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EXHIBIT 10.12
SUPPLY AGREEMENT
This Supply Agreement and all attachments ( collectively, the "Agreement") is
made by Coinstar, Inc. ("Buyer") its principal place of business at ▇▇▇▇-▇▇▇▇▇
▇▇▇▇▇▇ ▇.▇., ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and SeaMED Corporation ("Seller") its
principal place of business at ▇▇▇▇▇ ▇.▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇. This Agreement sets forth the terms and conditions pursuant to which
Buyer and Seller will conduct business for the life of this Agreement.
Seller and Buyer agree as follows:
SECTION 1. DEFINITIONS
Whenever used in this Agreement, the following terms shall have the following
specified meanings:
1.1 "Buyer's Plant" means Buyer's plant located in Bellevue, Washington or such
other location in the United States as Buyer may specify for delivery of any
Product.
1.2 "Customer" means any customer of Buyer, any subsequent owner, operator or
user of any Product and any other Person that has or acquires an interest in any
Product.
1.3 "Order" means Buyer's purchase order for Products.
1.4 "Documentation" means Specifications and/or Inspection Procedures.
1.5 "Inspection Procedures" means detailed inspection procedures for Product
quality assurance and to assure compliance with Specifications in the form
delivered to Seller.
1.6 "Lot" means the number of Products to be delivered for acceptance testing at
the end of each week pursuant to firm delivery dates under an Order.
1.7 "Person" means any individual, corporation, partnership, trust, association
or other entity.
1.8 "Purchased Product" means Product purchased by Buyer in accordance with the
acceptance procedures under Section 4.1.
1.9 "Product" means the Coinstar, Inc. Jefferson-1000 Self Service Coin Machine
and ▇▇▇▇▇ System Coin Counting Mechanism (and any spare parts or components of
the same), with the exception of the ▇▇▇▇▇ Retrofit Kits, manufactured or to be
manufactured by Seller, as more particularly described in the Specifications.
Buyer and Seller may mutually agree to amend Exhibit A to include other
electronic assemblies as specified in the future.
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1.10 "Specifications" means the specifications for each Product in the form
delivered to Seller, as may be changed from time to time pursuant to paragraph
2.1.
1.11 "Term" means the period commencing with the date of this Agreement and
ending on the third anniversary date of this Agreement. Thereafter, the
Agreement shall continue automatically for subsequent one (1) year terms. Either
party can terminate this Agreement by giving written notice to the other more
than thirty (30) days prior to the end of any one (1) year term upon completion
of the initial three (3) year term.
1.12 "Tooling" means Buyer purchased tooling set forth in Exhibit B, as the same
may be amended from time to time.
1.13 "Warranty Period" means, with respect to each Purchased Product listed in
Exhibit A, the period ending upon the expiration of eighteen (18) months after
the date of shipment and invoice of such Product from Seller's Plant.
1.14 "Spare Parts Warranty Period" means the period ending upon the expiration
of ninety (90) days after the date of installation of such Spare Part (but not
to exceed six (6) months from the date of delivery of such spare part to Buyer).
However, with respect to the Spare Parts listed in Exhibit C, Seller shall pass
on the benefits of any extended warranty to Buyer. Upon Buyer's request and
under normal circumstances, Seller will use best efforts to ship a reasonable
quantity of the Spare Parts listed in Exhibit C to Buyer within 30 days.
SECTION 2. PRODUCT CHANGES; TOOLING
2.1 Changes to Documentation. Seller shall revise the Documentation only in
accordance with the Document Change Control Agreement set forth in Exhibit D.
Buyer shall be the owner of all Documentation and all associated patent,
copyright, trade secret and other proprietary rights with the exception of
Seller's proprietary manufacturing processes and Seller's proprietary STEMS
software.
2.2 Tooling. Seller shall hold the Tooling for use in the manufacture, assembly
and testing of Products. Buyer shall bear the cost of manufacturing,
preventative maintenance and normal wear repairing of all Tooling. Buyer shall
be the owner of all Tooling (and Seller shall place a permanent marking on all
Tooling showing Buyer's ownership and shall execute and deliver any and all
documents as Buyer may reasonable request to vest, evidence or give public
notice of Buyer's ownership). Seller shall deliver any and all Tooling to Buyer
promptly on written request and in any event at the end of the Term in good
operating condition and state of repair, ordinary wear and tear excepted,
together with any and all related specifications, drawings, manuals,
documentation and records (e.g., pertaining to the operation, maintenance and
repair of the Tooling).
2.3 Buyer Supplied Components. Any parts inventory of Buyer supplied components
shall remain the sole and exclusive property of Buyer.
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SECTION 3. PURCHASE AND SALE OF PRODUCTS
3.1 Purchase Agreement. This Agreement is a supply agreement whereby the Buyer
agrees to purchase Product for the term shown from the Seller. At a minimum,
Buyer agrees to purchase all of its requirements for Product in the United
States up to and including 1800 units per year during the initial three (3) year
term of this Agreement. Buyer may choose to build Product itself or through a
third party so long as the yearly commitment to Seller of 1800 units is not
affected. Should the annual volume of units ordered by Buyer be greater than or
less than 1800 units per year, Seller will re-calculate the unit price
accordingly based on the pricing methodology in Exhibit A-1 and Exhibit F. Any
volume price adjustments will be implemented as go forward pricing not
retroactively. Buyer will provide Seller with an opportunity to bid on any
Products for sale outside of the United States provided no exclusion of U.S.
suppliers exists. Notwithstanding Seller's right to bid on any Products for sale
outside of the United States, Buyer shall have the right to select any seller at
its sole discretion.
3.2 Exclusion of ▇▇▇▇▇ Retrofit Kits. Buyer and Seller agree to exclude the
Product known as "▇▇▇▇▇ Retrofit Kits" from this Agreement. Buyer and Seller
agree to review ▇▇▇▇▇ System Retrofit Kit pricing within two (2) months of
executing this Agreement. Buyer and Seller will work together to reduce the cost
of the retrofit kits and upon mutual acceptance of terms will amend this
Agreement to add the ▇▇▇▇▇ Retrofit Kits to the Product definition.
3.3 Production Products. Seller shall manufacture, sell and deliver to Buyer
such Products as Buyer may order from Seller during the Term.
3.4 Right to Bid on New Product. Seller shall have the right to bid on the
manufacture of any new Product that Buyer may decide to introduce during the
term of this Agreement. For the purposes of this Agreement, new Product is
defined as a Product which differs from the specifications in Exhibit A by more
than 50% of component content, provided that such component content changes are
not resultant from on-going cost reduction efforts or added product features to
the Products listed in Exhibit A. Notwithstanding Seller's right to bid on new
Product, Buyer shall have the right to select any seller at its sole discretion.
3.5 Segregation of Engineers and Early Notification of Competing Products.
During the term of this agreement, Seller agrees that the employee's of Seller
that are engaged or have been engaged in the design and development of Buyer's
product will not be used to develop, or manufacture competing products. Seller
further agrees to use its best efforts to inform Buyer of the manufacture of
competing products prior to any public announcement. If such disclosure is made,
Buyer agrees to treat such information in confidence.
3.6 Orders; Delivery Schedule. Each of Buyer's Orders for Products shall be
submitted to Seller substantially in the form of a purchase order or such other
form as may be utilized by Buyer for ordering Products under this Agreement.
Each Order shall contain a description of the Products ordered, specify the
shipping destination (if any at that time), specify the quantity of Products
ordered and specify the dates on which each ordered Product is to be made
available to
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Buyer for acceptance testing with respect to the first three month period
covered by the Order schedule, along with a forecast of when additional Product
will be acceptance tested for the remaining quarters covered by the Order. No
less than ninety (90) days prior to such forecasted quarter, Buyer will supply
Seller with a definitive schedule for Product acceptance testing timing and
quantities for such quarter. The definitive quantity may vary from the
forecasted quantity by plus or minus thirty Percent (30%). Time is of the
essence in this Agreement. If one or more Lots is not made available for
delivery and acceptance testing in accordance with the definitive schedule
provided by Buyer ("Short Lot(s)"), and the reason(s) for such delay are within
the reasonable control of Seller, and Seller fails to ensure that, within eight
(8) weeks from the date of the first Short Lot, the cumulative number of
Products in Lots actually made available for acceptance testing and delivery is
again equal to the number required through that date under the definitive
schedule, Seller shall be in material breach of this Agreement and Buyer may
terminate this Agreement and all or part of any outstanding Orders at any time
thereafter. Upon such termination, Buyer shall pay Seller an amount equal to
Seller's Burdened Costs (as defined in Section 3.9.2 below) for raw materials
which are purchased by Seller (or which Seller has then placed non-cancelable
purchase orders) specifically for the manufacture of such Products and which are
returned to Seller's suppliers where possible, sold or otherwise disposed of as
directed by Buyer.
3.7 Purchased Price. As full compensation for the Products and the performance
of Seller's obligations under this Agreement, Buyer shall pay Seller the price
for each Product as established in each order. Buyer requested changes to (a)
the Documentation or (b) to ordering components for subassemblies resulting in a
quantity less than the total purchase quantity for such Products under such
Order, may cause an increase or decrease in underlying material costs, and
therefore in the price of Products. All increases or decreases in material cost
due to such changes will be passed on to Buyer as direct material cost increases
or savings (as the case may be). Seller will provide Buyer detailed baseline
cost and actual costs for any such changes to support any price adjustments made
hereunder. The parties will work together to ensure that the mechanics and
documentation of implementing price changes occur in an efficient manner for
both Buyer and Seller. Burden rates as stated in Exhibit E will be fixed for the
initial three (3) year term of this Agreement. Buyer and Seller agree to met
every three (3) months during the term of the Agreement to discuss the
methodology (i.e. tooling, NRE, economic order buys, etc.) towards price
reduction and reduction of actual costs to manufacture Products. Seller and
Buyer agree to work together to continue to reduce the manufacturing cost of the
Products where possible.
3.8 Payment. Seller shall issue its invoice for the price of a Product upon
Buyer's approval of the Product pursuant to paragraph 4.1. Buyer shall pay
Seller the amount due under each of Seller's invoices within thirty (30) days
after Buyer's receipt of the invoice. Seller shall promptly furnish Buyer with
such documentation and information as Buyer may reasonably request to verify the
amount due under any of Seller's invoices. Payments otherwise due or payable
under this Agreement may be withheld by Buyer on account of any Product that
does not comply with the warranty set forth in paragraph 7.1 or the failure of
Seller to comply with any of its other obligations under this Agreement.
Applicable taxes will appear as additional amounts owing on invoices.
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3.9 Cancellation of Orders.
3.9.1 Buyer may not cancel any Order as it applies to Products scheduled
for delivery within ninety (90) days after Buyer gives Seller such notice of the
cancellation.
3.9.2 Buyer may cancel any Order as it applies to Products scheduled for
delivery more than ninety (90) days after Buyer gives Seller such notice of the
cancellation; provided that, with respect to canceled Products scheduled for
delivery more than ninety (90) days but less than three hundred sixty five (365)
days after Buyer gives Seller notice of the cancellation, Buyer shall agree to
pay Seller an amount equal to Seller's Burdened Costs (as defined below) for raw
materials which are purchased by Seller (or for which Seller has then placed
non-cancelable purchase orders) specifically for the manufacture of such
Products and which are returned to Seller's suppliers where possible, sold or
otherwise disposed of as directed by Buyer. Seller's "Burdened Costs" shall
equal the difference between the amount paid by Seller for such materials plus a
handling charge of ten percent (10%) plus any ▇▇▇▇ back by Seller's suppliers
for taking less than amounts ordered with respect to Product Orders and the
amount of any refund, credit, allowance or compensation received by or on behalf
of Seller for such return, sale or other disposition. Seller shall furnish Buyer
such receipts, documents and other information as Buyer may reasonably request
to verify Seller's net Burdened Costs under this Agreement.
3.9.3 No cancellation shall relieve Buyer or Seller of any of their
respective obligations under this Agreement as to any Products not canceled. If
Buyer purports to cancel all or any part of any Order for Seller's breach or
default and it is determined that Seller was not in breach or default that would
permit such cancellation, then such cancellation shall be deemed to have been a
cancellation pursuant to this paragraph and the rights and obligations of the
parties shall be determined accordingly.
3.10 Spare Parts. Seller will produce and sell and provide Buyer with spare
parts for the Products, which are configured and tested to the current Product
Specifications pursuant to Orders for such spare parts. During the first term
year of this Agreement, Buyer shall provide Seller with a 1 year forecast of
spare parts requirements and shall provide firm orders for spare parts
quarterly. Seller shall invoice Buyer for Seller's actual spare part direct
material and assembly labor cost plus 10 percent (10%) For the subsequent term
years of the Agreement, Seller shall invoice Buyer for Seller's actual spare
part direct material and assembly labor cost plus 10 percent (10%) when spare
parts are ordered with annual Product Orders. For spare parts orders not made in
connection with annual Product Orders, Seller shall invoice Buyer for Seller's
actual spare part direct material and assembly labor cost plus seventeen percent
(17%). On Orders for spares that provide for future delivery to Buyer, Seller
will reasonably accommodate Buyer's requests, as necessary, to delay delivery or
utilize some portion of such spare parts in future Product manufacturing.
SECTION 4. ACCEPTANCE, DELIVERY AND SHIPMENT
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4.1 Acceptance. Delivery of Products to Buyer shall be deemed to have occurred
upon acceptance of each lot of Products under any Order in accordance with the
following acceptance procedure. Seller shall notify Buyer when a particular
Product Lot is ready for acceptance testing. Buyer will promptly inspect all or
a portion of such Product Lot at Seller's Plant. Buyer many conduct a
statistical sampling of each such Lots of Products. If five percent (5%) or more
of the lot fails to comply with the warranties set forth in paragraph 7.1, then
Seller shall repair the non-conforming Products at Seller's plant using Seller's
labor, tools, and materials, all at Seller's expense. However, if Seller will
not be able to make, or does not make, such required repairs within a reasonable
time, Buyer may, at its option, repair the non-complying Products and charge
Seller the reasonable cost of the repair. Even if a Product Lot is accepted,
Seller shall remain responsible to correct non-conformities in any Product in
such Lot under paragraph 7.2.
4.2 Storage of Completed Products. Accepted Product lots shall be stored in a
clean and safe condition by Seller at Seller's Plant or any other mutually
acceptable location until Buyer requests shipment of individual Products to
Buyer's Plant. Seller shall retain all risk of loss with respect to such stored
Products until shipment. Once accepted pursuant to Section 4.1, Buyer shall
retain all right, title and interest in and to such Products. Seller shall
execute any and all documents reasonably required in order to protect Buyer's
ownership interest in all accepted and delivered Products. Seller shall maintain
general liability and any other insurance reasonably required to insure against
loss or damage of any nature to the Products and Tooling in amounts equal to the
full insurable value thereof. At Buyer's request, Seller shall provide a
certificate evidencing the above required insurance coverage.
4.3 Shipment. Upon Buyer's request, Seller shall properly ▇▇▇▇ and otherwise
identify each accepted Product for shipment to Buyer's Plant. Buyer shall
arrange and pay for all transportation, handling, transit insurance, duties,
governmental inspections and other requirements for delivery of the Products in
accordance with this Agreement. Shipments shall be F.O.B. Seller's Plant.
4.4 Packaging. Seller shall properly package the Purchased Product according to
Buyer's instructions for protection against damage or deterioration that may
result from shipment, handling, storage or other cause.
4.5 Schedule. Seller shall make the Products available for Buyer's acceptance
testing in accordance with the schedule set forth in the applicable Order, as
revised and updated as described in Section 3.6. However, Seller shall not be
liable for delays in delivery due to causes which are not reasonably
foreseeable, which are beyond Seller's control and which cannot be overcome by
the exercise of reasonable diligence; provided that Seller gives Buyer prompt
written notice of the circumstances giving rise to the delay, the anticipated
duration of the delay and the action being taken by Seller to overcome or
mitigate the delay. The specified delivery date shall be extended by the period
of any such delay and the shipment schedule shall be recovered in accordance
with section 3.6. unless otherwise agreed to by the parties. Shipment delays
requested by the Buyer or due to Buyer supplied materials, design changes,
software or other factors under the primary control of the Buyer may result in
an inventory deposit from the Buyer to the Seller.
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4.6 Excess and Obsolete Material. During the performance of this Agreement,
Seller will purchase materials to support the requirements of the Buyers
program. Certain materials which Seller will acquire will be subject to
minimum-buy requirements and quantity price breaks which may result in excess
material accumulation which will be the responsibility of the Buyer.
Additionally, design changes may cause materials to become obsolete. Obsolete
materials due to a design change will be returned to suppliers when possible.
Non-returnable inventory will be charged to the buyer. During the performance of
this Supply Agreement, Seller will provide the Buyer with periodic updates of
the status and amount of excess or obsolete material. Seller will use its best
efforts to minimize the impact of excess material and/or obsolete materials on
Buyer's program. Seller will return materials to suppliers for credit, less
restocking fees, when appropriate. However, final costs associated with the
accumulation of excess and obsolete materials are chargeable and payable by the
Buyer. Any excess or obsolete inventories will be charged to the Buyer at
Seller's cost plus material burden, but without profit. Disposition of excess or
obsolete materials will be coordinated with the Buyer to minimize the impact of
cost to the Buyer where possible.
SECTION 5. INSPECTION
5.1 Seller's Plant. Seller's Plant and all Tooling shall be subject to
inspection by Buyer at any time during normal business hours upon twenty-four
(24) hours prior notice. Seller shall provide Buyer with safe and sufficient
access for such inspection.
5.2 By Seller. Seller shall perform such detailed inspections and tests of each
Purchased Product as are necessary to ensure that such Product complies with the
requirements of this Agreement. Without limiting the generality of the
foregoing, Seller shall:
(a) comply with the Inspection Procedures applicable to each Purchased
Product;
(b) inspect and test all materials and components to be incorporated in
any Purchased Product on receipt in order to assure material and
component quality; and
(c) keep and maintain complete and adequate records of all inspections
and test performed on Purchased Products, and make such records
available to Buyer for examination, copying and audit.
5.3 By Buyer. All Products shall at all times be subject to inspection and
testing by Buyer upon 24 hours prior notice to Seller. Seller shall provide
Buyer with safe and sufficient access, equipment and facilities for any such
inspection or test prior to delivery. No acceptance of any Products shall be
construed to result from any inspection, test or delay or failure to inspect or
test by Buyer prior to final inspection and test of such Products by Buyer.
Buyer shall be afforded a reasonable opportunity to inspect each Product for
damage at its specified destination. No inspection, test, delay or failure to
inspect or test, or failure to discover any defect or noncompliance by Buyer
shall relieve Seller of any of its obligations under this Agreement or
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impair Buyer's right to reject defective or non-complying Products or any other
right or remedy afforded to Buyer.
SECTION 6. COMPLIANCE WITH LAWS AND STANDARDS
6.1 General. Seller shall comply (and shall ensure that all Products and
Seller's subcontractors and suppliers of every tier comply) with all applicable
laws, ordinances, rules, regulations, orders, licenses, permits and other
requirements, now or hereafter in effect, of any governmental authority. Seller
shall furnish such documents as may be required to effect or evidence such
compliance. All laws, ordinances, rules, regulations and order required to be
incorporated in agreements of this character are incorporated in this Agreement
by reference.
6.2 Industry Standards. Seller shall produce all Products in accordance with,
and shall ensure that each Product complies with, the following requirements as
now or hereafter in effect:
(a) Federal Communications Commission ("FCC") Class "A" Standard agency
approvals and;
(b) Underwriters Laboratory ("UL") Standard 751 agency approvals.
Seller shall provide Buyer with such specifications, testimony and other
assistance as Buyer may reasonably request in connection with the listing,
approval, registration or satisfaction of similar requirements of any trade
association or other organization, as the same may apply to the Product.
SECTION 7. WARRANTY
7.1. Warranty. Seller warrants to Buyer that:
(a) each Product shall be free from defects in material and workmanship;
(b) each Product shall be free from all defects in design, except to the
extent manufactured to a detailed design furnished by Buyer;
(c) all materials, parts components and other items incorporated in any
Product shall be new and suitable for its intended purposes;
(d) all Products shall strictly comply with the Documentation; and
(e) each Product shall comply with the requirements of this Agreement
and the Order pursuant to which it is purchased by Buyer.
7.2 Correction of Noncompliance. If at any time during the Warranty Period Buyer
notifies Seller of any failure to comply with the warranty set forth in
paragraph 7.1, Seller shall promptly correct such noncompliance (e.g., repair or
replacement of the noncomplying Product)
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and remedy any damage to the Product resulting from such failure. Buyer will pay
the costs of transportation to Seller's Plant for warranty service. Seller will
pay all other transportation and other costs incidental to such correction and
remedying. If Buyer rejects any Products that do not comply with the warranty
set forth in paragraph 7.1, Seller shall have a reasonable time to correct the
noncompliance. If Seller fails to correct the noncompliance within a reasonable
time, Buyer may cancel the Order as it applies to the noncomplying Products only
without any cost, obligation or liability to Buyer with respect to such
noncomplying Products and without prejudice to any other rights or remedies of
Buyer with respect to such noncompliance (e.g., as to damages or cover).
7.3 Seller's Failure to Correct Noncompliance. If during the Warranty Period
Buyer requests Seller to correct any Product that does not comply with the
warranty set forth in paragraph 7.1 and Seller thereafter fails to correct the
noncompliance or otherwise comply with the requirements of paragraph 7.2, or
indicates its inability or unwillingness to comply, then Buyer may perform (or
cause performance of) the correction or otherwise achieve compliance by the most
expeditious means available to it (by contract or otherwise) and charge to or
otherwise recover (for example, by offset against the compensation otherwise
payable to Seller under this Agreement) from Seller all reasonable costs thereof
that are associated with the direct repair of the Product. Buyer's right to
perform corrections, achieve compliance and recover the costs thereof from
Seller shall not be interpreted or construed as obligating Buyer to make any
correction or otherwise achieve compliance. Further, Seller's obligations
(including warranty) shall not be limited or reduced in any way because of any
corrections performed or caused to be performed by Buyer or Buyer's rights to
perform the same. However, Seller will have no obligation for damage to a
Product where such damage is caused by the efforts of Buyer or Buyer's
representative in correcting the noncompliance.
7.4 Response Time. Seller shall use its best efforts to perform such warranty
service by a qualified service technician within (10) business days from the
time that Seller receives the defective Product part, assuming material
availability. If the claim is not within Seller's warranty obligations under
this paragraph 7, Seller shall immediately notify Buyer and, at Buyer's option,
shall either return such Product part to Buyer or shall perform the required
service under paragraph 7.5 as directed by Buyer.
7.5 Service Not Covered by Warranty. In the event that any Product requires
repair or other service that is not covered by Seller's warranty obligations
under this paragraph 7 (e.g., after expiration of the Warranty Period), Seller
shall provide such service at a rate as may be agreed upon by the parties.
Seller shall use its best efforts to complete such repairs within four (4)
business days in the case of a priority repair and within ten (10) business days
in the case of a normal repair.
7.6 Spare Parts. Seller warrants that spare parts shall be free from defects in
material and workmanship. If at any time during the Spare Parts Warranty Period
any spare part provided pursuant to this Section does not conform with the
above, the Buyer or, at the Buyer's option, the Buyer's designee shall return
such spare part to the Seller. The Seller shall, within seven (7) days following
receipt of the part, promptly repair or replace such spare part (dependent on
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material availability) without charge and refund to the Buyer or the Buyer's
designee freight paid by the Buyer or the Buyer's designee for the original and
return shipment. Such freight cost shall not exceed the then current surface
rate, freight charge charged by United Parcel Service ("UPS") or, if such UPS
freight charge is not readily available, the rate charged by a shipping company
similar to UPS.
7.7 Spare Parts Warranty. The Buyer and Seller will jointly create and
periodically review a list of spare components (not to exceed 15 parts) which
require extended (one (1) year) warranty per 1.14. Should the Seller's suppliers
provide an extended warranty to the Seller at no cost that same warranty will be
passed on to the Buyer at no cost. Should the Seller's supplier not provide such
warranty, the Buyer and Seller will negotiate in good faith on the additional
cost associated with supplying an extended warranty.
7.8 Ongoing Engineering Service. Seller shall provide such technical support
services to Buyer as the parties may agree upon during the Term and thereafter
until the expiration of the Warranty Period for all Products delivered under
this Agreement. Such services may include, without limitation, engineering
consulting services to modify, correct or enhance any Product to perform
according to its specifications or to its intended function. Seller's
engineering hourly rates for the Term are set forth on Exhibit E.
SECTION 8. ADDITIONAL OBLIGATIONS OF SELLER
8.1 Proprietary Nature of Products. The Documentation, Tooling and Products
involve valuable patent, copyright, trade secret and other proprietary rights of
Buyer. Accordingly, Seller shall not, without Buyer's prior written consent;
(a) sell any Product to any person other than the Buyer;
(b) manufacture any Product except for sale to Buyer under this
Agreement;
(c) deliver or disclose any Documentation, Tooling, or any confidential
or proprietary information of or relating to Buyer (e.g., whether of
a technical, financial, business, trade secret or other nature) to
any Person other than Buyer; or
(d) use any Documentation or Tooling for any purpose other than the
manufacture of Products for sale to Buyer under this Agreement.
Seller and Buyer shall each maintain as confidential any specifications,
drawings, blueprints, data, business information, trade secrets, manufacturing
processes, or other confidential information which Seller or Buyer learns or
acquires by virtue of this Agreement.
8.2 Component Specifications. Seller shall provide upon request from Buyer a
complete list of all parts and components used in the Product and the
manufacturers of such parts and components, specifically noting which parts or
components are available only from the manufacturer listed. Seller shall ensure
that all Products and pertinent parts and components of
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all Products are serialized and otherwise identified in accordance with any
reasonable requirements by Buyer.
8.3 Product Defect Notification. Seller shall immediately notify Buyer by fax or
telephone of any material or recurring defect, deficiency or nonconformity
discovered with respect to the Product.
8.4 Modification. Seller shall not modify or authorize any modification
affecting form, fit or function of any Product, or which would be significant
with respect to requirements or any governmental authority, without the prior
written consent of Buyer. Seller shall promptly disclose in writing to Buyer all
potential modifications (including, but not necessarily limited to, alterations,
improvements and enhancements), methods, applications, inventions, ideas and
know-how relating to the Product made by Seller during the Term.
8.5 Improvements. Seller hereby acknowledges that improvements to the Product
funded by the Buyer, which are unique to Buyer's program, shall be the sole
property of Buyer, and Seller shall provide Buyer, at Buyer's request and at a
reasonable charge, reasonable assistance in securing patents for such
improvements. Seller agrees to promptly disclose improvements to Buyer and to
execute documents reasonably requested by Buyer to evidence Buyer's ownership of
such improvements. Manufacturing process improvements developed by the Seller
shall be the property of the Seller.
SECTION 9 NOTICES
9.1 Notices. Any notice, request, authorization, direction or other
communication under this Agreement shall be given in writing and be delivered in
person or by first-class U.S. mail, properly addressed and stamped with the
required postage, to the intended recipient as follows:
If to Seller. If to Buyer.
▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
Contracts Manager Director of Manufacturing and Quality
SeaMED Corporation Coinstar, Inc.
▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with copies to: with copies to:
Vice President, Operations Vice President, Program Management
and Development
Either party may change its address specified above by giving the other party
notice of such change in accordance with this paragraph.
9.2 Independent Contractor. Seller is an independent contractor, not an agent or
representative of Buyer. Seller shall not have any right, power or authority to
enter into any
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agreement for or on behalf of, or incur any obligation or liability of or to
otherwise bind Buyer. This Agreement shall not be interpreted or construed to
create an association, joint venture or partnership between the parties or to
impose any partnership obligation or liability upon either party.
9.3 Nonwaiver. The failure of either party to insist upon or enforce strict
performance by the other party of, any provision of this Agreement or to
exercise any right under this Agreement shall not be construed as a waiver or
relinquishment to any extent of such party's right to assert or rely upon any
such provision or right in that or any other instance; rather, the same shall be
and remain in full force and effect.
9.4 Survival. Paragraphs 6, 7, and 8.1 (and all provisions of this Agreement
which may reasonably be interpreted or construed as surviving the completion,
expiration, termination or cancellation of this Agreement) shall survive the
completion, expiration, termination or cancellation of this Agreement.
9.5 Entire Agreement. This Agreement and all outstanding purchase orders from
Buyer to Seller for Product set forth the entire agreement, and supersede any
and all prior agreements, of the parties with respect to the Products. No
additional or different provisions proposed by Buyer or Seller shall apply and
are hereby rejected, unless provisions are specifically agreed to in writing by
both parties. If any term of this Agreement conflicts with any term of an issued
Purchase Order, this Agreement shall take precedence. Any terms or conditions in
the Purchase Order not covered under this Agreement must be specified on the
front of purchase orders and must be mutually and explicitly agreed to by both
the Buyer and Seller.
9.6 Amendment. No change, amendment or modification of any provision of this
Agreement shall be valid unless set forth in a written instrument signed by the
party to be bound thereby.
9.7 Successors and Assigns. Neither party shall assign (voluntarily, by
operation of law or otherwise) this Agreement or any right, interest or benefit
under this Agreement without the prior written consent of the other party;
provided, however, that either party may assign this Agreement or any of its
rights, interests or benefits in this Agreement without such consent to any
entity which is wholly owned or controlled by, which owns or controls or which
is under common control with the assigning party. No assignment with or without
such consent shall relieve or release either party of any of its obligations
under this Agreement. Subject to the foregoing restriction on assignments, this
Agreement shall be fully binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors, assigns and legal
representatives.
9.8 Applicable Law. This Agreement shall be interpreted, construed and enforced
in accordance with the laws of the State of Washington, except to the extent
such laws may be preempted by the laws of the United States of America. Seller
shall not commence or prosecute any suit, proceeding or claim to enforce the
provisions of this Agreement, to recover damages for breach of or default under
this Agreement, or otherwise arising under or by reason of this Agreement other
than in the courts of the State of Washington or the District Court of the
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▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ of Washington. Seller irrevocably consents to
the jurisdiction of the courts of the State of Washington with venue laid in
King County and of the District Court of the United States, Western Division,
State Of Washington.
9.9 Force Majeure. Neither party shall be liable for any failure to perform or
delay in performing any of its obligations hereunder when such failure or delay
is due to one or more of the following circumstances: any natural catastrophe,
fire, war, riot or civil unrest, or any act, regulation, restriction, order or
intervention of any governmental authority. Upon the occurrence of such
circumstance(s), the affected party shall immediately notify the other party,
keep the other party informed of any further developments and use all
commercially reasonable efforts to overcome the force majeure event. Immediately
after such condition is removed, the affected party shall perform such
obligation with all due speed.
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IN WITNESS WHEREOF, the authorized representatives of the parties have executed
this Agreement under seal as of the date(s)set forth below.
SEAMED CORPORATION
SELLER BUYER
By /s/ ▇▇▇▇▇▇ ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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(Signature) (Signature)
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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(Printed Name) (Printed Name)
Sr. VP, Operations President and Chief Operating Officer
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(Title) (Title)
May 14, 1998 May 15, 1998
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(Date) (Date)