DISTRIBUTION AGREEMENT
This Agreement, made and entered into this 1st day of January, 1996 by and
between NOVELLUS SYSTEMS, INC. having its principal place of business at 3970
North First Street, San Jose, California 95134, U.S.A. (hereinafter referred to
as "Manufacturer") and SEKI TECHNOTRON CORPORATION, having its principal place
of business at 5-6-30, Kiba, Koto-ku, Tokyo 135, Japan (hereinafter referred to
as "Distributor").
WITNESSETH:
WHEREAS, Manufacturer is engaged in the business of the manufacture of various
equipment including the Product hereinafter defined and
WHEREAS, Distributor is engaged in the business of the sales, service and
marketing of merchandise, and
WHEREAS, Distributor is desirous of being appointed exclusive distributor for
all customers except for the customers assigned to Nippon Novellus (see Exhibit
"A") for all Novellus Systems, Inc. CVD products in the Territory hereinafter
defined.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, Manufacturer and Distributor do hereby agree to the terms and
conditions set forth below.
1. DISTRIBUTORSHIP, PRODUCTS AND TERRITORY
1.01 EXCLUSIVE DISTRIBUTORSHIP - Manufacturer hereby grants to Distributor
during the term of this Agreement the exclusive right to sell and
service all Products in the Territory to all accounts except those
specified in Exhibit "A" in accordance with the terms and conditions
herein set forth. All inquiries and/or orders received by Manufacturer
from Distributor's customers within the Territory or for delivery in the
Territory to such customers shall be transmitted to Distributor for
handling.
1.02 PRODUCTS - The term Products as used herein shall refer to all CVD
products manufactured by Novellus Systems, Inc., including parts hereof,
as well as all accessories, attachments, spare parts and renewal parts
therefore. Manufacturer shall have the right to modify, alter, improve,
change or discontinue any or all of the Products covered by this
Agreement upon thirty (30) days notice to Distributor. In the event
Manufacturer manufactures any new or additional Products similar to or
related to the Products hereunder, said Products, shall be added to the
Products covered by the Agreement as long as there is no conflict of
Distributors Product line.
1.03 TERRITORY - Territory as used herein shall mean the Country of Japan.
2. ORDERS AND SHIPMENT
2.01 Distributor may place orders through its subsidiary SEOCAL, 361 Lytton
Avenue, Palo Alto, CA 94301-1431 for the Products with Manufacturer.
Distributor shall set forth the quantity of Products, the specifications
therefor, and the desired delivery date. Manufacturer, after its
acceptance of the purchase order, shall sell the Products to Distributor
for resale in the Territory. Manufacturers subsidiary (Nippon Novellus)
shall place orders directly with Manufacturer without involvement of
Distributor.
2.02 The products sold to Distributor by Manufacturer shall be shipped FOB
Destination to the destination in the territory designated in the
purchase order ("Destination") (i.e., title shall pass at Destination),
unless otherwise agreed to by the parties. Manufacturer shall bear risk
of loss for the products until delivery to Distributor at Destination.
Manufacturer will pay all freight charges to Destination and invoice
such charges to Distributor, however Distributor's subsidiary SEOCAL
reserves the right to designate the freight company to be used by
Manufacturer. Distributor will take delivery at Destination and be
responsible for clearing the products through customs, and for all
customs and other fees. The parties hereto agree to cooperate for
purposes of obtaining all necessary export licenses and complying with
U.S. export laws.
2.03 Manufacturer and Distributor agree that an order for Manufacturer's
Product(s), that is designated as a Distributor's customer, can be
accepted by Manufacturer from a customer in the Territory that is tied
to a Volume Pricing Agreement negotiated by the Manufacturer.
Manufacturer agrees to pay Distributor a sales commission of 5% and a
service commission of 7% of the U.S. list price in lieu of Distributor
acting in their normal distribution role, assuming Distributor has
participated in the selling process and will be servicing the system
during start up and the warranty period.
2.04 When Manufacturer's sales and marketing personnel assigned to its
Japanese subsidiary perform the selling and servicing function at
specifically identified accounts (see Exhibit "A") its subsidiary,
Nippon Novellus, will bill directly to customers that which it sells and
services.
2.05 Distributor agrees to service the Products sold by it, unless any of
Distributor's accounts are transferred to Manufacturer, or
Manufacturer's designee, by mutual agreement of the parties hereto. In
addition, upon the mutual agreement of the parties hereto, Distributor
may service accounts other than Distributor's accounts. Any accounts
transferred under service contract or warranty will carry a prorated
portion of that service with the new servicing party.
2.06 When Manufacturer's personnel assigned to its Japanese subsidiary
perform the servicing function and Distributor's personnel perform the
selling function for those accounts specifically identified in the
Exhibit "A", Distributor will be responsible for Japanese customer
engineering special modification and system installation, Manufacturer
will be responsible for servicing the system once the system has been
accepted by the customer, and Distributor will forfeit its 7% service
commission.
2.07 Following accounts transfer (see Exhibit "A") Manufacturer agrees that
Nippon Novellus serves during start up and the warranty period on all
systems Distributor sold to the customers transferred. For those
systems serviced by Nippon Novellus for which a service commission (6%;
7% less 1% for installation) has been paid to Distributor, Distributor
will pay to Nippon Novellus a rebate. The rebate will be calculated by
taking the number of months for which Nippon Novellus has assumed the
warranty obligation divided by the warranty period (24 months) and
multiply by the amount of the commission.
3. PRICING AND TERMS OF PAYMENT
3.01 SALES PRICES - Attached hereto and made a part hereof as Exhibit "B" is
Manufacturer's List Price for the Products, parts and accessories. The
price to Distributor shall be eighty eight percent (88%) of the U.S.
Domestic List Price at any given point in time unless otherwise covered
by another provision of this Agreement. Said prices shall be subject to
change by Manufacturer from time to time by 3 months prior written
notice to Distributor; provided however, that no such
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price increase shall affect purchase orders accepted by Manufacturer
prior to notification of Distributor of the price change by
Manufacturer. This price shall cover Distributor's sales and service of
the Product.
3.02 TERMS OF PAYMENT - Unless otherwise agreed by the parties, payment shall
be made by Distributor separately for each shipment per purchase order
accepted by Manufacturer. Unless otherwise agreed by the parties,
payment by Distributor to Manufacturer for Products shall be made in
full net forty-five (45) days from shipment date.
3.03 CURRENCY - Currency for payments covered by this Agreement shall be U.S.
Dollars.
4. MARKETING AND ADVERTISING
4.01 DISTRIBUTOR'S UNDERTAKING - Distributor shall exert its best efforts to
vigorously promote the sale of Products in the Territory during the term
of this Agreement and to develop a market demand for the same in the
Territory. Distributor shall advertise the Products throughout the
Territory in appropriate advertising media and in a manner insuring
proper and adequate publicity for the Products. Distributor shall
maintain a sales and service organization which can be best utilized for
the promotion of the sales of the Product, that is appropriate to the
customer base serviced by Distributor.
Given reasonable notice from Manufacturer or its Japanese subsidiary,
Nippon Novellus, Distributor shall arrange joint customer visits.
Manufacturer or its subsidiary, Nippon Novellus, has the right to
independently arrange customer visits, with prior notification to the
Distributor, that may not include representatives of Distributor.
Distributor shall not, without prior written consent of Manufacturer,
manufacture, sell, distribute or otherwise handle products which, in the
opinion of Manufacturer, are similar to or competitive with the Products
of Manufacturer. Failure to comply with the foregoing provision will
subject this Agreement to immediate termination.
Distributor shall not, without prior knowledge, approval and written
consent of Manufacturer, design or cause to be installed any
modification or change to the system hardware, software or process in
part or whole. Distributor shall not utilize or transfer Manufacturer's
process techniques or technologies to equipment or systems other than
those supplied by Manufacturer.
Distributor shall send at the Distributor's expense appropriate
personnel to required sales and service meetings scheduled by
Manufacturer and shall dispatch designated personnel to Manufacturer's
plant for specific Product and service training as is deemed necessary
to properly execute the sales and service functions envisioned in the
Agreement. Distributor shall arrange customer visits to Manufacturer's
facilities, provided Distributor has given Manufacturer adequate notice
thereof and Manufacturer has consented to any such visit.
4.02 SPARE PARTS - Distributor shall stock spare parts commensurate with the
number of systems both in and out of warranty installed by Distributor
in the Territory. Parts will be purchased from Manufacturer's
subsidiary (Nippon Novellus). If Manufacturer discontinues or obsoletes
any part, then Distributor may return the discontinued or obsolete parts
purchased from Manufacturer or its subsidiary for credit in the amount
of one hundred (100%) percent of invoiced amount. If Distributor does
not elect to purchase replacements for any such obsolete parts, then
Distributor will receive a credit equal to 80% of the invoiced amount
for any such obsolete invoiced parts
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against amounts thereafter payable to Novellus hereunder for other spare
parts and Products. Parts on consignment will be ordered from
Manufacturer's subsidiary and shipped upon completion of a mutually
acceptable consignment agreement between Distributor and Manufacturer's
subsidiary.
4.03 TERRITORY DEMONSTRATION CENTER - Manufacturer's subsidiary (Nippon
Novellus), shall provide process demonstration facilities including, but
not limited to, fully functional system, test and evaluation equipment,
trained personnel and consumable items. For such services, Distributor
shall pay Nippon Novellus an annual retainer and a fee for each Demo.
ANNUAL RETAINER- Distributor will pay to Nippon Novellus an annual
retainer fee for 1996 of $300,000 by January 31, 1996. For years
subsequent to 1996, the annual retainer fee will be calculated by taking
the prior years fee and adding an amount equal to the prior years fee,
times the inflation rate announced by the Japanese Government for the
prior year. Such fee will be invoiced by Nippon Novellus when the
inflation rate is announced, and payable by Distributor upon receipt of
invoice.
DEMO FEE - Distributor shall pay a fee for each demo. Nippon Novellus
will provide a quote for the fee to Distributor based on estimated
material and labor hours required to complete the demo.
4.04 FAIRS AND EXHIBITIONS - Distributor agrees to participate in appropriate
industry exhibitions to exploit Product in the Territory. The cost of
the exhibitions and displays and the responsibility therefor shall be
borne by the Distributor. If Manufacturer and Distributor have a booth
together then they will negotiate a reasonable fee to be paid by each
party.
4.05 SERVICE PERSONNEL - Distributor shall maintain sufficient service
personnel as is necessary to properly perform the service and support
functions required for the installed systems. Distributor agrees to
provide Manufacturer with personnel plan for satisfying the service
requirements for installed systems during the term of this Agreement.
The parties agree that one field engineer for every three Concept One
systems in warranty and one field engineer for every five Concept One
systems not in warranty will provide sufficient personnel to service
Concept One installed systems. The parties also agree that one field
engineer for every Concept Two system in warranty will provide
sufficient personnel to service Concept Two installed systems.
4.06 DISTRIBUTOR'S GOAL - Distributor agrees that goals will be set mutually
by Manufacturer and Distributor yearly. The goals for calendar year
1995 through 1999 will be established by Manufacturer and Distributor in
January of each respective year.
4.07 PERFORMANCE EVALUATION - Manufacturer will conduct semiannual
performance evaluations of Distributor based upon Manufacturer's review
of major accounts, including MEC and Fujitsu. The criteria of this
performance evaluation will follow the guidelines as provided by
manufacturer and will include without limitation, criteria such as the
adequacy of personnel training, the level of service and support
provided to customers and the accomplishment of the goals as set forth
in Section 4.06. The criteria will be jointly established by
Distributor and Manufacturer on January of each year, and the
performance evaluations based on the established criteria will be
conducted the following July and January. In the event Manufacturer, in
its sole discretion, determines as a result of any performance
evaluation that Distributor has not met the established criteria,
Manufacturer shall have the right to transfer the accounts not meeting
this criteria to Nippon Novellus earlier than the original schedule.
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5. CONFIDENTIALITY OF INFORMATION AND MATERIALS
Distributor agrees to use best efforts to hold in strict confidence and
not to disclose to others or use, either before or after termination of
the Agreement, any technical or business information, manufacturing
technique, process experimental work, trade secret or other confidential
matter relating to Products. Distributor shall, upon request (and upon
termination of this Agreement without request), deliver to Manufacturer
any and all drawings, notes, documents and materials received from
Manufacturer or developed in conjunction with the sale or service of
Products.
6. WARRANTY
6.01 Manufacturer warrant that the Product shall be free from defect in
design, materials and workmanship for a period of twenty-four (24)
months from the date of delivery to the site of the customer subject to
Section 6.02. Manufacturer shall supply Distributor free of charge,
replacement parts necessary for the warranty servicing performed by
Distributor.
If Manufacturer requests return of defective goods subject to Section
6.02, Manufacturer shall pay all transportation charges for the return
of defective goods and all transportation and customs clearance charges
for the replacement of goods.
6.02 LIMITATION. MANUFACTURER'S LIABILITY UNDER THE WARRANTY SET FORTH IN
THIS SECTION 6 SHALL BE LIMITED TO EITHER (AT MANUFACTURER'S OPTION) A
REFUND OF THE CUSTOMER'S PURCHASE PRICE OR THE REPLACEMENT OF DEFECTIVE
GOODS. IN NO EVENT SHALL MANUFACTURER BE LIABLE FOR THE COST OF
PROCUREMENT OF SUBSTITUTED GOODS BY THE CUSTOMER OR FOR ANY SPECIAL,
CONSEQUENTIAL OR INCIDENTAL DAMAGES FOR BREACH OF WARRANTY. EXCEPT FOR
THE EXPRESS WARRANTY SET FORTH IN THIS SECTION 6, MANUFACTURER GRANTS NO
OTHER WARRANTIES, AND EXPRESSLY DISCLAIMS ANY OTHER WARRANTIES, EXPRESS
OR IMPLIED, BY STATUTE OR OTHERWISE, REGARDING THE PRODUCTS, THEIR
FITNESS FOR ANY PURPOSE, THEIR QUALITY, THEIR MERCHANTABILITY, OR
OTHERWISE.
Distributor is responsible for maintaining an inventory of consigned
warranty parts and to pay for any reported shortages. As defined in the
Consigned Inventory Agreement executed in connection herewith,
Distributor shall report to Manufacturer monthly on the inventory of
consigned warranty parts.
7. PRODUCTS LIABILITY
Manufacturer shall maintain at all times during the effective term of
the Agreement at its own expense product liability insurance providing
limits of not less than $1,000,000 per person and not less than
$2,000,000 per occurrence on all Products sold under this Agreement.
All such insurance policies shall designate Distributor as an additional
insured, or such policies shall contain coverage protecting Distributor
as a vendor of the products. Manufacturer shall furnish Distributor
with satisfactory evidence of such insurance coverage.
Furthermore, Manufacturer shall indemnify Distributor from any and all
damages, expenses and obligations which Distributor may incur or sustain
by reason of the purchase or sale of any defective Products, except as
to the extent that the defect is attributable to modifications made by
the Distributor.
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8. REPORTS
Distributor agrees to furnish to Manufacturer monthly reports
regarding sales to customers, lost business reports, forecasts of
future sales to prospective customers in the Territory, and
competitive information. Distributor also agrees to furnish every
Friday a brief weekly status report on sales and support activities so
Manufacturer can have a sense of the market and how well Distributor
is achieving the sales objectives mutually set forth.
9. INTELLECTUAL PROPERTY
9.01 USE OF NAME - Manufacturer agrees that Distributor may, during the
term of this Agreement, use all trademarks, the name of the Products,
and the term "Exclusive Distributor in Japan for Manufacturer" in
advertising and promotional materials only in connection with sales of
Products to Distributor's customers in accordance with the terms set
forth herein. The Products are offered for sale and are sold by
Manufacturer subject in every case to the condition that such sale
does not convey any license express or implied, to manufacturer,
duplicate or otherwise copy or reproduce any of the Products or any
part thereof. Distributor shall take appropriate steps with its
customers to inform them of and to assure compliance with the
restrictions contained in this Section 9.01. Distributor agrees that
Manufacturer owns all right, title, and interest in the product lines
that include the Products and in all of Manufacturer's patents,
designs, copyrights, trademarks, trade names, inventions, know-how,
and trade secrets except the matters known to the public relating to
the design, manufacture, operation and service of the Products. The
use by Distributor of any of the property rights described in this
Section 9.01 is authorized only for the purposes and during the period
set forth herein. Manufacturer further agrees that after termination
or the expiration of this Agreement, Distributor may use
Manufacturer's trademarks in connection with the sale of its remaining
inventory of Products for a period not to exceed one (1) year from the
date of termination or expiration of this Agreement so long as such
termination is not as a result of any default by Distributor in its
performance hereunder.
9.02 INDEMNIFICATION - In the event Distributor or its customer is served
with notice of alleged infringement of any patents, designs,
copyrights and trademarks arising from the sale of any of the
Products, Manufacturer shall, indemnify Distributor or such customer
on the terms set forth in this Section 9.02. Distributor agrees that
Manufacturer has the right to defend or at its option to settle, and
Manufacturer agrees, at its own expense, to defend or at its option to
settle, any action, claim, suit or proceeding brought against
Distributor or its customer on the issue of infringement of any United
States or Japanese patent, copyright, or trademark by the Products
sold hereunder or the use thereof, subject to the limitations
hereinafter set forth. Manufacturer shall have sole control of any
such action, claim, suit or proceeding and settlement negotiations
relating thereto, and Manufacturer agrees to pay subject to the
limitations hereinafter set forth, any final judgment entered against
Distributor or its customer on such issue in any claim action, claim
suit or proceeding defended by Manufacturer. Distributor agrees that
Manufacturer at its sole option shall be relieved of the foregoing
obligations unless Distributor or its customer notifies Manufacturer
promptly in writing of such action, claim, suit or proceeding and
gives Manufacturer authority to proceed as contemplated herein, and,
at Manufacturer's expense, gives Manufacturer proper and full
information and assistance to settle and/or defend any such action,
claim, suit or proceeding. If the Products, or any part thereof, are,
or in the opinion of Manufacturer may become, the subject of any
claim, action, suit or proceeding for infringement of any United
States or Japanese patent, copyright or trademark, or it is
adjudicatively determined that the Products, or any part thereof,
infringe any Untied States or Japanese patent, copyright or trademark,
or if the sale or use of the Products, or any part thereof, is, as a
result,
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enjoined, then Manufacturer may, at its option and expense either: (i)
procure for Distributor and its customers the right under such patent,
copyright or trademark to sell or use, as appropriate, the Products or
such part thereof; or (ii) replace the Products, or part thereof, with
other suitable Products or parts; or (iii) suitably modify the
Products, or part thereof; or (iv) if the use of the Products, or part
thereof, is prevented by injunction, remove the Products, or part
thereof, and refund the aggregate payments paid thereof by
Distributor's customer, less a reasonable sum for use and damage.
Manufacturer shall not be liable for any costs or expenses incurred
without its prior written authorization. Notwithstanding the
foregoing, Manufacturer assumes no liability for (i) infringements
covering completed equipment or any combination, method or process in
which any of the Products or parts thereof may be used but not
covering the Products or parts thereof when used alone; (ii) trademark
infringements involving any marking or branding not applied by
manufacturer or involving any marking or branding applied at the
request of Distributor; or (iii) infringements involving the
modification or servicing of the Products, or any part thereof, unless
such modification or servicing was performed by Manufacturer. The
foregoing provisions of this Section 9.02 state the entire liability
and obligation of Manufacturer and the exclusive remedy of Distributor
and its customers, with respect to any alleged infringement of
patents, copyrights, trademarks or other intellectual property rights
by the Products or any part thereof.
10. RELATIONSHIP OF PARTIES
The relationship between Manufacturer and Distributor shall not be
that of a principal and an agent, but shall be that of a seller and
purchaser, each acting as an independent contractor. Distributor
shall have no right or authority to (and shall not) incur, assume or
create, in writing or otherwise, any warranty, liability, or
obligation of any kind, express or implied, in the name of or on
behalf of Manufacturer. All sales and other agreements between
Distributor and its customers are Distributor's exclusive
responsibility.
11. OTHER PROVISIONS
11.01 When Seki requests technical assistance of Novellus or Nippon Novellus
the engineer must follow Seki's direction at that account.
11.02 In this regard, Novellus, Nippon Novellus and Seki agree not to hire
each other's employees without full mutual agreement.
12. ASSIGNMENT
Neither party shall assign or transfer any of its rights or
obligations under this Agreement in whole or in part to any
individual, firm or corporation without the prior written consent of
the other party.
13. TERM OF AGREEMENT
13.01 TERM AND RENEWAL - This Agreement becomes effective on the date
mentioned above and remains in effect until December 31, 1999. Either
party shall have the right thereafter to terminate this Agreement on
ninety (90) days notice to the other party.
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13.02 TERMINATION PROTECTION - In the event of termination of this
Agreement, (i) all Distributor backlog at the time of termination
shall ship per the terms of this Agreement and (ii) Manufacturer shall
pay to Distributor a sales commission rate of 5% of the net invoice
price at the shipment date for each system in the backlog and (iii)
Distributor shall service all systems during start up and the warranty
period on all backlog orders at the time of termination and (iv)
Manufacturer shall pay to Distributor a service commission rate of 7%
of the net invoice price for start up and warranty services at the
shipment date for each system in the backlog.
Upon request of Distributor, Manufacturer may repurchase after the
termination of the Agreement, all products including demonstration
units in hands of Distributor with good condition at the price equal
to that paid by Distributor for the inventory and at the depreciated
price for the demonstration units.
13.03 LIMITATION ON LIABILITY - Except as otherwise expressly provided
herein, in the event of termination by either party in accordance with
any of the provisions of this Agreement, neither party shall be liable
to the other, because of such termination, for compensation,
reimbursement or damages on account of the loss of prospective profits
or anticipated sales or on account of expenditures, investments,
leases or commitments in connection with the business or goodwill of
Manufacturer or Distributor. Termination shall not, however, relieve
either party of obligations incurred on or prior to the date of
termination.
14. EVENTS OF TERMINATION
14.01 In addition to the right of termination set forth in paragraph 13.01,
either party may terminate this agreement as follows:
14.011 BANKRUPTCY, ETC. - By either party immediately and without
prior written notice to the other party in the event that proceedings
in bankruptcy or insolvency are instituted by or against the other
party, or a receiver is appointed, or if any substantial part of the
assets of the other party is the object of attachment, sequestration
or other type of comparable proceeding, and such proceeding is not
vacated or terminated within thirty (30) days after its commencement
or institution.
14.012 DEFAULT - By either party immediately if one party defaults in
the performance of any of the provisions of this Agreement and does
not cure the default within thirty (30) days after receipt of written
notice given by the other party.
14.013 LICENSES - By either party immediately if either party is
unable to obtain or renew any permit, license, patent or other
governmental approval necessary to carry on the business contemplated
under this Agreement.
14.02 LIMITATION ON TERMINATION RIGHTS - The parties hereto expressly agree
that none of the rights set forth in the second paragraph of Section
13.02 shall apply to a termination pursuant to this Section 14.
14.03 SURVIVAL - In the event of a termination pursuant to Section 13 or
this Section 14, Section 3.01 (Sales Prices), 3.03 (Terms of Payment,
5 (Confidentiality, 6 (Warranty), 9 (Intellectual Property), 10
(Relationship of Parties), 13 (Term), 14 (Events of Termination), 16
(Export-Import Laws), 17 (Limitation of Liability), 18 (Governing Law)
and 19 (Arbitration) shall
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survive such termination for a period of three (3) years, and for a
period of ten (10) years on Section 7 (Products Liability) after
termination of this agreement.
15. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the parties
hereto and supersedes all previous negotiations, agreements and
commitments in respect thereto, and shall not be released, discharged,
changed or modified in any manner, except by instruments signed by
duly authorized officers or representative of each of the parties
hereto. Notwithstanding the foregoing, the parties intend the
agreement between them in effect prior to the commencement of the term
of this Agreement to continue to apply to define the rights and
obligations of the parties with respect to all sales made prior to the
commencement date of this Agreement.
16. EXPORT-IMPORT LAWS - Distributor shall, at its own expense, pay all
import and export licenses and permits and take all other actions
required to accomplish the export and import of the Products purchased
by Distributor. Distributor understands the Manufacturer is subject
to regulation by agencies of the U.S. Government, including the U.S.
Department of Commerce, which prohibit export or diversion of certain
technical products to certain countries. Distributor warrants that it
will comply in all respects with the export and re-export restrictions
set forth in the export license for every Product shipped to
Distributor or its customers.
17. LIMITATION ON LIABILITY
MANUFACTURER'S LIABILITY ARISING OUT OF THIS AGREEMENT AND/OR SALE OF
THE PRODUCTS SHALL BE LIMITED TO THE AMOUNT PAID BY THE CUSTOMER FOR
THE PRODUCTS. IN NO EVENT SHALL MANUFACTURER BE LIABLE FOR COSTS OF
PROCUREMENT OF SUBSTITUTE GOODS. IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER PARTY OR ANY OTHER ENTITY FOR ANY SPECIAL,
CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES, HOWEVER CAUSE, ON ANY
THEORY OF LIABILITY.
18. GOVERNING LAW
The validity and interpretation of the Agreement and of each clause
and part thereof shall be governed by the laws of the State of
California.
19. ARBITRATION
Any controversy arising between the parties in connection with this
Agreement, which cannot be amicably settled by the parties, shall be
referred to arbitration in accordance with the Agreement between the
Japan Commercial Arbitration Association and the American Arbitration
Association to facilitate the Use of Commercial Arbitration in Trade
between Japan and the United States of America dated September 16,
1952 and the decision of such arbitration proceeding shall be binding
and conclusive upon the parties hereto. Arbitration shall be
conducted in California if Distributor demands arbitration, and in
Tokyo, Japan if Manufacturer demands arbitration. The expense of any
such arbitration shall be decided as part of the arbitration
settlement.
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20. SEPARABILITY OF PROVISIONS
A judicial or administrative declaration in any jurisdiction on the
invalidity of any one or more of the provisions hereof shall not
invalidate the remaining provisions of this Agreement in that
jurisdiction, nor shall such declaration have any effect on the
validity or interpretation of the Agreement outside of that
jurisdiction.
21. WAIVER OF COMPLIANCE
Any failure by any party hereto to enforce at any time any term or
condition under this Agreement shall not be considered a waiver of
that party's rights thereafter to enforce each and every term and
condition of the Agreement.
22. NOTICES
All notices and other communication in connection with this Agreement
shall be in writing and shall be sent to the respective parties at the
following addresses, or to such other addresses as may be designated
by the parties in writing from time to time by registered or certified
mail or facsimile:
TO MANUFACTURER: NOVELLUS SYSTEMS, INC.
3970 NORTH FIRST STREET
SAN JOSE, CA 95134 U.S.A.
TO DISTRIBUTOR: SEKI TECHNOTRON CORPORATION
5-6-30 KIBA, KOTO-KU
TOKYO 135 JAPAN
In WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective duly authorized representative.
/s/Peter Hanley
-----------------------------------------------------------
MANUFACTURER: NOVELLUS SYSTEMS, INC.
Name: Peter Hanley
Title: Executive Vice President, Sales and Marketing
Date: February 1, 1996
/s/ Shu Seki
-----------------------------------------------------------
DISTRIBUTOR: SEKI TECHNOTRON CORPORATION
Name: Shu Seki
Title: President
Date: February 1, 1996
-----------------------------------------------------------
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EXHIBIT "A"
Nippon Novellus shall assume the service and sales responsibilities from Seki
Technotron Corporation for the accounts and upon the dates specified below:
ACCOUNTS SERVICE TRANSFER* SALES TRANSFER*
-------- ----------------- ---------------
Sony 6/1995 1/1996
Fujitsu 6/1999 1/2000
MEC 6/1999 1/2000**
NSI 6/1996 1/1997
Nittetsu 6/1997 1/1998
Rohm 6/1997 1/1998
Yamaha 6/1999 1/2000
All Others 6/1999 1/2000
*Determination of the exact date of the transfer will be coordinated
between the appropriate sales or service group of Distributor and Manufacturer
based upon the circumstances existing at that time. Manufacturer reserves the
right to transfer any of these accounts at an earlier date if Distributor's
performance does not meet the criteria set forth under Section 4.07 of the
Distribution Agreement.
**Distributor must increase sales for this account either directly or
indirectly by furnishing sales information and coordination to Novellus in order
for Novellus to book orders outside territory. In the event sales for this
account do not increase year over year, Novellus maintains the right to
accelerate transition of this account.
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