Exhibit 10.22
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS
EXHIBIT, WHICH PORTIONS HAVE BEEN OMITTED AND REPLACED WITH [****] AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
TRANSCEIVER SUPPLY AGREEMENT
by and between
Finisar Corporation,
Sunnyvale, California, United States of America
acting for itself and its Affiliates,
- hereinafter referred to as "Buyer"-
and
Infineon Technologies Trutnov, sro,
54101 Trutnov, Czech Republic
- hereinafter referred to as "Seller" -
- Buyer and Seller are hereinafter collectively referred to as the
"Parties" and individually referred to as a "Party" -
PREAMBLE
WHEREAS The Parties have entered into the Trutnov Asset Transfer Agreement of
the same date which provides for the sale and transfer of assets by Seller to
Buyer as more fully set forth in the Trutnov Asset Transfer Agreement; and
CONFIDENTIAL TREATMENT REQUESTED
WHEREAS Buyer wishes to continue to procure fiber optic products from Seller for
an interim period following the closing date under the Trutnov Asset Transfer
Agreement; and
WHEREAS Seller wishes to continue to supply such fiber optic products to Buyer
until January 31, 2006.
NOW THEREFORE in consideration of the above, the Parties agree to the following
terms and conditions:
1. SUBJECT OF THE AGREEMENT
The subject of this agreement (hereinafter referred to as "Agreement") is
the supply of (i) the products specified in Exhibit 1 to this Agreement and
(ii) any other fiber optic products which will be supplied by Seller to
Buyer throughout the term of this Agreement (together hereinafter referred
to as the "Products") by Seller to Buyer or its Affiliates. The list of
Products may be changed by the Parties from time to time.
"Affiliate" shall mean any company which controls, is controlled by, or is
under the same control as Buyer. "Control" shall mean the direct or
indirect ownership of more than fifty percent (50%) of such company's
capital or equivalent voting rights.
2. DEMAND PLANNING AND PURCHASE ORDERS
2.1 Prior to February 15, 2005, Buyer will provide Seller with a first three
(3) month rolling forecast of its demand for Products. Buyer will provide
Seller with updated three (3) month rolling forecasts on the first day of
each month thereafter. Seller will purchase raw materials based on such
forecasts.
2.2 Prior to September 30, 2005, Buyer may place purchase orders for the
Products on a build to order basis with standard lead times and Seller will
manufacture and ship Products against these orders. In the event Buyer's
demand exceeds the forecast, Seller will make reasonable commercial efforts
to satisfy Buyer's demand.
CONFIDENTIAL TREATMENT REQUESTED
2.3 In addition to placing orders for the Products, prior to September 30, 2005
Buyer may place purchase orders for raw materials used to manufacture the
Products ("Raw Materials") for delivery with standard lead times and Seller
will ship Raw Materials against these orders. Seller will make reasonable
efforts to satisfy Buyer's purchase orders.
2.4 Buyer shall forward its purchase orders in writing or by facsimile to the
agreed order entry point at Seller. Seller is obliged to accept a purchase
order in writing within four (4) business days following receipt thereof
unless (i) the purchase order is in excess of Buyer's forecast, (ii) Seller
can show commercially justifiable reasons (taking into account all
circumstances of the specific case and balancing the interest of both
parties) for refusing to accept Buyer's purchase order or (iii) the
relevant order is in excess of Seller's capacity at the time this Agreement
is signed. Upon Seller's acceptance of a purchase order, an individual
purchase contract (hereinafter referred to as "Individual Purchase
Contract") is concluded. In case a purchase order is refused by Seller, the
Parties shall immediately endeavor to find reasonable remedial measures.
2.5 The terms and conditions of this Agreement shall apply to any purchase
order of Buyer regarding the Products even if they do not refer to it
expressly. Any separate general terms and conditions of Buyer or Seller
shall not apply.
3. DELIVERY
3.1 The Products are delivered "Ex Works" according to Incoterms 2000.
3.2 If the delivery date is defined
a) by day, Seller shall not deliver more than -5 / +0 days earlier or
later than the agreed delivery day;
b) by week, Seller shall deliver within the agreed delivery week.
CONFIDENTIAL TREATMENT REQUESTED
3.3 If Seller realizes that it cannot adhere to the agreed delivery date, it
shall without delay inform Buyer and indicate the prospective duration of
the delay. The Parties shall immediately endeavor to find reasonable
remedial measures.
3.4 If Seller is responsible for delays in deliveries and if Buyer
substantiates that it has suffered damages due to the delay, Buyer may
claim per full week of delay liquidated damages of 0,5% of the price of the
delayed Products up to a maximum amount of 5% of such price.
3.5 Subject to the condition that Buyer has set a reasonable time period within
which to deliver the delayed Products and Seller fails to deliver the
Products within such time period, Buyer may cancel the relevant Individual
Purchase Contract without incurring any liability. The notice of
cancellation shall be served without delay following expiration of the set
time period.
3.6 Any further claims for damages or rights of Buyer due to the delay shall be
excluded.
3.7 Buyer shall place its last order by September 30, 2005. The last deliveries
shall be effected on or before January 31, 2006.
3.8 If subsequent to the confirmation of any purchase order Buyer requires an
earlier or later delivery date than agreed, the Parties shall use
reasonable efforts to find a mutually acceptable solution.
4. PRICES
4.1 The purchase price for the Products shall be established as follows:
(a) If a specific Product (by part number) was sold to a specific customer
in the period from October 1, 2004 through December 31, 2004 (the
"Fourth Calendar Quarter"), the purchase price to be paid by Buyer to
Seller for Products sold to that customer
CONFIDENTIAL TREATMENT REQUESTED
shall be [****] of the last price at which Seller or its Affiliates
sold such Product to such customer during the Fourth Calendar Quarter.
(b) If Seller or its Affiliates did not sell a specific Product (by part
number) to a specific customer during the Fourth Calendar Quarter, the
purchase price to be paid by Buyer to Seller for Products sold to that
customer shall be [****] of the weighted average price for sales by
Seller and its Affiliates during the Fourth Calendar Quarter of the
Product Group (as shown on Exhibit 1) to which the Product belongs.
(c) The purchase price to be paid by Buyer to Seller for a new Product for
which there is no sales history shall be [****] of the price that
Buyer has quoted to its customer. Buyer shall endeavour to sell the
Product at the highest price the market will bear.
(d) For Products sold through a distributor, if a specific Product (by
part number) was sold to a specific end customer in the Fourth
Calendar Quarter, the purchase price to be paid by Buyer to Seller for
Products sold to that customer shall be [****] of the adjusted
distributor sale price for that Product during the Fourth Calendar
Quarter. [Note: The adjusted distributor sale price is defined as the
original distributor buy price less [****] which were paid to the
distributor for competitive market reasons and is to be provided by
Seller.]
(e) For Products sold through a distributor, if a specific Product (by
part number) was not sold to a specific end customer during the Fourth
Calendar Quarter, the purchase price to be paid by Buyer to Seller for
Products sold to that customer shall be [****] of the weighted average
price for all sales by Seller and its Affiliates during the Fourth
Calendar Quarter of the Product Group (as shown on Exhibit 1) to which
the Product belongs.
(f) In the event a customer advises Buyer that the historic sales price
for Products during the Fourth Calendar Quarter is different than the
sales price reflected in Seller's sales records for the Fourth
Calendar Quarter, Buyer shall have the right to ask Seller to verify
the prices at which Products were sold to that customer.
4.2 The prices for the Raw Materials shall be [****].
CONFIDENTIAL TREATMENT REQUESTED
4.3 All prices are based on the applicable clause of the Incoterms 2000 as
defined in Section 3.1 and include packaging. The applicable VAT shall be
added to the price.
5. INVOICES AND TERMS OF PAYMENT
5.1 Seller shall issue an invoice meeting the requirements of applicable tax
laws with every delivery. The invoice shall show the volumes, the price per
ordered Product, the order number and the Product part number.
5.2 Payments shall be effected without deduction in EURO within forty-five (45)
days following the invoice date. In case of any dispute arising out of an
Individual Purchase Contract, Buyer shall in any case pay the undisputed
part of the invoice related to such Individual Purchase Contract according
to the payment terms mentioned above.
6. RISK, TITLE
6.1 Risk of loss or damages shall pass to Buyer according to the applicable
clause of the Incoterms 2000 as defined in Section 3.1.
6.2 Title to Products shall pass upon full payment of the purchase price for
the respective Products. Notwithstanding the foregoing, Buyer shall be
entitled to resell the Products. Buyer shall assign its right for payment
related to these resold Products to Seller. Buyer shall however collect the
payment related to the Products itself, as long as Buyer makes payments to
Seller with regard to the Products in due time.
6.3 If Buyer fails to make any payment when due in accordance with this Section
6, Seller may give written notice of such non-payment to Buyer. If Buyer
fails to make such payments within 14 calendar days following receipt of
such notice, Buyer shall be in default of payment and Seller shall be
entitled to collect payments itself by Buyer's customers.
6.4 Buyer's rights for payment shall be released from assignment to the extent
such rights exceed Buyer's payment obligations by more than thirty (30) per
cent.
CONFIDENTIAL TREATMENT REQUESTED
7. WARRANTY
7.1 The Products shall be free from defects in material and workmanship.
Notwithstanding the foregoing, Seller shall not be responsible (a) for the
design and specification of the Products, (b) for insignificant defects,
including but without limitation any defects that do not effect the use of
the Product intended by Buyer, (c) for any non reproducible computer bugs,
(d) for defects arising out of parts, software or other material or
instructions provided by Buyer. The warranties stated in Section 7 are
exclusive and in lieu of all other warranties, whether express or implied,
including, but not limited to, the implied warranties of merchantability or
fitness for a particular purpose.
7.2 Seller shall at its sole discretion repair or replace any non-compliant
Products. In case these corrective actions fail within a reasonable period
of time, Buyer is entitled to request price reduction or to cancel the
relevant Individual Purchase Contract and request Seller to take back the
Products delivered (under such Individual Purchase Contract) and to
reimburse the purchase price.
7.3 The warranty period shall be [****] months starting on the date the risk of
loss or damage has passed to Buyer according to Section 3.1.
7.4 Seller's liability for any further damages resulting from the
non-compliance of the Products and any further rights of Buyer due to the
non-compliance shall be limited pursuant to the stipulations of Section 12.
8. INDUSTRIAL AND INTELLECTUAL PROPERTY RIGHTS
8.1 Buyer hereby grants to Seller during the term of this Agreement a
royalty-free, non-exclusive, non-transferable right to use all of the
material intellectual property rights listed in Exhibit 5.1.3 to the Master
Sale and Purchase Agreement between Buyer and Infineon Technologies AG
dated January 25, 2005 for the sole purpose of manufacturing the Products
to be sold to Buyer under this Agreement. Seller shall not be entitled to
grant sublicenses of such rights to any third party or to use such
intellectual property rights to manufacture Products for any one other than
Buyer.
CONFIDENTIAL TREATMENT REQUESTED
8.2 Buyer shall defend, indemnify and hold harmless Seller from all claims,
costs, damages, judgments and attorney's fees resulting from or arising out
of any alleged and/or actual infringement or other violation of any
patents, patent rights, trademarks, trademark rights, trade names, trade
name rights, copyrights, trade secrets, proprietary rights and processes or
other such rights related to the Products including their design and the
Specifications.
8.3 The obligations of Buyer under Section 8.2 are subject to the condition
that the Seller informs the Buyer without delay in writing of any claims
for infringement, does not acknowledge the validity of any such claims and
conducts any disputes, including settlements out of court, only in
agreement with Buyer.
9. CONFIDENTIAL INFORMATION
9.1 Each Party shall use all information of the other Party which it receives
in connection with this Agreement and which has been marked as
confidential, only for the purposes of this Agreement and shall keep this
information confidential with the same degree of care as it uses with
respect to its own confidential information. This obligation shall survive
the expiration or termination of this Agreement for a period of three
years.
9.2 This obligation shall not apply to information which is or becomes public
knowledge or which the receiving Party can demonstrate was independently
developed or lawfully received from a third party.
10. FORCE MAJEURE
Neither Party shall be liable to the other for failure or delay in the
performance of any of its obligations under this Agreement for the time and
to the extent such failure or delay is caused by force majeure such as, but
not limited to, riots, civil commotions, wars, strikes, freight embargo,
shortage of supply, lock-outs, hostilities between nations, governmental
laws, orders or regulations, actions by the government or any agency
thereof, storms, fires, sabotages, explosions or any other contingencies
beyond the reasonable control of the respective Party and of its
sub-contractors. In such events, the affected Party shall immediately
inform the other Party of such circumstances together with documents of
proof, and the performance of obligations hereunder shall be suspended
during, but not
CONFIDENTIAL TREATMENT REQUESTED
longer than, the period of existence of such cause and the period
reasonably required to perform the obligations in such cases.
11. EXPORT CONTROL REGULATIONS
Seller shall not be obliged to deliver the Product(s) and Buyer shall not
be obliged to pay the purchase price under any Individual Purchase Contract
concluded under this Agreement if the necessary export licenses are not
obtained by reasons outside of the control of the Parties or if there are
any other barriers by reason of US, German, or any other export regulations
that have to be observed. The Parties agree to inform each other about any
export or re-export restrictions and regulations and about the Export
Control Classification Numbers (ECCN) relating to Product(s) and/or end
use/end user. Buyer guarantees to comply with any export or re-export
restrictions and regulations relating to Product(s) and/or end use/end
user.
12. LIABILITY
12.1 Seller shall be liable for damage to Buyer's property caused by Seller's
performance under this Agreement up to a maximum amount per occurrence of
[****] of the revenue under this Agreement, and up to the maximum amount
for all occurrences of [****] of the revenue under this Agreement.
The obligations of Seller are subject to the condition that Buyer informs
Seller without delay in writing of any such claims, does not acknowledge
the validity of any such claims and conducts any disputes, including
settlements out of court, only in agreement with Seller.
12.2 Apart from warranties and liabilities expressly stipulated in this
Agreement, Seller disclaims all liability regardless of the cause in law,
in particular the liability for indirect or consequential damages, loss of
profits, loss of information and data, except in any cases where liability
is mandatory at law. The limitation of liability shall not apply where
liability is mandatory, e.g. Seller's liability for damages caused
intentionally by Seller or Seller's employees or according to the German
Product Liability Act.
CONFIDENTIAL TREATMENT REQUESTED
12.3 The enforcement of the aforementioned rights of Buyer shall be excluded if
Buyer does not notify Seller in writing of its claims within six months
after being aware of such rights.
13. TERM
13.1 This Agreement shall be effective as of February 1st, 2005 and shall expire
on January 31st, 2006.
13.2 Either Party is entitled to terminate this Agreement prematurely with
thirty (30) days written notice in case:
a) the other Party becomes insolvent or otherwise proceeds in bankruptcy,
or
b) the other Party materially breaches its obligations under this
Agreement and fails to rectify such breach within thirty (30) days
from the receipt of written notice from the other Party.
13.3 In the event this Agreement is terminated, Sections 8.2, 8.3, 9, 12, 14 and
15 shall survive.
14. ARBITRATION
Any disputes arising in connection with this Agreement or relating to its
validity shall be finally decided in accordance with the arbitration
regulations of the German Arbitration Institution (Deutsche Institution fur
Schiedsgerichtsbarkeit e.V.), Bonn, to the exclusion of legal proceedings.
The arbitration tribunal shall also be entitled to come to a binding
decision regarding the validity of this arbitration clause. The venue of
the arbitration shall be Munich. All costs of arbitration shall be
allocated among the Parties in accordance with Section 91 para. (1) of the
German Civil Procedure Act (Zivilprozessordnung - "ZPO").
CONFIDENTIAL TREATMENT REQUESTED
15. APPLICABLE LAW
This Agreement and Individual Purchase Contracts entered into between the
Parties hereunder shall be governed by and construed in accordance with the
law in force in Germany without reference to its conflicts of law
provisions. The application of the United Nations Convention on Contracts
for the International Sale of Goods of April 11, 1980 shall be excluded.
16. ASSIGNMENT
Neither Party may assign this Agreement, delegate its obligations or assign
its rights hereunder, except to one or more of its Affiliates, or to its
legal successor, or in connection with a sale of all or substantially all
of its business, without the prior written consent of the other Party,
which consent will not be unreasonably withheld.
17. MISCELLANEOUS
17.1 Seller shall maintain the quality assurance program for the manufacturing
of Products that is in effect as of the date of this Agreement.
17.2 Upon prior written notice and mutual agreement, Seller shall permit Buyer
and its Affiliates to audit at Buyer's cost Seller's manufacturing
facilities during business hours. Any such audit must be in compliance with
reasonable security, safety and confidentiality requirements of Seller.
Upon prior approval of Seller, Buyer, together with its Affiliates, direct
and indirect customers, may visit the manufacturing line of Seller.
17.3 Alterations and amendments to this Agreement shall only be valid if made in
writing. Any waiver of this requirement for the written form shall likewise
be in writing.
17.4 The effectiveness of this Agreement shall not be impaired if any provision
of this Agreement should be completely or partially invalid or
unenforceable. In such case, the Parties shall agree on a provision that
meets, as closely as reasonably possible, the economic intention of the
invalid or unenforceable provision.
CONFIDENTIAL TREATMENT REQUESTED
17.5 The language of this Agreement shall be English. Correspondence, technical
and commercial documents as well as any information relating to this
Agreement shall be in English.
18. ENTIRETY OF AGREEMENT
This Agreement together with the Individual Purchase Contracts and the
Exhibits to this Agreement (herein referred to as "Exhibits") shall
constitute the entire understanding between the Parties with respect to the
subject matter herein. Therefore neither Buyer's nor Seller's General Terms
and Conditions shall be applicable for the delivery of Products.
This Agreement supersedes all prior or contemporaneous oral or written
communications, proposals and representations with respect to its subject
matter.
19. EXHIBITS
Exhibit 1: Products
In case of discrepancy between the provisions of any Exhibit and this Agreement,
the terms and conditions of this Agreement shall prevail.
CONFIDENTIAL TREATMENT REQUESTED
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
in duplicate by their respective duly authorized representatives.
INFINEON TECHNOLOGIES TRUTNOV SRO
By: /s/ Arno Paetzold And by: /s/ Stefan Sommer
----------------- ----------------------
Name: Arno Paetzold Name: Stefan Sommer
Title: SD M&A Title: Corporate Legal Counsel
Date: Jan. 25, 2005 Date: January 25th, 2005
FINISAR CORPORATION
By: /s/ S.K. Workman And by: /s/ Dave Buse
----------------- ----------------------
Name: S.K. Workman Name: Dave Buse
Title: CFO Title: SVP - Sales & Mktg.
Date: 25 Jan. 2005 Date: 25 Jan. 05
CONFIDENTIAL TREATMENT REQUESTED