EXHIBIT 10.16
ARRIS INTERACTIVE/MITSUMI
ELECTRIC CO., LTD.
MANUFACTURING AGREEMENT
JULY, 1997
MANUFACTURING AGREEMENT
SECTION 1: DEFINITIONS 4
SECTION 2: SCOPE OF WORK 6
2.1 Design of Products 6
2.2 Manufacturing of Products 6
2.3 Manufacturing Primeship and Location 7
2.4 Manufacturing Scheduling 7
2.5 Quality Assurance 7
2.6 Repairs 7
2.7 New Product Introduction 7
2.8 Cost Reduction and Optimization 7
2.9 Packaging 8
2.10 Program Coordination 8
SECTION 3: PRICING AND PAYMENT TERMS 8
3.1 Pricing of Product and Services 8
3.2 Pricing of New Product(s) 9
3.3 Payment 9
3.4 Invoicing 9
3.5 Taxes 9
3.6 Record Keeping 9
SECTION 4: PURCHASE ORDERS 9
4.1 Purchase Orders 9
4.2 Acceptance of Purchase Orders 9
4.3 Completion 9
SECTION 5: PURCHASE ORDER RESCHEDULING/CANCELLATIONS 10
5.1 Rescheduling 10
5.2 Product Modifications 10
5.3 Cancellation 10
5.4 Cancellation Charges 10
SECTION 6: FORECASTS 11
6.1 Product(s) Forecast 11
SECTION 7: SHIPPING/DELIVERY/TITLE 11
7.1 FOB Terms 11
7.2 Shipping 11
7.3 Delivery in Installments 11
7.4 Title 11
7.5 Late Delivery 12
SECTION 8: MANUFACTURING CAPACITY 12
8.1 Manufacturing Capacity 12
SECTION 9: QUALITY 12
9.1 Quality Assurance 12
9.2 Failure Analysis 13
9.3 Inspection and Acceptance 13
SECTION 10: PREPRODUCTION 13
SECTION 11: SPECIFICATIONS AND COMPONENTS 14
11.1 Specifications 14
11.2 Customer Components 14
11.3 Programs 14
11.4 Design Transfer Process 14
SECTION 12: QUARTERLY OPERATIONS REVIEWS 15
12.1 Reviews 15
SECTION 13: ECNs, CHANGES AND ERRORS, AND EXCESS AND OBSOLETE MATERIALS 15
13.1 Design Control 15
13.2 ECN Class Definitions and Applicability 15
13.3 Responsibility for Cost of ECNs and Actions 15
13.4 Changes and Errors 15
13.5 Approval of Major Changes and Errors 16
13.6 Excess and Obsolete Materials 16
SECTION 14: DEVELOPED INFORMATION 16
SECTION 15: WARRANTY 16
15.1 Manufacturer's Warranty 16
15.2 Manufacturers Duties 17
15.3 Customer Warranty 17
15.4 Conforming Products 17
15.5 Incoming Inspection 17
15.6 DISCLAIMER. 17
SECTION 16: Repairs 18
16.1 Repairs under Warranty 18
16.2 Repairs out of Warranty 18
16.3 Time Limitations 18
16.4 Repair Process 18
SECTION 17: LIMITATION OF LIABILITY 18
17.1 Exclusion of Certain Damages 18
17.2 Time Limitations 18
SECTION 18: INTELLECTUAL PROPERTY RIGHTS 19
18.1 Manufacturer Indemnity 19
18.2 No Other Rights 19
SECTION 19: TERM AND TERMINATION 19
19.1 Term 19
19.2 Termination of Agreement 19
19.3 Payment Obligations 20
19.4 Survival 20
SECTION 20: GENERAL TERMS 20
20.1 Indemnification 20
20.2 Independent Contractor Status 20
20.3 Confidential Information 20
20.4 Freedom of Action 21
20.5 Trademarks and Trade Names 21
20.6 Compliance with Governmental Legal Requirements 21
20.7 Export Controls 21
20.8 Force Majeure 21
20.9 Notice 22
20.10 Assignment 22
20.11 Governing Law 22
20.12 Waiver 22
20.13 Severability 22
20.14 Complete Agreement 23
MANUFACTURING AGREEMENT
THIS MANUFACTURING AGREEMENT (the "Agreement) is made effective as of the ____
day of 1997 (the "Effective Date") by and between Mitsumi Electric Co., Ltd. ,
8-8-2 Kokuryo-cho, Chofu-shi, Tokyo, 182 Japan (hereinafter "Manufacturer") and
ARRIS INTERACTIVE L.L.C., a limited liability company organized under the laws
of the State of Delaware, located at 3871 Lakefield Drive, Suwanee, Georgia,
30024 (hereinafter "Customer").
WITNESSETH:
WHEREAS, Customer desires to have Manufacturer manufacture and assemble certain
Products (as hereinafter defined) pursuant to one or more Purchase Orders (as
hereinafter defined) issued by Customer in accordance with this Agreement; and
WHEREAS, Manufacturer desires to manufacture and assemble such Products for
Customer hereunder;
NOW, THEREFORE, Customer and Manufacturer, in consideration of the mutual
premises contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, agree as follows:
SECTION 1: DEFINITIONS
Capitalized terms used in this Agreement and not otherwise defined herein shall
have the meanings set forth below.
"Affiliate" of a corporation shall mean its subsidiaries, any company
of which it is a subsidiary, and other subsidiaries of such company.
"Bill of Materials" shall mean a listing or reference for the Hardware,
Firmware and Software components included in or required for the
manufacture or assembly of the Products based on their Specifications.
"Changes and Errors" shall mean material, manufacturing labor and
engineering support incurred as the result of the implementation of
product design changes resulting from engineering change notices
("ECNs") issued by the Customer, and applicable to manufacturing
correction or rework of current production in process.
"Components" shall mean parts, materials, firmware and software
listings included in or required for the manufacturing of each Product,
as provided in the Bill of Materials for such Product.
"Days" shall mean calendar days, unless otherwise specified, provided
that if a deadline falls on a Saturday, Sunday, or holiday, it shall be
extended until the following regular business day.
"Delivery" shall mean delivery of Products, FOB Manufacturer's
facility.
"Effective Date" shall mean the date first written above.
"Engineering Change Notice [ECN]" shall mean a Product design change,
manufacturing specification change or process change initiated by the
Customer to address product related issues potentially affecting the
performance, reliability, safety, serviceability, cost,
manufacturability or Form, Fit, or Function of the Products.
"Excess and Obsolete" shall mean surplus in material inventory
resulting from a reduction in production forecast by the Customer or as
a result of a procurement strategic decision initiated by the Customer,
and surplus material resulting from implementation of design changes
and ECNs rendering Components obsolete.
"Firmware" shall mean a combination of (1) hardware and (2) software
represented by a pattern of bits contained in such hardware.
"Form" shall mean physical size, appearance, layout, shape, and
dimensions.
"Fit" shall mean mounting, protocol and interface connections and
operations (i.e., electrical or mechanical connections).
"Function" shall mean product operation, functionality and features.
"Intellectual Property Rights" shall mean any rights under patent,
semiconductor chip protection, copyright, trade secret, trademark, or
similar laws which would restrict the manufacture, assembly, or
distribution of the Products or the subsequent use, sale, or repair of
the Products as purchased by Customer from Manufacturer hereunder.
"Known Product Defect" shall mean documented known field product issues
requiring correction resulting from outstanding product ECNs or
manufacturing defects.
"Manufacturing and Design Documentation" shall mean materials and media
provided to Manufacturer by Customer or third-party contractors,
suppliers, or licensers acting at Manufacturer's request, in each case
specifically for use in the manufacture and assembly of Products
hereunder, including drawings, routings, Bill of Materials, schematics,
circuit diagrams, Specifications, and test documents.
"Nonrecurring Charges" shall mean charges for special engineering work
or other activities listed under this designation in a Statement of
Work.
"Preproduction" shall mean the period proceeding standard manufacturing
where initial pilot production runs are being produced to demonstrate
product functionality, manufacturing processes and test yields.
"Product Code" shall mean an identification code for each Product
components; the .product code will include a product identification
code and a vintage release number to provide traceability of product
changes.
"Purchase Order" shall mean an order to purchase a specific quantity of
a Product submitted by Customer and accepted by Manufacturer in
accordance with this Agreement, which refers to the type and volume and
timing of Products to be manufactured and purchased; price terms;
scheduled delivery dates (unless submitted on open delivery terms); and
"sold to," and "ship to" addresses. The terms of this Agreement control
over any printed terms on a purchase order, acknowledgment,
confirmation, or invoice.
"RF Converter" shall mean printed circuit assembly which converts
coaxial carried RF signals to a digital bit stream, manufactured by
Manufacturer for Customer, and which specifications are listed in
Exhibit "B".
"Specifications" shall mean the description of the Product, performance
and test requirements as provided through detailed drawings, in-process
and final test criteria, or similar documentation.
"Statement of Work" shall mean a document defining a specific task
relating to a particular product or Service, documented and agreed on
by Manufacturer and Customer, which refers to the Specifications for
the Product or Service that the Manufacturer agrees to manufacture,
assemble or perform pursuant to Purchase Orders Customer may submit
hereunder. This Agreement may include multiple Statements of Work and
each Statement of Work shall be considered a separate transaction. The
statement of work shall be within the Scope of Work of this Agreement
as described in Section 2 hereof. The Statement of Work price terms and
applicable manufacturing and testing procedures for each Product will
be set forth in a Statement of Work. A Statement of Work may be
implemented by reference to a new or change in a particular product.
"Tooling" shall mean all patterns, tools, jigs, dies, equipment.
"Voice Ports" shall mean end subscriber located modules, manufactured
by Manufacturer for Customer which interface with the cable network and
provide standard or premium telephone or data services to the connected
subscribers and which specifications are listed in Exhibit "B".
SECTION 2: SCOPE OF WORK
Manufacturer agrees to perform for Customer the tasks and services described
hereafter, with respect to the Products described within this agreement and
according to the accepted schedules and budgets therein, as modified from time
to time by mutual agreement, under the specific direction of the designated
Technical Coordinator of Customer. Specific requirements from Customer will be
addressed with "Statements of Work" defining the task, schedules and budgets
items related to a specific requirement. Each Statement of Work will be within
the boundary of this Scope of Work, unless modified by mutual agreement.
2.1 DESIGN OF PRODUCTS.
Manufacturer shall provide design and manufacturing services and
coordinate with such of its affiliates or subcontractors to produce
product(s) meeting the specifications in Exhibit "B" per the
schedule(s) given in Exhibit "C" as they may be mutually amended.
2.2 MANUFACTURING OF PRODUCTS.
Manufacturer shall manufacture and shall coordinate with such of its
affiliates or subcontractors (as Customer agrees by written consent,
which shall not be unreasonably withheld) and sell Products to
Customer, and Customer shall order and purchase Products from
Manufacturer, in accordance with the terms and conditions of this
Agreement. Manufacturer shall deliver to Customers specified location
only that quantity of Products specified in Customers Purchase Orders,
at prices set forth in such Purchase Orders. Manufacturer shall be
responsible for final assembly and system level testing of all products
assembled and/or manufactured under this agreement. The initial product
list to be manufactured by Manufacturer are outlined in Exhibit "A"
herewith. Customer reserves the right to amend this product list from
time to time based on market requirements.
2.3 MANUFACTURING PRIMESHIP AND LOCATION.
Manufacturer agrees that Customer has internally qualified Akita
Mitsumi Co., Ltd., Japan facilities as the prime manufacturing
facilities to perform all Manufacturer's obligations under this
Agreement. Accordingly, Manufacturer shall not move or otherwise
transfer production of any Products from this facility without the
prior, written consent of Customer, which consent shall not be
unreasonably withheld. Each party shall provide the other with
reasonable .access to its facilities reasonably required in connection
with the performance of each party's respective, obligations under this
Agreement. Manufacturer can elect to use sub-contractors to manufacture
sub-assemblies of a product. In such case, Manufacturer shall be
responsible for any sub-contracting agreements concerning the
manufacture of products sub-assemblies, the co-ordination of
manufacturing schedule and the overall quality of the finished
products.
2.4 MANUFACTURING SCHEDULING
Manufacturer shall coordinate the manufacturing scheduling and material
planning with regard to the Products to be manufactured with all
necessary affiliates and subcontractors and shall manage the overall
production plan and shipments thereunder in accordance with the
Manufacturing Forecast provided by Customer in accordance with Section
6 hereof, and the Delivery Dates set forth in the Purchase Orders.
2.5 QUALITY ASSURANCE.
Manufacturer shall build and test the Products in accordance with the
test procedures and specifications as developed by Manufacturer and
agreed to by Customer. Manufacturing test data will be maintained by
Manufacturer for at least two (2) years from the date of such test and
will be available for inspection by Customer during normal business
hours upon reasonable notice.
2.6 REPAIRS
Manufacturer shall manage the Repairs process in accordance to Section
16 of this Agreement.
2.7 NEW PRODUCT INTRODUCTION
Upon Customer request, Manufacturer shall provide timely
manufacturability assessment, test and production engineering support
for new and cost reduced Product that is proposed to be introduced by
Customer. Customer shall use commercially reasonable efforts to provide
a forward view of the Product development plan and timing for new
products. Each new Product will be addressed with a separate Statement
of Work defining the deliverables and schedules.
2.8 COST REDUCTION AND OPTIMIZATION.
Manufacturer shall use its best efforts to aid Customer with respect to
its cost reduction of the Products and shall procure materials and
services for the Products such that the lowest overall Product cost is
achieved. Manufacturer shall work with Customer to optimize the
manufacturing of the Products. In the event that lower total product
cost can be achieved through outside subcontracting of manufacturing of
specific Products, Manufacturer and Customer shall use their best
efforts to transfer out manufacturing of these Products by the
Manufacturer in favor of the lower total cost option.
2.9 PACKAGING
Packaging shall be in accordance with Customer's standards, unless
otherwise mutually agreed in writing. Customer shall specify in each
Statement of Work, or otherwise as agreed by the parties, the
trademarks and trade dress features to appear on the Products and the
publications to be included in packaging.
2.10 PROGRAM COORDINATION.
Each party shall appoint Program coordinators to provide operational,
commercial and technical liaison with the other party hereto in
connection with the manufacture and the delivery of the Products. Each
coordinator shall be responsible to provide the official point of
interface within each party and will be prime to the provide
coordination within their respective organization for all aspect of the
execution of this agreement.
Manufacturer Program Coordinator:
Takeshi Naito
Phone; 81-3-3489-3800
Fax; 81-3-3488-1228
Customer Program Coordinator:
Jeff Milway
Phone; 770-622-8644
Fax; 770-622-8645
SECTION 3: PRICING AND PAYMENT TERMS
3.1 PRICING OF PRODUCT AND SERVICES
Pricing for each Product units shall be mutually agreed upon by the
parties and shall be defined as follow:
(i) a pricing schedule for current Products to be manufactured by
Manufacturer on a "standard production" basis (Exhibit "A");
(ii) a pricing schedule for repair services (Exhibit "D");
All prices are in U.S. dollars unless otherwise stated.
Exhibits "A" and "D" are incorporated herein by reference. Manufacturer
will sell Products and Services to Customer at the prices indicated on
such Exhibits. Changes to pricing schedules shall be mutually agreed on
by the parties in connection with each material change in an applicable
Bill of Materials for each Product. The parties understand that, during
the term hereof, different Products may be manufactured and sold to
Customer by Manufacturer upon mutual agreement of the parties.
Manufacturer and Customer may agree to amend pricing schedules
accordingly. The pricing in Exhibits "B" is subject to periodic review
and change by written agreement of the parties.
Unless otherwise expressly stated in writing, Manufacturer's prices are
exclusive of charges for Product(s) transportation and other related
services, and any sales or other tax or duty which Manufacturer may be
required to collect or pay upon the ordered transaction. Premium
transportation may be used with Customer's concurrence to expedite
delivery but only upon Customer's written request and expense. Premium
transportation shall be used by Manufacturer, at its own cost, if
necessary to meet Order delivery dates.
3.2 PRICING OF NEW PRODUCT(S)
Prices for new Product units shall be mutually agreed upon by the
parties and shall be defined according to section 3.1 of this
agreement.
3.3 PAYMENT
Payment terms are net/45 days from the date Manufacturer issues an
invoice.
3.4 INVOICING
Manufacturer may invoice for Products upon completion and shipment of
such Products pursuant to Purchase Orders. To the extent Manufacturer
is entitled to do so under a Statement of Work, Manufacturer may
invoice monthly for other Services performed, if any, as set forth in
the applicable Statement of Work.
3.5 TAXES
Customer shall be responsible for sales, use, or custom taxes or duties
resulting from the sale or shipment of Products in accordance with its
Purchase Orders. Customer shall provide tax exemption numbers, if
applicable, for such purchases.
3.6 RECORD KEEPING
Manufacturer shall its maintain records and shall implement mutually
agreeable accounting classifications such that charges to Customer are
separately identified.
SECTION 4: PURCHASE ORDERS
4.1 PURCHASE ORDERS
Customer will provide Purchase Order(s) on a monthly basis, as its
needs require. Such Purchase Order(s) will cover a forward period of a
minimum of 60 days.
4.2 ACCEPTANCE OF PURCHASE ORDERS
Manufacturer shall accept Purchase Orders conforming to the
requirements of this Agreement and Statements of Work then in effect.
Manufacturer shall indicate its acceptance of proposed Purchase
Order(s) by written acknowledgment of the Purchase Order(s) for
quantity and delivery timing requested within ten (10) days after its
receipt thereof. Customer shall expect that delivery quantities and
timing will be as requested provided that such quantities are within
the Product(s) Forecast.
4.3 COMPLETION
Upon acceptance of each Purchase Order, Manufacturer will manufacture
and assemble the Products called for by such Purchase Order, conduct
final testing, and package the Products in accordance with the
Products' Specifications.
SECTION 5: PURCHASE ORDER RESCHEDULING/CANCELLATIONS
5.1 RESCHEDULING
Manufacturer agrees to use commercially reasonable efforts to
accommodate Customer's requests for rescheduling (both acceleration and
delay), from time to time. Before accepting such rescheduling requests,
Manufacturer may quote applicable charges resulting from changes in
costs associated with such rescheduling to Customer. If the parties are
unable to agree on such changes in charges, then Manufacturer shall
deliver the Products as initially agreed, subject to Customer's right
to cancel Purchase Orders as provided herein.
5.2 PRODUCT MODIFICATIONS
Manufacturer agrees to use commercially reasonable efforts to
accommodate changes in versions of a Product within a reasonable time
after receiving a written request for such change.
5.3 CANCELLATION
Customer may, by written notice, cancel shipments of Products that are
scheduled for delivery more than thirty (30) days after Manufacturer's
receipt of such notice. Upon Manufacturer's receipt of a notice of
cancellation, Manufacturer shall stop work on the canceled Portion of
existing Purchase Orders immediately. Manufacturer agrees to use its
best efforts to return, reuse, or sell any Manufacturer Components that
comprise the canceled portion of the applicable Purchase Order and
Manufacturer will use its best efforts to effectively minimize all
other costs associated with such cancellation.
5.4 CANCELLATION CHARGES
With respect to canceled Purchase Orders, Customer agrees to pay
Manufacturer:
(a) For Components (other than items paid for by Customer)
acquired solely for the execution of such Purchase Order,
Customer shall pay to Manufacturer, Manufacturer's actual
costs for such Components, minus amounts saved as a result of
any return, reuse, or sale of such Components; plus
(b) For completed work and work in progress that cannot be used
to fill other orders, Customer shall reimburse Manufacturer's
costs for actual and reasonable labor and supplies incurred
pursuant to Customer's Purchase Orders up to the date of
receipt of notice of cancellation.
(c) Customer shall be responsible for long lead-time materials
purchased by Manufacturer, with prior written approval from
Customer, outside the immediate 60 day Firm Purchase Order
period.
In no event shall cancellation charges set forth previously exceed the
price of the Products covered by the canceled portion of the Purchase
Order.
Manufacturer will provide Customer with documentation adequate to
support its claim for cancellation charges. Components and completed
work and work in progress that are paid for by Customer pursuant to
such cancellation charges shall be Customer's property and shall be
held or delivered to Customer as Customer may reasonably request
Notwithstanding the foregoing, Customer shall have no obligation to pay
cancellation charges if the cancellation is occasioned by the failure
of Manufacturer to perform its obligations under this Agreement.
SECTION 6: FORECASTS
6.1 PRODUCT(S) FORECAST
(a) Customer shall provide its Product(s) forecasts in the following
manner:
Days from Shipment Required Specifically
----------------------------------------------------------------
0 to 60 Days Firm Order
61 to 90 Days 30% variation from previous forecast
91 to 120 Days 75% schedule variation from previous forecast
12 months Rolling forecast updated quarterly
(b) Orders shall be managed in weekly intervals within the immediate 90 day
period and monthly within the rest of the 12 month period. Customer
shall provide monthly forecasts and except as provided in a Purchase
Order, forecast information shall be for planning purposes only and
shall not represent Customers commitment to purchase any or all of such
units or create any other obligation whatsoever by Customer beyond the
immediate 60 day period.
(c) Manufacturer shall provide acknowledgment and factory delivery
commitments to the above requirements within 5 working days for 0 to 60
day requirements and 10 working days for 61 day and over requirements.
(d) Manufacturer will provide weekly shipment reports detailing all Product
Codes shipped, quantity, value and "Ship to" customer.
SECTION 7: SHIPPING/DELIVERY/TITLE
7.1 FOB TERMS
All deliveries of Products covered under this Agreement shall be made
Manufacturer FOB Manufacturer's facility freight collect, or prepaid by
Manufacturer and charged to Customer per Invoice. Customer may specify
the carrier by so indicating within a mutually agreeable, reasonable
period of time prior to shipment. If Products are designated for
export, Customer is responsible for assuring compliance with applicable
export laws, and Customer will provide Manufacturer with instructions
for the handling of such export shipments.
7.2 SHIPPING
Shipping will be planned to meet commitments with the most economical
shipping arrangements for both Customer and Manufacturer. All shipments
will be marshaled and Product(s) may not be shipped incomplete, except
as may be mutually agreed to by the parties.
7.3 DELIVERY IN INSTALLMENTS
Manufacturer may fill a Purchase Order in installments, but only in
mutually agreeable partial quantities and at mutually agreeable
intervals. Manufacturer may not Ship incomplete Products at any time,
unless pre-approved by Customer.
7.4 TITLE
Title to any Manufacturer Components included in the Products will pass
to Customer upon the earlier of delivery to Customer or Manufacturer's
receipt of payment for such items. To the extent not otherwise provided
in this paragraph, title to Products will pass to Customer at point of
shipment. Customer Components shall be held by Manufacturer as on
consignment from Customer and shall be accounted for by Manufacturer
and cared for in accordance with commercially reasonable standards.
Title to Customer Components will remain with Customer, but
Manufacturer shall have a purchase money security interest against the
Products until receipt of payment from Customer.
7.5 LATE DELIVERY
Manufacturer agrees that it shall deliver the Products ordered by
Customer hereunder on, or not earlier than 10 calendar days before, the
Delivery Dates specified in the Purchase Orders. Manufacturer shall
immediately notify Customer of any anticipated late deliveries and any
impending plant or facility shutdowns for any reason; including
vacation, tool repair, labor difficulties or governmental order, which
may adversely impact the scheduled Delivery Dates. In the event that
Manufacturer is delinquent on delivering a Product to Customer for
reasons other than a force majeure, Manufacturer shall deliver such
Product to Customer in the most expeditious manner possible and the
payment of premium transportation costs associated with the delivery of
the Product shall be at Manufacturers expense. Furthermore, any
deliveries made more than 30 days beyond the Delivery Date specified in
s Purchase Order shall result in Manufacturer being required to prepare
a written corrective action plan and delivering such to Customer,
specifying the causes for such delay and the corrective action to be
taken as a result thereof, and Customer shall have the right to
terminate the Purchase Order to which such delivery relates without any
liability for such termination.
SECTION 8: MANUFACTURING CAPACITY
8.1 MANUFACTURING CAPACITY
Manufacturer warrants that it currently has the installed capacity to
produce manufacturing output of 10,000 RF Converters per month.
Manufacturer agrees to use its best efforts to accommodate capacity
increases if requested by Customer, from time to time. Notwithstanding
the foregoing, Manufacturer agrees that it will accommodate an increase
in capacity within 90 days with a preapproved forecast or 180 days from
the date of request of production output.
SECTION 9: QUALITY
9.1 QUALITY ASSURANCE
Prior to first Production start for each Product(s), Manufacturer shall
provide Customer with a specific product quality plan satisfactory to
Customer.
Manufacturer agrees that all shipments and products shall be verified
for compliance with the agreed Customer's test specifications for each
Product(s); test and verification records will be logged and kept
available for a period of 24 months from the period of shipment for
each Product(s).
Further, the parties agree that regular quality reviews will be held no
less frequently than on a quarterly basis at such time and place as
mutually agreed to by the parties. Reasons for such meetings may
include, but shall not be limited to:
(a) Review of quality acceptance criteria;
(b) Review of test process for quality or cost improvement;
(b) Quality performance and receiving inspection/installation
results;
(c) Corrective action results/change control; and
(d) Field problem reviews and regulatory impacts.
In addition, Manufacturer agrees to:
(a) Respond in a timely manner to Customers quality related
corrective action requests as a result of quality
non-conformance;
(b) Allow inspections and periodic quality audits by Customer to
determine product conformance to quality criteria and
(c) Manufacture Products in compliance with applicable
requirements hereunder and as required by law.
Manufacturer shall notify Customer promptly of product(s) or quality
issues identified in the course of the manufacturing process. Customer
shall provide prompt technical assistance to Quality and Product
related issues. Manufacturer has the right to stop manufacturing lines
to limit product defects exposure, except as otherwise provided herein.
9.2 FAILURE ANALYSIS
Manufacturer agrees to support Customer in the performance of failure
Root Cause analysis such that product issues can be solved at the
source.
Customer agrees to share with Manufacturer all pertinent data that can
improve product quality of process reliability.
9.3 INSPECTION AND ACCEPTANCE
Customer may notify Manufacturer in writing of particular deficiencies
in the Products, from time to time, but failure to give such notice
of such deficiencies shall not prejudice warranty claims hereunder.
Products will be deemed accepted by Customer if a notice of
deficiency is not received by Manufacturer within fifteen (15) days
after Customer's receipt of the Products. Manufacturer's
responsibility for deficiencies shall be as provided for under the
warranty provisions of this Agreement.
SECTION 10: PREPRODUCTION
When, requested, Manufacturer shall support Customer in the
introduction of New Product(s) throughout the preproduction product
cycle including the following tasks;
(a) Manufacturability assessment
(b) Product testability assessment
(c) Component sourcing
(c) Manufacturing and test process design
(d) Manufacturing launch
The Preproduction tasks required, for each "new Product will be covered
by specific Statements of Work.
SECTION 11: SPECIFICATIONS AND COMPONENTS
11.1 SPECIFICATIONS
Customer shall have primary responsibility for the preparation of
Specifications for the Product. Customer shall provide Manufacturer
with copies of preliminary, working draft, and completed portions of
the Specifications for review. The parties agree to cooperate with each
other to implement changes to the Specifications made by Customer from
time to time. The parties shall jointly review the impact of such
changes, and, in the event Manufacturer reasonably believes that any
such change will affect the work performed by Manufacturer under this
Agreement, it shall notify Customer and advise Customer of any such
effect, including any impact on the manufacture or assembly of the
Product, design considerations, and the costs to be incurred by
Manufacturer and Customer as a result of such changes.
11.2 CUSTOMER COMPONENTS
Customer may identify to Manufacturer certain Components that must be
used in the manufacturing of the Product. Either these Components may
be consigned by Customer or Manufacturer may be directed by Customer to
purchase such components from Customer's approved vendor list ("AVL").
If Manufacturer offers alternatives to Customer's AVL, the alternative
must be approved in writing by Customer prior to use in production of
Products.
11.3 PROGRAMS
If third party Software is incorporated in the Products, procurement of
such Software shall be the responsibility of Manufacturer or Customer
as set forth in the applicable Statement of Work or Bill of Materials.
Any restrictions or payment obligations imposed by the original source
on Manufacturer's or Customer's use or handling of such Software shall
be set forth in a separate signed writing. There shall be no payment or
reimbursement obligation on Customer's part for programming obtained or
provided by Manufacturer unless such payments or reimbursements are set
forth in a Bill of Materials that indicates that Customer has accepted
such obligation. Title to any Programs and other Proprietary
Information provided by Customer to Manufacturer (by license or
otherwise) to be used in the manufacturer of Products will remain with
Customer and Manufacturer shall use such Programs and other Proprietary
Information solely for the purpose contemplated by this Agreement.
Customer hereby grants to Manufacturer a personal and nonexclusive
license to use the Programs in and for the Products during the term of
this Agreement. Manufacturer may only make such copies of the Programs
as are necessary for it to perform its duties hereunder, plus one copy.
Manufacturer shall immediately return such Programs, permitted copies
and Proprietary Information to Customer upon termination of this
Agreement.
11.4 DESIGN TRANSFER PROCESS
It is expected that Manufacturer provide capability to allow electronic
transfer of all design information. The actual extent and format of
product design information shall be mutually agreed.
SECTION 12: QUARTERLY OPERATIONS REVIEWS
12.1 REVIEWS
Customer and Manufacturer agree to review quarterly the business
performance of each party. Such review shall include items such as
product delivery, production forecast, product performance, quality,
pricing, and new designs.
SECTION 13: ECNS, CHANGES AND ERRORS, AND EXCESS AND OBSOLETE MATERIALS
13.1 DESIGN CONTROL
Customer shall be the sole design authority for the Products and as
such may issue, from time to time, Engineering Change Notices [ECNs].
Customer shall retain engineering control over the entire Product,
including Components, sub-assemblies and all other data and material.
Manufacturer shall provide on request, to the Technical Coordinator of
Customer, process information and specifications, Bills of Materials,
updated versions of all drawings, tool drawings, manufacturing and test
documentation, software, and other Information as may be reasonably
required for the manufacture of the Products ("Manufacturing Data")
promptly after such material has been created and thereafter at the
request of Customers Program Coordinator. Such information shall be
furnished in English.
13.2 ECN CLASS DEFINITIONS AND APPLICABILITY
"Class 1 ECNs" apply to hazardous conditions or inoperative conditions
and must be implemented immediately for all new production, work-in
process and stock on hand in Manufacturer's facilities. "Class 2 ECNs"
apply to Products that fail published specifications or experience
excessive field failure rates which must be implemented on any new
production after a planned, mutually agreed to, implementation date as
soon as possible, "Class 3 ECNs" apply to new feature, cost
improvement, or material substitution on Products and shall be
implemented on any new production after a planned, mutually agreed to,
implementation date. "Class 4 ECNs" apply to new feature, cost
improvement, or material substitution on products after a planned
implementation date determined by Manufacturer to minimize scrap
material costs. "Class 5 ECNs" shall be issued by Customer which apply
to new Products produced by Manufacturer indicating product acceptance
by Customer. Customer shall issue ECN's to Manufacturer from time to
time and the responsibility for the costs of such ECN's is set forth in
Section 13.3.
13.3 RESPONSIBILITY FOR COST OF ECNS AND ACTIONS
Charges for ECN's needed due to product specification error/changes are
the responsibility of Customer. All other charges due to ECN's are
responsibility of Manufacturer.
13.4 CHANGES AND ERRORS
Customer is responsible for costs of Changes and Errors resulting from
Engineering Design Changes requested by the Customer and shall be
billed for such costs by Manufacturer. Manufacturer is responsible for
all Changes and Errors resulting from defects in workmanship and
resulting from Engineering Design Changes requested by the
Manufacturer.
13.5 APPROVAL OF MAJOR CHANGES AND ERRORS
All costs of Changes and Errors in excess of $10,000 must be
pre-approved in writing by Customer. Manufacturer shall provide monthly
Changes and Errors reports to Customer in a format as shall be mutually
agreed.
13.6 EXCESS AND OBSOLETE MATERIALS
Customer is responsible for all costs resulting from a reduction in
forecast exceeding the ordering rules outlined in Section 6.1 and
Customer is responsible for all obsolete material resulting from
engineering design changes requested by Customer. Manufacturer is
responsible for the cost of all other Excess and Obsolete materials.
Customer will accept Excess and Obsolete charges at the time of the
final disposition of such material to the extent Customer is
responsible: for such changes as outlined above. Manufacturer and
Customer shall review such Excess and Obsolete materials monthly to
ensure compliance with the terms herein.
SECTION 14: DEVELOPED INFORMATION
The parties agree that Manufacturer is performing research or
development activities, manufacturing and assembly services for
Customer and it is specifically agreed that Customer is not conferring
on Manufacturer any Intellectual Property Rights or licenses concerning
Customer's Products and that all design plans are the Property of
Customer. If Manufacturer does design or develop anything related to
Customers Products and Product designs, such "Improvements" shall be
promptly disclosed to Customer and they shall be considered "work for
hire" and belong to Customer or alternatively Manufacturer agrees to
promptly disclose to Customer any such "Improvement" and assign all
such rights exclusively to Customer. "Improvements" shall include
improvements, changes, additions, and modifications to Customer's
Product design and Intellectual Property, but shall not include
Manufacturer's general practices and knowledge, pre-existing
intellectual property, designs, and individual components and other
intellectual property not specifically related to the Product.
SECTION 15: WARRANTY
15.1 MANUFACTURER'S WARRANTY
Manufacturer warrants that the Products manufactured hereunder, under
normal use and service, will be free from defective material and faulty
workmanship and will perform in accordance with Customers applicable
Specifications for a period, of 20 months from the date of manufacture;
provided, however, that Manufacturer shall have no liability for any
defects as a result of specification flaws. This warranty does not
apply to items normally consumed in operation, such as lamps and fuses.
Manufacturer's sole obligation and Customer's exclusive remedy under
this warranty is limited to the replacement or repair, at Manufacturers
option and expense, of the defective Products, and such obligation and
remedy are conditioned upon the Products not having been altered by any
party other than Manufacturer without Manufacturer's prior written
consent, and the defect not being the result of mishandling, abuse,
misuse or improper storage, operation, or maintenance, or other causes
not imputable to Manufacturer and upon the Products not having been
damaged by fire, explosion, power failure, or any act of nature or
public enemy. Repair or replacement Products furnished during the
warranty period shall be warranted for a period of one hundred and
twenty (120) days or the remainder of the original warranty whichever
is longer. The aforementioned warranties shall inure to Customer, its
successors and assigns, and those who
purchase or use each Product Manufacturer warrants that the Product
delivered to Customer is free and clear of all liens and encumbrances.
15.2 MANUFACTURERS DUTIES
Manufacturer shall maintain product test logs for all products shipped
for a period of 24 months and shall make such information available to
Customer on request. Product related issues identified in field returns
shall be documented by Manufacturer and reported in writing to Customer
as soon as practicable. Manufacturer shall assist Customer in
performing root cause analysis of field failures and make such
information available to Customer on request. Manufacturer shall have
no responsibility for defects in Customer Components with no design
root cause; but Manufacturer agrees to cooperate in processing
applicable third-party warranty claims and in taking advantage of
remedies, if any, available from the original sources of such Customer
Components. Issues resulting from Warranty administration must be
reported monthly in writing by Manufacturer and both parties shall use
their best efforts to achieve prompt resolution of any open issues.
15.3 CUSTOMER WARRANTY
Customer warrants it has the right (1) to consign Customer Components
to Manufacturer for incorporation in the Products in accordance with
the Manufacturing and Design Documentation and (2) to authorize
Manufacturer to use, for purposes of manufacturing and assembling the
Products hereunder, any information provided by Customer and contained
in the Manufacturing and Design Documentation.
15.4 CONFORMING PRODUCTS
For Products that are returned to Manufacturer by Customer for warranty
repair or replacement and are found by Manufacturer to conform to the
Product Specifications and such conformity is verified by Customer,
Customer shall pay Manufacturer shipping charges and duties.
15.5 INCOMING INSPECTION
All incoming lots are subject to sampling and inspection according to
MIL STD-105D, level 2, normal inspection, single sampling, AQL level =
1.0. Lots will be subject to acceptance or rejection as per the above
criteria. Rejected lots will be submitted to the Manufacturer for 100%
inspection and correction. Customer and Manufacturer reserve the right
to reject any defective units, regardless of whether the lot as a whole
is accepted or rejected. A unit is considered defective if it (or any
section of it) fails to work or it fails to meet any specification
listed in this document. Units exhibiting inadequate or poor
workmanship may also be considered defective.
15.6 DISCLAIMER.
THE FOREGOING WARRANTIES AND REMEDIES CONSTITUTE THE ONLY WARRANTIES
WITH RESPECT TO PRODUCTS AND ARE CUSTOMER'S EXCLUSIVE REMEDIES IN THE
EVENT SUCH WARRANTIES ARE BREACHED. SUCH WARRANTIES ARE IN LIEU OF ALL
OTHER WARRANTIES, WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPUED.
INCLUDING WITHOUT LIMITATION, ANY WARRANTY WITH RESPECT TO ANY OTHER
SERVICES PROVIDED BY MANUFACTURER HEREUNDER OR OTHERWISE, AND ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
NEITHER PARTY SHALL BE LIABLE FOR ANY INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES OF ANY NATURE FOR ANY REASON.
SECTION 16: REPAIRS
Manufacturer agrees to provide repairs services for Product it
manufactures. Stock classes applicable to repairs are set forth in
Exhibit "F".
16.1 REPAIRS UNDER WARRANTY
Manufacturer is responsible for the cost of repairs where workmanship
defects are identified, subject to the terms set forth in section 15.
Customer shall be responsible for costs of repair where specification
related defects are identified. Manufacturer can replace product with
"like for like" replacement Class B stock.
16.2 REPAIRS OUT OF WARRANTY
The price schedule for out of warranty repairs is set forth in Exhibit
"D".
16.3 TIME LIMITATIONS
Manufacturer must retain repair capabilities for the product component
set forth in Exhibit "A" for a period of 7 years.
16.4 REPAIR PROCESS
a) Manufacturer shall coordinate the management of repairs and
returns, and shall coordinate the management of repairs and
returns with such of its affiliates or subcontractors (as
Customer agrees by written consent, which shall not be
unreasonably withheld).
b) Manufacturer shall proceed with the repair of Class C
product(s) as defined in Exhibit "E" within twenty-one (21)
calendar days from the date of receipt at Manufacturer's site.
In the event that any Product is not capable of being repaired
by Manufacturer on a timely basis, it shall be replaced with a
Class A Product as defined in Exhibit "E".
c) Manufacturer shall establish return depots in North America
and Japan.
SECTION 17: LIMITATION OF LIABILITY
17.1 EXCLUSION OF CERTAIN DAMAGES
IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR INDIRECT, SPECIAL,
INCIDENTAL, OR CONSEQUENTIAL DAMAGES, LOSS OF PROFITS, LOSS OF USE, OR
DATA OR INTERRUPTION OF BUSINESS, WHETHER SUCH ALLEGED DAMAGES ARE
LABELED IN TORT, CONTRACT, OR INDEMNITY, EVEN IF SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
17.2 TIME LIMITATIONS
Actions by either party, however asserted, other than in respect of any
infringement of Intellectual Property Rights, shall be commenced within
two years from the date the cause of action accrues.
SECTION 18: INTELLECTUAL PROPERTY RIGHTS
18.1 MANUFACTURER INDEMNITY
Manufacturer, at its own expense, shall protect, defend, hold harmless,
and indemnify Customer and any subsequent owner of the Products, and
shall pay any damages, agreed upon settlement amounts, or necessary
costs (including attorney fees and fines) finally awarded with respect
to all proceedings or claims against it or them for the infringement of
any Intellectual Property Rights resulting from Manufacturer's
manufacture and assembly processes or the use of Manufacturer
Components where such use necessarily and solely causes the
infringement. Manufacturer shall not have any liability hereunder based
on (1) required compliance by Manufacturer with manufacturing and
design documentation originating with and furnished by Customer (or the
combination. of the Products with other apparatus not included in the
deliveries to Customer), if such compliance (or combination)
necessarily and solely gives rise to such proceedings or claims; (2)
infringement or alleged infringement caused solely by Customer
Components; or (3) infringements resulting from modifications or
alterations made after shipment by Manufacturer. Customer shall not
agree to settle any such proceeding or claim without ~e written consent
of Manufacturer, which consent shall not be unreasonably withheld.
18.2 NO OTHER RIGHTS
Except for any licenses and immunities that are expressly granted by
this Agreement, nothing in this Agreement or any course of dealing
between the parties will be deemed to create a license from either
party to the other of any Intellectual Property Right, whether by
estoppel, implication, or otherwise.
SECTION 19: TERM AND TERMINATION
19.1 TERM
This Agreement shall commence on the Effective Date and shall be in
effect until December 31, 1998 Thereafter, this Agreement shall
automatically renew for successive terms of one year unless and until
terminated pursuant to Section 19.2.
19.2 TERMINATION OF AGREEMENT
This Agreement may be terminated by either party at any time upon the
occurrence of any one or more of the following events of default:
(a) The other party defaults in the performance of any material
requirement or obligation under this Agreement or any other
written agreement between the parties concerning the subject
of this Agreement, and such default is not cured within 20
days after written notice of such default is sent to such
party;
(b) Customer fails to make (in full) any payment required by this
Agreement to Manufacturer on the date due, and fails to cure
such default within 20 days after written notice of such
default is sent to Customer; or
(c) The other party ceases to do business, makes a composition or
assignment for the benefit of its creditors, makes a general
arrangement with its creditors concerning any extension or
forgiveness of any of its secured debt, becomes bankrupt or
insolvent, suffers or seeks the
appointment of a receiver to the whole or any material part of
its business, takes any action to liquidate or wind up the
whole or any material part of its business, is found subject
to any provisions of any bankruptcy code concerning
involuntary bankruptcy or similar proceeding, or suffers a
material adverse change in its financial position such that
payments hereunder may be affected or delayed by a creditor or
administrator of the business of the other party.
In addition, either party may terminate this Agreement for convenience
on a 9 months prior written notice to the other party.
In the event of termination of this Agreement, Manufacturer agrees that
the Customer will have the option to purchase the dedicated test
equipment, texturing and tools used for the manufacturing and test of
the Product(s). Manufacturer agrees to sell such equipment at actual
depreciated book value at the time of termination.
19.3 PAYMENT OBLIGATIONS
No termination of this Agreement shall release Customer from any
obligation to pay Manufacturer any amount that has accrued or become
payable at or prior to the date of termination.
19.4 SURVIVAL
Notwithstanding any termination of this Agreement, the provisions of
Section 20.3 shall continue in accordance with its terms.
SECTION 20: GENERAL TERMS
20.1 INDEMNIFICATION
Each party shall indemnify and defend the other party against all
claims, suits, losses, expenses, and liabilities for bodily injury,
personal injury, death, and property damage directly or indirectly
caused by any Products or through the intentional acts or negligence of
such party or of any person for whose actions said party is legally
liable. Both parties shall carry and maintain liability insurance
coverage to satisfactorily cover its obligations under this Agreement.
20.2 INDEPENDENT CONTRACTOR STATUS
Each of the parties hereto shall conduct the work to be performed
hereunder as an independent contractor and not as an agent or employee
of the other party. Subject to the terms and conditions of this
Agreement, each party shall choose the means to be employed and the
manner of carrying out its obligations hereunder. Each party shall have
sole responsibility for the supervision and payment of its personnel
and, except as agreed in writing, all other costs and expenses required
to perform its obligations hereunder.
20.3 CONFIDENTIAL INFORMATION
All technical information, specifications, drawings, documentation and
"know-how" of every kind and description whatsoever disclosed by either
party to the other under this Agreement ("Information"), except insofar
as it may be in the public domain or be established to have been
independently developed and so documented by the other party or
obtained by the other party from any person not in breach of any
confidentiality obligations to the disclosing party, is the exclusive
property of the disclosing party, and the other party, except as
specifically authorized in writing by the disclosing party, or as
permitted hereunder, shall treat and protect the Information as
confidential, shall not reproduce the Information except to the extent
reasonably required for the performance of this Agreement, shall not
divulge the Information in whole or in part to any third parties, and
shall use the Information only for purposes necessary for the
performance of this Agreement. This obligation shall survive the
termination of this Agreement. Each party shall disclose the
Information only to those of its employees and agents who shall have a
"need-to-know" the Information for the purposes described herein after
first making such employees or agents aware of the confidentiality
obligations set forth above.
20.4 FREEDOM OF ACTION
Except as restricted by Intellectual Property Rights of a party hereto
or of third parties, nothing in this Agreement shall limit the right of
Customer or Manufacturer to develop, have developed, procure, and/or
market products or services now or in the future, including any that
may be competitive with those that are subject of this Agreement.
Neither party shall be required to disclose planning information to the
other except for the forecast described in Section 6 and as may be
mutually agreed upon by the parties.
20.5 TRADEMARKS AND TRADE NAMES
Neither this Agreement nor the sale of Products hereunder shall be
deemed to give either party any right to use any of the other party's
trademarks or trade names without such other party's specific, written
consent.
20.6 COMPLIANCE WITH GOVERNMENTAL LEGAL REQUIREMENTS
Manufacturer shall comply with the provisions of all applicable
federal, state, and local laws, regulations, rules, and ordinances
applicable to the transactions governed by this Agreement. Customer
shall ensure that the product design complies with FCC regulations and
meets UL and CSA standards. Manufacturer shall ensure compliance of all
manufactured products to applicable UL and CSA standards. Manufacturer
must at all times be ISO 9002 compliant and obtain similar governmental
and safety certifications or approvals. Manufacturer shall perform all
administrative actions required to qualify each Product for
preferential treatment under the rules of any applicable trade treaty.
20.7 EXPORT CONTROLS
Each party agrees that it will not knowingly (1) export or re-export,
directly or indirectly, any technical data (as defined by the U.S.
Export Administration Regulations), including software received from
the other under this Agreement; (2) disclose such technical data for
use in; or (3) export or re-export directly or indirectly, any direct
product of such technical data, including software, to destination to
which such export or re-export is restricted or prohibited by U.S. or
non-U.S. law without obtaining prior authorization from U.S. Department
of Commerce and other competent government authorities to the extent
required by those laws. This clause shall survive termination or
cancellation of this Agreement.
20.8 FORCE MAJEURE
Neither Customer nor Manufacturer shall be considered in default or
liable for any delay or failure to perform any provision of this
Agreement if such delay or failure arises directly or indirectly out of
an act of nature, acts of the public enemy freight embargoes, strikes;
quarantine restrictions, unusually severe weather conditions,
insurrection, riot, and other such causes beyond the control of the
party responsible for the delay or failure to perform.
20.9 NOTICE
Unless otherwise specified in this Agreement, all notices and other
communications permitted or required hereunder shall be in writing and
shall be mailed, telecopied, telegraphed, telexed or delivered to the
other party at the address set forth in the following (or at such other
address as either policy shall designate in writing to the other party
during the term of this Agreement) and shall be effective at the
earlier of the time received of five days after dispatch in accordance
with the terms of this Section. Each notice to Customer or Manufacturer
shall be addressed until notice of change thereof, as follows:
If to Customer:
Arris Interactive L.L.C.
Suite 300
Lakefield Drive
Suwanee, Georgia 30024
Attn:Jeff Milway
Telephone: 770-622-8644
Fax:770-622-8770
If to Manufacturer:
Mitsumi Electric Co., Ltd.
8-8-2 Kokuryo-cho
Chofu-shi
Tokyo 182
Japan
Attn: Tomoaki lida_______________
Telephone: 81-3-3489-5333___________
Fax: 81-3-3488-1228________________
20.10 ASSIGNMENT
This Agreement may not be assigned by either party without the prior
written consent of the other party. Any attempted assignment or
transfer of any of the rights, duties, or obligations herein shall be
void if not in compliance with this subsection.
20.11 GOVERNING LAW
This Agreement shall be governed by the laws of the State of Georgia.
20.12 WAIVER
No failure or delay on the part of either party hereto in exercising
any right or remedy under this Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right or
remedy. No provision of this Agreement may be waived except in writing
signed by the party granting such waiver.
20.13 SEVERABILITY
If any provision of this Agreement is held to be invalid, the other
provisions will not be affected.
20.14 COMPLETE AGREEMENT
This Agreement (including the attachments hereto, Statements of Works,
Acknowledgments, Invoices, and Purchase Orders issued hereunder)
constitutes the complete and exclusive final written expression of all
the terms of agreement between parties. It supersedes all prior
agreements, understandings, and negotiations concerning the matters
specified herein. Any representations, promises, warranties or
statements made by either party that differ in any way from the terms
of this Agreement shall not be binding on either party unless made in
writing and signed by a duly authorized representative of each party.
Agreed to: Agreed to:
CUSTOMER MANUFACTURER
ARRIS INTERACTIVE LLC. MITSUMI ELECTRIC CO., LTD.
By: /s/ R.J. Stanzione By: /s/ H. Moribe
R.J. Stanzione H. Moribe
Name (Print or Type) Name (Print or Type)
Title: CEO Title: CSO
Date: 7/9/97 Date: 9/15/97
July 9, 2001
Mr. Tom Lida
Mitsumi Electric Co., LTD
8-8-2 Koyuryo-Cho
Chofo-shi
Tokyo 182
Japan
Subject: Amendment to Manufacturing Agreement between Arris Interactive LLC and
Mitsumi Electric Co., LTD.
Dear Lida-san:
This letter amends the above mentioned agreement as follows:
Change the last sentence of Section 7.4 from:
"Title to Customer Components will remain with Customer, but Manufacturer shall
have a purchase money security interest against the Products until receipt of
payment from Customer."
To read as follows:
"Title to Customer Components will remain with Customer."
Provisions of the above-mentioned agreement to the extent not amended by or in
conflict with the above amendment shall continue in effect.
Please sign and return a copy of this letter signifying your agreement.
Regards,
Jeff Milway
Senior Director - Operations
Arris Interactive LLC
IN WITNESS WHEREOF, the undersigned has executed this Amendment.
Mitsumi Arris Interactive
Signature: /s/ Steve Moribe /s/ David Potts
Printed Name: Steve Moribe David Potts
Title: Executive Vice President Vice President and CEO
Date: July 9, 2001 July 9, 2001