EXHIBIT 10.(Q)
Sub-contracting Agreement of Detection Systems,--China Plant, Qianshan,
Zhuhia City
No. 09(95)Sub-contracting Agreement,
Qianshan, Xiangzhou, Zhuhai
In accordance with the principle of equal and mutual benefits and
through the friendly negotiation, Detection Systems,--China Plant located
at Qianshan, Zhuhai City (Party A) and Detection Systems(HK) Limited (Party
B) have made this agreement.
1. Both Parties of the Agreement
Party A: Detection Systems,--China Plant, Qianshan Town, Zhuhai
City
Official Representative:
Tel: 0000000
Address: The Industrial Estate of Meixi Village, Quinshan Town,
Zhuhai City
Party B: Detection Systems (HK) Limited
Official Representative: Xxxxxxx Xxx
Tel. 00000000
Address: Xxxx 00-00, 00/X Xxx Xxxxxxxx Xxxxxx,
19 On Sum Street, Shatin, N.T. Hongkong
2. Commercial Assistance
Commercial Assistance: Qianshan Branch Xiangzhou Foreign
Processing & Assembly Service Company of Zhuhai City
Office Representative: Xx Xxxx-xxxx
Address: 00, Xxxxxxxx Xxxx, Xxxxxxxx Xxxx, Xxxxxxxxx Xxxxxxxx,
Xxxxxx Xxxx
Tel: 0000000 0000000
3. Purpose of the Agreement
Party B provides the manufacturing equipments, tools and
decorating materials, etc. with the
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approximate value of 3,887.47 thousand HKS. Party B also
provides all the raw and auxiliary materials, packing materials
free of charge. Party A manufactures the Electronic Burglary
Systems and Closed-circuit TV Systems with the materials provided
by Party B. All the manufactured products will be exported.
Party A will get the expenses for the processing. The annual
quantity of processing is one million pieces and the annual sub-
contracting fee is two million HKS.
4. Responsibilities for Both Parties
Party A:
(1) Provide factory of seven thousand square meters and the
accessories for water and electricity, and organize the labour for the
production.
(2) Process all the Customs documents for import and export in
China's Customs.
(3) Except unavoidable factors, accept the technical instruction
of Party B and fulfill the processing tasks on time, quality and quantity
according to the product type requirements of Party B.
(4) Provide job and living conditions for technical and managing
personnels from Party B (All the expenditures will be borne by Party B)
Party B:
(1) Provide the manufacturing equipments, tools and decorating
materials with the approximate value of 3,887.47 thousand HKS (See the
lists for the detail). The legal title of properties belongs to Party B.
After the expired date of the agreement, Party B can export all the
materials after the approval by the Customs, other than those scrap
materials and nip.
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(2) Process all the Customs documents for import and export out
of China distinct.
(3) Send technical personnel to Party A for installation and
testing of the mechanical equipments; for the instruction of production and
for checking of the products before being sent out from the factory; and
responsible for all the expenditures of technical personnels.
(4) According to production capabilities of the equipments,
provide enough raw and auxiliary materials and arrange subcontracting
agreements in advance to assure that Party A have even and smooth
production.
5. Principle of determining the Price and Payment Terms
(1) The trial period is one month. During the trial period,
Party B should pay Party A400HKS$ for each worker each month (25.5 Working
days per month, eight working hours per day).
(2) The processing expenses will be paid by D/P (Documents
against Payment at Sight). Party A will get the expenses through Zhuhai
Branch, Bank of China from Party B, Hongkong Branch, Bank of China. The
paying period is seven days. After the due date, Party B must pay bank
interest to Party A according to the current interest rate of the Bank.
Party A have absolute right to stop delivering goods if the required fee
hasn't been received.
6. Responsibility for Product Quality, Rate of Loss, Transportation
and Insurance Terms
(1) Party B will be responsible for the quality of the raw and
auxiliary materials, packing materials. Party A will be responsible for
the quality of manufactured products. The quality of the products are
based on the technical requirements which both parties agreed and checked
by random sample. Once
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approved and received, Party B will be wholly responsible for the quality
problem.
(2) The rate of loss of the raw ans auxiliary materials and the
rate of nonconformed products should be listed in each subcontracting
contract.
(3) The import and export of the raw and auxiliary materials
will be processed by the port of Gongbei, Xianghou and Jiuzhou Harbour.
And all the transportation expenses will be borne by Party B.
(4) All the insurance of equipments, tools, raw and auxiliary
materials, packing materials and finished products under transportation and
storage will be held by Zhuhai Branch, the People's Insurance Company of
China with the help of Party A. Insurance premium will be borne by Party
B. The insurance of the factory will be borne by Party A.
7. Promises of Both Parties
(1) Party B will be responsible for the expenditures of
repairing the equipments and replacing the spare parts.
(2) Party B will be responsible for paying Party A life expenses
of eight HK$ for each person each day according to the actual number of
worker if Party B has not provided enough materials causing working days
less than 25 or cumulated days of without work over 4. Party A can accept
the orders from other customers.
(3) During the period of this agreement, Party B must pay to
Party A in average no less than 700HK$ for each person of the factory.
(4) During the period of this agreement, all the parties should
abide by the rules and regularities of Fire Protection, Safety Production
and Labour Management in China. Both parties should cooperate actively.
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8. Arbitration
In the process of carrying-out this agreement, both parties agree
to ask Guangdong Branch, Foreign Economic & Trade Arbitration Committee of
the China's International Trade Promotion Committee for arbitration if they
have arguments which cannot be solved through negotiation. Both parties
acknowledge that the arbitration is final. And the loser will bear all the
economic loss. The arbitration is based on Chinese law.
9. The Effect Condition of the Agreement and Others
(1) The agreement will come into effect after the three parties
signed the signature and the date from the approval by the authorized
department of the Government of Party A. The effective period is five
years.
(2) Any party who doe snot carry out this agreement and incoming
economic losses for other parties must bear responsibility of compensation.
(3) Commercial assistance will help the enterprise to develop
the incoming materials processing business.
(4) Both parties may negotiate and add other terms if there are
some unmentioned terms. The added terms will be carried out with this
agreement after they are ap proved by the original approval organization.
If there are some special reasons for cancelling this agreement in advance,
the reasons should be pointed out two months in advance. After the
approval by the original approval organization, the agreement can be
cancelled.
(5) There are four original documents for this agreement, three
for each signatured party, one for the approval department. Various copies
have the same effect for this agreement.
(6) This Agreement is signed at Qianshan, Zhuhai City on June
19, 1995.
