EXHIBIT 10.6
COMPAQ COMPUTER CORPORATION
PURCHASE AGREEMENT
This Purchase Agreement ("Agreement") is made by Compaq Computer
Corporation ("Buyer") and Apex PC Solutions, Inc. a Washington Corporation
("Seller"). The terms and conditions contained in this Agreement shall
govern the purchase and sale of Product listed in Exhibit A ("Products and
Pricing").
1. INTENT
A. Buyer intends to enter into a long-term relationship with Seller. As such,
Seller is willing to cooperate with Buyer to further mutual long term goals
by sharing Product road map and technology directions. Seller agrees to
cooperate to achieve Buyer's long term program goals such as shortening
Product lead-times, increasing volume flexibility, achieving Just-in-Time
delivery, achieving ongoing cost reductions and specific quality goals, and
continuous quality improvement.
B. This Agreement is not a requirements contract and does not obligate Buyer
to purchase any minimum quantity of Product but only establishes the terms
and conditions for such purchases if and when they occur.
2. PURCHASE ORDERS
A. Buyer will purchase Products only by issuing purchase orders ("Order or
Orders") to Seller. Orders shall contain such things as quantity, price,
delivery date, part number, and revision level. Buyer shall make
commercially reasonable efforts to send written confirmation (except by
mutual agreement) of Orders within one (1) week after Issuance. If Seller
fails to return the acknowledgment, Seller will be deemed to have accepted
any Order which conforms with the terms of this Agreement. No additional
or different provisions proposed by Seller shall apply unless expressly
agreed to in writing by Buyer. Buyer hereby gives notice of its objection
to any additional or different terms.
B. Seller agrees that all Buyer sites, subsidiaries, affiliated companies and
subcontractors, wherever located, shall be entitled to make purchases under
this Agreement.
3. TERM OF AGREEMENT
A. The term of this Agreement shall be twelve (12) months, commencing on the
date Buyer executes this Agreement ("Effective Date"). This Agreement will
be automatically renewed at the conclusion of the initial twelve (12) month
period for successive twelve (12) month periods unless one of the parties
indicates by written notice to the other party not less than thirty (30)
days prior to the end of any such twelve (12) month period that it does not
intend to renew the Agreement. Notwithstanding the foregoing, the
Agreement shall remain in full force and effect and shall be applicable to
any Order(s) issued by Buyer to Seller during the term of this Agreement
until any and all obligations of the parties under such Order(s) have been
fulfilled.
4. PRICING
A. The prices for the Products shall be set forth in Exhibit A and shall be
fixed for the period set forth therein (the "Pricing Period").
B. Prices shall include all charges such as packaging, packing, crating,
storage, forwarding agent or brokerage fees, freight shipping charges,
document fees, duties, and any and all sales, use, excise and similar
taxes. F.O.B. point specified in Exhibit A.
C. *
D. *
5. DELIVERY
A. Time shall be of the essence in meeting Buyer's requirements. Delivery
performance shall be measured by on-dock date at Buyer's specified ship-to
location.
B. Unless otherwise set forth in the Order, title and risk of loss shall pass
to Buyer at Buyer's specified ship-to location.
C. If Seller delivers Product in advance of the specified delivery date, Buyer
may either return such Product at Seller's risk and expense for subsequent
delivery on the specified delivery date or retain such material and make
payment when it would have been due based on the specified delivery date.
D. Changes to delivery dates may only be made by Buyer's authorized purchasing
representatives. Buyer may, without cost or liability, issue change
requests for Product quantities and schedule dates in accordance with the
Flexibility Agreement attached as Exhibit D ("Flexibility Agreement").
Written confirmation will be sent by Seller to Buyer within two (2) work
days of receiving a change request, and Buyer shall provide a confirming
Order change within ten (10) working days of receiving Seller's
confirmation.
E. Seller shall notify Buyer in writing immediately if Seller has knowledge of
any event which could result in any change to the agreed delivery plan.
F. In the event that Product scheduled for delivery is more than one
(1) business day late, Buyer may request such Product to be shipped and
delivered via a different mode of transportation at sellers expense.
Alternatively, Buyer may purchase substitute Product elsewhere without
affecting other remedies Buyer may have and charge Seller any additional
cost incurred as a result.
6. PACKING, MARKING, AND SHIPPING INSTRUCTIONS
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 1
A. All Product shall be prepared and packed in a commercially reasonably
manner so as to secure the lowest transportation rates and meet carrier's
requirements or those set forth in the Product specification attached as
Exhibit B ("Specification").
B. Each shipping container shall be marked to show Buyer's Order number, part
number, revision level, lot number, and quantity contained therein. A
packing list showing the Order number shall be included in each container.
C. Seller agrees to standardize the count multiples used in shipments.
7. QUALITY
A. Seller shall establish and/or maintain a quality improvement plan
acceptable to Buyer. Seller's Quality improvement Plan is attached to this
Agreement as Exhibit C ("Quality Plan").
B. At Buyer's request, Seller will facilitate on-site visits and inspections
by Buyer during normal business hours. Buyer's inspections shall in no way
relieve Seller of its obligation to deliver conforming Product or waive
Buyer's right of inspection and acceptance at the time the Products are
delivered.
C. Seller agrees to provide relevant outgoing inspection, quality, and
reliability data upon Buyer's request.
D. Seller agrees to conform to the revision level stated on Buyer's Order.
E. Seller agrees to advise Buyer of any changes to process, materials, or
sources of supply and ensure that such changes do not compromise
specifications, quality, or reliability of Products ordered by Buyer.
8. INSPECTION AND ACCEPTANCE
A. Products purchased pursuant to this Agreement shall be subject to
inspection and test by Buyer at all times and places, including the period
of manufacture or development. Unless otherwise specified in the Order,
final inspection and acceptance of Product by Buyer shall be at Buyer's
facilities. Buyer reserves the right to reject Product which does not
conform to the specifications, drawings, samples or other descriptions
specified by Buyer. Buyer may, at its option, either return defective or
non-conforming Product for full credit of the purchase price plus any
transportation charges paid by Buyer, or require prompt correction or
replacement of defective or non-conforming Product, which rights shall be
in addition to such other rights as Buyer may have in law or in equity.
Product required to be corrected or replaced shall be subject to the same
inspection and warranty provisions of this Agreement as Product originally
delivered under any Order. Buyer may charge Seller for costs of any above
normal level of inspection.
B. In the event Buyer returns Product back to Seller for correction or
replacement, Seller shall repair or replace all defective Product within
* of receipt of such Product. Seller will issue a "Return Material
Authorization" within twenty-four (24) hours of receipt. Seller shall
bear all risk and costs such as labor, material, inspection, and shipping
to and from Buyer's facilities. If Buyer incurs any such costs, it may
either recover them directly from Seller or set off via a credit note any
amounts due to Seller. Seller agrees to provide failure analysis of
rejected material within * after receipt of reject materials. Seller
will also provide a written corrective action report addressing the steps
that will be taken to eliminate the cause of the problem. Buyer and
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 2
Seller will negotiate in good faith any cost incurred by Seller on
product returned where failure cannot be found.
9. WARRANTY
A. Seller warrants that title to all Products delivered to Buyer under this
Agreement shall be free and clear of all liens, encumbrances, security
interests or other claims and that for a period of * from date of
acceptance of material by Buyer, that all Product shall be free from
defects in material, workmanship, and design. Seller further warrants
that all Product shall conform to applicable specifications, drawings,
samples, and descriptions referred to in this Agreement. The warranty for
replaced or repaired Product will be the same as the original Product.
B. Defective material discovered during Buyer's manufacturing or assembly
processes are not considered to be a warranty repair and shall be corrected
in accordance with paragraph 8.B.
C. Seller agrees that in case of epidemic failure (greater than * failure for
the same cause in any * period), Seller shall provide correction or
replacement in accordance with Paragraph 8.B.
D. EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 9, NO WARRANTIES, EXPRESS OR
IMPLIED, STATUTORY OR OTHERWISE, ARE MADE WITH RESPECT TO THE PRODUCT
DELIVERED BY SELLER TO BUYER UNDER THIS AGREEMENT.
10. OUT OF WARRANTY REPAIRS and SPARE PARTS AVAILABILITY
A. Seller agrees to refurbish to a "like new" condition any out of warranty
Product at the refurbishment prices listed in Exhibit E ("Service, Repair,
and Refurbishment"). In addition, Seller agrees to make available for
purchase by Buyer replacement and repair parts for Products ("Spares") in
accordance with Exhibit E.
11. PAYMENT AND SETOFF
A. Terms of payment shall be net 45 from the date of Seller's invoice provided
that Product has been received by Buyer. Payment of invoices shall not
constitute final acceptance of the Product.
B. Buyer retains the right to setoff rejections of Product or discrepancies on
paid invoices against future invoices.
C. Unless otherwise specified in Exhibit A or agreed to in writing by the
parties, payment shall be in U.S. dollars.
12. CHANGES
A. Buyer may from time to time change the specifications for the Products and
Seller agrees to make best efforts to comply. If changes result in a
change in Seller's costs or in the time for performance, an adjustment will
be made. Any adjustment must be in writing and must be requested within
ten (10) days of receipt by Seller of the notice of change.
B. No changes shall be made by Seller in the form, fit, or function of
Products purchased hereunder without Buyer's prior written approval.
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 3
13. TERMINATION FOR CAUSE
A. Seller may terminate this Agreement and/or any Order issued hereunder at
any time by written notice in the event Buyer:
1. Fails to comply with any material provision of this Agreement or any
Order issued hereunder, and, in the case of a breach which is capable
of remedy, falls to remedy same within thirty (30) days of
notification of said breach, or
2. Becomes insolvent or makes an assignment for the benefit of creditors,
or a receiver or similar officer is appointed to take charge of all or
a part of the Buyer's assets and such condition is not cured within
thirty (30) days.
B. Buyer may terminate this Agreement and/or any Order issued hereunder at any
time by written notice in the event Seller:
1. Fails to comply with any material provision of this Agreement or any
Order issued hereunder, and in the case of a breach which is capable
of remedy, fails to remedy same within thirty (30) days of
notification of said breach, or
2. Becomes insolvent or makes an assignment for the benefit of creditors,
or a receiver or similar officer is appointed to take charge of all or
a part of Seller's assets and such condition is not cured within
thirty (30) days, or
3. Assigns or attempts to assign, or subcontracts or attempts to
subcontract, any or all of its rights or obligations under this
Agreement or any Orders issued hereunder to a third party without
Buyer's prior written approval, or
4. Failure to agree on pricing for any Pricing Period.
C. Upon termination by Seller of the Agreement and/or any Order issued under
13A above, Buyer's entire liability shall be to purchase all finished
goods, work in progress, and Buyer unique materials that have been
purchased within lead time by Seller to fulfill Buyer's Order(s).
D. Upon termination by Buyer of the Agreement and/or any Order issued under
13B above:
1. Buyer shall have the option to purchase any materials or work in
progress which Seller may have purchased or processed for the
fulfillment of any Order at Seller's cost plus a reasonable amount for
any value already added by Seller,
2. Buyer shall have no liability beyond payment for any balance due for
Products delivered by Seller before notice of termination.
14. TERMINATION FOR CONVENIENCE
A. Buyer may terminate this Agreement and/or any Order issued hereunder at any
time for any reason upon giving written notice of termination to the
Seller. Upon receipt of such notice, Seller shall immediately cease to
incur expenses pursuant to this Agreement and/or the Order that has been
terminated unless otherwise directed in the termination notice. Seller
shall also take all reasonable steps to mitigate the cost to Buyer for
terminating this Agreement and/or any Order. Within sixty (60) days from
the date of
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notice, Seller shall notify Buyer of costs incurred up to the date of
termination. In no event shall such cost exceed the unpaid balance:
1. Due for conforming material delivered prior to receipt of Buyer's
termination notice; and
2. Due on purchase orders previously issued in conformance with this
Agreement.
B. In addition to the foregoing, in the event that this Agreement is
terminated pursuant to this Paragraph, Buyer's entire liability shall be to
purchase all finished goods, work in progress, and Buyer unique materials
that have been purchased within lead time by Seller to fulfill Buyer's
Order(s).
15. LIMITATION OF LIABILITY
A. EXCEPT FOR A BREACH OF SECTION 19, 23 OR 24 OF THIS AGREEMENT, NEITHER
PARTY SHALL BE LIABLE FOR ANY CONSEQUENTIAL (INCLUDING, WITHOUT LIMITATION,
LOST PROFITS, Unliquidated INVENTORY, ETC.), INCIDENTAL, INDIRECT, SPECIAL,
ECONOMIC, OR PUNITIVE DAMAGES ARISING OUT OF OR RESULTING FROM THIS
AGREEMENT EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES. SELLER'S LIABILITY TO BUYER FOR DIRECT DAMAGES UNDER THIS
AGREEMENT SHALL BE LIMITED TO THE AMOUNTS PAID BY BUYER UNDER THIS
AGREEMENT, INCLUDING ANY OTHER AMOUNTS PAID BY BUYER SUCH AS FREIGHT AND
STORAGE.
16. FORCE MAJEURE
A. Neither party shall be liable for its failure to perform any of its
obligations hereunder during any period in which performance is delayed by
earthquake, fire, flood, war, embargo, riot or the intervention of any
government authority ("Force Majeure"), provided that the party suffering
such delay immediately notifies the other party of the delay. If, however,
Seller's performance is delayed for reasons set forth above for a
cumulative period of thirty (30) calendar days or more, the Buyer,
notwithstanding any other provision of this Agreement to the contrary. may
terminate this Agreement and/or any Order issued hereunder by notice to
Seller. In the event of such termination, Buyer's sole liability hereunder
will be for the payment to Seller of any balance due and owing for
conforming Product delivered by Seller prior to Seller's notification of
delay to Buyer. In the event the parties do not terminate this Agreement
and/or Order due to a Force Majeure, the time for performance or cure will
be extended for a period equal to the duration of the Force Majeure.
17. PRODUCT NOTICES
A. Any notice given under this Agreement shall be in writing and will be
effective when delivered personally or deposited in the mail, postage
prepaid and addressed to the parties at their respective addresses set
forth below, or at any new address subsequently designated in writing by
either party to the other:
If to Seller: If to Buyer:
APEX PC SOLUTIONS, INC. COMPAQ COMPUTER CORPORATION
0000 000XX XXXXXX, XX P.O. BOX 692000
page 5
XXXXXXX, XX 00000 20555 S.H. 249
XXXXXXX, XXXXX 00000-0000
ATTN.: XXXXX SlRIANNI ATTN.: XXXX XXXXXXXX
with a copy to:
COMPAQ COMPUTER CORPORATION
P.O. BOX 692000
20555 S.H. 249
XXXXXXX, XX 00000-0000
ATTN.: Division Counsel - Operations
18. COMPLIANCE WITH LAWS
A. All Product supplied and work performed under this Agreement shall comply
with all applicable laws and regulations in effect. In particular, Seller
agrees that its performance under this Agreement shall comply with all laws
governing its relationship with its employees, agents or subcontractors and
with the chlorofluorocarbon labeling requirements of the U.S. Clean Air Act
of 1990. Upon request, Seller agrees to certify compliance with such
applicable laws and regulations.
19. PATENT, COPYRIGHT AND TRADEMARK INDEMNITY
A. Seller shall defend, at its expense, any claim against Buyer alleging that
Products furnished under this Agreement (other than claims related to the
Buyer's logo and/or trademark) infringe any patent, copyright or trademark
and shall pay all costs and damages awarded, provided Seller is notified in
writing of such claim and permitted to defend and compromise such claim.
If a final injunction against Buyer's use of the Products results from such
a claim (or, if Buyer reasonably believes such a claim is likely) Seller
shall, at its expense, and at Buyer's request, either use commercially
reasonable efforts to obtain for Buyer the right to continue using the
Product or replace or modify the Product so that it becomes noninfringing.
In the event that Seller cannot obtain such right for Buyer, Seller shall
repurchase all finished Products which Buyer has unsold in its warehouse at
that time. The foregoing states the sole and exclusive liability of Seller
for infringement of proprietary rights.
B. Seller warrants that there are no claims of infringement with respect to
the Product.
C. Seller is authorized to use Compaq logo and trademark only to the extent
necessary to meet the required specification for the Product(s). No other
rights with respect to Buyer's trademarks, trade names or brand names are
conferred, other expressly or by implication, upon Seller.
20. CAPACITY PLANNING
A. Seller agrees to review forecasts provided by Buyer and advise Buyer if
Seller anticipates that he will be unable to achieve the requested
volumes. Buyer volume forecasts will be provided to Seller in accordance
with Exhibit A. Seller may from time to time request Buyer to review
Buyer's forecast and advise of any changes.
21. GRATUITIES
page 6
A. Each party represents that it has not offered nor given and will not offer
nor give any employee, agent, or representative of the other party any
gratuity with a view toward securing any business from the other party or
influencing such person with respect to the business between the parties.
22. INSURANCE AND STATUTORY OBLIGATIONS
A. If Seller's work under this Agreement requires access by Seller to any of
Buyer's premises or the premises of Buyer's customers or locations where
Buyer conducts business, or with material or equipment furnished by Buyer,
Seller shall take all necessary precautions to prevent the occurrence of
any injury to persons or property during the progress of such work and,
except to the extent that such injury is due solely and directly to Buyer's
acts or negligence, Seller shall indemnify Buyer against all loss which may
result in any way from any act or negligence of Seller; its employees,
servants, agents or subcontractors, and Seller shall maintain such
insurance as shall protect Buyer from such risks and from any statutory
liabilities arising therefrom and shall provide evidence of such insurance
to Buyer upon request.
23. INDEMNIFICATION
Seller agrees to protect, defend, indemnify and save Buyer harmless from
all sums, costs and expense which Buyer may incur or be obliged to pay as a
result of any loss, expense, damage, liability, claims, demands in favor of
any person, as a result of personal injury or death resulting from the use
of the Products where the personal injury or death is solely and directly
the result of the gross negligence or willful misconduct of Seller.
24. CONFIDENTIAL INFORMATION
A. Each party recognizes that it may have previously entered or will in the
future enter into various agreements with the other party which obligates
it to maintain as confidential certain information disclosed to it by the
other party. To the extent that such information or any further
confidential information, which might include but is not limited to
business plans, forecasts, capacity, pricing, inventory levels, etc.
(collectively referred to hereinafter as "Information"), is disclosed in
furtherance of this Agreement or any Order issued hereunder, such
information shall be so disclosed pursuant to the minimum terms and
conditions listed below; provided, however, the minimum terms and
conditions listed below shall in no way relieve the parties from any
obligation or modify such obligations previously agreed to in other
agreements. Both parties agree that this Agreement and any other
agreements regarding confidential information shall hereafter be considered
as coterminous, and shall expire no earlier than the date of expiration or
termination of this Agreement.
B. Both parties agree that the party receiving Information will maintain such
Information in confidence for a period of three (3) years from the date of
disclosure of such information.
C. Each party shall protect the other party's information to the same extent
that it protects it own confidential and proprietary information and shall
take all reasonable precautions to prevent unauthorized disclosure to third
parties.
page 7
D. The parties acknowledge that the unauthorized disclosure of such
Information will cause irreparable harm. Accordingly, the parties agree
that the injured party shall have the right to seek immediate injunctive
relief enjoining such unauthorized disclosure.
E. This provision shall not apply to information (1) known to the receiving
party at the time of receipt from the other party, (2) generally known or
available to the public through no act or failure to act by the receiving
party, (3) furnished to third parties by the disclosing party without
restriction on disclosure, or (4) furnished to the receiving party by a
third party as a matter of right and without restriction on disclosure.
F. Immediately upon termination of this Agreement or at the request of the
other party, each of the parties shall promptly return all materials in its
possession containing Information of the other party.
25. COUNTRY OF ORIGIN
A. For each Product purchased under this Agreement, Seller shall furnish Buyer
with country of origin (manufacture), by quantity and part number (Buyer's
and Seller's) if necessary.
B. Seller agrees to provide necessary export documents and to facilitate
export of Product. Seller further agrees to assist Buyer's import of
Product as reasonably requested by Buyer.
26. PROPERTY FURNISHED BY BUYER
A. Any tools, drawings, specifications, or other materials furnished by Buyer
for use by Seller in its performance under this Agreement or any Order
issued hereunder shall be identified and shall remain the property of Buyer
and shall be used by Seller only in its performance hereunder. Such
property shall be delivered, upon request, to destination specified by
Buyer in good condition, except for normal wear and tear.
27. GENERAL
A. Any obligations and duties which by their nature extend beyond the
expiration or earlier termination of this Agreement shall survive any such
expiration or termination and remain in effect.
B. If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable, such provision shall be enforced to the
fullest extent permitted by applicable law and the validity, legality and
enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
C. No action, except those regarding claims by third parties, or claims with
respect to patents, copyrights, trademarks or trade names or the
unauthorized disclosure of Confidential Information, regardless of form,
arising out of this Agreement may be brought by either party more than two
(2) years after the cause of action has arisen, or, in the case of
nonpayment, more than two (2) years from the date the payment was due.
D. Any waiver of any kind by a party of a breach of this Agreement must be in
writing, shall be effective only to the extent set forth in such writing
and shall not operate or be construed as a waiver of any subsequent
breach. Any delay or omission in exercising
page 8
any right, power or remedy pursuant to a breach or default by a party
shall not impair any right, power or remedy which either party may have
with respect to a future breach or default.
E. Seller hereby gives assurance to Buyer that it shall not export, re-export
or otherwise disclose, directly or indirectly, technical data received from
Buyer or the direct product of such technical data to any person or
destination when such export, re-export or disclosure is prohibited by the
laws of the United States or regulations of a Department of the United
States.
F. This Agreement is considered to be Compaq Confidential.
G. The entire Agreement between the parties is incorporated in this Agreement
and Appendices attached hereto, and it supersedes all prior discussions and
agreements between the parties relating to the subject matter hereof. This
Agreement can be modified only by a written amendment duly signed by
persons authorized to sign agreements on behalf of both parties, and shall
not be supplemented or modified by any course of dealing or trade usage.
Variance from or addition to the terms and conditions of this Agreement in
any Order, or other written notification from Seller will be of no effect.
H. THE CONSTRUCTION, VALIDITY, AND PERFORMANCE OF THIS AGREEMENT AND ANY ORDER
ISSUED UNDER IT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF WASHINGTON,
U.S.A.
IN WITNESS, THE AUTHORIZED REPRESENTATIVES OF THE PARTIES HAVE EXECUTED THIS
AGREEMENT.
For the Buyer For the Seller
/s/ Xxxxxx Xxxxxxxx
for Xxx Xxxxxx 9/19/94 /s/ Xxxxx X. Xxxxx 9/8/94
------------------------------------- -------------------------------------
Signature (date) Signature (date)
Xxxxxx X. Xxxxxx Xxxxx X. Xxxxx
Name -------------------------------------
Name
Vice-president Corporate Procurement
Title General Manager
-------------------------------------
Title
page 9
CORPORATE PURCHASE AGREEMENT AMENDMENT
EXHIBIT A
PRODUCTS AND PRICING
ITEM SELLER REFERENCE COMPAQ REFERENCE LEAD-TIME PRICE TIME
---- ---------------- ---------------- --------- ----- ----
1. 242694-001 242694-001 8 weeks * *
* *
* *
* *
2. 242695-001 242695-001 8 weeks * *
* *
* *
* *
3. 242778-001 242778-001 8 weeks * *
* *
* *
* *
Seller agrees that the price is firm for the period of 90 days and that
price will be renegotiated prior to the end of the firm pricing period.
Seller agrees to furnish a non-binding price forecast for the following
three calendar quarters.
Seller further agrees to provide price in US.
This Appendix A is effective October 11, 1996 and amends the Corporate
Purchase Agreement (the "Agreement") between Apex PC Solutions and Compaq
Computer Corporation executed on September 19, 1994. The EXHIBIT A in the
original Agreement shall be replaced in its entirety by this Exhibit A.
Except as expressly amended by this Amendment, the Agreement shall
continue in full force and effect in accordance with its terms.
APEX PC SOLUTIONS COMPAQ COMPUTER CORPORATION
By: /s/ XXXXXXXXXXX X. XXXXXXXX By: /s/ XXXXXX X. XXXXXXX
--------------------------------- ---------------------------------
Name: XXXXXXXXXXX X. XXXXXXXX Name: XXXXXX X. XXXXXXX
------------------------------- -------------------------------
Title: Vice President Title: Director
------------------------------ ------------------------------
Date: 10-9-96 Date: 10-16-96
------------------------------- -------------------------------
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 10
EXHIBIT B
SPECIFICATION
Buyer's specification number 169953-001/-002 and 169954-001/-002 is
incorporated by reference.
page 11
EXHIBIT C
QUALITY AGREEMENT
page 12
COMPAQ COMPUTER CORPORATION
AND
APEX PC SOLUTIONS
SWITCHBOX QUALITY PLAN
*
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 13
EXHIBIT D
FLEXIBILITY AGREEMENT
The following changes to volumes on existing purchase orders may be made without
cost or liability to Buyer.
NUMBER OF WEEKS PRIOR % INCREASE
TO SCHEDULED DELIVERY DATES
8 weeks or more *
6 weeks *
5 weeks *
4 weeks *
3 weeks or less *
*
*
Q394
-------------------------------------------------------------------------------
WEEK/ORDER 12 11 10 9 8 7 6 5 4 WEEK 0
-------------------------------------------------------------------------------
Apex Inventory * * * * * * * * * *
-------------------------------------------------------------------------------
Apex WIP * * * * * * * * * *
-------------------------------------------------------------------------------
Vendor WIP 80% C * * * * * * * * * *
-------------------------------------------------------------------------------
Vendor WIP (80% C * * * * * * * * * *
-------------------------------------------------------------------------------
Vendor Raw Material * * * * * * * * * *
-------------------------------------------------------------------------------
Q494
-------------------------------------------------------------------------------
WEEK/ORDER 12 11 10 9 8 7 6 5 4 WEEK 0
-------------------------------------------------------------------------------
Apex Inventory * * * * * * * * * *
-------------------------------------------------------------------------------
Apex WIP * * * * * * * * * *
-------------------------------------------------------------------------------
Vendor WIP 80% C * * * * * * * * * *
-------------------------------------------------------------------------------
Vendor WIP (80% C * * * * * * * * * *
-------------------------------------------------------------------------------
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 27
-------------------------------------------------------------------------------
Vendor Raw Material * * * * * * * * * *
-------------------------------------------------------------------------------
*
*
*
-------------------------------------------------------------------------------
Week/Order 14 13 12 11 10 9 8 7 6 5 4 Week 0
-------------------------------------------------------------------------------
Reschedule * * * * * * * * * * * *
-------------------------------------------------------------------------------
Compaq Option * * * * * * * * * * * *
-------------------------------------------------------------------------------
* *
*
*
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 28
EXHIBIT E
SERVICE, REPAIR, AND REFURBISHMENT
A. OUT OF WARRANTY REPAIRS
1. Seller agrees to refurbish to "like new" condition any out of warranty
Product at the prices listed below. This obligation shall be
satisfied by either refurbishing Product submitted by Buyer or
replacing such Product with refurbished Product of the same part
number. Returned Product shall be at the latest revision level.
"Like new" condition means refurbished to meet the electrical and
mechanical requirements of the Buyer's applicable specifications
including the replacement of non-functioning parts.
2. Product submitted by Buyer for refurbishment will be in reasonably
good condition and repairable. In the event Product submitted for
refurbishment has been tampered with in an attempt to repair it or has
been damaged beyond repair, Seller will not be obligated to make out
of warranty repairs.
3. Seller agrees to provide monthly status reports indicating quantities
of units returned, units which aren't repairable, and units for which
no trouble was found.
4. Seller agrees, upon Buyer request, to provide repair training,
documentation, and spare parts to local service providers. Local
service providers will be selected by mutual agreement.
5. Fair and equitable repair pricing to be negotiated in good faith at a
later date.
B. SPARE PARTS AVAILABILITY
No spare parts. Whole unit replacement.
C. DOCUMENTATION
In addition to warranty service, Apex agrees to provide out of warranty
service for a period of up to *. Apex also agrees that if for any
reason Apex is unable to perform out of warranty service, bills of
material, wiring schematics and other pertinent documentation will be
provided to Compaq, or its designated representative. It is understood
that this information is and will remain the property of Apex PC Solutions
and will be used under license by Compaq Computer Corporation and or its
designated representative.
D. LOCAL SERVICE SUPPORT
Seller will, at buyer's request, and by mutual consent, provide spare parts
and training for Buyer's local service providers in Buyer's geographic
sales regions.
* Subject to confidential treatment request; filed separately with the
Securities and Exchange Commission.
page 29
EXHIBIT F
LOCAL SITE REQUIREMENTS
HOUSTON
to be determined
SCOTLAND
to be determined
SINGAPORE
to be determined
page 30
