ZBRA » Topics » General Terms And Conditions

This excerpt taken from the ZBRA 10-Q filed Apr 30, 2008.

General Terms And Conditions

 

1.1 Definitions. Terms used herein with initial capital letters shall have the respective meanings set forth in Article X.

 

1.2 Appointment of Manufacturer. Zebra hereby appoints Manufacturer, and Manufacturer hereby accepts, the non-exclusive appointment to manufacture the Products for purchase by Zebra, at such times and from time to time as Zebra, in its sole discretion, may request by issuance of a binding forecast per Section 4.1.

 

1.3 Other Zebra Parties. If Zebra provides Manufacturer with a parental guarantee, Zebra’s Affiliates shall have the right to purchase Products in accordance with the other terms of

 

*** Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

 

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this Agreement. Any and all pricing that is offered to Zebra shall also be made available to Zebra’s Affiliates.

 

1.4 Exclusivity. Manufacturer shall not manufacture, package, market or sell any finished Product, or any WIP, component, subassembly, assembly or print engine unique to any finished Product, to or for any Person, anywhere in the world, other than to Zebra or Zebra’s Affiliates.

 

1.5 Non-competition. Manufacturer acknowledges that Zebra possesses valuable Confidential Information, Technology and Intellectual Property Rights related to the Products, that Zebra derives significant competitive advantage from the foregoing, that Manufacturer will be exposed to Zebra’s Confidential Information and Technology in connection with its obligations under this Agreement and that money damages are insufficient to protect Zebra’s interest in its Confidential Information, Technology and Intellectual Property Rights. Manufacturer further acknowledges that the scope of Zebra’s business is independent of location such that is not practical to limit the restrictions contained in this Section 1.5 to specific countries. Therefore, in order to protect Zebra’s rights in its Confidential Information, Technology and Intellectual Property Rights, and the value of Zebra’s business, to the extent permitted by applicable Laws, [*** Redacted] Manufacturer acknowledges that the restrictions contained in this Section 1.5 are reasonable in all respects, necessary to protect Zebra’s Confidential Information, Technology and Intellectual Property Rights, constitute a material inducement of Zebra to enter into this Agreement and that, without such protection, Zebra’s competitive advantage would be materially adversely affected. If, at the time of enforcement of these provisions, a court or arbitrator’s award permitted by Section 9.5a holds that the restrictions stated in this Section 1.5 are unreasonable under circumstances then existing, the parties agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area.

 

1.6 Most Favored Nation. Manufacturer shall not, anywhere in the world, manufacture, package, market or sell thermal barcode printers or thermal card printers, at lower prices, or on better terms, than those offered to Zebra. If such better terms or pricing are provided to any Person, then Manufacturer shall promptly offer the same pricing or terms to Zebra. At its sole option, Zebra may elect to substitute such pricing or terms for the corresponding pricing or terms herein.

 

1.7 Competitiveness. Manufacturer understands that Zebra’s purchase of Products under this Agreement is dependent upon the Product pricing remaining competitive with that of other manufacturers and suppliers for thermal barcode printers or thermal card printers. Manufacturer shall be responsible for surveying the industry and benchmarking contract terms (including pricing, inventory levels, flexibility and lead time for Materials) and shall share all such information (including Manufacturer’s internal supply chain management report) in detail with Zebra during the Quarterly Business Review.

 

*** Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

 

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1.8 Quality Data. Manufacturer shall submit to Zebra a mechanism for evaluating and scoring Manufacturer’s performance with respect to the Quality Data, consistent with generally accepted United States industry standards. Manufacturer shall monitor, evaluate and score its performance with respect to all Quality Data and shall provide Zebra with a monthly report of such performance, signed by Manufacturer’s Quality Manager, within five (5) Business Days after the last day of such month. Manufacturer shall discuss each such report with Zebra at the next Quarterly Business Review. Zebra shall have the right to terminate this Agreement for cause for Manufacturer’s failure to achieve performance standards under the Quality Data, subject to the same cure period as provided in Section 8.2.

 

1.9 Management of the Relationship.

a. Appointment of Project Team. Each party shall initially designate the following personnel with respect to this Agreement: (i) a relationship manager that is a member of its business unit management staff (each a “Relationship Manager”); (ii) a technical contact that is a member of its engineering or product development staff (each a “Technical Manager”); and (iii) a quality manager that is a member of its quality management staff (each a “Quality Manager”). Zebra’s Relationship Manager shall be Zebra’s Commodity Manager, its Technical Manager shall be Zebra’s Director of Manufacturing Engineering and its Quality Manager shall be Zebra’s Director of Operational Quality. Manufacturer’s Relationship Manager shall be Manufacturer’s Business Unit Director, its Technical Manager shall be Manufacturer’s Business Unit Manager and its Quality Manager shall be Manufacturer’s Quality Manager. Each party may change any of such personnel upon notice to the other party.

b. Duties of Project Team. The Relationship Managers, Technical Managers and Quality Managers shall form the project management team (“Project Team”) and shall meet in person or by phone:

 

  (i) within fifteen (15) Business Days after the Effective Date, to promptly develop a Transfer Plan for the initial PCBA Product transfers and regularly thereafter for follow-on Product, including the criteria set forth in Exhibit C (“Transfer Plan”);

 

  (ii) each calendar quarter to (A) monitor and review the Quality Data from the previous calendar quarter, (B) review and discuss the results for the previous calendar quarter of the Bill of Materials and cost reduction reviews required by Section 5.2, (C) review and monitor the Stored Inventory held at Approved Warehouses pursuant to Section 4.7c, (D) review and discuss the Long-lead Time Materials, and (E) review the business relationship generally, both forward- and backward- looking (collectively, the “Quarterly Business Review”); and

 

  (iii) at the reasonable request of either party.

 

*** Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

 

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The Project Team shall attempt to achieve a timely resolution of any issues or potential issues related to this Agreement before such issues escalate into a Dispute between the parties; provided that, any amendments to this Agreement shall only be made in accordance with Section 9.19. Any Dispute arising out of or relating to this Agreement shall be resolved solely in accordance with the procedures specified in Section 9.5.

 

1.10 Critical Personnel. All employees, contractors and consultants of Manufacturer listed on Exhibit D (the “Critical Personnel”) shall dedicate a majority of their time to performing Services for Zebra. [*** Redacted] Manufacturer shall notify Zebra within two (2) Business Days after becoming aware that any Critical Personnel is reassigned or intends to terminate, or has terminated, his or her employment or engagement with Manufacturer and shall also provide Zebra with all information of which Manufacturer is aware with respect to any new employer of any Critical Personnel if such employer is a competitor of Zebra. Upon Zebra’s request, Manufacturer shall inform any such new employer of the Critical Personnel’s confidentiality obligations under this Agreement.
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