Exhibit 10.47
[GTECH CORPORATION LOGO] rev 12-11-02
AGREEMENT NO.: 51-1001-00/SL810 LPX
BY AND BETWEEN
GTECH CORPORATION
55 TECHNOLOGY WAY
WEST GREENWICH, RHODE ISLAND 02817
AND
BCM ADVANCED RESEARCH
1 HUGHES
IRVINE, CA 92618
FOR THE PURCHASE OF
CPU MOTHER BOARDS
GTECH REPRESENTATIVES: VENDOR REPRESENTATIVES
JOHN PICARD TOM SKIBINSKI
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GTECH CORPORATION OEM PURCHASE AGREEMENT
1. TERMS AND CONDITIONS.................................................1
1.1 PRODUCTS...........................................................1
1.2 SERVICES...........................................................1
1.3 OEM PURCHASES......................................................1
1.4 NO MINIMUM COMMITMENT; NO EXCLUSIVITY..............................1
1.5 SPARE PARTS........................................................1
2. ORDERING.............................................................2
2.1 PURCHASE ORDERS....................................................2
2.2 LEAD TIME..........................................................2
2.3 RESCHEDULING.......................................................2
2.4 CANCELLATION FOR CONVENIENCE.......................................2
2.5 FORECAST...........................................................2
3. SHIPPING, PACKAGING, AND DELIVERY....................................3
3.1 F.O.B., TITLE, RISK OF LOSS........................................3
3.2 SHIPMENT...........................................................3
3.3 PACKAGING..........................................................3
3.4 INTERNATIONAL SHIPMENTS............................................3
3.5 EARLY ARRIVAL......................................................3
4. PRICE................................................................3
4.1 UNIT PRICES........................................................3
4.2 PRICE REDUCTION....................................................3
4.3 PRICE REDUCTIONS ON SPARE PARTS AND REPAIRS........................4
5. PAYMENT..............................................................4
6. TAXES AND DUTIES.....................................................4
7. CHANGES..............................................................4
7.1 PRODUCT CHANGES....................................................4
7.2 GTECH CHANGES......................................................4
7.3 ENHANCEMENTS, SUCCESSOR PRODUCTS...................................5
8. COOPERATION IN LOTTERY AND GAMING MARKET.............................5
8.1 TRANSFER OF EQUIPMENT..............................................5
8.2 NON-COMPETE CLAUSE.................................................5
8.3 VENDOR OUTSIDE REQUIREMENTS........................................5
9. QUALITY AND RELIABILITY REQUIREMENTS.................................5
9.1 QUALITY AND RELIABILITY REQUIREMENTS...............................5
9.2 RELIABILITY PLAN...................................................5
9.3 RELIABILITY TEST...................................................5
9.4 RELIABILITY TEST REPORT............................................6
9.5 VENDOR SURVEY......................................................6
9.6 TEST EQUIPMENT AND PROCEDURE CORRELATION...........................6
9.7 FINAL TEST AND INSPECTION DATA.....................................6
9.8 SOURCE INSPECTION..................................................6
9.9 RECEIVING INSPECTION...............................................6
9.10 FIELD RELIABILITY REPORTING........................................6
9.11 FAILURE ANALYSIS AND CORRECTIVE ACTIONS............................7
9.12 GTECH'S RIGHTS WITH RESPECT TO NON-CONFORMING GOODS................7
10. INSURANCE............................................................7
10.1 VENDOR INSURANCE COVERAGE..........................................7
10.2 GENERAL LIABILITY..................................................7
10.3 PROOF OF INSURANCE.................................................7
11. INDEMNITY............................................................8
12. REPAIR SUPPORT.......................................................8
12.1 REPAIR ORDERS......................................................8
12.2 INTERNATIONAL REPAIR AND SUPPORT...................................8
12.3 FAILURE ANALYSIS...................................................8
12.4 REPAIR CAPABILITIES................................................9
12.5 TEST EQUIPMENT.....................................................9
12.6 QUALIFIED VENDOR LIST..............................................9
12.7 DIAGNOSTICS........................................................9
12.8 DOCUMENTATION......................................................9
13. TRAINING.............................................................9
13.1 INITIAL TRAINING...................................................9
13.2 COMPONENT LEVEL TRAINING..........................................10
13.3 FUTURE TRAINING...................................................10
14. WARRANTIES..........................................................10
14.1 AGENCY/STANDARDS COMPLIANCE.......................................10
14.2 AUTHORITY.........................................................10
14.3 TITLE; INFRINGEMENT...............................................10
14.4 CONFORMANCE; DEFECTS..............................................10
14.5 FREIGHT COSTS ON REPAIRS..........................................10
15. TOOLING.............................................................10
16. FORCE MAJEURE.......................................................11
17. CONFIDENTIALITY.....................................................11
18. PUBLIC ANNOUNCEMENTS................................................12
19. NOTICES.............................................................12
20. ASSIGNMENT..........................................................12
21. TERM AND TERMINATION................................................12
21.1 TERM..............................................................12
21.2 TERMINATION BY GTECH..............................................12
21.3 TERMINATION BY VENDOR.............................................13
21.4 OBLIGATIONS ON TERMINATION........................................13
22. CONFLICTING PROVISIONS..............................................13
23. MANUFACTURING RIGHTS................................................13
24. MISCELLANEOUS.......................................................13
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GTECH OEM PURCHASE AGREEMENT
THIS AGREEMENT between GTECH CORPORATION, a Delaware corporation, with
offices at 55 Technology Way, West Greenwich, RI 02817 ("GTECH") and BCM
Advanced Research, a California corporation, with offices at 1 Hughes, Irvine,
California 92618 ("VENDOR") sets out the terms and conditions under which VENDOR
will sell the Products and provide the Services described in this Agreement and
Attachments to GTECH.
1. TERMS AND CONDITIONS
1.1. PRODUCTS. As used in this Agreement, "Products" means the cpu
mother board, as well as the VENDOR's recommended spare parts, subassemblies,
operating supplies, maintenance kits, and options, if any, produced in
accordance with the specifications and any subsequent modifications authorized
in accordance with the terms of this Agreement attached hereto as Attachment
1("PRODUCT Specifications").
1.2. SERVICES. As used in this Agreement, "Services" means the
ancillary services, if any, to be provided by VENDOR in accordance with the
terms of this Agreement including without limitation, those services described
in Sections 12 and 13 of this Agreement.
1.3. OEM PURCHASES. The Products purchased under this Agreement are
intended primarily for resale, rental or lease directly and indirectly to
GTECH's customers under trademarks and trade names selected by GTECH for use in
conjunction with GTECH systems. Products may also be used by GTECH and its
subsidiaries for their internal use.
1.4. NO MINIMUM COMMITMENT; NO EXCLUSIVITY. Unless otherwise
specified in Attachment 2, there is no minimum quantity of purchases under this
Agreement. VENDOR will furnish Products and Services on an as-ordered basis. It
is expressly understood and agreed that GTECH is not obligated to purchase any
or all of the Products and Services from VENDOR and that GTECH may manufacture
competitive Products and Services itself and/or procure competitive products and
services from other vendors.
1.5. SPARE PARTS. VENDOR shall provide a Recommended Spare Parts
List ("RSL") for all Products covered by this Agreement. The RSL shall include
all parts and assemblies necessary to repair and maintain the Products purchased
under this Agreement. The RSL shall include a forecast of parts that must be
repaired and/or replaced over the first three years of service. A separate RSL
shall be supplied for each product model or configuration, identifying all
common parts.
a. NON-STANDARD SPARE PARTS. If the Product contains a
part not readily available in the marketplace ("Non-Standard Spare Parts"),
VENDOR shall make such part available to GTECH in accordance with Section
1.5(b).
b. SPARE PART SUPPORT. VENDOR shall make all spare parts
including Non-Standard Spare Parts as described in Section 1.5(a) above,
available during the Term of this Agreement and for a period of five (5) years
thereafter. In the event VENDOR is unable to fill
GTECH's Purchase Orders for spare parts promptly, VENDOR shall make available,
at no charge to GTECH, VENDOR's manufacturing drawings and specifications, list
of suppliers, and information necessary to purchase and/or manufacture all parts
and/or assemblies or subassemblies for the parts that are not available from the
VENDOR.
2. ORDERING
2.1 PURCHASE ORDERS. All purchases under this Agreement will be
made under purchase orders ("Purchase Orders") referencing this Agreement issued
by GTECH or by any subsidiary or affiliate of GTECH. Purchase Orders will be
placed directly with VENDOR or its designated distributor and deemed accepted by
VENDOR unless rejected in writing by VENDOR specifying the reasons for rejection
within fourteen (14) calendar days after receipt of the Purchase Order. VENDOR
may reject purchase orders only if a Purchase Order does not comply with the
terms and conditions of this Agreement.
2.2 LEAD TIME. Unless otherwise agreed, Purchase Orders shall
specify a delivery date with the normal lead-time of eight (8) weeks FOB, Taiwan
("Lead Time"). If GTECH requests delivery to meet a special requirement,
including but not limited to the replacement of Products lost or damaged in
shipment, VENDOR will use all commercially reasonable efforts to expedite
delivery; including, without limitation, giving GTECH first priority with
respect to all Products in stock or on order, provided however, that GTECH shall
not pay any additional charges or costs for expediting unless such charges or
costs have been accepted in writing by GTECH. In the event that Products ordered
within the Lead Time are overdue for delivery to GTECH, VENDOR shall ship
Products to GTECH and any premium airfreight charges shall be prepaid by, and
borne by VENDOR.
2.3 RESCHEDULING. GTECH may reschedule delivery of any Product or
Service by written notice to VENDOR at anytime before the delivery date
specified in the applicable Purchase Order with the following conditions:
a. If materials have already been procured for the
rescheduled Purchase Orders, GTECH will be invoiced for and liable for those
materials.
b. If the Purchase Order to be rescheduled has already
entered the production line there can be no rescheduling.
2.4 CANCELLATION FOR CONVENIENCE. GTECH may cancel any or all
Purchase Orders or part thereof at any time prior to the scheduled delivery date
with the following conditions:
a. If materials have already been procured for the
Purchase Orders to be cancelled and cannot be used elsewhere by VENDOR within 30
calendar days of the cancellation, GTECH will be invoiced for and liable for
those materials.
c. If the Purchase Order to be cancelled has already
entered the production line there can be no cancellation.
2.5 FORECAST. GTECH will provide a three (3) month rolling
forecast upon request by VENDOR. Any forecast, which may be provided, is a good
faith estimate of GTECH's
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anticipated requirements for the Products for the periods indicated based on
current market conditions and does not constitute a commitment to purchase any
quantity of Products or Services.
3. SHIPPING, PACKAGING, AND DELIVERY
3.1 F.O.B., TITLE, RISK OF LOSS. Unless otherwise agreed, delivery
of Products will be made F.O.B. VENDOR's dock, Taiwan facility if procured
directly with VENDOR. Delivery of Products will be made F.O.B. distributor's
dock in continental U.S. if procured thru distribution. Subject to proper
packaging, title and risk of loss shall pass to GTECH upon proper tender of the
Products to the carrier. VENDOR or distributor will provide proof of delivery
upon request and will provide reasonable assistance to GTECH at no charge in any
claim GTECH may make against a carrier or insurer for misdelivery, loss or
damage to Products after title has passed to GTECH.
3.2 SHIPMENT. VENDOR will ship Products in accordance with GTECH's
instructions as specified in the Purchase Order. In the absence of any other
instructions, Products will be shipped by common carrier commercial land freight
for delivery in the continental United States and by ocean freight for
deliveries elsewhere, insurance and shipping charges collect.
3.3 PACKAGING. VENDOR shall affix to the outside of each shipment
a list of contents, including serial numbers, to allow for review of contents
upon receipt. Products shall be packaged in accordance with GTECH's General
Packaging Specifications or equivalent as specified in Attachment 5.
3.4 INTERNATIONAL SHIPMENTS. If GTECH specifies delivery for
international shipment by GTECH or GTECH's freight forwarder, VENDOR will be
responsible for obtaining any necessary U.S. Department of Commerce export
licenses, permits or approvals. GTECH will be responsible for any licenses,
permits or approvals of the country of import.
3.5 EARLY ARRIVAL. GTECH reserves the right to reject Products
arriving at GTECH's facilities more than five (5) calendar days before the
delivery date specified in the Purchase Order.
4. PRICE
4.1 UNIT PRICES. All pricing will be specified in Attachment 2 and
shall remain in effect for the Term of this Agreement and any extensions
thereafter.
4.2 PRICE REDUCTION. VENDOR represents that the prices specified
in Attachment 2 are the lowest prices charged to any other customer of VENDOR
purchasing the same or lesser quantities of Products and/or Services under
similar terms and conditions. If at any time or times hereafter, VENDOR offers
Products and/or Services to any other customer on more favorable terms,
conditions or prices, VENDOR shall, at that time, offer the same terms,
conditions and prices to GTECH. If accepted by GTECH, such terms, conditions
and/or prices shall apply to all Products and Services purchased by GTECH for
the balance of the Term and any extensions thereafter.
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4.3 PRICE REDUCTIONS ON SPARE PARTS AND REPAIRS. In the event of a
price reduction on the Products covered under this Agreement, VENDOR agrees to
reduce the list price of all spare parts on VENDOR's RSL, by a percentage rate
equal to the reduction in the price of the Products. Any and all discounts that
are stated in Attachment 2 of this Agreement shall remain in effect, and may be
applied to all purchases made hereunder. The price reduction will apply to all
Purchase Orders for spare parts and repairs that are scheduled for delivery no
less than fifteen (15) calendar days after the effective date of the price
reduction.
5. PAYMENT
VENDOR may issue invoices no earlier than the shipping date of the
Products or Services. Payment will be made within thirty (30) calendar days of
receipt of proper invoices. Payment shall not constitute acceptance on
non-conforming Products. For repair of Products at international locations, term
of payment will be thirty (30) calendar days.
6. TAXES AND DUTIES
GTECH will pay as a separate invoiced item only such sales, use,
value-added or similar tax listed therein (all other taxes are excluded,
including, without limitation, taxes based upon VENDOR's net income), lawfully
imposed on the sale of the Products or provision of Services to GTECH. Taxes,
duties or like charges imposed on the Products after title has passed to GTECH
will be paid by GTECH unless such charges are the result of a trade sanction
imposed on VENDOR's Products, as specified in Section 21.2, below. In lieu of
taxes, GTECH may furnish to VENDOR a tax exemption certificate. VENDOR agrees to
provide reasonable assistance to GTECH, without charge, in any proceeding for
the refund or abatement of any taxes GTECH is required to pay under this Section
6.
7. CHANGES
7.1 PRODUCT CHANGES. VENDOR shall submit evaluation samples of all
Products changes that affect form, fit, function, maintainability, reparability,
reliability or appearance at least thirty (30) calendar days before such changes
are implemented. VENDOR shall forward (2) copies of all requests to make the
changes generally described above to: GTECH CORPORATION, 55 Technology Way, West
Greenwich, RI 02817 Attention: Purchasing Agent. GTECH may, at its option,
decline to have such changes incorporated into the Products. Proposed changes
will not be incorporated into the Products until accepted in writing by GTECH.
In no event will GTECH ever be deemed to have accepted any change in the price
or delivery schedule without its prior written consent.
7.2 GTECH CHANGES. GTECH may request changes in the Products at
any time or times during the Term of this Agreement. If such changes in the
Products will require changes in the prices and/or delivery schedule, VENDOR
must respond promptly with a written change proposal setting forth the changes
in prices and/or delivery schedule. Such proposal, when signed by an authorized
representative of GTECH, will become part of this Agreement. If VENDOR does not
respond with a written change proposal within thirty (30) calendar days after
receipt of GTECH's request, such changes will be implemented without any
alternation in the price and/or delivery schedule. Such changes, which are
deemed by GTECH to be proprietary
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and/or confidential, shall remain the property of GTECH and VENDOR may not use
such changes or disclose them to others without the prior written consent of
GTECH.
7.3 ENHANCEMENTS, SUCCESSOR PRODUCTS. If during the Term of this
Agreement, VENDOR offers improvements, options, additional functionality or
other enhancements ("Enhancements") to the Products not available at the time
this Agreement is signed or other products which substantially replace the
Products ("Successor Products"), VENDOR will offer such Enhancements and/or
Successor Products to GTECH at prices that do not exceed those charged to any
other customer of VENDOR purchasing the same or lesser quantities of such
Enhancements or Successor Products. If GTECH elects, in writing, to purchase
such Enhancements or Successor Products, the Enhanced Products or Successor
Products will be substituted to make up the balance of any committed quantity
under this Agreement. In any event, GTECH may, at its option, elect to continue
to purchase Products as originally specified for the Term of this Agreement and
any extensions thereafter.
8. COOPERATION IN LOTTERY AND GAMING MARKET
8.1 TRANSFER OF EQUIPMENT. During the Term of this Agreement and
any extensions thereof, GTECH shall have the sole discretion as to whether to
submit proposals or bids for the sale, lease or other transfer of the Products
to any current or potential customer of GTECH or its affiliates, and as to
whether such a proposal or bid shall be submitted by GTECH, by VENDOR or jointly
with other parties.
8.2 NON-COMPETE CLAUSE. VENDOR further agrees that during the Term
of this Agreement and any extensions thereof, and for the one (1) year period
after the expiration or earlier termination, VENDOR shall not directly or
indirectly, engage in or participate in any effort or act to induce any of the
customers, associates or employees of GTECH or its affiliated companies to take
any action which is in direct conflict with the business interests of GTECH, its
subsidiaries or affiliates.
8.3 VENDOR OUTSIDE REQUIREMENTS. VENDOR agrees that it shall advise its
distributors outside the U.S. of the covenants and responsibilities set forth in
this Agreement.
9. QUALITY AND RELIABILITY REQUIREMENTS
9.1 QUALITY AND RELIABILITY REQUIREMENTS. GTECH requires that the
VENDOR have in place at its manufacturing facility, adequate quality and
reliability safeguards to ensure that all Products shipped to GTECH meet or
exceed all parameters specified in the Product Specification, and that the
Product is not subject to any infant mortality.
9.2 RELIABILITY PLAN. The VENDOR will submit to GTECH Quality
Assurance ("QA") a reliability test plan for the Products, which will include
the VENDOR's reliability requirements based on the Products Specification and
test schedule. GTECH QA will review the reliability plan for the Product,
provide comments and approve the plan when satisfied that all design
requirements will be adequately tested.
9.3 RELIABILITY TEST. The VENDOR will conduct a reliability test
on the Products to ensure that the Products meet or exceed all parameters
specified in the Product Specification.
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GTECH may participate and/or monitor the VENDOR's reliability test on the
Product at the VENDOR's facility. The VENDOR will provide GTECH QA with a
minimum two weeks notice prior to the start of the reliability test.
9.4 RELIABILITY TEST REPORT. The VENDOR will submit to GTECH QA a
formal reliability test report for the Products based on the results of the
Product reliability test. The reliability test report will contain all data
necessary to verify and confirm that the Products meet all the design
requirements identified in the Product Specification and any resultant design
changes and corrective action to resolve any test failures. GTECH QA must
approve the VENDOR's reliability test report before the VENDOR can be approved
to ship Products to GTECH.
9.5 VENDOR SURVEY. The VENDOR will allow GTECH to perform a vendor
survey at the VENDOR'S facility. This survey will include, but is not limited
to, an audit of the manufacturing process, reviewing the yields at each
inspection and test point in the manufacturing; process, review of the on-going
reliability test data, Product design changes, corrective action, and field
reliability performance and repair data.
9.6 TEST EQUIPMENT AND PROCEDURE CORRELATION. The test equipment
and procedures used in the VENDOR's final inspection and test, will correlate
with the test equipment and procedures used by GTECH upon mutual agreement
between VENDOR and GTECH.
9.7 FINAL TEST AND INSPECTION DATA. The VENDOR will provide GTECH
with inspection and/or test data based on the mutually agreed upon test
equipment and procedures with each lot of Products delivered to GTECH. The
VENDOR will make final test and inspection data (yield information), on-going
reliability test data, field reliability performance data, and repair data
available at the request of GTECH throughout the life of the Products.
9.8 SOURCE INSPECTION. The VENDOR will allow GTECH (or its
representatives) to perform source inspection at their facility, using mutually
agreed upon test equipment and procedures. It is GTECH's plan to source inspect
the initial lots of Products scheduled for shipment from VENDOR's manufacturing
facility to GTECH production or field sites. To do this in a timely fashion, the
VENDOR will notify GTECH (or its representative) that source inspection is
available at least one week prior to the requested source inspection date.
Source inspection activity will continue, at the discretion of GTECH QA.
9.9 RECEIVING INSPECTION. GTECH plans to conduct receiving
inspection and test on all OEM components. GTECH will 100% inspect and test the
first seven (7) consecutive lots of VENDOR Products for visual, mechanical,
electrical and other types of compliance as specified. After the initial seven
(7) lots have been qualified, GTECH plans to conduct receiving inspection using
MIL-STD-105E, General Inspection Level I, with an AQL of 1.0 for normal sampling
inspection.
9.10 FIELD RELIABILITY REPORTING. The VENDOR agrees to supply GTECH
QA with field reliability performance data for the Products purchased by GTECH.
The field reliability data is to be structured in the following manner and made
available on electronic mail:
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VENDOR FAILURE ANALYSIS SPREADSHEET
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PRODUCT DATE RETURN RETURN INITIAL DATE REPAIR ROOT CAUSE CORRECTIVE RMA SHIP
SER. NO. RECV'D SOURCE REASON FINDINGS ANALYZED PERFORMED ACTION TAKEN NO. DATE
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9.11 FAILURE ANALYSIS AND CORRECTIVE ACTIONS. The VENDOR agrees to
supply, within 15 calendar days of written notice of non-conformance, written
failure analysis and corrective actions for any significant trend for
in-warranty Product failures of consequence related to form, fit, function,
quality or reliability requirements called out in the Product Specification.
9.12 GTECH'S RIGHTS WITH RESPECT TO NON-CONFORMING GOODS. The
testing procedures available to GTECH are discretionary and not mandatory. In
the event GTECH chooses not to perform any or some portion of such testing, or
such testing would not reasonably reveal a non-conformance in the Products,
GTECH reserves its right under the Uniform Commercial Code to reject any
shipment of Products and to seek remedy from VENDOR commensurate with the
non-conformance.
10. INSURANCE
10.1 VENDOR INSURANCE COVERAGE. VENDOR shall purchase and maintain
throughout the life of this Agreement, such insurance as will protect it and
GTECH from claims set forth below which may arise out of or result from the
VENDOR'S operations under this Agreement whether such operations be by it or by
any subcontractor or by anyone for whose acts any of them may be liable. VENDOR
shall cause GTECH to be additional insured under all coverages except Workers'
Compensation. Appropriate endorsements will be attached to state that the
VENDOR's policy will be primary to any other policies that may be in effect.
10.2 GENERAL LIABILITY. Policy will provide a minimum of $1,000,000
per occurrence for Products and Completed Operations.
10.3 PROOF OF INSURANCE. Evidence of said insurance will be in the
form of a certificate of insurance and will be, provided within ten (10)
calendar days from the date of this Agreement. Notification to GTECH will occur
within thirty (30) calendar days of any cancellation or material change in
coverage. In the event of a failure to furnish such proof or the cancellation or
material change of such insurance, without prejudice to any other remedy GTECH
may have, GTECH may terminate this Agreement, or at its option, charge the cost
of required insurance to the VENDOR. Coverage will be in effect with insurance
carriers licensed to do business in any
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state that the VENDOR will perform its services and will be rated no less than A
by the AM Best Company. All Certificates of Insurance are to be forwarded to:
GTECH Corporation, 55 Technology Way, West Greenwich, RI 02817. ATTN: Risk
Management Department.
11. INDEMNITY
In addition to, and not in limitation of, any other indemnifications,
warranties and covenants set forth herein, VENDOR hereby agrees to indemnify and
hold GTECH harmless with respect to any and all costs, expenses and liability,
including without limitation reasonable attorney's fees, arising out of any
claim or action based on a failure of the Products or Services to meet the
specifications set forth herein, or the failure of the VENDOR to meet any of its
obligations hereunder.
VENDOR shall defend, indemnify and hold GTECH, its subsidiaries,
affiliates, distributors and customers harmless from any and all costs, expenses
and liability, including reasonable attorney's fees, arising out of any claim or
action based on actual or alleged infringement by the Products or any patent,
copyright, trade secret or other proprietary interest related to such Products.
GTECH shall give VENDOR prompt written notice of any claim or action and shall
provide reasonable assistance, at VENDOR'S expense, in defending any such claim
or action. If an injunction is issued which prohibits the use or sale of the
Products by reason of any matter covered by this Section 10, then VENDOR shall,
at its expense, either: (a) procure for GTECH, its subsidiaries, affiliates,
distributors and customers the right to continue using the Products; (b) modify
the Products so they become non-infringing; (c) substitute equivalent
non-infringing products; or, (d) if neither (a) through (c) are reasonably
available, GTECH may return the Products to VENDOR and VENDOR will refund the
purchase price to GTECH less depreciation based upon the straight line method
and a product life of five (5) years.
Notwithstanding the foregoing, VENDOR shall have no liability to GTECH
for actual or claimed infringement arising out of: (a) compliance with detail
designs, plans or specifications furnished by GTECH unless such infringement
would arise independent of such designs, plans or specifications; (b) use of the
Products in combination with other equipment or software not reasonably
contemplated by VENDOR; or, (c) use of the Products in any process not
reasonably contemplated by VENDOR. VENDOR acknowledges that the Specifications
in Attachment 1 is not a "specification" which excuses or releases VENDOR from
performing its indemnity and other obligations hereunder.
12. REPAIR SUPPORT
12.1 REPAIR ORDERS. In addition to VENDOR's obligations under
Section 14, VENDOR agrees to repair all Products in accordance with its standard
terms as set forth in Attachment 4 of this Agreement.
12.2 INTERNATIONAL REPAIR AND SUPPORT. VENDOR will repair out of
warranty Products in accordance with its standard terms as set forth in
Attachment 4 of this Agreement.
12.3 FAILURE ANALYSIS. VENDOR shall provide a failure analysis per
its standard repair report on Products that are returned for repair under
warranty. On serialized Products, repair
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data shall be provided for each serialized unit returned. VENDOR shall provide
general failure data on out of warranty returns.
12.4 REPAIR CAPABILITIES. GTECH reserves the right to repair any of
the assemblies, subassemblies, or other items comprising the Products purchased
under this Agreement. VENDOR will supply GTECH with the necessary support to
repair the Products, including the information listed under Sections 12.3, 12.5,
12.6, 12.7 and 12.8.
12.5 TEST EQUIPMENT. VENDOR shall make available to GTECH, upon
written request by GTECH, any test procedures, special tools, jigs, fixtures,
diagnostics, programs, test equipment or supplies necessary to repair the unit,
any of the assemblies, subassemblies, piece parts, components, or other items
comprising the Products purchased under this Agreement to component level.
12.6 QUALIFIED VENDOR LIST. VENDOR shall supply GTECH a qualified
vendor list (QVL) for all components used in the Products purchased under this
Agreement. This QVL shall include the component manufacturers and vendors along
with the corresponding part numbers for all components used in the Product, any
of the assemblies, subassemblies, piece parts, components, or other items
comprising the Products purchased under this Agreement. Updates to this list
shall be forwarded to GTECH CORPORATION, 55 Technology Way, West Greenwich, RI
02817 Attention: Procurement Agent Responsible for Commodity.
12.7 DIAGNOSTICS. VENDOR shall provide to GTECH its diagnostics,
test programs and test routines, necessary to repair to component level, the
unit, any of the assemblies, subassemblies, piece parts, components, or other
items comprising the Products purchased under this Agreement.
12.8 DOCUMENTATION. In consideration of the, purchase of Products
under this Agreement, and at no additional cost, VENDOR hereby grants onto GTECH
the unlimited right to use, reprint, and distribute VENDOR's Product manuals and
documentation ("Documentation"), including but not limited to user's manuals,
schematics, maintenance, theory of operation and troubleshooting guides, and any
other Documentation that VENDOR shall make available during the Term of this
Agreement for the sole purpose of GTECH to make repairs to Products and for no
other purpose. Upon request, VENDOR shall provide camera-ready copies of the
Documentation to GTECH at no additional charge. GTECH agrees to display
copyright notices in accordance with VENDOR's reasonable written instructions.
13. TRAINING
13.1 INITIAL TRAINING. VENDOR agrees to provide, at no charge to
GTECH, three (3) training classes with up to twelve (12) students per class at a
GTECH-designated site during the term of this Agreement. Pursuant to the above,
GTECH shall: (1) reimburse VENDOR for instructor's reasonable transportation and
living expenses and, (2) provide equipment (or reimburse VENDOR for equipment
transportation) as required to support training classes. VENDOR shall provide
the instructor and instructional materials for the above referenced classes.
Training classes may be video taped for future use by GTECH.
-9-
13.2 COMPONENT LEVEL TRAINING. VENDOR shall provide at no charge to
GTECH, such training necessary to enable GTECH to repair to a component level
(i.e. resistor, capacitor, integrated circuit) the unit, any of the assemblies,
subassemblies, or other items comprising the Products purchased under this
Agreement. A minimum of one (1) of the training classes described in Section
13.1 shall consist of Component Level Training.
13.3 FUTURE TRAINING. GTECH may schedule a maximum of three (3)
students per quarter in VENDOR's regularly scheduled class, at VENDOR's
location, during the Term of this Agreement. If no regularly scheduled classes
are conducted, then GTECH may request VENDOR to conduct one (1) class per year
in which GTECH may schedule a maximum of six (6) students.
14. WARRANTIES
14.1 AGENCY/STANDARDS COMPLIANCE. VENDOR warrants and represents
that all Products delivered to GTECH under this Agreement will comply with
applicable standards as called out in the Product Specification.
14.2 AUTHORITY. VENDOR warrants that: (a) it has the right to enter
into this Agreement; (b) all necessary actions, corporate and otherwise, have
been taken to authorize the execution and delivery of this Agreement and the
same is the valid and binding obligation of VENDOR; (c) all licenses, consents
and approvals necessary to carry out all of the transactions contemplated in
this Agreement have been obtained by VENDOR; and (d) VENDOR'S performance of
this Agreement will not violate the terms of any license contract, note or other
obligation to which VENDOR is a party.
14.3 TITLE; INFRINGEMENT. VENDOR warrants that: (a) it has and
shall pass to GTECH good title to the Products free and clear of all liens and
encumbrances; (b) the Products do not infringe any patent, trademark or
copyright or otherwise violate the rights of any third party; (c) no claim or
action is pending or threatened against VENDOR or, to VENDOR's knowledge,
against any licenser or supplier of VENDOR that would adversely affect the right
of GTECH or any customer of GTECH to use the Products for their intended use.
14.4 CONFORMANCE; DEFECTS. Unless otherwise specified in Attachment
1, VENDOR warrants that the Products will: (a) be new; (b) conform to the
Specification; (c) be free from defects in materials and workmanship for a
period of twenty-four (24) months from VENDOR's or distributor's invoice date.
Upon written notice from GTECH of a Product or part that fails to meet the
foregoing warranty, VENDOR will promptly repair or replace such Products in
accordance with the warranty set forth in Attachment 4 of this Agreement.
14.5 FREIGHT COSTS ON REPAIRS. All Products returned to VENDOR for
repair shall be in accordance with its terms set forth in Attachment 4 of this
Agreement.
15. TOOLING
Any tooling purchased by GTECH for the manufacture of the Products
("Tooling"), whether kept at GTECH's, VENDOR's or VENDOR's vendor's premises,
shall remain the property of GTECH for GTECH's exclusive use. The Tooling
purchased by GTECH and used
-10-
by VENDOR in the manufacture of the Products shall be stored and maintained by
VENDOR but may be removed from the VENDOR's location at any time by GTECH,
without notice, and at no additional cost to GTECH. VENDOR shall take such steps
to protect GTECH's title to the Tooling as GTECH may reasonably request. At a
minimum, VENDOR shall cause a sign to be affixed to such tooling stating
"Property of GTECH Corporation". VENDOR will immediately notify GTECH of any
change in the location of the tooling.
16. FORCE MAJEURE
For the purposes of this Agreement, a "Force Majeure" shall mean an
event or effect that cannot be reasonably anticipated or controlled, including
but not limited to an action of the elements, or any other cause which, by the
exercise of reasonable diligence, said Party is unable to prevent. Neither GTECH
nor VENDOR shall be liable to the other for any delay in or failure of
performance under this Agreement due to a "Force Majeure" occurrence provided
that the Party claiming Force Majeure notifies the other in writing within five
(5) calendar days of the commencement of the condition preventing its
performance and its intent to rely thereon to extend the time for its
performance of this Agreement.
17. CONFIDENTIALITY
VENDOR acknowledges and agrees that all documents, data, software or
information in any form which are provided by GTECH (hereinafter "Confidential
Information") is the property of GTECH. VENDOR will receive and maintain all
Confidential Information in the strictest confidence and, except as provided
herein, shall not use Confidential Information for its own benefit or disclose
it or otherwise make it available to third parties without the prior written
consent of GTECH. VENDOR agrees to limit the use of Confidential Information to
only those of its employees who need the Confidential Information for the
purpose of this Agreement and to advise all of its employees of GTECH's rights
in the Confidential Information. Nothing in this Agreement shall be construed as
granting or conferring any rights by license or otherwise in any Confidential
Information, trademarks, patents or copyrights of GTECH, except for the limited
purposes of VENDOR's performance hereunder. Confidential Information does not
include information which is: (a) in the public domain; (b) already known to the
Party to whom it is disclosed (hereinafter "Recipient") at the time of such
disclosure; (c) subsequently received by Recipient in good faith from a third
party having prior right to make such subsequent disclosure; (d) independently
developed by Recipient without use of the information disclosed pursuant to this
Agreement; or (e) approved in writing for unrestricted release or unrestricted
disclosure by the Party owning or disclosing the information (hereinafter
"Discloser"). In the event either VENDOR is required or legally compelled to
disclose any of the Confidential Information as a result of a legal process or
pursuant to governmental action, the VENDOR shall give prompt written notice to
GTECH so that GTECH may seek a protective order or other appropriate remedy
and/or waive compliance with the provisions of this Agreement. At the request of
a Discloser, and in any event upon the expiration or other termination of this
Agreement, each Recipient shall promptly deliver to Discloser all products,
components and equipment provided by Discloser as well as all records or other
things in any media containing or embodying Discloser's Confidential Information
within its possession or control which were delivered or made available to each
Recipient during or in connection with this Agreement, including any copies
thereof.
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18. PUBLIC ANNOUNCEMENTS
VENDOR agrees not to make any public announcements regarding this
Agreement or to disclose any of the terms and conditions hereof to any third
party without prior written consent of GTECH.
19. NOTICES
All notices required or contemplated by this Agreement shall be deemed
effective if written and delivered in person or if sent by registered mail,
return receipt requested, to GTECH at the address shown above to the attention
of GTECH's Representative or to VENDOR at the address shown above to the
attention of VENDOR's Representative; or such other persons or addresses as may
hereafter be designated by the respective Parties. A copy of all Notices sent to
GTECH shall be addressed to the Office of General Counsel at the address shown
above.
20. ASSIGNMENT
This Agreement and the disclosure of Confidential Information hereunder
are made in reliance upon VENDOR's reputation, skill and expertise. VENDOR
agrees not to assign this Agreement or any right or obligation hereunder without
the prior written consent of GTECH in each instance. Any attempted assignment
shall be void. This covenant not to assign without consent shall include
assignments to parents or subsidiaries of VENDOR or any transfer of a majority
interest in VENDOR. The consent by GTECH to any assignment shall not constitute
a waiver of the need for consents for any further assignments.
GTECH may assign its rights and/or obligations hereunder, in whole or
in part, to any parent or subsidiary corporation, or any affiliate, without the
consent of, but upon notice to, VENDOR.
21. TERM AND TERMINATION
21.1 TERM. This Agreement will commence on the 30th day of May 2002
("Effective Date"), and shall continue for five (5) years ("Term") unless
terminated earlier as provided in this Agreement. Unless either Party notifies
the other in writing at least sixty (60) calendar days before the end of the
Term of its intent to terminate this Agreement at the end of the Term, this
Agreement will be extended automatically and will continue in effect without any
volume commitment until terminated by either Party on sixty (60) calendar days
prior written notice. Unless otherwise agreed in writing, the prices for the
Products during any such extension shall be the same prices in effect at the end
of the Term.
21.2 TERMINATION BY GTECH. GTECH may terminate this Agreement at
any time if (a) VENDOR fails or neglects to perform any of its obligations
hereunder and such condition has not been cured within thirty (30) calendar days
of written notice thereof by GTECH; (b) VENDOR, or VENDOR's parent or a wholly
owned subsidiary of VENDOR, is the subject of trade sanctions by the United
States government, or any other government, or quasi-governmental agency which
materially affects GTECH's ability to sell, lease, or maintain the Product; (c)
VENDOR attempts to assign this Agreement or any obligation hereunder without
GTECH's consent; (d) any assignment is made of VENDOR's business for the benefit
of
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creditors, or if a petition in bankruptcy is filed by or against VENDOR and is
not dismissed within ninety (90) calendar days, or if a receiver or similar
officer is appointed to take charge of all or part of VENDOR's property, or if
VENDOR is adjudicated a bankrupt; or (e) the Products are infringing and the
VENDOR is unable to procure a right for GTECH to continue to use the Products as
set forth in Section 11 hereof.
21.3 TERMINATION BY VENDOR. VENDOR may terminate this Agreement if:
(a) GTECH fails to perform any of its obligations hereunder and such condition
has not been cured within thirty (30) calendar days of written notice thereof by
VENDOR; provided that, VENDOR may not terminate this Agreement for reason of
non-payment by GTECH of any disputed amounts, or (b) if any assignment is made
of GTECH's business for the benefit of creditors; or, (c) if a petition in
bankruptcy is filed by or against GTECH and is not dismissed within ninety (90)
calendar days, or if a receiver or similar officer is appointed to take charge
of all or part of GTECH's property, or if GTECH is adjudicated a bankrupt.
21.4 OBLIGATIONS ON TERMINATION. Upon expiration or termination of
this Agreement for any reason, VENDOR shall promptly deliver to GTECH all tools,
equipment, software documentation and other materials furnished to VENDOR by
GTECH hereunder. VENDOR's obligations under Sections 2, 8, 9, 10, 11, 12, 14,
17, 18, 20, 21 and 24 hereof shall survive expiration or earlier termination of
this Agreement or its extensions regardless of the manner of termination.
22. CONFLICTING PROVISIONS
In the event of a conflict between the terms and conditions of this
Agreement and the terms and conditions of any Purchase Order, typewritten terms
added by GTECH on a Purchase Order shall control the terms and conditions of
this Agreement, and the terms and conditions of this Agreement shall control the
printed terms and conditions on any Purchase Order. Typewritten terms added by
GTECH on any individual purchase order shall apply only to the Products and/or
Service ordered under such individual Purchase Order. The terms and conditions
of this Agreement and, if applicable, the typewritten terms and conditions added
by GTECH on any Purchase Order shall prevail over any inconsistent terms and
conditions contained in any VENDOR acknowledgment or invoice.
Notwithstanding any permitted assignment, VENDOR shall remain
responsible for the full performance of all of the terms and conditions of this
Agreement.
23. MANUFACTURING RIGHTS
Attachment 6 will govern Manufacturing Rights.
24. MISCELLANEOUS
This Agreement and Attachments and Purchase Orders issued and accepted
hereunder set forth the entire understanding of the Parties with respect to the
Products and merges all prior written and oral communications relating thereto.
It can be modified or amended only in a writing signed by a duly authorized
representative of each Party. Section headings are provided for the convenience
of reference only and shall not be construed otherwise.
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No failure to exercise, or delay in exercising, on the part of either
Party, any right, power or privilege hereunder shall operate as a waiver
thereof, or will any single or partial exercise of any right, power or privilege
hereunder preclude the further exercise of the same right or the exercise of any
other right hereunder.
This Agreement is made pursuant to and shall be governed by the laws of
the State of Rhode Island, without regard to its rules regarding conflict of
laws. The Parties agree that the courts of the State of Rhode Island, and the
Federal Courts located therein, shall have exclusive jurisdiction over all
matters arising from this Agreement.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS AGREEMENT ON
THE DATES MENTIONED BELOW.
BCM ADVANCED RESEARCH GTECH CORPORATION
By /S/ T.E. SKIBINSKI By /S/ JOHN PICARD
-------------------------------- --------------------------------
Print T. SKIBINSKI Print J. PICARD
----------------------------- -----------------------------
Title DIR. OF SALES Title PURCHASING MGR
----------------------------- -----------------------------
Date 12/20/02 Date 12/11/02
------------------------------ ------------------------------
By /S/ RAY WANG By /S/ WILLIAM MIDDLEBROOK
-------------------------------- --------------------------------
Print RAY WANG Print WILLIAM MIDDLEBROOK
----------------------------- -----------------------------
Title MANAGING DIRECTOR Title VP TECHNOLOGY OPERATIONS
----------------------------- -----------------------------
Date 12/20/02 Date 12/11/02
------------------------------ ------------------------------
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ATTACHMENT 1
PRODUCT SPECIFICATION
GTECH CORP BCM
Product specification 51-1002-00 Rev. E. Model number SL810
Part number 51-1002-01 (TFT panel) Part number 10062
Part number 51-1002-02 (DSTN panel) Part number 10061
ATTACHMENT 2
PRICING
1. Unit Price $157.56 FOB Taiwan (no cpu processor and no memory)
2. Minimum commitment 500 units per order
ATTACHMENT 3
SPARE PARTS PRICING
- ----------------------------------------------------------------------------------------------
Qty. Reference Parts N/P Amount
- ----------------------------------------------------------------------------------------------
1 OSCI 25MHZ OSC SMD 3.3V 4P) $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 OSC2 OSC 14.318MHz 3.3V 4P SMD EPSON $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 U1 IC ICWORKS W209CH Clock Generator $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 U15 IC ITE ITE8661F I/O Chip $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 U28 IT8712 $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 U42 IC AD.AD18198JST AC'97 Soundport Codec $2.50 $2.50
- ----------------------------------------------------------------------------------------------
1 U6 IC LTC.LTC1753CG 1.3-3.5V REG. Controller $2.80 $2.80
- ----------------------------------------------------------------------------------------------
1 CN14 3M 81068-600203 68Pin DIP $4.00 $4.00
- ----------------------------------------------------------------------------------------------
1 U26 IC REALTEK RTL8139C Ethernet PQFP-128Pin $3.50 $3.50
- ----------------------------------------------------------------------------------------------
1 U35 IC ITE IT8888F PQFP-160Pin $4.00 $4.00
- ----------------------------------------------------------------------------------------------
1 U32 FLASH SST SST49LF004A-33-4C-NH 4MB PLCC32 $3.80 $3.80
- ----------------------------------------------------------------------------------------------
1 U9 IC Intel 82810 BGA-421Pin $8.00 $8.00
- ----------------------------------------------------------------------------------------------
1 U33 IC ICH82801AA BGA-241Pin $12.00 $12.00
- ----------------------------------------------------------------------------------------------
1 U49 IC SMI SM712G 20 VGA 2MB BGA-256Pin $16.00 $16.00
- ----------------------------------------------------------------------------------------------
1 PCB Rev.A1 PCB BCM SL810 Rev.A1 6Layer GRN. $15.00 $15.00
- ----------------------------------------------------------------------------------------------
TOTAL $83.85
ATTACHMENT 4
IN WARRANTY
1. VENDOR warrants that for a period of twenty-four (24) months from the
invoice date, Products will be free from defects in design, workmanship,
and functionality to Product Specification; and will be manufactured in a
good, workman-like manner. If Product does not conform to the Product
Specification, GTECH may return the Product for 'no-charge' warranty
service. VENDOR agrees to issue a return material authorization ("RMA")
immediately upon GTECH's request to return the Product using VENDOR's RMA
request form.
2. Only the cpu motherboard itself is to be returned to VENDOR for service.
VENDOR will make best effort to return any accessories (i.e.: cpu, memory,
manuals, disks, cables, etc.), which accompany the Product returned for
service. VENDOR will not be responsible for any discrepancy between
accessories sent in with Product to be serviced versus accessories returned
to the customer after Product has been serviced. Repaired Product will be
warranted by VENDOR either for the remainder of the original warranty or
for twenty 20 calendar days from repair, whichever is longer. Upon request,
GTECH may audit VENDOR's repair and in-warranty records during regular
business hours. Product returned under this provision will be repaired to
the same revision level as the returned Product.
3. If the Product returned for repair has a problem caused by unauthorized
modifications and/or misuse, or if a problem is caused by a software
malfunction outside VENDOR's reasonable control or damage is caused by
parties other than VENDOR or if no problem is found to exist with the
Product as agreed between the parties, VENDOR will not be responsible for
warranty repair of the Products.
4. Failed units will be shipped from GTECH directly to VENDOR'S repair
facility at the following location(s).
Location: BCM Advanced Research
Address: 1 Hughes
City: Irvine, State: CA 92618
5. Freight from GTECH to VENDOR's facility will be paid for by GTECH. Return
freight will be VENDOR's responsibility.
6. VENDOR agrees that Product will be repaired and returned to GTECH within
fifteen (15) calendar days after receipt at VENDOR's repair facility. If
GTECH requests expedited service, VENDOR will use its best efforts to
repair reasonable quantities of Product within seven (7) working days of
receipt at VENDOR's repair facility.
EXCEPT TO THE EXTENT SET FORTH IN THIS WARRANTY, VENDOR MAKES NO OTHER
WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE PRODUCTS AND SPECIFICALLY
DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
OUT OF WARRANTY
1. GTECH will pay a fee of $50.00 per unit, plus parts and freight on Product
returned for repair.
-2-
ATTACHMENT 5
PACKAGING SPECIFICATIONS
VENDOR packaging will comply with GTECH's packaging requirements as defined in
GTECH's packaging specification document titled: RLSE MFG 85-000-22 which is
comparable to ISTA procedure 2A.
ATTACHMENT 6
MANUFACTURING RIGHTS
1. MANUFACTURING DOCUMENTATION PACKAGE. Upon placement of GTECH's first Purchase
Order for production volume of Products, VENDOR agrees to deliver to GTECH, or
to a mutually agreed upon escrow agent, all of the documentation and other
information used by VENDOR and required to manufacture, test, maintain and
support the Products (herein, the "Manufacturing Package") including, without
limitation, the full and complete schematic diagrams, assembly drawings,
structured Bills of Materials, printed circuit board artwork, parts and vendor
lists, test specifications, assembly aids and software in both machine readable
source and object forms. As a part of the Manufacturing Package, VENDOR also
agrees to provide unrestricted access to and joint control of VENDOR tooling,
agency approval files (FCC, UL, CSA, VDE, etc.), a complete description of any
special tools, fixtures and test equipment that are required but are not readily
available in the marketplace. Neither GTECH nor escrow agent will have any right
to use the "Manufacturing Package" except as set forth in Section 3 below or as
otherwise authorized by VENDOR.
2. UPDATES; VERIFICATION; EXPENSES. VENDOR agrees to update the "Manufacturing
Package" as necessary to keep the package current with the latest version of the
Products delivered to GTECH under this Agreement. If the "Manufacturing Package"
is delivered to any person or entity other than GTECH, GTECH shall have the
right to inspect the package to verify the contents of the "Manufacturing
Package" and VENDOR's compliance with this Section. VENDOR will pay all costs
and expenses of any kind associated with the preparation and maintenance of the
"Manufacturing Package", as well as any fees of any person other than GTECH
holding the "Manufacturing Package".
3. RIGHT TO MANUFACTURE. If any one of the following events occur, GTECH shall
have the right, including the rights under any of the VENDOR's applicable
patents and copyrights, to use the "Manufacturing Package" to manufacture or
have manufactured the Products under the conditions in each of the below
sections.
a. VENDOR ceases doing business as an entity or is finally adjudicated a
bankrupt under Chapter 7 of the Bankruptcy Act or any similar or
successor provision for the liquidation or dissolution of VENDOR;
b. VENDOR is either unable or unwilling to continue to manufacture or
have manufactured the Products;
c. A petition in bankruptcy is filed by or against VENDOR and is not
dismissed within ninety (90) calendar days thereafter or if a
receiver, trustee in bankruptcy or similar officer is appointed to
take charge of all or a substantial part of VENDOR's property;
d. VENDOR fails to provide GTECH adequate assurance of future performance
within sixty (60) calendar days of GTECH's request or written
notification by VENDOR of its inability to provide the Products to
GTECH strictly in accordance with the terms of this Agreement;
e. VENDOR materially breaches any provision of this Agreement and fails
to cure such breach within sixty (60) calendar days.
Except as provided in this Section or as otherwise authorized by VENDOR, neither
GTECH nor the escrow agent shall have any right to use the "Manufacturing
Package" for any purpose and this Attachment 7 shall not be construed as a
transfer or assignment of VENDOR's intellectual property rights, except as
specifically necessary for the manufacture and sale of the Products under this
Agreement.
-2-