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CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
EXHIBIT 10.17
BOARD MANUFACTURING AND TRANSITION AGREEMENT
This Board Manufacturing and Transition Agreement ("Agreement") is entered into
effective as of November 12, 1998 (the "Effective Date"), by and between Jaycor
Networks, Inc., a Delaware corporation having a place of business at 0000 Xxxxx
Xxxxxx Xxxxx, Xxx Xxxxx, XX 00000 ("Purchaser"), and Adaptec, Inc., a Delaware
corporation having a place of business at 000 X. Xxxxxxxx Xxxxxxxxx, Xxxxxxxx,
XX 00000 ("Adaptec").
RECITALS
A. On November 12, 1998, Purchaser and Adaptec are entering into a certain Asset
Acquisition Agreement under which Purchaser shall acquire certain assets of
Adaptec, including intellectual property and technology related to certain fibre
channel chip and board level products.
B. During a transition period not to exceed six months, Purchaser desires for
Adaptec to perform certain manufacturing services, including purchasing,
assembly and manufacture testing, and packaging of certain of the fibre channel
board level products transferred to Purchaser under the Asset Acquisition
Agreement, and to sell and ship such products to Purchaser, and Adaptec is
willing to perform such services.
C. The parties desire to define the general terms and conditions governing
Adaptec's manufacture of such products, and the purchase and sale of such
products, all as further set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the covenants and
agreements set forth in this Agreement, the parties agree as follows:
AGREEMENT
1. DEFINITIONS
1.1 "Confidential Information" shall have the meaning set forth
in the Mutual Confidential Disclosure Agreement, dated September 2, 1998,
executed between the parties ("MNDA"), attached hereto as Exhibit C, and shall
include the terms and conditions of this Agreement, which shall constitute
confidential information of both parties.
1.2 "Deliver, Delivered or Delivery" means the delivery of the
Products ordered pursuant to a particular Purchase Order to the Delivery Point
for shipment in accordance with Purchaser's instructions.
1.3 "Delivery Point" means the San Francisco Bay Area.
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1.4 "Lead Time" means 1) the minimum amount of time prior to the
requested Delivery of each respective Product that Adaptec must receive a
Purchase Order for the Product, and 2) the maximum amount of time that Adaptec
has after receiving a Purchase Order before Adaptec must Deliver the ordered
Product, as specified in Exhibit A.
1.5 "Packaging Specification" means Adaptec's standard packaging
process and format for each respective Product as set forth in Adaptec's
applicable standard assembly specification as may be amended from time to time
by Adaptec, including without limitation the use and placement of Adaptec
stickers and logos on such packaging.
1.6 "Price" means the price for each respective Product, as set
forth in Exhibit A.
1.7 "Product" means a fibre channel board level product to be
manufactured and sold by Adaptec hereunder, as set forth in Exhibit A.
1.8 "Purchase Orders" means written or electronically
transmitted purchase orders to Adaptec for the Products, including the
description of the Product, quantity, Delivery Point, requested Delivery date
and other relevant information relating to the order and shipment.
1.9 "Purchaser Documentation" means the documentation to be
provided to Adaptec by Purchaser for each respective Product, including the
items listed on Exhibit B.
1.10 "Purchaser Technology" means technical information specific
to the Products, including Product design documentation (including Purchaser
Documentation), test data, and Test Equipment.
1.11 "Services" means the manufacturing services performed by
Adaptec hereunder, including purchasing, assembly and manufacture, testing,
packaging and shipping.
1.12 "Specifications" means the respective specifications for
each Product, as agreed in writing by the parties.
1.13 "Test Equipment" means testers, fixtures, tooling, and
other test equipment used in manufacture, assembly, and production test of the
Products, as set forth on Exhibit B hereto.
1.14 "Functional Test Plan" means the testing process and
criteria with respect to each Product to determine whether such Product meets
the Specifications.
1.15 "Consigned Inventory" means the inventory of components for
Products and partially completed Products which are owned by Purchaser and
consigned to Adaptec for purposes of Adaptec's rendering the Services.
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1.16 "Inventory" means the Consigned Inventory; Risk-buy
Inventory, Unique Inventory and other Adaptec inventory of components for
Products, partially completed Products, and completed Products consistent with
Purchaser's outstanding Purchase Orders.
1.17 "ICT" means in circuit testing.
1.18 "Standard Cost" means the standard cost of a component or
Product, as set forth in Adaptec's SAP system, plus the cost of freight,
clearance and duties between Singapore and Milpitas, at the Effective Date.
1.19 "Minimum Lot Size" means the minimum quantity of each type
of Product that may be manufactured at one time, as specified in Exhibit A.
1.20 "Risk-buy Inventory" means the inventory of long lead time
components used in rendering the Services, as specified in Exhibit F, ("Long
Lead Time Components") which are purchased by Adaptec pursuant to Purchaser's
direction for purposes of Adaptec's rendering the Services.
1.21 "Unique Inventory" means the inventory of components which
are used by Adaptec solely for the purpose of rendering the Services, as
specified in Exhibit G. ("Unique Components"), which are purchased by Adaptec
for the purpose of rendering the Services.
2. TERM OF AGREEMENT
The term of this Agreement ("Term) shall commence on the Effective Date
and shall continue for a period of three (3) months, subject to earlier
termination as provided in Section 16. The Term may be renewed for an additional
period of up to three (3) months, subject to Purchaser's election to receive
transition assistance, as set forth in Section 16.5.
3. MANUFACTURE OF PRODUCTS
3.1 Manufacture of Products. During the Term, Adaptec shall use
reasonable commercial efforts to manufacture the Products in accordance with the
terms of this Agreement. Adaptec will commence performance of the Services with
respect to a Product upon receipt of a Purchase Order therefor, including
without limitation the procurement of any components required to render such
Services. Adaptec shall have no obligation to procure or stock in inventory any
such components prior to the receipt of a Purchase Order requiring such
components, except in response to an authorization to purchase Risk - buy
Inventory. Adaptec may, at its sole discretion, allocate production and delivery
among Adaptec's customers.
3.2 Provision of Purchaser Documentation and Purchaser
Technology. As soon as required after the Effective Date, Purchaser will deliver
to Adaptec the Purchaser Documentation. Subject to the terms and conditions of
this Agreement, Purchaser grants to
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Adaptec and its subcontractors, during the Term of this Agreement, a
non-exclusive, nontransferable license to use the Purchaser Technology solely to
perform the Services.
3.3 Provision of Test Equipment. As soon as required after the
Effective Date, and upon Adaptec's request from time to time, Purchaser will
deliver to Adaptec the Test Equipment necessary for Adaptec to test the Products
in accordance with the Functional Test Plan. Such Test Equipment shall remain
the property of Purchaser, and Adaptec agrees to use the Test Equipment solely
for the purpose of testing the Products. Adaptec shall use reasonable commercial
efforts to maintain the Test Equipment in good condition and repair, including
the provision of any necessary regular maintenance. However, Adaptec shall not
be responsible for any loss or damage to the Test Equipment unless it results
from the negligence or willful misconduct of Adaptec or its employees. Adaptec
will use reasonable efforts to monitor the capacity of existing Test Equipment
and to advise Purchaser when additional Test Equipment is necessary.
3.4 Purchase of Long Lead Time Components. Upon Purchaser's
written request, Adaptec shall purchase Long Lead Time Components. All such Long
Lead Time Components shall be deemed to be "Risk-buy Inventory" and Purchaser
shall assume all risk for non-use of such components.
3.5 Reconciliation of Unique Components. Adaptec shall purchase
Unique Components consistent with Purchaser's forecast and outstanding Purchase
Orders. All such Unique Components shall be deemed to be "Unique Inventory" and
Purchaser shall assume all risk for non-use of such components.
3.6 Packaging. Adaptec will package each Product substantially
in accordance with the applicable Packaging Specification.
3.7 Contractors. Adaptec may retain third parties
("Contractors") and subsidiary companies ("Subsidiaries") to furnish services to
it in connection with the performance of its obligations hereunder and permit
such Contractors and Subsidiaries to have access to Purchaser's Confidential
Information, but only to the extent and insofar as reasonably required in
connection with the performance of Adaptec's obligations under this Agreement;
provided that all such Contractors and Subsidiaries shall be required by Adaptec
to execute a written agreement (a) sufficient to secure compliance by such
Contractors and Subsidiaries with Adaptec's obligations of confidentiality
concerning Confidential Information set forth in Section 17; (b) acknowledging
the Contractor's or Subsidiary's obligation to assign all work product in
connection with performance hereunder; and (c) effecting assignments of all
Intellectual Property Rights concerning any Purchaser Technology to Purchaser.
Purchaser, upon request, may review such agreements at any time before or after
execution by such Contractors and Subsidiaries to ensure compliance with this
Agreement.
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4. PRICING
Subject to the terms and conditions of this Agreement, Adaptec agrees to
sell the Products at the respective Prices set forth on Exhibit A, which
represent approximately the *
. Unless otherwise agreed to in writing by
Adaptec, all Prices are exclusive of transportation and insurance costs, and all
taxes, duties and assessments (except taxes levied against Adaptec's income),
including state and local use, sales property and similar taxes. Purchaser
agrees to pay such taxes unless Purchaser has provided Adaptec with (i) an
exemption resale certificate in the appropriate form for the jurisdiction of
Purchaser's place of business and any jurisdiction to which Product is to be
directly shipped hereunder, or (ii) written evidence that such sale is otherwise
exempt from such taxes. Where applicable, transportation and taxes shall appear
as separate items on Adaptec's invoice.
5. FORECASTS, ORDERING & ADJUSTMENTS
5.1 Forecasts. Purchaser will provide Adaptec, on the Effective
Date, and thereafter on the first day of each calendar month, a forecast of
Purchaser's quantity requirements for each Product for each of the months
remaining in the Term. While such forecasts will not be regarded as a commitment
to purchase, they shall represent and reflect Purchaser's good faith
expectations of customer demand. Purchaser acknowledges that forecasts will be
used by Adaptec for material and manufacturing planning purposes.
5.2 Purchase Orders. On the first day of each calendar month,
Purchaser shall issue Purchase Orders to Adaptec to initiate the performance of
Services with respect to the Products. Each Purchase Order will be issued by
Purchaser in accordance with the applicable Lead Times to allow Delivery during
the Term and, together with previously issued Purchase Orders, shall cover the
ordering of Products to be delivered during * .
Quantities specified in each Purchase Order shall be at least the Minimum Lot
Size for each Product ordered. Adaptec shall use reasonable efforts to
acknowledge the Purchase Order and to confirm the scheduled Delivery Date within
forty-eight (48) hours. No Purchase Order shall be binding until accepted by
Adaptec.
5.3 No Cancellation. Purchaser may not cancel any Products
ordered or on order for Delivery. Upon Purchaser's request, Adaptec will use
reasonable efforts to reschedule Products scheduled for Delivery *
. However, such adjustment may be subject
to additional costs or charges and may not be feasible for short time frames.
5.4 Agreement Controls. Except for the Products, quantities and
other matters necessary to be specified by a Purchase Order, to the extent
accepted by Adaptec, the terms governing the manufacture, delivery, acceptance
and payment for the Products will be governed by the terms and conditions of
this Agreement. In the case of conflict between this Agreement and any Purchase
Order, invoice, acknowledgment or similar document, the terms of this
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* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
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Agreement will prevail. Any remedies at law or equity not specifically
disclaimed or modified by this Agreement remain available to both parties.
6. DELIVERY, CARRIER & RISK OF LOSS
6.1 Delivery of Product; Risk of Loss. All Products purchased
hereunder shall be Delivered F.O.B. Adaptec's dock in the San Francisco Bay
Area, and title and risk of loss or damage to the Products will pass to
Purchaser at such Delivery Point. All quoted Delivery dates are estimates only
and Adaptec shall not be liable for any failure to meet a quoted Delivery date.
Notwithstanding the foregoing, Adaptec will make reasonable commercial efforts
to meet approved Delivery dates, subject to Purchaser's authorization to
purchase Long Lead Time Components.
6.2 Shipment. Unless otherwise agreed by the parties, shipment
costs from San Francisco and Milpitas to destinations within the United States
shall be freight collect. The carrier will be selected by Adaptec. In no event
shall Adaptec be liable for any delay in delivery, or assume any liability in
connection with shipment, nor shall the carrier be deemed an agent of Adaptec.
All claims for damages must be filed with the carrier. Shipments may be made in
installments. All shipments will be made directly to Purchaser; no drop
shipments shall be made under this Agreement. Unless otherwise agreed in writing
or as set forth in the Packaging Specification, all Products will be packed and
shipped in accordance with Adaptec's normal practices.
7. PAYMENTS
Upon Delivery of the Products, Adaptec will send an invoice to Purchaser
identifying the Purchase Order and confirming the quantity and description of
all Products that have been shipped. Purchaser will pay invoices for Products,
or such other invoices as are issued under this Agreement, within thirty (30)
days of receipt. Payment of invoices shall be made to Adaptec as Adaptec may
direct in its invoice (or otherwise in writing). Payment does not constitute
final acceptance of the Products and is subject to adjustments for errors,
shortages and defects. Shipments, deliveries, and performance of the Services
shall at all times be subject to the approval of Adaptec's credit department and
Adaptec may at any time decline to make any shipments or deliveries or perform
any Services except upon receipt of payment, or upon terms and conditions or
security satisfactory to Adaptec. If shipments are delayed by Purchaser, payment
shall become due, at Adaptec's option, thirty (30) days after the date Adaptec
is prepared to make shipment.
8. QUALITY AND INSPECTION
8.1 Process and Quality. Adaptec will manufacture the Products
in accordance with its general process and quality procedures.
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8.2 Yield Improvement. Adaptec will use reasonable commercial
efforts to improve Product yield, but shall not be liable for Product yield
except as provided in Sections 9 and 10.
8.3 Adaptec Testing. Purchaser shall supply a Functional Test
Plan and appropriate Test Equipment for each Product. Adaptec shall fully test
all Products Delivered hereunder in accordance with its ICT and with the
applicable Functional Test Plan.
8.4 Partially Passed Products. In the event the Product passes
the ICT, but does not pass the Functional Test Plan due to a design-related
error, Adaptec shall so notify Purchaser. Such Products shall be deemed to
conform to the Specifications and other requirements of this Agreement, and may
not be rejected by Purchaser.
8.5 Training on Functional Testers. Within one (1) month of the
Effective Date, Purchaser may request training on the maintenance, usage and
debug of functional testers which are relevant to the Products. Adaptec shall
provide up to forty (40) hours of such training at Adaptec's facility in
Milpitas according to a mutually agreed upon schedule, at no additional charge.
8.6 Manufacture of Tester. Within three (3) months of the
Effective date, Purchaser may request that Adaptec manufacture for Purchaser a
functional tester. In such event, Adaptec shall manufacture the functional
tester as provided in and for the price set forth on the quotation attached as
Exhibit H.
9. ACCEPTANCE AND REJECTION OF PRODUCTS
Any Product Delivered hereunder shall be deemed accepted by Purchaser
unless Adaptec receives written notice of a defect or non-conformity with
respect to such Product within thirty (30) days of shipment to Purchaser or its
Customer. In the event a Product appears not to conform to the Specifications,
Purchaser shall promptly notify Adaptec and afford Adaptec a reasonable
opportunity to inspect such Product. No Product shall be returned to Adaptec
without compliance with Adaptec's Return Material Authorization ("RMA")
procedures, a current version of which is attached hereto as Exhibit D.
10. WARRANTY
10.1 Materials and Workmanship. Adaptec warrants that the
Products purchased and Delivered hereunder will, for a period of one (1) year
("Win Period"), commencing on the date of Delivery, be free from defects in
material and workmanship and conform to the Specifications. Notwithstanding the
foregoing, the warranty in this Section 10.1 will not extend to defects
attributable to the Product design or defects arising from compliance with the
Specifications or defects in the Functional Test Plan.
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10.2 Warranty Remedy. If any Product is found to breach the
warranty specified in Section 10.1 during the Warranty Period, Purchaser may
send a notice to Adaptec informing it of the breach of warranty and shall
provide appropriate failure analysis data indicating the defect or failure mode.
Upon Adaptec's confirmation of such failure analysis data, Adaptec shall
reimburse Purchaser for the lesser of the actual cost of repair of such
defective Product and the actual purchase price paid by Purchaser for such
defective Product. Subject to confirmation of a defect, Adaptec will make
payment of any reimbursement within thirty (30) days of receipt of the failure
analysis data and documentation of Purchaser's actual cost of repair or, if
repair is not appropriate, an explanation of why repair is not appropriate.
10.3 No Liability. Adaptec shall have no liability or obligation
to Purchaser under this Section 10 with respect to any Products which have been
subjected to abuse, misuse, improper use, negligence, accident, alteration,
repair or rework performed by unauthorized parties.
10.4 Disclaimer of Warranties. EXCEPT AS EXPRESSLY SET FORTH IN
SECTION 10.1, THE PRODUCTS ARE PROVIDED "AS IS" AND ADAPTEC MAKES NO
REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING
BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, AND NONINFRINGEMENT.
11. PRODUCT CHANGES
11.1 On Adaptec's Notice. In no event shall Adaptec make any
modification to the Products without Purchaser's prior written approval, which
shall not unreasonably be withheld or delayed.
11.2 At Purchaser's Request. Should Purchaser desire
modifications in the Product which do not affect form, fit, or function,
Purchaser shall submit its request to Adaptec in writing, and Adaptec shall use
reasonable commercial efforts to respond to such request in writing within five
(5) business days, setting forth the impact of such proposed change on the
performance of the Services and the Price of the Products. Any change affecting
safety or necessary for proper functioning of the Products will be implemented
by Adaptec as soon a& possible. Unless the parties agree otherwise, requested
changes will not affect the Products already scheduled or rescheduled for
Delivery as of the date such request is received by Adaptec. Purchaser shall be
responsible for payment for any inventory which is made obsolete or any yield
loss as a consequence of the implementation of the change.
11.3 Change Management. All changes to a Product shall be
subject to Adaptec's standard change management procedure.
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12. TRADEMARK LICENSE
12.1 Trademark License. Subject to the terms and conditions of
this Agreement, Adaptec hereby grants to Purchaser and Purchaser accepts a
worldwide, nontransferable, fully-paid and royalty-free right and license to use
the Adaptec trademarks "AIC", "Adaptec" and the Adaptec stylized "a" logotype
(the "Adaptec Marks") solely as affixed by Adaptec to Products and corresponding
packaging supplied by Adaptec to Purchaser hereunder. Purchaser acknowledges and
agrees that Adaptec owns and will continue to own all right, title and interest
in and to the Adaptec Marks and any and all goodwill therein and thereto,
whether arising as a result of Purchaser's use of the Adaptec Marks or
otherwise. Purchaser hereby assigns and, if and as Adaptec may request in the
future, agrees to assign and affirm assignment to Adaptec of all such right,
title and interest in the Adaptec Marks and related goodwill. If requested by
Adaptec, Purchaser will cooperate with Adaptec in securing any trademark
registrations and other indicia of ownership for which Purchaser's cooperation
is required as a matter of applicable local law as a result of Purchaser's use
of the Adaptec Marks. Purchaser agrees to use the Adaptec Marks only in the
exact manner of use by Adaptec.
12.2 Private Labeling. If Purchaser repackages Products
received from Adaptec, Purchaser agrees to repackage in packaging using
Purchaser's marks. Purchaser further agrees to use commercially reasonable
efforts to cease all use of the Adaptec Marks as soon as feasible.
13. OWNERSHIP OF PURCHASER TECHNOLOGY
Purchaser owns the Purchaser Technology. Notwithstanding the foregoing,
Purchaser is aware that Adaptec is in the business of developing and
manufacturing products similar to the Products, and intends to continue
to manufacture the same in the future. Nothing in this Agreement shall
limit the ability of Adaptec to produce products or portions of products
which are similar to the Products for customers other than Purchaser,
either during the term of this Agreement or after its termination,
provided that in doing so, Adaptec does not (a) infringe Purchaser's
intellectual property rights, (b) use Purchaser Technology or Purchaser
Confidential Information, or (c) breach the terms of the Asset
Acquisition Agreement or Cross-License Agreement entered into
contemporaneously herewith.
14. PROPRIETARY RIGHTS INDEMNITY
14.1 Adaptec Indemnity. Adaptec shall, at its expense and at
Purchaser's request, defend any claim or action brought against Purchaser, and
Purchaser's subsidiaries, affiliates, directors, officers, employees, agents and
independent contractors, to the extent it is based on a claim that the
manufacturing process for the Products infringes any patent, copyright, mask
work right or other intellectual property right, or misappropriates any trade
secret, of a third party ("Claim"). Adaptec shall pay all costs of defense and
settlement, together with any judgment which may be finally awarded; provided:
(a) Purchaser gives Adaptec reasonably
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prompt notice in writing of any such Claim and permits Adaptec, through counsel
of its choice, to defend and/or settle such Claim; and (b) Purchaser provides
Adaptec information, assistance and authority, at Adaptec's expense, to enable
Adaptec to defend such Claim. Adaptec shall not be responsible for any
settlement made by Purchaser without Adaptec's written permission.
14.2 Exceptions. Adaptec will not have liability under this
Section 14 to the extent that the Claim results from (a) the use of the
Purchaser Documentation or otherwise from the Product design or features; or (b)
Purchaser's combination, operation, or use of the Products with designs,
devices, parts, or software not supplied by Adaptec.
14.3 Purchaser Indemnity. Purchaser shall, at its expense and at
Adaptec's request, defend any claim or action brought against Adaptec, and
Adaptec's subsidiaries, affiliates, directors, officers, employees, agents and
independent contractors, to the extent it is based on a claim that the Purchaser
Documentation, the Product design or any third party intellectual property
incorporated in Product at the direction of Purchaser, infringes any patent,
copyright, mask work right or other intellectual property right, or
misappropriates any trade secret, of a third party ("Claim"). Purchaser shall
pay all costs of defense and settlement, together with any judgment which may be
finally awarded; provided: (a) Adaptec gives Purchaser reasonably prompt notice
in writing of any such suit and permits Purchaser, through counsel of its
choice, to defend and/or settle such Claim; and (b) Adaptec provides Purchaser
information, assistance and authority, at Purchaser's expense, to enable
Purchaser to defend such Claim. Purchaser shall not be responsible for any
settlement made by Adaptec without Purchaser's written permission.
14.4 Exceptions. Purchaser will not have liability under this
Section 14 to the extent that such Claim results from Adaptec's manufacturing
process.
15. GENERAL INDEMNITY
Each party hereto (the "Indemnifying Party") shall, at its own expense,
defend the other party, and its subsidiaries, affiliates, directors, officers,
employees, agents and independent contractors (collectively, the "Indemnified
Party"), from and against any and all loss, cost, liability or expense
(including costs and reasonable fees of attorneys and other professionals)
arising out of or in connection with the negligence of the Indemnifying Party's
agents and employees. Such indemnity shall include claims brought with respect
to the defective design of the Product for which Purchaser shall be the
indemnifying party. The Indemnifying Party shall pay all costs of defense and
settlement, together with any judgment which may be finally awarded; provided:
(a) the Indemnified Party gives the Indemnifying Party reasonably prompt notice
in writing of any such suit and permits the Indemnifying Party, through counsel
of its choice, to defend and/or settle such Claim; and (b) the Indemnified Party
provides the Indemnifying Party information, assistance and authority, at the
Indemnifying Party's expense, to enable the Indemnifying Party to defend such
Claim. The Indemnifying Party shall not be responsible for any settlement made
by the Indemnified Party without the Indemnifying Party's written permission.
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16. TERMINATION
16.1 Termination Without Cause. Purchaser may, for any reason or
for no reason whatsoever, terminate this Agreement, in whole, or in part, upon
two (2) months advance notice to Adaptec.
16.2 Effect Of Termination Without Cause. In the event Purchaser
terminates this Agreement pursuant to Section 16. 1, Purchaser shall pay to
Adaptec all amounts due to Adaptec, including: (a) for all Products ordered
under outstanding Purchase Orders not fulfilled due to such termination, the
full purchase price for all materials in finished goods and the proportionate
price (based on status of completion) of any work in process, and (b) the full
purchase price of all Risk-buy Inventory and Unique Inventory including freight,
tax, and other costs paid by Adaptec, riot incorporated into Products sold to
Purchaser. Adaptec shall promptly invoice such amounts after the effective date
of termination, and payment shall be made within thirty (30) days of the invoice
date.
16.3 Termination For Default. Either party may suspend its
performance and/or terminate this Agreement immediately upon written notice at
any time if:
(a) The other party is in material breach of any
warranty, term, condition or covenant of this Agreement other than those
contained in Section 17 and fails to cure that breach within thirty (30) days
after written notice of that breach and of the first party's intention to
suspend its performance or terminate;
(b) The other party is in material breach of any
warranty, term, condition or covenant of Section 17; or
(c) The other party: (i) becomes insolvent; (ii) admits
in writing its insolvency or inability to pay its debts or perform its
obligations as they mature; or (iii) makes a general assignment for the benefit
of creditors.
16.4 Effect of Termination in General. The following terms apply
to any termination under this Agreement, including without limitation,
termination for convenience and for default:
(a) Immediately upon any termination of this Agreement,
Adaptec shall, to the extent and at times specified by Purchaser, stop all work
on outstanding Purchase Orders, incur no further direct cost, and protect all
property in which Purchaser has or may acquire an interest pursuant to this
Section 16.
(b) Immediately upon any termination of this Agreement,
each party will return to the other party or, pursuant to the other party's
written instructions, destroy all materials in its possession containing
Confidential Information of the other party. Returned
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Confidential Information materials shall be shipped freight collect. In
addition, Adaptec shall immediately deliver to Purchaser or to Purchaser's
designated third party manufacturer, as Purchaser directs, any and all Purchaser
Technology, Inventory or other property of the Purchaser within Adaptec's
possession or control. Such items shall be delivered FOB the Adaptec facility at
which they are located (i.e., Singapore or Milpitas). Notwithstanding the
foregoing, Adaptec shall have no obligation to deliver any Inventory until and
unless Purchaser has paid in full all amounts due to Adaptec.
(c) Unless this Agreement is terminated pursuant to
Section 16.1 or by Adaptec pursuant to Section 16.3, Purchaser shall reimburse
Adaptec for the full purchase price paid by Adaptec, including freight, tax, and
other costs paid by Adaptec, of all Risk-buy Inventory and Unique Inventory
which is not incorporated into Products sold to Purchaser. Such reimbursement
shall be paid for as provided in Section 7.
(d) If this Agreement is terminated by Adaptec pursuant
to Section 16.3, then Purchaser shall immediately pay to Adaptec all amounts due
to Adaptec, including the full purchase price for all outstanding Purchase
Orders, and the full purchase price of all Risk-buy Inventory and Unique
Inventory, including freight, tax, and other costs paid by Adaptec, not
incorporated into Products sold to Purchaser.
(e) Notwithstanding any termination of this Agreement,
the provisions of Section 7, 9, 10, 12, 13, 14, 15, 17, 18 and the relevant
sections of Sections 16 and 19 shall remain in effect.
16.5 Transition Assistance. Purchaser may elect to purchase the
transition assistance specified in Exhibit E for transitioning the Services
provided by Adaptec hereunder to SCI Systems, Inc. in Singapore. Purchaser shall
exercise its election by paying to Adaptec the fee specified in Exhibit E within
thirty (30) days of the Effective Date. If Purchaser has paid such fee and the
Agreement is not terminated by Adaptec pursuant to Section 16.3, then upon
termination of the Agreement Adaptec shall provide such transition assistance to
Purchaser. Notwithstanding the foregoing, if the Agreement is terminated by
Adaptec to pursuant to Section 16.3, Adaptec shall have no obligation to provide
any such technical assistance and any fees paid by Purchaser therefor shall be
applied to amounts owed to Adaptec, with any residual fees refunded to
Purchaser.
17. CONFIDENTIALITY
Each party will protect the other's Confidential Information in
accordance with the terms of the MNDA. Notwithstanding the terms of the
MNDA, Purchaser may disclose the terms and conditions of this Agreement
to investors and potential investors, subject to such parties' agreement
to maintain such terms and conditions in confidence.
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18. LIMITATION OF LIABILITY
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, AND EXCEPT AS SET FORTH
IN SECTIONS 14 AND 15, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER OR
ANY OTHER PERSON FOR ANY SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
OF ANY KIND, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS OR DAMAGES TO THE
OTHER PARTY'S BUSINESS REPUTATION HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY,
WHETHER IN AN ACTION FOR CONTRACT, STRICT LIABILITY OR TORT (INCLUDING
NEGLIGENCE) OR OTHERWISE, WHETHER OR NOT THE FIRST PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE
OF ANY REMEDY.
19. GENERAL
19.1 Notice. Any notice shall be considered given if delivered
personally or if sent by either party to the other by prepaid Federal Express,
registered or certified mail, or by telefax (followed by a confirming hard copy)
addressed to the address specified below, or to such other address as the party
provides by written notice:
If to Adaptec:
Adaptec, Inc.
000 X. Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Vice President, Operations
cc: General Counsel
If to Purchaser:
Jaycor Networks, Inc.
0000 Xxxxx Xxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attention: President
19.2 Assignment. Neither party shall assign any of its rights or
privileges hereunder without the prior written consent of the other party;
provided, however, that Adaptec may subcontract the performance of any or all of
the Services without Purchaser's consent, subject to provision of written notice
to Purchaser identifying such subcontractor. Any attempt at assignment in
derogation of the foregoing shall be null and void. Subject to the foregoing,
this Agreement shall be binding upon and inure to the benefit of the parties
hereto, their subsidiaries, and their respective successors and assigns.
13
14
19.3 Allocation of Risk. The parties acknowledge and affirm that
the sections on limitation of liability, warranties and disclaimer of warranties
and damage limitation in this Agreement allocate the risks between the parties.
This allocation is reflected in the pricing of the Products and is an essential
element of the basis of the bargain between the parties.
19.4 Export Control.
(a) Representation. Purchaser agrees to comply strictly
and fully with all export controls imposed on the Products by any country or
organization in whose jurisdiction Purchaser operates or does business.
Purchaser will not knowingly, export or reexport any Product to any country
prohibited under United States Export Administration Regulations, without first
obtaining a valid license to so export or reexport the Products.
(b) Responsibility. All export permits, import
certificates, insurance, duty, customs clearance charges and/or licenses and
related costs will be Purchaser's responsibility.
19.5 Waiver. No failure or delay on the part of either party in
the exercise of any right or privilege hereunder shall operate as a waiver
thereof or as a waiver of the exercise of any other right or privilege
hereunder, nor shall any single or partial exercise of any such right or
privilege preclude other or further exercise thereof or of any other right or
privilege.
19.6 Governing Law: Attorneys' Fees. This Agreement shall be
governed by and enforced in accordance with California law as applied to
contracts entered into in California by California residents to be performed
entirely within the State of California. In the event either party is required
to seek legal recourse to enforce its rights hereunder, the prevailing party
shall be entitled to receive, in addition to any other award, all costs in
connection therewith, including reasonable attorneys' fees.
19.7 Titles . Any titles included herein are for convenience
only and are not to be used in the interpretation of this Agreement.
19.8 Severability. If any provision of this Agreement is held to
be ineffective, unenforceable or illegal for any reason, such provision
partially will be enforced to the maximum extent permitted by law, and the
remainder of this Agreement will remain in full force and effect.
19.9 Force Majeure. Neither of the parties shall be deemed to be
in default of this Agreement to the extent any failure to perform hereunder is a
result of conditions beyond the other party's reasonable control, including but
not limited to, acts of God, war, strikes, fires, floods, earthquakes, work
stoppages and embargoes, material shortages, subcontractor delays, equipment or
other facilities failures (which delays or failures are beyond the reasonable
control, without negligence, of the defaulting party), and neither party shall
have the right to terminate this Agreement for any such delay or default on the
part of the other party.
14
15
19.10 Integration. This Agreement and its Exhibits embodies the
entire understanding of the parties and supersedes any prior agreements,
representations or understandings between the parties as it relates to the
subject matter hereof. No amendment or modification of this Agreement shall be
valid or binding unless in writing and signed by duly authorized representatives
of each party.
19.11 Publicity. Except as required by law, neither party will
disclose the terms of this Agreement to any third party without the express
written consent of the other, which consent shall not unreasonably be withheld
or delayed.
19.12 Relationship. The parties are independent contractors.
Nothing contained herein and no action taken pursuant hereto shall constitute
the parties as joint ventures or the agents of the other party for any purpose
or in any sense whatsoever.
19.13 Counterparts. This Agreement may be executed in
counterparts, each of which constitutes an original, and together which
constitute the Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date.
JAYCOR NETWORKS, INC. ADAPTEC, INC.
("Purchaser") ("Adaptec")
By: /s/ XXXXX X. XXXXXXXX By: /s/ Xxxxx Xxxxxxx
------------------------------- -------------------------------
Name: Name:
----------------------------- -----------------------------
Title: Title:
---------------------------- ----------------------------
15
16
EXHIBIT A
Products, Prices Lead Times & Minimum Lot Size
AHA-F940 32-bit PCI Fibre Channel Host Bus Adapter
AHA-F950 64-bit PCI Fibre Channel Host Bus Adapter
Lead Time for all Products *
Minimum Lot Sizes for all Products * .
STANDARD COST
PRODUCT BOARDS: PART NUMBER PRICE
--------------- ----------- -----
AHA-F940 5 PACK 1699300 *
AHA-F940 BAG BULK 1668300 *
AHA-F940 DEV KIT 1697200 *
AHA-F940 HOST ADAPTER 1668200 *
AHA-F940 MAC 5-PACK 1749600 *
AHA-F940 SINGLE 1696900 *
AHA-F940/AVID ADAPTER 1752400 *
AHA-F940/AVID HOST ADAPTER 1750600 *
AHA-F940/AVID KIT 1752500 *
AHA-F940/AVID SINGLE 1750700 *
AHA-F940/JA SGL 1696900JA *
AHA-F950 5 PACK 1699400 *
AHA-F950 BAG BULK 1649100 *
AHA-950 DEV KIT 1697300 *
AHA-F950 HOST ADAPTER 1649000 *
AHA-F950 SINGLE 1697000 *
AHA-F950/Al BAG BK 1668500 *
AHA-F950/Al HOST ADAPTER 1668400 *
AHA-F950/JA SGL 1697000JA *
AHA-F950/SGI HOST ADAPTER 1687800 *
AHA-F950/SGI KIT 1687600 *
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
17
EXHIBIT B
Purchaser Documentation and Test Equipment
PRODUCT: AHA-F940
-design: schematics
-layout: Gerber Files (located in directory:9945d3/pcb/mfg/994504d.00 at
apache:/export/proj/pcbcad/p1/pcbcad/fire_files/)
-building parameters:
xxxx of materials
assembly drawings (located in directory:9945d3/pcb/mfg/994504d.00 at
apache:/export/proj/pcbcad/p1/pcbcad/fire_files/)
fab drawings (located in directory:9945d3/pcb/mfg/994504d.00 at
apache:/export/proj/pcbcad/p1/pcbcad/fire_files/)
Programmable Array Logic equations
-verification and testing
test plans
test reports from Adaptec's Compatibility Test Laboratory and Product Test
Laboratory
certificates for FCC (US), UL (US), CE (Europe), VCCI (Japan),
and C-TICK (Australia)
related ECN/ECR/EDA
PRODUCT: AHA-F950
-design: schematics
-layout: Gerber Files (located in directory: 9946e3/pcb/mfg/994604e.00 at
apache:/export/proj/pcbcad/p/pcbcad/fire_files/)
-building parameters:
xxxx of materials
assembly drawings (located in directory: 9946e3/pcb/mfg/994604e.00 at
apache:/export/proj/pcbcad/pl/pcbcad/fire_files/)
fab drawings (located in directory: 9946e3/pcb/mfg/994604e.00 at
apache:/export/proj/pcbcad/pl/pcbcad/fire_files/)
Programmable Array Logic equations
-verification and testing
test plans
test reports from Adaptec's Compatibility Test Laboratory and Product Test
Laboratory
certificates for FCC (US), UL (US), CE (Europe), VCCI (Japan),
and C-TICK (Australia)
related ECN/ECR/ EDA
18
Test Equipment
FUNCTIONAL TESTER * :
AHA-F951
AHA-F951
AHA-F950B (F952)
AHA-F950B (F952)
AHA-F940
AHA-F9x0
ICT TEST FIXTURE * :
AHA-F940
AHA-F950
ICT TEST FIXTURE * :
GenRad ICT Fixture AHA-F940
GenRad ICT Fixture AHA-F950
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
19
EXHIBIT C
Master Mutual Non-Disclosure Agreement
20
MUTUAL CONFIDENTIAL DISCLOSURE AGREEMENT
Agreement dated Sept 2, 1998, between Jaycor Networks, Inc ("Jaycor") and
Adaptec, Inc., ("Adaptec")
1. Background. Jaycor and Adaptec intend to engage in discussions and
negotiations concerning a possible business transaction between the parties. In
the course of such discussions and negotiations, it is anticipated that each
party may disclose or deliver to the other certain trade secrets or confidential
or proprietary information for the purpose of enabling the parties, and their
respective employees, officers, directors, agents and advisors (collectively,
"Representatives"), to evaluate the feasibility of such business transaction.
Jaycor and Adaptec have entered into this Agreement in order to assure the
confidentiality of such trade secrets and confidential or proprietary
information in accordance with the terms of this Agreement.
2. Proprietary Information. As used in this Agreement, the term
"Proprietary Information" shall mean all trade secrets or confidential or
proprietary information designated as such in writing by a disclosing party,
whether by letter or by the use of an appropriate proprietary stamp or legend,
prior to or at the time any such trade secret or confidential or proprietary
information is disclosed to the receiving party. Notwithstanding the foregoing,
information which is orally or visually disclosed by one party to the other, or
is disclosed in writing without an appropriate letter, proprietary stamp or
legend, shall constitute Proprietary Information if (i) it would be apparent to
a reasonable person, familiar with the disclosing party's business and the
industry in which it operates, that such information is of a confidential or
proprietary nature the maintenance of which is important to the disclosing party
or if (ii) a disclosing party, within thirty (30) days after such disclosure,
delivers to the receiving party a written document or documents describing such
information and referencing the place and date of such oral, visual or written
disclosure and the names of the Representatives of the receiving party to whom
such disclosure was made.
3. Disclosure of Proprietary Information. The receiving party shall hold
in confidence, and shall not disclose (or permit or suffer disclosure) to any
person other than its Representatives, any Proprietary Information of the
disclosing party. The receiving party and its Representatives shall use such
Proprietary Information only for the purpose for which it was disclosed and
shall not use or exploit such Proprietary Information for its own benefit or the
benefit of another without the prior written consent of the disclosing party.
Without limitation of the foregoing, each party shall not cause or permit
reverse engineering of the other party's Proprietary Information or
decompilation or disassembly of any software programs which are part of the
Proprietary Information. The receiving party shall disclose Proprietary
Information received by it under this Agreement only to Representatives who have
a need to know such Proprietary Information in the course of the performance of
their duties in connection with the transaction contemplated by this Agreement,
and who are bound to protect the confidentiality of such Proprietary
Information. The receiving party will promptly report to the disclosing party
any actual or suspected violation of the terms of this Agreement and will take
all reasonable further steps requested by the disclosing party to prevent,
control or remedy any such violation.
-1-
21
4. Limitation Obligations. The obligations of the receiving party
specified in Section 3 above shall not apply, and the receiving party shall have
no further obligations, with respect to any Proprietary Information to the
extent the receiving party can demonstrate that such Proprietary Information:
(a) is generally known to the public at the time of disclosure or
becomes generally known through no wrongful act on the part of the receiving
party;
(b) is in the receiving party's possession at the time of
disclosure;
(c) becomes known to the receiving party through disclosure by
sources other than the disclosing party having the legal right to disclose such
Proprietary Information;
(d) is independently developed by the receiving party without
reference to or reliance upon the Proprietary Information; or
(e) is required to be disclosed by the receiving party to comply
with applicable laws or governmental regulations, provided that the receiving
party provides prior written notice of such disclosure to the disclosing party
and takes reasonable and lawful actions to avoid and/or minimize the extent of
such disclosure.
5. Ownership of Proprietary Information. The parties agree that the
disclosing party is and shall remain the exclusive owner of the Proprietary
Information and all patent, copyright, trade secret, trademark and other
intellectual property rights therein. No license or conveyance of any such
rights to the receiving party by the disclosing party is granted or implied
under this Agreement.
6. Return of Documents. The receiving party shall, upon the termination of
this Agreement or the request of the disclosing party, return to the disclosing
party all drawings, documents and other tangible manifestations of Proprietary
Information received by the receiving party pursuant to this Agreement (and all
copies and reproductions thereof).
7. Miscellaneous
(a) This Agreement supersedes all prior agreements, written or
oral, between Jaycor and Adaptec relating to the subject matter of this
Agreement. This Agreement may not be modified, amended or discharged, in whole
or in part, except by an agreement in writing signed by the parties.
(b) This Agreement will be binding upon and inure to the benefit
of the parties hereto and their respective heirs, successors and assigns.
(c) This Agreement shall be construed and interpreted in
accordance with the laws of the State of California, without reference to any
Conflicts of laws rules. In the event of
-2-
22
any dispute arising out of this Agreement, the prevailing party shall be
entitled to an award of its costs and attorneys' fees.
(d) The parties agree that any breach of this Agreement will
cause substantial and irreparable damages and, therefore, in the event of any
such breach, in addition to other remedies which may be available, and the
injured party shall have the right to seek specific performance and other
injunctive and equitable relief.
EXECUTED as of the day and year first set forth above.
Jaycor Networks, Inc. Adaptec, Inc.
By: /s/ XXXXX X. XXXXXXXX By: /s/ XXXXXX XXXXXX
------------------------- -------------------------------------
Title: President & CEO Title: V.P. Adaptec, Inc.
-3-
23
EXHIBIT D
RMA Procedure
[ADAPTEC LOGO] FACSIMILE TRANSMISSION
TO:
COMPANY
FAX:
DATE: November 24, 1998
FROM: Xxxxx Xxxxxx
FAX (000) 000-0000
SUBJECT: RETURN AUTHORIZATION
FYI RESPONSE TO YOUR FAX CONTROL # RESPONSE RQRD
URGENT X RESPONSE TO YOUR REQUEST X RESPOND By
-4-
24
[ADAPTEC LOGO]
OEM RMA REQUEST INFORMATION
THE FOLLOWING INFORMATION AND PROCEDURES ARE REQUIRED WHEN REQUESTING A RETURN
MATERIAL AUTHORIZATION (RMA) NUMBER.
A. Submit RMA requests via Fax to the following number:
Fax Number: 000-000-0000
RMA Customer Service Representatives:
Xxxxxxx Xxxxxx
Xxxxx Xxxxxx
B. Provide the following information with your request:
1. Full company name and ship to address.
2. Contact person with phone & Fax number.
3. Quantity returning, model number and Adaptec six digit part number
located component side up, on an white label affixed to a surface mounted
IC. The bar-coded serial number, is located on the backside of the
product.
EXAMPLE: QTY. 2
AHA-1542CF SINGLE = ADAPTEC MODEL NUMBER
571600 = ADAPTEC SIX DIGIT PART NUMBER
9352 = ADAPTEC FOUR DIGITAL DATE CODE
4. Your part number if applicable.
5. P.O. number or debit memo number if applicable.
6. Any special instructions or requirements.
25
7. MINIMUM RETURN QUANTITY OF 10 PRODUCTS PER RMA REQUEST ONCE A MONTH. IF
QUANTITY IS LESS THAN 10 PRODUCTS PER REQUEST, THAN A RMA CAN BE ISSUED
TWICE A MONTH.
C. UPON RECEIPT OF THE ABOVE INFORMATION, WARRANTY STATUS WILL BE DETERMINED,
AND A CONFIRMATION LETTER WITH THE RMA NUMBER WILL BE FAXED TO YOU WITHIN
48 HOURS.
D. Place products in individual anti-static bags, and package utilizing
proper packing insulation. If shipping in multiple cartons, boxes should
be numbered; 1 of 3, 2 of 3, etc.
E. Return only products and quantities authorized on request confirmation.
All return shipments will be verified with original return request, and
customer notified of any discrepancies received. For international
customers, provide a pre-alert prior
NOTE: ALL INTERNATIONAL CUSTOMERS TO PROVIDE A PRE-ALERT BEFORE SHIPPING
PRODUCTS.
F. ENCLOSE A PACKING SLIP, CLEARLY LABEL EACH BOX WITH THE RMA NUMBER AND
SHIP FREIGHT PRE-PAID. ANY PACKAGE RECEIVED WITHOUT A VALID RMA NUMBER
CLEARLY MARKED ON THE OUTSIDE OF THE BOX WILL BE RETURNED UNOPENED.
G. CUSTOMERS RETURN MATERIALS TO:
ADAPTEC, INC.
ATTN: RECEIVING - M/S 225
000 XXXXX XXXXXXXX XXXX.
XXXXXXXX, XX 00000
ATTN: RMA #RXXXXX
H. Repaired products will be returned freight pre-paid by Adaptec no later
than 15 working days from date of receipt of defective materials.
I. If products are deemed unrepairable due to obsolescence or unavailability
of replacement parts, Adaptec will at their option either replace products
with current equivalent products, or issue credit at the last listed
purchase price.
J. The RMA number will be valid for 30 days from date of issuance and will be
canceled if products are not received in that time frame, unless customer
requests an extension.
NOTE: COMPLIANCE TO ALL OF THE ABOVE INFORMATION WILL INSURE THAT AN RMA REQUEST
IS COMPLETED IN A TIMELY AND EFFICIENT MANNER WITHOUT ANY UNNECESSARY
DELAYS.
26
[ADAPTEC LOGO]
DEFECTIVE MATERIALS RMA REQUEST
TO: ADAPTEC RMA DEPT. DATE:__________
FAX #: 000-000-0000 COMPANY NAME:
______________________________________
ATTN: Elisa, Xxxxxx CONTACT NAME:
______________________________________
Xxxxxxx Xxxxxx FAX # & TELEPHONE #:
______________________________________
CUSTOMER ID #:
______________________________________
SHIP TO ADDRESS:
______________________________________
______________________________________
--------------------------------------------------------------------------------
QTY ADAPTEC MODEL NUMBER ADAPTEC P/N CUSTOMER P/N DATE CODES
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
27
EXHIBIT E
Transition Assistance
-------------------------------------------------------------------------------------------------------
MAN-HOURS/
ACTIVITIES RESOURCES PERSON REMARKS
-------------------------------------------------------------------------------------------------------
SUB-CON'S QUALITY SYSTEM/PLANT IMPT: ON A PER SUB-CON BASIS
QUALIFICATION
-------------------------------------------------------------------------------------------------------
>> FIRST AUDIT QA Engr (x1) *
-------------------------------------------------------------------------------------------------------
QA Assistant Engr (x1) *
-------------------------------------------------------------------------------------------------------
QA EA (x1) *
-------------------------------------------------------------------------------------------------------
Snr Process Engr (x1) *
-------------------------------------------------------------------------------------------------------
Test Engr (x2) *
-------------------------------------------------------------------------------------------------------
Purchasing Sect Mgr (x1) *
-------------------------------------------------------------------------------------------------------
*Packaging Engr (x1) * Packaging will only be involved
if sub-con has the
-------------------------------------------------------------------------------------------------------
*Packaging EA (x1) * capability to assemble kits
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
>> FOLLOW-UP AUDIT QA Engr (x1) * Follow-up audit will be
performed if the First Audit
-------------------------------------------------------------------------------------------------------
QA Assistant Engr (x1) * finds non-conformances which
requires corrective
-------------------------------------------------------------------------------------------------------
QA EA (x1) * action
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
DOCUMENTATION PACKAGE IMPT: ON A PER PRODUCT BASIS
-------------------------------------------------------------------------------------------------------
>> PACKAGE COMPILATION Doc Con Specialist (x1) *
-------------------------------------------------------------------------------------------------------
> BOM (Product &
Functional Tester)
-------------------------------------------------------------------------------------------------------
> Deliverables (ASW
masters, FT/ICT prgms,
-------------------------------------------------------------------------------------------------------
Postscript files for
artworks, Films for
-------------------------------------------------------------------------------------------------------
Sleeves/CD)
-------------------------------------------------------------------------------------------------------
> Specs (AVL list, Prnt/Pkg/
Lbl instructions,
-------------------------------------------------------------------------------------------------------
Schematic/Fab/Assy
drawings, others)
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
>> PACKAGE VERIFICATION Engr (x1) *
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Initials __ __
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
28
----------------------------------------------------------------------------------------------------------
MAN-HOURS/
ACTIVITIES RESOURCES PERSON REMARKS
----------------------------------------------------------------------------------------------------------
>> COMPILATION OF NON-AVL Purchasing Sect Mgr (x1) *
SUPPLIERS
----------------------------------------------------------------------------------------------------------
> PCB, manuals, others Purchaser (x2) *
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
MFG/TESTING CAPABILITY TRANSFER
----------------------------------------------------------------------------------------------------------
>> IN-CIRCUIT TESTER IMPT: ON A PER FIXTURE BASIS
----------------------------------------------------------------------------------------------------------
> Fixture re-tool & Test Test Engr (x1) * According to Genrad Inc., SCI
program modification is using GR2286 ICT
----------------------------------------------------------------------------------------------------------
Testers which are different
from AMS. The worst case
----------------------------------------------------------------------------------------------------------
> Fixture transfer, set-up Test Engr (x1) * is the ICT Test Fixture needs
& training to be re-tooled and the
----------------------------------------------------------------------------------------------------------
> ICT qualification QA Engr (x1) * test program need to be modified
and re-qualified
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
>> FUNCTIONAL TESTER
----------------------------------------------------------------------------------------------------------
> Tester verification in AMS Test Engr (x1) * IMPT: ON A PER TESTER BASIS
(EXCEPT FOR
----------------------------------------------------------------------------------------------------------
> Tester transfer & set-up Test Engr (x1) * TRAINING, WHICH IS PER PRODUCT
sub-con BASIS)
----------------------------------------------------------------------------------------------------------
> FT qualification QA Engr (x1) *
----------------------------------------------------------------------------------------------------------
> Training & knowledge transfer Test Engr (x2) *
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
>> FIRMWARE PROGRAMMING
PROCESS IMPT: ON A PER PRODUCT BASIS
----------------------------------------------------------------------------------------------------------
> Training & knowledge transfer Test EA (x1) * Assuming that all sub-con
(including equipments are compatible
----------------------------------------------------------------------------------------------------------
MAC address) (Zebra 140xi printer, TEC
printer, AutoLabel 3000,
----------------------------------------------------------------------------------------------------------
> Programmer qualification QA EA (x1) * DATA I/O programmer Codesoft
software) and no
----------------------------------------------------------------------------------------------------------
hardware/software transfer
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
>> MANUFACTURING PROCESS IMPT: ON A PER SUB-CON BASIS
----------------------------------------------------------------------------------------------------------
> *BGA Process transfer Snr Process Engr (x1) * Applicable only if products
requires BGA processes
----------------------------------------------------------------------------------------------------------
Initials __ __
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
29
----------------------------------------------------------------------------------------------------
MAN-HOURS/
ACTIVITIES RESOURCES PERSON REMARKS
----------------------------------------------------------------------------------------------------
> *BGA Quality spec training QA EA (x1) * Sub-con must have BGA
capability (including
----------------------------------------------------------------------------------------------------
inspection). There will be
no hardware (including
----------------------------------------------------------------------------------------------------
stencils)/software transfer
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
>> PACKAGING PROCESS IMPT: ON A PER SUB-CON BASIS
----------------------------------------------------------------------------------------------------
> Training for creating Packaging EA (x1) *
diskette label
----------------------------------------------------------------------------------------------------
>*Training for Barcode Packaging EA (x1) * Applicable only if sub-con
Tracking System will perform BTS
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
FIRST BUILD SUPPORT IMPT: ON A PER PRODUCT BASIS
----------------------------------------------------------------------------------------------------
>> TECHNICAL COORDINATION QA Assistant Engr (x1) *
MEETING
----------------------------------------------------------------------------------------------------
QA EA (x1) *
----------------------------------------------------------------------------------------------------
QA Rel Snr Engr (x1) *
----------------------------------------------------------------------------------------------------
Snr Process Engr (x1) *
----------------------------------------------------------------------------------------------------
Test Engr (x2) *
----------------------------------------------------------------------------------------------------
Purchasing Sect Mgr (x1) *
----------------------------------------------------------------------------------------------------
Doc Con Snr Admin (x1) *
----------------------------------------------------------------------------------------------------
Planner (x1) *
----------------------------------------------------------------------------------------------------
Packaging EA (x1) *
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
>> FIRST BUILD ON-SITE SUPPORT QA EA (x1) *
----------------------------------------------------------------------------------------------------
QA AE (x1) *
----------------------------------------------------------------------------------------------------
Snr Process Engr (x1) *
----------------------------------------------------------------------------------------------------
Packaging EA (x1) *
----------------------------------------------------------------------------------------------------
Test Engr (x2) *
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
>> FIRST ARTICLE
----------------------------------------------------------------------------------------------------
> PCBA level QA Technician (x1) *
----------------------------------------------------------------------------------------------------
>*Diskette QA Technician (x1) * Applicable only if diskette
or single/kit level products
----------------------------------------------------------------------------------------------------
>*Kit level QA Technician (x1) * involved
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
>> FIRST 3 LOTS BUY-OFF QA Inspector (x5) * First 3 lost of 150 each
(ON SITE)
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Initials __ __
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
30
----------------------------------------------------------------------------------------------------
MAN-HOURS/
ACTIVITIES RESOURCES PERSON REMARKS
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
MISCELLANEOUS IMPT: ON A PER PRODUCT BASIS
----------------------------------------------------------------------------------------------------
>> TRANSFER COORDINATION Section Mgr (x1) *
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
>> POST TRANSFER TECHNICAL Engr (x1) *
SUPPORT
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
Grand Total * (US$)
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
REMARKS:
(1) Cost Estimate does not provide for quality monitoring beyond first 3 lots
(2) Cost Estimation does not provide for customer complaints support post
transfer
(3) Transfer coordination & post transfer technical support are provision for
activities beyond those itemised above
(4) This cost estimation is based on a typical Adaptec product. Products with
unique requirements will require reassessment of cost related to the unique
areas.
(5) Cost Estimate for ICT does not include supplier charges for fixture
and program modifications
(6) Exchange rate of S$1.7238 to US$1.000 used
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
31
EXHIBIT F
Long Lead Time Components
These are the Long Lead Time Components for the F950/1697000 and the
F940/1696900:
ADAPTEC PART NUMBER DESCRIPTION LEAD-TIME
------------------- ----------- ---------
1. * * *
2. * * *
3. * * *
4. * * *
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
32
EXHIBIT G
Unique Components
UNIQUE PARTS LIST (COMPONENTS) FOR F940/950
Std
P/N Desc. OPA Cost
--- ----- --- ----
739911 aic 1160 x1 *
994507-00 pcb x1 *
994607-00 pcb x1 *
13470 ic x1 *
13473 ic x1 *
13961 ic x1 *
13555 res chip x1 *
14031 res chip x1 *
14417 res ntwk x1 *
13671 bracket x1 *
13784 screwlock x2 *
11916 cap x1 *
13304 conn x1 *
13474 osc xtal x1 *
13699 led x1 *
13783 plug x1 *
511450-00 install guide 1 *
497530-00 flyer 1 *
497429-00 cable 1 *
497528-00 label 1 *
497605-00 card 1 *
511703-00 card 1 *
511652-00 user guide 1 *
511703-00JA card 1 *
511450-00JA install guide 1 *
511652-00JA user guide 1 *
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
33
EXHIBIT H
Quotation for Manufacture of Functional Tester
Unit Total
S/N Item Description Cost Qty Cost
FIXTURE
--------------------------------------------------------------------------------
1 Desktop fixture fabrication * 1 *
TOTAL *
--------------------------------------------------------------------------------
SYSTEM
1 Intel Pentium System with 200 CPU & * 1 *
32 MB
Ram
ISA display card
Seagate 2.1GB IDE Harddisk
1.44MB Floppy Disk Drive
300W Power Supply
MS Dos TOTAL *
--------------------------------------------------------------------------------
ACCESSORIES
1 Laser Handheld Scanner * 1 *
2 I/O Port Controller * 1 *
3 Universal Fault Board * 1 *
4 PCI Bus Isolation Board * 1 *
5 PCI Bus Extender * 1 *
6 Lambda Power Supply * 1 *
7 Solid state Relay * 1 *
8 PCI bridge Board * 1 *
9 Loop-back cable * 1 *
10 Miscellaneous * 1 *
TOTAL *
--------------------------------------------------------------------------------
LABOUR COST
1 S/W & H/W development &
Troubleshooting Time:
(One Test Development Engr for
100 hrs) * 100 *
TOTAL *
--------------------------------------------------------------------------------
GRAND
TOTAL *
--------------------------------------------------------------------------------
Remarks
(1) Fixture fabrication, System & Accessories are estimation and are based on
AHA-F950 product tester
* "Confidential portion has been omitted and filed separately with the
Securities and Exchange Commission."
