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EXHIBIT 10.11
TURNKEY AGREEMENT
This agreement is made between MAT Technologies Ltd. Xx. 000, Xxxxxx
Xxxxxx Xxxx., 00 Xxx Xxxxxx Xxxxxx, Xxx Po Industrial Estate, N.T., Hong Kong
and The Customer, whose name and address is set forth below:
AccelGraphics, Inc.
0000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
U.S.A.
WHEREAS:
The Customer agrees to purchase from MAT and MAT hereby agrees to sell
and deliver to The Customer, various assemblies and subassemblies, that are to
be released and acknowledged respectively by purchase order, in accordance with
the terms and conditions set forth below.
1.0 Term
The term of this Agreement shall continue in full force and
effect for a period of twelve (12) months following the
close-out of the last outstanding Customer Purchase Order.
2.0 Order Requirements
The Customer will individually release the procurement,
fabrication, and test of each assembly/subassembly by purchase
order which will embody specifies as to configuration and
acceptance criteria along with special test equipment and
tooling.
2.1 Order Quantities, Pricing, and Schedules (as list in
Exhibit A)
The pricing of each assembly/subassembly shall be
calculated on the total quantity to be procured over
a [* * * *] period in accordance with a negotiated
and mutually acceptable quantity/price schedule.
Purchase orders must reflect full contract volume of
[* * * *] units in first year.
2.2 Order Forecast Variations
Orders released by The Customer will each contain
quantities for the next [* * * *] period with a firm
delivery schedule for [* * * *] presented in the form
of a rolling [* * * *] forecast (The "Forecast"). The
Forecast will be updated by change order notice prior
to the fifteenth (15th) of each month to permit the
extension of The Forecast by [* * * *] and provide
schedule variations to satisfy The Customer's
requirement.
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Such variations may be in the nature of increases or
decreases commencing with the [* * * *].
Should a schedule increase be required in months [* *
* *] commencing from date of notice of change, such
schedule increase shall be limited as follows:
The increased amounts for month [* * * *] may be up
to [* * * *] of the original scheduled amounts
respectively.
Should a schedule reduction be required in months [*
* * *] commencing from date of notice of change, such
schedule reduction shall be limited as Follow:
The total scheduled amounts for months [* * *
*] may be rescheduled for delivery during months [*
* * *]; and additional [* * * *] period. However, in
no way may the number of units be less than [* * * *]
of the amount previously scheduled to be delivered
for that month.
3.0 Terms and Conditions
3.1 Changes in Specifications
The Customer may, during the performance of this
contract, request changes in the specifications of
the Products. Such changes shall be implemented upon
mutual agreement which shall be reduced to writing
and signed by both parties. If any such change causes
an increase or decrease in the price of, or the time
required for, the performance of any part of the work
under this contract, an equitable adjustment shall be
made in the contract price or delivery schedule, or
both, and shall be modified to reflect such equitable
adjustment. MAT will not be obligated to proceed with
the contract as changed until mutual agreement has
been reached, reduced to writing and signed by both
parties, but MAT will make its best efforts to comply
with requested changes pending mutual agreement, in
writing, to be signed by both parties. It is strongly
recommended that the customer provide a [* * * *]
supply of those components added to an assembly as
part of an immediately effective ECO. In all cases,
the customer is responsible for obsolescence costs
related to an ECO; however, MAT will make every
effort to minimize these costs.
3.2 Customer Supplied Components
Should The Customer elect to supply any components to
MAT, and MAT agree to such action, such components
including provision for failure parts, will be
delivered to MAT not later than [* * * *] prior to
each scheduled delivery date. Should The Customer be
unable to meet such
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delivery requirements, MAT may at its option, ship
Products to The Customer absent the supplied pans on
or after [* * * *] from the scheduled delivery date.
Under these circumstances, MAT will give written
notification to The Customer prior to actual
shipment.
3.3 Acceptance Criteria
The basic acceptance criteria shall be conformance to
drawings, specifications, and test criteria as
specified by each Purchase Order, and will satisfy
the intent and objectives of The Customer's
workmanship and quality standards.
3.31 Alternate Sources
MAT will, on a continuing basis, perform
value analyses of material and labor content
in the interest of improving quality and
reducing cost to The Customer. Alternate
material sources, and if any, off-load
assembly recommendations, as determined
feasible by MAT will require the written
approval of The Customer prior to
implementation.
3.32 Acceptance
The Customer shall inspect all Products
promptly upon receipt thereof at the
receiving destination and may reject any
goods which fail to meet the specifications
as outlined in MAT's Quotation. Units not
rejected by written notification to MAT
within ten (10) days of receipt at The
Customer facilities shall be deemed to have
been accepted.
3.33 Rejection
Rejection goods shall be returned to MAT,
freight prepaid, within ten (10) days of
receipt of a Return Materials Authorization
(RMA) from MAT. MAT will issue an RMA within
5 working days of acknowledged rejects. No
later than thirty (30) days after receipt by
MAT of rejected goods, MAT shall, at its
expense, either repair or replace said
properly rejected goods. MAT will prepay
transportation charges back to The Customer.
3.4 Shipment
Delivery will be FOB destination. All shipments
hereunder will be made in MAT standard shipping
packages to The Customer at The Customer's address
set forth below:
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Accel Graphics, Inc.
0000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
U.S.A.
3.5 Payment
Payment terms for products is [* * * *]. Payment
terms for toolings are as follows :
- [* * * *] upon order confirmation.
- [* * * *] at completion of molds.
- [* * * *] after sample acceptance.
3.6 Taxes
The Customer shall bear all applicable U.S. federal,
state, municipal, and other governmental taxes (such
as sales, use, or similar charges) and all personal
property taxes assessable on the Products. The
Customer shall in no event be liable for any taxes
levied on MAT based upon its income or any taxes or
duties levied by a U.S. or non-U, S. governmental
agency.
3.7 Warranty
MAT warrants that Products delivered by MAT to The
Customer pursuant to this Agreement shall be free
from defects in material and workmanship and shall
successfully meet all specifications and test
criteria as outlined in MAT Quotation. This warranty
does not extend to The Customer supplied components.
The warranty shall be effective for a period of [* *
* *] after acceptance. MAT's obligation under this
warranty is limited to replacing or repairing, if
can't be repaired or replaced then refund, any of the
Products that are found to be defective during the
warranty period for which The Customer will give MAT
specific written notification of defect.
THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER
WARRANTIES, EITHER EXPRESSED OR IMPLIED.
3.8 Limitation of Liability
Any provision herein to the contrary not
withstanding, in no event shall MAT be liable for
indirect, incidental, or consequential damages, and
in no event shall the liability of MAT arising in
connection with any products sold hereunder, exceed
the actual amount paid by The Customer to MAT for
Products delivered.
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3.9 Assignment
The rights of The Customer or MAT under this
Agreement may not be assigned in whole or in part by
operation of law or otherwise, without the prior
express written consent of the other, which consent
shall not be unreasonably withheld. However, either
party may assign this Agreement and its rights
hereunder, without the consent of the other, to
successors as a result of mergers and acquisitions.
Any attempted assignment of any rights, duties, or
obligations hereunder without such consent shall be
voided.
3.10 Force Majeure
If the performance of this Agreement or of any
obligation hereunder is prevented, restricted, or
interfered with by reason of fire, flood, or other
casualty or accident, labor disputes, war or other
violence, any law, order, proclamation, regulation,
ordinance, demand or requirement of any governmental
agency or intergovernmental body; or any other act or
condition whatsoever beyond the reasonable control of
the parties hereto, the party so affected shall be
excused from such performance to the extent of such
prevention, restriction, or interference.
4.0 Confidential Information
It is agreed that all information supplied by The Customer
shall be regarded as proprietary information owned by The
Customer. MAT is granted No rights or licenses with respect to
such customer proprietary information except provided herein.
Both parties agree to receive and hold each other's
proprietary information in confidence and to exert the same
effort to prevent disclosure thereof as they would for their
own proprietary information. The obligations of this paragraph
shall, however, impose no obligation upon either party with
respect to any portion of the received information (a) which
was known to the receiving party prior to its first receipt
from the other party; (b) which is now or shall hereafter,
through no act or failure to act upon the part of the
receiving party become generally known; (c) which is hereafter
furnished by a third party and without restriction on
disclosure; or (d) which is independently developed by either
party, provided the person or persons developing same have not
had access to the same information as received from the other
party.
5.0 Termination
5.1 Default
Failure on the part of either party to satisfy its
duties or obligations in accordance with the terms of
this Agreement, shall constitute a default if not
cured within [* * * *] after written notice of such
breach.
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5.2 Termination for Default
In the event of termination brought about by default
on the part of The Customer, MAT will negotiate in
good faith to agree on reasonable attempts to restock
or utilize common material. Such material will be
sent to The Customer and The Customer agrees to be
billed at [* * * *], along with [* * * *], as
determined by MAT purchase documentation, to The
Customer as it is received by MAT and billed by MAT
to The Customer [* * * *].
5.3 Termination for Insolvency
Either party may terminate this Agreement on [* * *
*] written notice if the other party is insolvent or
has made any assignment by operation of law or
otherwise of this Agreement or any of its rights
hereunder for the benefit of creditors. In the event
of termination, all marks, design, any data,
drawings, documents, copy rights, trademark, patterns
or other intellectual property right relating to the
products must be returned within 30 days to
AccelGraphics Inc.
6.0 Miscellaneous
6.1 Entire Agreement
This Agreement supersedes and cancels all prior
agreements, if any, between the parties and shall not
be amended, altered, or changed except by written
agreement signed by both parties.
6.2 Titles and Subtitles
The titles and subtitles used in this Agreement are
for convenience only and are not a part of this
Agreement and do not in any way limit or amplify the
terms and provisions of this Agreement.
6.3 Notices
All notices and other communications hereunder shall
be in writing, to the parties hereto at their
respective addresses specified herein, subject to the
right of either party to change its address by
written notice.
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MAT address for notice is:
Managing Director
MAT Technologies Ltd.
Xx. 000, Xxxxxx Xxxxxx Xxxx.
00 Xxx Xxxxxx Xxxxxx
Tai Po Ind. Estate
N.T., Hong Kong.
6.4 Use of Standard Purchase Order
The Customer will use its standard purchase order
form to release items, quantities, prices, schedules,
change notices, specifications or other notice
provided for hereunder, said Purchase Orders will be
governed by the terms and conditions of this
Agreement to the extent that such terms and
conditions are inconsistent with those set forth in
this Agreement.
6.5 Governing Law
This Agreement shall be governed in all respects by
the laws of Hong Kong.
6.6 No Waiver
No waiver of any provision of this Agreement shall be
effective except by written agreement signed by both
parties. No waiver of any breach of any provision
thereof shall constitute a waiver of any subsequent
breach of the same or of any other provision thereof.
6.7 Express of Suite
If suit is commenced to enforce the performance of
any part of this Agreement, including without
limitation any order or release made hereunder, the
prevailing party shall be paid by the other party
reasonable attorneys' fees and expenses.
6.8 Counterparts
This Agreement may be executed in two or more
counterparts, each of which shall be deemed an
original, but all of which together shall constitute
one and the same instrument.
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IN WITNESS WHEREOF, The parties have executed this Agreement as of the
day and year first written below.
MAT Technologies Ltd. THE CUSTOMER
By: /s/ MAT Technologies Ltd. By: /s/ Xxxxxxx X. Xxxx
--------------------------------- -------------------------------
(Authorized Signature) (Authorized Signature)
Date: February 5, 1996 Date: February 5, 1996
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Name: AccelGraphics, Inc.
Address: 0000 Xxxxxx Xxxx
Xxx Xxxx, Xxxxx. 00000
Telephones: [* * * *]
Facsimile: [* * * *]
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EXHIBIT A
The cost breakdown of unit price of AccelGraphics Panther Card based on
contract volume of [* * * *] units per year.
Estimated Material Cost (exclude P/N555-0800-01) [* * * *]
Scrap Allowance [* * * *] [* * * *]
Material Overhead Cost [* * * *] [* * * *]
Administration Cost [* * * *] [* * * *]
Labor Cost for board assembly [* * * *]
ICT Testing [* * * *]
Functional Testing [* * * *]
Labor Cost for packaging [* * * *]
Total Cost [* * * *]
Profit [* * * *]
Total Amount [* * * *]
Remarks :
1. Assume the total functional testing time is around 10 minutes and the
testing yield is 99% or above, and the testing time for products is
less than 1 minutes, and the testing yield is 97% above. All the
functional testers will be provided by AccelGraphics.
2. Delivery assemblies will be manufactured to MAT workmanship standard
(IPC-A-610 Class II) and In-circuit testing.
a) The In-circuit test will be performed on a HP3065 In-circuit
tester.
b) In-circuit test program and fixture will be developed by us in
our facility. AccelGraphics must approve test program results
prior to production use.
3. As our general practice, AccelGraphics has to absorb all the [* * * *]
buy from vendors.
4. This quote contains costing estimates of components below which can be
extremely volatile in terms of price and delivery MAT reserves the
fight to adjust price and lead times of the assemblies quotes herein
should any component cost rise greater than [* * * *] or lead time
lengthen more than [* * * *]. The overall material cost and the lead
time will be reviewed by The Customer and MAT quarterly.
10
No.
U/P (US$) Per Unit Supplier
--------- -------- --------
4.1 PCB (P/N 225-0105-01) [* * *] 1 [* * *]
4.2 IC-VRAM 256K X 16 [* * *] 4 [* * *]
4.3 IC DRAM 1 MEG X 16 [* * *] 1 [* * *]
4.4 IC-VIP TVP3026 [* * *] 1 [* * *]
4.5 CABLE [* * *] 1 [* * *]
4.6 SHIPPING CONTAINER [* * *] 1 [* * *]
4.7 CONN-15POS RT ANGLE [* * *] 1 [* * *]
(520-0270-01)
4.8 CONN-RT ANGLE 15POS [* * *] 1 [* * *]
(520-0277-01)
4.9 HEAT SINK-1.5X1.5XO.4 W/ADH [* * *] 1 [* * *]
4.10 IC-OCTAL BUS EXCHANGE SWITCHES [* * *] 1 [* * *]
(555-0804-01)
4.11 IC-REGULATOR-MIC29300 [* * *] 1 [* * *]
4.12 IC-REGULATOR-MIC29150 [* * *] 1 [* * *]
4.13 64K X 8 EPROMSOCKET [* * *] 1 [* * *]
4.14 PALCE 16V8-7 [* * *] 1 [* * *]
5. IC-3D Processor will be consigned by AccelGraphics, and this quote does
not include the first five items which mentioned on your BOM (P/N 125-,
340-, 345-, 345- & 546-0244-02).
