the date of Seller's
invoice, otherwise, delivery shall be deemed complete.
6. THE APPROVAL/QUALITY PERFORMANCE/INSPECTION
6.1 All Product to be supplied by Seller to Buyer pursuant to this Agreement
shall be checked and tested by Seller in accordance with the requirements
specified in Annex 3 hereto and Seller shall keep record of the test
results at least four (4) years after delivery of each Product and on
request provide Buyer with copies thereof. Seller shall only supply
Products which comply with the Specifications and other agreed
requirements, if any.
6.2 Buyer may inspect the delivered Products at their destination within
sixty (60) days after the arrival date at the place of destination. Buyer
shall have the right to reject all or any of the Products which do not
meet the inspection standard, provided that such claim shall be served to
Seller with supporting evidence within ninety (90) days after the arrival
date of the Products at the place of destination. In case of a rejection,
Seller shall replace the applicable Products free of charge within a
reasonable period of time, it being understood that all costs connected
with the forwarding of such replacements shall be for Seller's account.
7. INVOICING AND PAYMENT TERMS
7.1 Seller's invoice shall be issued upon delivery of the Products. Payment
of the invoice is due within thirty (30) days from the date of Seller's
invoice. All payments shall be made without any discount whatsoever.
Seller shall submit the invoices to the address stated therefor in
Appendix 4 hereto. Invoices shall be submitted in duplicate.
7.2 If shipments are made in installments, Seller shall invoice Buyer for
each installment separately.
7.3 Unless otherwise agreed payment is to be made by wire transfer to
Seller's bank account as mentioned in Appendix 4. All bank charges,
taxes, levies, duties and other cost as may be due or become due on
payments hereunder are for Buyer's account.
7.4 Buyer hereby waives any and all rights to offset existing and future
claims against any payments due for Products sold hereunder or under any
other agreements that Buyer and
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Seller may have and agrees to pay the amounts hereunder regardless of any
claimed offset which may be asserted by Buyer or on its behalf.
7.5 Buyer hereby grants Seller a purchase money security interest in the
Products as security for its obligations hereunder until the entire
amount due has been paid, and will execute any document to perfect this
security interest requested by Seller.
8. EXCUSABLE DELAY
8.1 Neither party shall be responsible for a failure in the performance of
this Agreement or of any confirmed Purchase Order if:
(i) such failure cannot reasonably be attributed to such party,
taking into account industry practice; or
(ii) such party cannot be held accountable for such failure because it
is caused by Force Majeure as defined in Section 8.3 hereof.
In case of such a failure, the performance of the relevant part of the
confirmed Purchase Order will be suspended, without the non-performing
party being held responsible for any damage resulting therefrom to the
other party.
8.2 The non-performing party will notify the other party on the occurrence of
such failure and the estimated duration as soon as possible. In the event
the suspension has lasted for three (3) consecutive months or as soon as
it is established that the suspension will last for at least three (3)
consecutive months, either party is entitled to terminate partially or in
whole the confirmed Purchase Order without being held liable to any
indemnity whatsoever towards the other party.
8.3 The expression "Force Majeure" shall mean and include circumstances or
occurrences beyond one party's reasonable control - whether or not
foreseeable at the time of this Agreement or the Purchase Order or Order
Confirmation - in consequence of which one party cannot reasonably be
required to execute its obligations under this Agreement or the confirmed
Purchase Order. Such circumstances or occurrences include but are not
restricted to: acts of God, war, civil war, insurrections, fires, floods,
labor disputes, epidemics, governmental regulations and/or similar acts,
freight embargoes, non-availability of any permits, licenses and/or
authorizations required, defaults or delays of suppliers or
subcontractors and inability or impracticability to secure
transportation, facilities, fuel, energy, labor, materials or components.
9. LIMITED WARRANTY AND DISCLAIMER
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9.1 Seller warrants to Buyer that the Products delivered pursuant to this
Agreement will, at the time of delivery and for a period of twelve (12)
months thereafter, be free from defects in design, construction,
manufacture, material and workmanship and shall conform to the
Specifications. Seller's obligations with respect to claims under this
warranty shall include a warranty adjustment consisting, at Buyer's
option, of (i) repair or replacement of such defective or non-conforming
Products, or (ii) an appropriate credit of the purchase price thereof;
provided that Seller is informed by Buyer in writing promptly after the
defects have revealed themselves.
9.2 The provisions of this Article 9 will survive the expiration or
termination for whatever cause of this Agreement.
9.3 This limited warranty and disclaimer does not cover
(i) damage sustained by normal wear and tear;
(ii) damage arising as a consequence of negligence, misuse or improper
storage, installation, repair, alteration, or return handling of
the Products or parts thereof, other than by Seller;
(iii) damage resulting from environmental or stress testing, other than
by Seller;
(iv) and damage arising as a consequence of continuous operating
beyond Seller's published Product specifications.
THE EXPRESS WARRANTY GRANTED ABOVE SHALL EXTEND DIRECTLY TO BUYER AND NOT
TO BUYER'S CUSTOMERS, AGENTS OR REPRESENTATIVES OR ANY OTHER THIRD PARTY
AND EXCEPT FOR WARRANTY OF TITLE, IS IN LIEU OF ALL OTHER WARRANTIES,
WHETHER EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF FITNESS
FOR A PARTICULAR PURPOSE OR MERCHANTABILITY, SUCH OTHER WARRANTIES BEING
SPECIFICALLY DISCLAIMED BY SELLER.
10. LIMITATION OF LIABILITY
10.1 IN NO EVENT SHALL EITHER PARTY'S LIABILITY FOR ANY BREACH OR ALLEGED
BREACH OF THIS AGREEMENT EXCEED THE TOTAL PURCHASE PRICE FOR PRODUCTS
CONCERNED, NOR SHALL EITHER PARTY BE LIABLE FOR ANY LOSS OF PROFITS, LOSS
OF USE, SPECIAL, INCIDENTAL, INDIRECT, EXEMPLARY OR CONSEQUENTIAL DAMAGES
RESULTING FROM SUCH BREACH OR ALLEGED BREACH INCLUDING BUT NOT LIMITED TO
EXCESS REPROCUREMENT COSTS, AND IRRESPECTIVE OF WHETHER SUCH
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PARTY HAS ADVANCE NOTICE OR ADVANCE KNOWLEDGE OF THE POSSIBILITY OF SUCH
DAMAGES.
10.2 SELLER'S PRODUCTS ARE NOT DESIGNED FOR USE IN LIFE SUPPORT DEVICES,
APPLIANCES OR SYSTEMS WHERE MALFUNCTION CAN REASONABLY BE EXPECTED TO
RESULT IN A PERSONAL INJURY. BUYER USING OR SELLING SELLER'S PRODUCTS FOR
USE IN SAID EQUIPMENT DOES SO AT ITS OWN RISK.
11. PRODUCT AND DESIGN CHANGES/DISCONTINUED PRODUCTS
11.1 Seller reserves the right to make Product and/or production changes with
Buyer's prior written approval, not to be unreasonably withheld provided
said changes shall not negatively affect form, fit or function of the
Products and their performance characteristics or their integrability
with Buyer's systems or products.
11.2 If production of any Product covered by this Agreement is to be
permanently discontinued ("Discontinued Product") at any time during the
term of this Agreement, Seller shall use reasonable commercial efforts to
give Buyer at least six (6) months prior written notice of such
discontinuance for multi-sourced Products and twelve (12) months notice
for sole sourced Products. Seller will also give Buyer notice of
Discontinued Products that are deemed to be technically
non-manufacturable, or otherwise limited in availability, when a standard
notice as outlined above is commercially impracticable.
11.3 Seller's written Discontinued Product notice to Buyer will contain the
specific last time ordering conditions for the Discontinued Products.
11.4 During the period after notice, Seller shall accept Purchase Orders from
Buyer for the unordered quantities of the Discontinued Products as priced
in this Agreement, to the extent such Purchase Orders can be supplied
within Seller's manufacturing capabilities.
11.5 Discontinued Product Purchase Orders will be considered Buyer's firm,
final Purchase Orders for the Discontinued Products and will not be
subject to Buyer's termination or cancellation without Seller's express
prior written approval. Seller's Scheduled Shipment Dates for
Discontinued Product(s) are approximate and will be based upon the
aggregate of all final order quantities received for the affected
Products which Seller must support.
12. INTELLECTUAL PROPERTY RIGHTS
12.1 Seller, at its own expense, shall defend any suit brought by any third
party against Buyer or its agents, stockholders, directors, employees,
officers, resellers, distributors, or assigns insofar as it is based upon
a claim that any Product alone, and not in combination with any other
products supplied by Seller, as directly supplied by Seller hereunder and
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not modified in any way by Buyer infringes any patent(s), trade ▇▇▇▇(s),
copyright(s) or design(s) or other intellectual property right(s) of any
third party, provided that Seller is notified promptly by Buyer in
writing of any claim of or suit for infringement and is given full
authority at Seller's option to settle or conduct the defense thereof
with Buyer's full assistance and co-operation in said defense at Seller's
expense. Seller will not be obligated to reimburse costs or expenses
incurred by Buyer without prior written notice of the expenditure. In the
event that Products supplied hereunder by Seller in the form as specified
above are in such suit held to constitute infringement and their use is
prohibited, with Buyer's consent (which consent shall be not unreasonably
withheld) Seller shall replace the infringing Products with
non-infringing Products or shall modify the Products so that they become
non-infringing, or authorize the return of such Products and grant Buyer
a credit for the Price paid therefor.
12.2 It is expressly understood that Seller shall not be liable for
infringement of any intellectual property rights covering any product
other than Products as such hereunder, in the form as supplied and not
modified in any way, nor for infringement of intellectual property rights
covering any assembly, circuit, combination, method or process in which,
or in the manufacture, testing or application of which such Products may
have been used. Furthermore, Seller shall not be liable for any
infringement necessarily arising from compliance with Buyer's design,
specifications or instructions. Buyer shall indemnify Seller against any
final award of damages or costs for such infringement and shall reimburse
all costs incurred by Seller in defending any suit or proceeding for such
infringement, provided Seller gives Buyer prompt notice in writing of any
such suit or proceeding for infringement and, if so requested, full
authority to conduct the defense thereof and full assistance and
co-operation in said defense at Seller's expense.
12.3 The sale of any Product hereunder does not convey any license, by
implication, estoppel or otherwise, under any intellectual property
rights of Seller covering any Product supplied hereunder or any
combination in which any Product supplied by Seller hereunder is combined
with any other product, whether or not supplied by Seller, or any method
or process in which any such Product of Seller may be used, except the
implied license to use and resell the Products under any of Seller's
intellectual property rights.
12.4 THE FOREGOING STATES THE ENTIRE LIABILITY OF SELLER IN CONNECTION WITH
THE INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES BY
PRODUCTS SUPPLIED BY SELLER HEREUNDER AND EXCEPT AS STATED HEREABOVE,
SELLER SHALL NOT BE LIABLE FOR ANY LOSS OR DAMAGE OF ANY KIND WHATSOEVER,
INCLUDING ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES,
SUFFERED OR INCURRED BY BUYER OR ITS IMMEDIATE CUSTOMERS IN RESPECT OF OR
IN CONNECTION WITH THE
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INFRINGEMENT OF ANY THIRD PARTY'S INTELLECTUAL PROPERTY RIGHTS.
13. TRADEMARK AND ADVERTISING
13.1 Neither Party shall, without the other Party's prior written consent, use
the other party's name or trademark as such and/or use same in connection
with any advertisement or sales literature.
13.2 The Parties understand that the consent necessary in article 13.1 above,
may require separate authorization agreements for such use consistent
with then current policy of the authorizing Party.
14. COMPLIANCE WITH LAWS
14.1 Seller warrants that it is legally authorized to enter into this
Agreement. Seller further warrants that it shall comply with all
applicable rules, regulations and laws in the manufacture and sale of the
Products, including but not limited to such matters as environmental,
export control and safety laws. If requested, Seller will assist Buyer or
Buyer's customer(s), if applicable, by providing evidence of its
compliance or such information necessary to assist Buyer or Buyer's
customer(s) to comply with same.
15. SEVERABILITY/WAIVER
15.1 In the event that any provision(s) of this Agreement shall be held
invalid or unenforceable by a court of competent jurisdiction or by any
future legislative or administrative action, such holding or such action
shall not negate he validity or enforceability of any other provisions
hereof.
15.2 The failure on the part of either Party to exercise, or any delay in
exercising, any right or remedy hereunder shall not operate as a waiver
thereof, nor shall any single or partial exercise of any right or remedy
hereunder preclude any other or future exercise thereof or the exercise
of any other right or remedy granted hereby or by any related document or
by law.
16. SUCCESSOR
16.1 This Agreement shall be binding upon and inure to the benefit of the
Parties hereto and their respective successors, assigns and legal
representatives. Neither Party shall, during the Term of this Agreement,
have the right to assign or otherwise transfer its rights or obligations
under this Agreement except with the prior written consent of the other
Party. However, nothing herein shall be construed to prevent Seller from
assigning its rights to receive payments due under the terms of this
Agreement.
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17. TERM AND TERMINATION
17.1 The term of this Agreement is from the Effective Date until September 30,
2001 (the "Term") and shall be automatically extended for a period of one
year unless notice not to extend is given by Buyer, and thereafter on
each anniversary of the Effective Date for additional one-year terms,
unless notice not to extend is given by either Party to the other Party
in writing by means of communication ensuring evidence and date of
receipt (e.g. registered mail with return receipt, special courier,
telex), not less than four (4) months before the date of expiry. The
Parties may agree in writing on longer periods of notice. Seller may
terminate this Agreement (1) in case of a material breach by Buyer that
is not cured within thirty (30) days after notice thereof, (2) in the
event that Buyer falls to meet its minimum volume purchase requirements
subject to the cure period provided in Section 2A.2, or (3) by giving
Buyer 60 days written notice in the event that the Board of Management of
Koninklijke Philips Electronics N.V. determines to close down Philips
Fab#0 in Eindhoven, the Netherlands or to discontinue the fingerprint
sensor activities in Fab#0. In case of termination by Seller of this
Agreement as described in this Article 17.1 (except for termination by
Seller in case of material breach by Buyer and termination by Seller for
convenience after the Term as described in this Section 17.1), Buyer has
the right to issue a last-time Purchase Order per Section 17.2. Buyer's
right to issue a last-time Purchase Order per Section 17.2 shall not
exist in case Buyer already has access to an alternative source of supply
for the Products. In case of termination by Seller of this Agreement,
(except for termination by Seller in case of material breach by Buyer and
for termination by Seller for convenience after the Term as described in
this Section 17.1), Seller shall make reasonable efforts in supporting
Buyer in finding an alternative source of supply for the Products,
including but not limited to royalty free licensing and disclosure of
Philips owned intellectual property rights to such alternative source of
supply. Which are necessary to manufacture the Products and solely for
the purpose of manufacturing the Products]. Purchase Orders outstanding
at the moment of termination (except for termination by Seller in case of
material breach by Buyer), which have been confirmed by Seller's Order
Confirmation, shall continue to be executed by the Parties in accordance
with the terms thereof and the provisions of this Agreement shall
continue to apply thereto until the pertinent transactions shall have
been completed. Buyer may terminate this Agreement in case of a material
breach by Seller that is not cured within 30 days after notice thereof.
17.2 Seller shall accept a last time Purchase Order from Buyer for additional
quantities of Products equal to the capacity of Fab #0 for a period of
nine (9) months, or until the time the alternative source is operative,
whichever is less]. Buyer shall not have the right to cancel or
reschedule outstanding Purchase Orders or such last-time Purchase Order.
18. APPLICABLE LAW AND JURISDICTION
18.1 This Agreement and Purchase Orders and Order Confirmations made hereunder
shall be construed in accordance with and governed by the laws of the
State of California. The
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United Nations Convention on Contracts for the International Sale of
Goods shall not apply. Neither Buyer's general conditions of purchase nor
Seller's general conditions of sale are applicable to this Agreement or
to any Purchase Order or Order Confirmation.
19. NOTICES
19.1 All notices, requests and demands given to or made upon the Parties
hereto shall, except as otherwise specified herein, be in writing and be
delivered or mailed to the Party at the notice address stated in Appendix
4 hereto.
Any notice, if mailed properly addressed, postage prepaid, certified mail
shall be deemed made on the certified date. Any, fax, telex, or Purchase
Order or Order Confirmation contained on electronic data or telegraphic
notice shall be deemed delivered on the first working day immediately
following the transmission date.
20. CONFIDENTIAL INFORMATION
20.1 The parties shall be bound by the non-use and non-disclosure provisions
of Article 8 of the Technology Transfer Agreement and such provisions are
incorporated herein by reference.
21. EXPORT CONTROL
21.1 Buyer and Seller agree to inform the other Party of any export control
regulations which may regulate the export/import of the Product to or
from any countries of Buyer's delivery addresses (Appendix 2), if so
requested Each Party shall cooperate to promptly secure any required
export licenses for the Products.
22. CHANGES
22.1 Buyer may, from time to time, request reasonable change(s) to the agreed
Specification of the Products or request chances to the Terms and
Conditions of this Agreement and Seller agrees to make good faith efforts
to comply. If such changes affect Seller's costs or in the time for
performance, an adjustment will be made in the unit prices and/or the
other affected terms and conditions. Any assertion of adjustment shall be
in writing and must be requested by Seller within twenty (20) working
days of Seller's receipt of Buyer's notice of change.
23. COMPLETE AGREEMENT AND APPLIED DOCUMENTS
23.1 This Agreement including its Annexes constitute the entire Agreement
between the Parties and the Parties agree that there are no other
representations, warranties or oral agreements relating to the subject
matter of this Agreement. Amendments and additions
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to this Agreement shall be valid only by exchange of documents signed by
both Parties. For the sake of clarity such amendments shall be expressly
marked "Amendment (nbr _________) to the Agreement." This Agreement
between Buyer and Seller shall supersede the provisions of any general
conditions of purchase which may be attached to or printed on the reverse
side of the Purchase Order used by Buyer.
24. DISPUTE RESOLUTION
Any dispute arising with respect to this Agreement shall be resolved in
the manner provided in the Technology Transfer Agreement.
List of Appendices:
Appendix 1 Products, Prices, Quantities, Business Conditions
Appendix 2 Participating Affiliates
Appendix 3 Quality Agreements and Procedures
Appendix 4 Contract Addresses
Appendix 5 Pricing Concepts
PHILIPS FLAT PANEL WHO?VISION SYSTEMS, INC.
DISPLAY (PHILIPS FPD) CO. B.V.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Chairman & CEO Flat Displays Title: CEO
Date: 9/30/98 Date: 9/30/98
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SUPPLY AGREEMENT
APPENDIX I
A. Products:
- To be filled in before signing for Photo and Capacitive products
B. Business Conditions:
- Minimum purchase volumes:
[ xxxxxx xxxxxxxxxxxxxxx
xx xx xxx xxxx
xx xxx xxxx
xx xx xxx xxxx
xx xxx xxxx
xx xxx xxxx
xx xxx xxxx]
- Lead-times [to be provided on/before December 31, 1999]
- Incoterrn specification - Ex Works
- (upside Flexibility [to be provided on/before March 31, 1999]
- Monthly rolling forecast [to be provided on/before March 31, 1999]
- cancellation/rescheduling [to be provided on/before March 31, 1999]
- Currency -- $US
- bookings delivery validity - [monitoring, reporting, and auditing
procedures to be established on or before March 31, 1999, with
audits, if any, to be performed by the Parties independent
accountants]
- fixed exchange rate [prices to be established in $US. The exchange
rate is the average value calculated over the ten days prior to the
Effective Date of this Agreement. To the extent prices are linked to
Dfl, Parties agree that exchange rates in effect on the date of
establishing Price List shall be subject to a variance
[Confidential Treatment requested for redacted portion of document]
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of +- 5%, and that the Parties share in the variance above such range on an
equal basis measured by the date of shipment/invoicing from Such Price List
assumptions.]
C. Ordering/Forecast Formats: (if applicable)
- EDI [to be described and completed on or before January 31, 1999]
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APPENDIX 2
Product Specifications
To be mutually agreed for Photo Sensor Glass on/before March 31, 1999, and for
Capacitive Sensor Glass by the date to be established by the Steering Committee.
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APPENDIX 3
QUALITY AGREEMENTS AND PROCEDURES
A. Quality Procedures
[to be described and completed on or before March 31, 1999]
B. Inspection Procedures
[to be described and completed on or before March 31, 1999]
C. Customer Complaint Procedure (RMA)
[to be described and completed on or before March 31, 1999]
D. Product and Design Change Conditions
[to be described and completed on or before March 31, 1999]
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APPENDIX 4
CONTRACT ADDRESSES
A. Philips Contract Address for Rolling Forecasts and Purchase Orders
[to be described and completed on or before March 31, 1999]
B. Buyer's Contract Address for Order Confirmation
[to be described and completed on or before March 31, 1999]
C. Buyer's Invoice Address
[to be described and completed on or before March 31, 1999]
D. Seller's Bank-Account for Payment of Invoices
[to be described and completed on or before March 31, 1999]
E. Notice Addresses
[to be described and completed on or before March 31, 1999]
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APPENDIX 5
PRICING CONCEPTS
[to be described and completed on or before March 31, 1999]
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