AGREEMENT OF SALE AND LICENSE
This Agreement of Sale and License ("Agreement") is
entered into as of December 9, 1994, by and between Raytheon
Company, a Delaware corporation, through its Semiconductor Division
("Raytheon SemiconductoC'), whose principal offices are located at
350 Ellis Street in Mountain View, California 94043, and Microsemi
Corporation ("MICROSEMI"), whose principal offices are
located at 2830 South Fairview Street, Santa Ana, California 92704.
RECITALS
WITNESSETH:
WHEREAS, Raytheon Semiconductor has decided to exit the
transistor product business and to sell its transistor product line
to a company or companies interested in remaining in the source
supply business for transistor products;
WHEREAS, MICROSEMI wishes to continue in the transistor
product business and to become and remain a transistor product
source;
WHEREAS, Raytheon Semiconductor in the course of its sale
wishes to fulfill purchase orders previously submitted to Raytheon
Semiconductor by its customers ('Customer Order Backlog"), and
to refer such customers to MICROSEMI for future transistor
products,
NOW, THEREFORE, in consideration of the foregoing and of
the mutual promises contained herein, the parties hereto do hereby
mutually agree as follows:
AGREEMENT
Assets to be Sold.
1.1 Raytheon Semiconductor will sell to MICROSEMI the
following assets related to its transistor product business:
1.1.1 Transistor manufacturing equipment as listed on
Exhibits A and B attached hereto and incorporated herein by
reference. The Exhibit A equipment will be delivered FOB Raytheon
Semiconductor's Mountain View facility whose address is set forth
above ("the Delivery Point") beginning on the Closing Date
(specified in paragraph 3.3 hereinbelow). The Exhibit B equipment
will be delivered at the Delivery Point (after Raytheon
Semiconductor has fulfilled its Customer Order Backlog) on or
before March 31, 1995 as to the assembly equipment; on or before
May 31, 1995 as to the test equipment; and on or before June 30,
1995 as to the remaining equipment.
1.1.2 Finished goods not needed for Raytheon
Semiconductor's Customer Order Backlog, as set forth on Exhibit C
attached hereto and incorporated herein by reference, to begin
delivery at the Delivery Point on the Closing Date.
1.1.3 Piece part inventory not needed for Raytheon
Semiconductor's Customer Order Backlog, as set forth on Exhibit D
attached hereto and incorporated herein by reference.
1. 1.4 Work in Process not needed for Raytheon
Semiconductor's Customer Order Backlog, as set forth in Exhibit E
attached hereto and incorporated herein by reference.
1.1.5 Mask sets for Raytheon Semiconductor's transistor
products, as set forth on Exhibit F attached hereto. The rights to
use such mask sets and/or to replicate them are the subject of
licenses granted by Raytheon Semiconductor to MICROSEMI set forth
in Section 2 hereinbelow.
1.1.6 The matters described in paragraphs 1.1.2, 1.1.3,
1.1.4 and 1.1.5 will begin delivery to MICROSEMI at the Delivery
Point on the Closing Date.
1.1.7 The amounts of finished goods or other goods
indicated on Exhibits C through E hereto are estimates or
approximations only. Divergences from the stated quantities, but
within plus or minus ten percent (10%) of the amounts shown on
Exhibits C through E, shall be within the parameters
of this Agreement. Variances greater than plus or minus ten
percent (10%) of the stated quantity will require an appropriate
adjustment in the purchase price at the Closing Date, either in
favor of MICROSEMI or in favor of Raytheon, as the case may be.
MICROSEMI has the right to inspect prior to signing this Agreement,
as set forth in paragraph 13 hereinbelow.
1.1.8 The assets to be sold by Raytheon Semiconductor to
MICROSEMI do not include any Customer Order Backlog existing at the
Closing Date. New transistor orders submitted to Raytheon
after the Closing Date and before the completion of the terms of
this Agreement, relating to the goods indicated on Exhibits C
through E, will be refered to MICROSEMI.
1.1.9 The transistor part types and related intellectual
property as set forth on the 'Exclusions" list attached hereto as
Exhibit G and made a part of this Agreement by reference are
explicitly excluded from the assets to be sold. MICROSEMI shall
not be precluded from supplying product, which compete with those
of Raytheon Semiconductor to any division of Raytheon Company who
may choose to do business with any MICROSEMI company.
2. Licenses to be Granted.
2.1 Intellectual Property to be Licensed.
2.1.1 In addition to selling the above-described assets
to MICROSEMI, Raytheon Semiconductor will, and hereby does, license
certain of its transistor-related intellectual property
to MICROSEMI.
2.1.2 The intellectual property described on Exhibit H
attached hereto is licensed on a perpetual, worldwide exclusive
basis, to the extent that Raytheon Semiconductor has the right to
do so.
2.1.3 The implementation of such licenses will be
accomplished by the delivery by Raytheon Semiconductor to MICROSEMI
beginning on the Closing Date at the Delivery Point, of drawings,
diagrams, and technical specifications related to the licensed
products, as well as processes and mask sets for manufacture of the
licensed products.
2.1.5 The licenses herein granted give MICROSEMI the
right to make, use, sell and distribute the transistor products
described on Exhibits H attached hereto, and to use and replicate
the mask sets associated therewith. MICROSEMI is not granted, and
does not have, the authority to transfer the licenses herein
granted, or to sublicense any part of said licenses to any other
company. Except in the event of sale or transfer by MICROSEMI of
the business in connection with a merger or other form of business
combination, except with written consent of Raytheon Semiconductor
which shall not be unreasonably withheld and is subject to the
terms and conditions of this Agreement.
2.1.6 Said licenses are granted "as is" and without
warranty of any kind whatsoever. Raytheon Semiconductor does not
represent, and hereby expressly disclaims, that its intellectual
property produces marketable products. Raytheon Semiconductor does
not undertake any obligation to debug such intellectual property,
or to provide any upgrades, enhancements, or derivatives thereof,
if any.
Payment of Purchase Price.
3.1 The Purchase Price to be paid to Raytheon
Semiconductor by MICROSEMI is seven hundred thousand dollars
($700,000) by cashier's check drawn on a California bank or by wire
transfer into Raytheon Semiconductor's bank account, verified as to
receipt.
3.2 The Purchase Price covers lien-free title to the
assets to be Sold (Section 1) and the Licenses to be Granted
(Section 2).
3.3 The Purchase Price is to be paid in accordance
with the following schedule:
$ 70,000. non-refundable deposit received on or before December 16,
1994; $530,000. due on or before the Closing Date of January 6,
1995; and $1 00,000. due on the delivery of the residual equipment
and inventory in accordance with this Agreement.
3.4 MICROSEMI must take delivery of all matters
specified to be delivered beginning on the Closing Date.
4. Limitation of Warranties.
4.1 Raytheon Semiconductor hereby warrants that it holds
the unencumbered, lien-free title and right to transfer all
property to be sold and licensed pursuant to this Agreement.
4.2 All of Raytheon's right, title and interest to the
assets to be sold will be transferred to MICROSEMI, except that
transfer of the finished goods with Raytheon's trademark and/or
logo already affixed hereon by Raytheon Semiconductor does not
grant any right or license to use such trademark or logo to
MICROSEMI. MICROSEMI is hereby granted the sole and limited
authority to sell the finished goods described on Exhibit C hereto
as previously marked by Raytheon Semiconductor.
4.3 Raytheon Semiconductor assumes the warranties, as
limited in Raytheon's standard terms and conditions of sale, for
product sold by Raytheon Semiconductor. MICROSEMI assumes the
warranties, pursuant to MICROSEMI's terms and conditions, if any,
for product sold by MICROSEMI.
4.4 The intellectual property described herein will be
licensed exclusively to MICROSEMI to the extent that Raytheon
Semiconductor has the right to do so.
4.5 All assets will be sold "as is" and "where is"
without any warranty whatsoever either express or implied. The
licenses will be granted as is" and without warranty, as more
specifically set forth in Section 2 hereinabove.
4.6 THE WARRANTIES EXPRESSED IN THIS SECTION ARE IN LIEU
OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO WARRANTIES OF MERCHANTABILIT'Y OR FITNESS FOR A
PARTICULAR PURPOSE, ALL OF WHICH ARE EXPRESSLY EXCLUDED.
5. Transfer of Customers.
5.1 As set forth below, as part of this Agreement,
Raytheon Semiconductor will transfer its transistor customer list
(except as stated in the exclusions listed in Exhibit G) to
MICROSEMI.
Raytheon Semiconductor agrees not to compete with MICROSEMI in the
transistor product business to the extent of the products and
intellectual property which are hereby sold to MICROSEMI for a
period of five (5) years after the Closing Date.
5.2 Raytheon Semiconductor will make reasonable visits
to customers with MICROSEMI to introduce MICROSEMI to them as a
transistor product source.
5.3 Raytheon Semiconductor will cooperate with MICROSEMI
to prepare a written announcement, acceptable in form to Raytheon
Semiconductor of MICROSEMI's status as the licensee of Raytheon
Semiconductor's transistor technology.
5.4 For the period of one (1) year after the Closing
Date, Raytheon Semiconductor will refer to MICROSEMI all inquiries
regarding purchase of transistor products from existing and
potential customers, with the exceptions noted in paragraph 5.1
hereinabove.
5.5 As regards to MICROSEMI's completing the
manufacture of Raytheon Semiconductor's transistor die, work in
process, and piece part inventory hereby sold to MICROSEMI,
MICROSEMI will prepare and maintain records for the traceability of
such matters from the hands of Raytheon Semiconductor into the
hands of MICROSEMI's customers, and such records shall be kept by
MICROSEMI for a period of five (5) years after the Closing Date.
MICROSEMI will notify Raytheon Semiconductor of any MICROSEMI
customer complaint traceable to the matters hereby sold and/or
licensed within ten (10) business days after MICROSEMI first learns
of such complaint, pursuant to section 7 hereinbelow. Such notice
does not in any way modify the limitation of warranties set forth
in section 4, above.
6. Assignment or Transfer of this Agreement.
Neither party shall assign or otherwise transfer any
rights or obligations arising under this Agreement without the
prior written approval of the other party, which will not be
unreasonably withheld.
7. Notification.
All notices given hereunder shall be in writing and sent
to the addresses stated below:
To Raytheon: Raytheon Semiconductor 350 Ellis Street P. 0. Box 7016
Mountain View, CA 94039-7016 Fax (415) 966-7742 Attn.: Rod Libby,
Manager, Quality & Reliability Engineering
To MICROSEMI: Microsemi Corporation 2830 South Fairview Street
Santa Ana, CA. 92704 Fax (714) 966-5256 Attn.: Philip Frey,
Chairman
8. Arbitration.
Any dispute or controversy arising out of, or under, or in
connection with, or in relation to, this Agreement, or the
subject-matter covered herein, which cannot be settled between the
parties, shall be determined by arbitration in San Jose, California
pursuant to the then existing rules of the American Arbitration
Association. Any award rendered therein shall be be det subject to
section 9 hereinbelow, and shail be final and binding upon each and
all of the parties, and their successors in interest, and a
judgment thereon may be entered in any court of competent
jurisdiction. The arbitrator may award the reasonable costs of
such proceedings and reasonable attorneys' fees to the prevailing
party.
9. Exclusion of Certain Damages.
In no event shall either party be liable for
consequential, incidental or special (including multiple or
punitive) damages arising out of this Agreement or the matters sold
or licensed pursuant hereto.
10. Taxes and Other Char-ges.
Prices do not include any applicable present or future
packing charges, warehouse charges, handling, shipping or insurance
charges, inspection fees, consular fees, import or export duties,
brokerage fees, taxes and levies (including but not limited to,
value added, property, sales, use, privilege, excise or similar
taxes), whether imposed by the United States or any other state,
local, or foreign government entity. Such taxes or charges when
applicable shall be paid by MICROSEMI. Obtaining any necessary
permits, licenses or certifications for the import or export of
products, equipment or technical data as described in this
Agreement shall be the responsibility of MICROSEMI.
11. This Agreement shall be governed by the laws of the State
of California, U.S.A.
12. This is the entire Agreement between the parties relative
to the sale and/or license of the matters described on the exhibits
hereto, and it supersedes any prior or contemporaneous written or
oral agreements thereon and may not be amended or modified except
by subsequent agreement in writing by duly authorized officers or
representatives of the parties.
This Agreement may be executed in duplicate originals or in faxed
copies, each of which will constitute an original.
13. Acknowledgment of Inspection.
By signing this agreement, MICROSEMI acknowledges that it
has been given the opportunity to inspect the assets to be sold and
the intellectual property to be licensed by Raytheon Semiconductor
under this Agreement.
RAYTHEON SEMICONDUCTOR
By:
Title:
Date:
MICROSEMI CORPORATION
By:
Title:
Date: