EXHIBIT 10.26
CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. THE LOCATIONS OF THE OMITTED MATERIALS ARE INDICATED BY THE
FOLLOWING NOTATION: [OMITTED MATERIAL]
MANUFACTURERS REPRESENTATIVE AGREEMENT
This Agreement made and entered into this 30th day of July 2000, by and between
Eagle Test Systems, Inc. of 620 S. Butterfield Rd., Mundelein, Illinois, U.S.A.
(hereafter ETS) principle/manufacturer, and Representative, Hypersonic, Inc.,
located at no. 227-2, Sec. 2 Chung-Hwa Rd., Chung-Li, Tao Yuan, 32051 Taiwan
R.O.C. (hereafter Representative). In consideration of the mutual covenants
contained herein, the parties agree as follows:
DEFINITIONS
a) Products means the hardware products manufactured and/or furnished by ETS
which shall be sold by ETS to customer as described in Appendix A.
b) Software means the computer software that shall be licensed by ETS to
representative as described in Appendix B.
c) Third Party Software means the computer software furnished by ETS but owned
by someone other than ETS.
d) Documentation means the documents that describe the general functional
capabilities, limitations, and operating requirements of the Software.
e) Updates means the updates, modifications, improvements, and enhancements of
the Software.
f) Spare Parts means hardware normally sold as line items per published price
list, or modules, fuses, or relays as would be found in an ETS spares kit.
REPRESENTATIVE
ETS hereby appoints representative in the territory known as Taiwan, R.O.C. for
products listed in Appendix A. The list of Products as set forth in Appendix A
may be abandoned or added to in writing by ETS.
RESPONSIBILITIES
ETS RESPONSIBILITIES
(i) ETS agrees to make every reasonable effort too manufacture quantities of the
Products sufficient to meet the resale requirements of representative.
(ii) ETS agrees to supply Software by appropriate media, such as magnetic tape
or Compact Disk, and the users manuals and Documentation thereof upon acceptance
of the order from representative.
(iii) ETS agrees to supply Updates from time to time as they become available to
ETS.
(iv) ETS agrees to provide reasonable amounts of technical assistance to
representative in a manner deemed appropriate by both parties.
(v) ETS shall make spare parts of the Products available to representative for
a period of one year from the last date of shipment of such model at then
current prices, notwithstanding termination of this agreement. It is general ETS
policy to provide to Customers (non-representatives) availability of spare parts
for a period of ten years from date of purchase.
WARRANTY
(i) Product Warranty
ETS shall warrant its New Products to be free from defects caused by faulty
materials or poor workmanship and to conform to specifications furnished or
approved by ETS for a period of (1) one year from date of shipment to
representative. ETS liability under this warranty is limited to correcting the
errors, replacing or making refund payment at its option and expense for any
Products which are returned by representative.
(ii) Software Warranty
ETS warrants the Software and Updates to conform to documents furnished or
approved by ETS for (1) one year from date of shipment to representative. ETS
liability under this warranty is limited to correcting the errors, replacing or
making refund payment at its option and expense for any Software or Updates
which are returned by representative.
(iii) ETS agrees to indemnify and hold harmless representative and its customers
from and against all damages and costs, including reasonable legal fees, which
may be assessed against representative or its customers in any claim by third
parties alleging unlawful acts or omissions to act where the alleged liability
of representative or its customers arises by reason of the use or sale of any
item delivered to representative or its customers provided that representative
or its customers give ETS prompt, written notice of all such claims or actions,
and an opportunity to elect to take over, settle, or defend the same through
consul of its own choice and under its sole discretion and at its own expense,
and will make available to ETS all defenses against such claims, known or
available to representative or its customers.
(iv) The foregoing warranties are in lieu of all other warranties, expressed or
implied, including any and all warranties of merchantability and fitness for a
particular use. In no event shall ETS be liable for special or consequential
damages.
(c) REPRESENTATIVE RESPONSIBILITIES
(i) As representatives, representative will be responsible for identifying
customers/prospects, making product presentations, providing contact between ETS
and the customer/prospect in a timely manner, all at representatives own
expense. The representative will make available an adequate number of trained
staff to meet these responsibilities, including a person trained in performing
equipment diagnostics, field service (at board replacement level) and system
setup. Representative, must make this support available to customers after
warranty, at a then reasonable charge. representative will use its best efforts
to promote marketing of the Products.
(ii) Representative agrees to maintain in effect at all times during this
agreement the necessary registrations with any and all governmental agencies,
commercial registries, and other offices as may be required under local law so
as to properly conduct commercial business in the area.
(iii) Representative agrees to maintain an inventory of spare parts for Products
in a quantity sufficient to meet the demands of its customers according to
reasonable recommendations made by ETS. Representative may purchase these spare
parts at a [OMITTED MATERIAL] discount from then current published prices.
Representative will maintain records of inventory of the spare parts on hand and
provide the same to ETS, on request, at reasonable intervals.
(iv) Representative must abide by the appropriate software license agreements
related to Third Party Software as provided by ETS. No other license of Third
Party Software is stated or implied.
(v) Representative will obtain a sublicense agreement in English language with
the customer prior to delivery of the Software or Updates to its customers. Such
sublicense agreement shall have substantially the same meanings of the terms of
ETS Software License Agreement as furnished by ETS.
(vi) Representative will hold in confidence during the term of this agreement
and for one year thereafter, any and all information of a confidential nature
regarding ETS business or affairs, including all data and information related to
software and updates.
All such confidential information of tangible nature shall be marked
"Confidential". Confidential information of an intangible nature will be
indicated in certain other appropriate manner.
Information shall not be considered confidential if:
1) Already known generally to the public.
2) Information which becomes generally available to the public through no fault
of representative or was previously known to representative.
3) Information independently developed by representative independently and
without the aid of information disclosed by ETS.
4) Information which lawfully becomes known to representative through a third
party.
(vii) Representative will refrain from engaging in the sale, marketing, service,
or having business relationships with any company or groups competing products.
MUTUAL RESPONSIBILITIES
(i) ETS agrees to participate in direct customer sales and training seminars in
the geographic area and/or the USA. The cost of visits either by ETS to
representative or representative to ETS will be the responsibility of the
traveling party unless otherwise agreed to in writing prior to the trip. While
at the Eagle facilities, Eagle will provide lodging for the representative at no
cost.
(ii) ETS agrees to provide technical training to representative staff at ETS
Mundelein. The cost of travel for representative personnel will be the
responsibility of representative. The cost of providing the facilities, staff
and lodging for the representative for said training will be the responsibility
of ETS.
If termination action is originated by ETS, then ETS will allow representative
to return spare parts or demonstration equipment and receive a refund of monies
paid according to the following plan:
[OMITTED MATERIAL]
COMPENSATION AND PAYMENT TERMS
ORDERS PLACED BY CUSTOMERS ON EAGLE
a) For orders placed by the end user/customer directly on ETS from the
representative s region, the representative will receive a sales commission. of
[OMITTED MATERIAL]% of the net order. Non-commissionable items are excluded from
commission (not including freight, taxes, C.O.D. charges, or duty)
b) ETS will pay a Service Commission to Representative equal to [OMITTED
MATERIAL]% of commissionable items for systems/products covered in paragraph a).
This service commission is provided as compensation for the Representative
providing service to the customer during the original warranty period. It is
paid at the same time as the sales commission is paid. The Representative agrees
to provide trained service staff (training provided for no charge (travel and
lodging not included) at ETS factory).
If Representative requires the assistance of Eagle personnel to install systems,
then Representative will cover all transportation, lodging and meals for these
personnel. This action activates if problems are unresolved after 3 working
days.
PAYMENT TO REPRESENTATIVE
Orders placed on Eagle Test Systems, Inc. will provide commission to
representative within [OMITTED MATERIAL] Days of receipt of each payment by ETS
from the customer. Eagle have to refund or credit any payment, then the
Representative's compensation will be adjusted accordingly.
SERVICE SUPPORT COMPENSATIONS FOR PRODUCTS TRANSFERRED INTO THE REGIONS
BY THE CUSTOMER IN ANOTHER REGION-(SERVICE COMMISSION)
If a system is purchased from ETS by the customer in another region and directly
shipped to the Representative's region, then the Representative will receive
compensation of [OMITTED MATERIAL]% of the net order (less other commissions
paid). Under no circumstances is any sales commission due Representative for
equipment ordered and delivered in another territory. If ETS systems are shipped
by third parties, then ETS, at its discretion, may choose to have Representative
provide service for the remainder of the warranty, at an annual fee of [OMITTED
MATERIAL]% of the original system cost pro-rated for the remaining term of the
warranty.
ETS will furnish representative at least thirty (30) day written notice of any
price changes made by ETS.
ORDERS are considered valid when accepted by ETS, in writing.
All shipment will be EX-WORKS Manufacturer's factory in Mundelein, IL. ETS shall
retain title to all Software and Updates at anytime.
ORDERS PLACED BY CUSTOMERS ON EAGLE-PAYMENT TO EAGLE
(i) Payment shall be made in such a way as to guarantee a minimum payment of 80%
of total order value at the time of shipment. This can be arranged through a
secured letter of credit or other proper customary methodology. The balance of
the order can be determined by linkage to a set of mutually agreeable and
measurable acceptance criteria.
(ii) Customer shall be responsible for any and all duties, customs , and taxes
imposed by the Applicable Government (exclusive of U.S.A.) or any municipality,
county, or prefecture thereof.
ORDERS PLACED BY REPRESENTATIVE ON EAGLE
(i) Orders placed by Representative on Eagle will receive a discount of [OMITTED
MATERIAL] from present list pricing.
(ii) Payment shall be [OMITTED MATERIAL] at time of order, [OMITTED MATERIAL] at
time of shipment, balance thirty(30) days after invoice date by cash remittance
in U.S. dollars by cable.
(iii) Representative shall be responsible for any and all duties, customs , and
taxes imposed by the Applicable Government (exclusive of U.S.A.) or any
municipality, county, or prefecture thereof
GENERAL ISSUES
Advertising
ETS shall supply free of charge, reasonable quantities of catalogs, brochures,
and the like. Demonstration Bonus
ETS will allow The representative to purchase one demonstration system per year
at an additional discount of [OMITTED MATERIAL] on SYSTEMS. Demonstration
equipment must remain on representative PREMISES for a period of six months
after delivery.
RELATIONSHIP OF PARTIES
The relationship between ETS and representative is that of seller and buyer.
Unless so authorized in writing, neither party shall have the right to assume,
create responsibility, expressed or implied, on behalf of the other party, or to
bind the other party in any manner whatsoever. Neither party shall accept
payment on behalf of the other. Neither party shall be considered an employee or
agent for any purpose. Representative shall not engage in activities which might
cause ETS to be deemed to be doing business in the territory for any purpose.
RESTRICTIONS
Representative shall refrain from doing any of the following without ETS written
consent:
1) Removing, altering, defacing any ETS label, legend, tag, serial number,
notice, trademark, patent number from any ETS product, container, or package.
2) Using any ETS intellectual property, trademark, or trade name, except to the
extent necessary to effect representatives obligations to promote or sell
Product in the area.
3) Affixing any representatives own identifying marks, symbols, trademarks, or
legends to any product of ETS, or any action which may be detrimental to ETS
Proprietary interests in identifying marks, symbols, trademarks, or legends or
other intellectual property rights.
4) Disclosing to any third party proprietary information relating to ETS
products which representative gained as a result of this relationship with ETS.
5) Engaging in any trade practice that would injure the reputation of ETS or its
products.
6) Promoting or selling any products in this territory deemed directly
competitive with ETS products
7) Making any warranties on behalf of ETS which exceed those of ETS as part of
the sale of Product to representative Customer.
TERMINATION
a) This agreement may be terminated on ninety (90) days written notice by either
party during the first year, one hundred twenty days during the second year, and
one hundred fifty days in subsequent years, reason need not be given.
b) In the event of a breach of any material provision of this agreement it may
be terminated upon written notice by either party. The notice must specify the
breach upon which termination is based.
c) Upon termination of this agreement, it shall be understood that the
representative no longer has the right to act as such, however, representative
may continue selling any items in inventory at the time of termination
d) In the event either party becomes insolvent, bankrupt, or court proceedings
are initiated relating to such parties financial instability, this agreement
terminates automatically. Should representative assign this agreement or any of
its obligations without prior written consent of ETS, this agreement terminates
automatically.
e) Upon termination of this agreement, representative shall pursuant to ETS
instructions, return to ETS, all Software, Updates, and Documentation, and all
copies thereof, in representative's possession at time of termination, save one
copy of each to the extent that it is required for customer service provided by
representative after termination.
f) Neither ETS nor representative shall by reason of the termination, be liable
to the other for compensation, reimbursement or damages on account of the loss
of prospective profits on anticipated sales, or on account of expenditures,
investments, leases or commitments made in connection with this agreement.
Notwithstanding the foregoing, nothing contained in this paragraph shall be
deemed to limit or otherwise restrict either parties right to recover damages
for the other parties breach of any provisions of this agreement.
ASSIGNMENT
Both parties may not assign or otherwise transfer any right, title, interest or
obligation hereunder to a successor, affiliate, or subsidiary without the
express written consent of the other. This agreement shall inure to the benefit
of such assignees, transferees, or other successors in the event of an
assignment consistent with the provisions of this agreement.
FORCE MAJUERE
Neither party shall be liable for any breach of this agreement occasioned by an
act of God, labor dispute, unavailable transportation, goods or services,
governmental restrictions, war or other hostilities, or cause beyond the control
of such party. In the event of delay attributable to such causes, the period for
performance of the obligation shall be extended for a period equal to the delay.
A delay beyond 180 days allows either party to terminate this agreement
effective immediately on written notice, stating the termination cause.
NOTICES
Notice shall be deemed effectively given only when delivered personally to an
officer of the party or sent by FAX and confirmed by registered mail addressed
to an officer at the appropriate address for the receipt of such notice:
Eagle Test Systems, Inc.
1353 Armour Blvd.
Mundelein, IL 60060 U.S.A.
representative:
Hypersonic, Inc.,
No. 227-2, Sec.2 Chung-Hwa Rd.
Chung-Li, Tao Yuan
32051 Taiwan R.O.C.
CONFLICTS
Should any conflicts arise concerning this agreement which cannot be resolved by
mutual agreement, action may be brought to resolve the conflict according to the
laws of the State of Illinois, U.S.A.
WAIVER
No waiver by either party of any term or condition of this agreement shall
constitute a waiver of any other term or condition or subsequent condition.
ENTIRE AGREEMENT
Representative acknowledges this agreement constitutes the entire agreement
between the parties and supersedes any and all prior agreements between them.
Any amendment to this agreement must be authorized in writing by qualified
officers of both parties.
By: /s/ Norman Lin By: /s/ Len Foxman
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Norman Lin(Print name) Len Foxman
Managing Director (Title) President
Hypersonic, Inc. Eagle Test Systems, Inc.
DATE: August 9, 2000 DATE: August 17, 2000
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Appendix A
All Standard Items as Listed in the Latest furnished Price List for ETS-564 and
ETS300 Products, not including Calibration, Maintenance, and Training Items.
Appendix B
ETS Shell, Utilities, Statistical, and Graphing Software.