UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): August 2, 2019
ONE STOP SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
Delaware | 001-38371 | 33-0885351 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
2235 Enterprise Street #110
Escondido, California 92029
(Address of principal executive offices)
(760) 745-9883
(Registrants telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
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Common Stock, par value $0.0001 per share | OSS | The NASDAQ Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 |
Entry into a Material Definitive Agreement. |
Effective as of August 2, 2019, One Stop Systems, Inc., a Delaware corporation (the Company), entered into a Domestic Strategic Sourcing Agreement (the Agreement) with Raytheon Company, a Delaware corporation (Raytheon).
Pursuant to the terms of the Agreement, the Company agrees to sell and Raytheon has the option to purchase products and services of the Company at certain prices, descriptions and quantities on an as needed basis for a for a period of five (5) years, unless terminated earlier pursuant to the Agreement.
The Agreement forecasts the ordering requirements from Raytheons anticipated customer requirements. Based on this forecast, Raytheon has the option to purchase products and services from the Company for such quantities, but the actual amount of products and services to be purchased is contingent upon the actual needs of Raytheons customer requirements. As a result, there is no commitment that Raytheon will purchase the forecasted requirement, and Raytheon also has the right to purchase such products from a different third party.
Although the Agreement itself is not a commitment from Raytheon to purchase any product or services from the Company pursuant to the price, description, and quantity set forth under a purchase order, the Company anticipates to fulfil purchase orders for its products, including custom products, parts, and services for the benefit of Raytheon and/or its end user customers. The price for such products and services are subject to price reductions or changes that are offered or given by the Company to other third parties, including its most favored customer, and Raytheon shall also have the right to market test the pricing for such products and services at any time during the term of the Agreement.
The foregoing description of the terms of the Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Agreement a copy of which is attached hereto as Exhibit 10.1.
Item 7.01 |
Regulation FD Disclosure. |
On August 8, 2019, the Company issued a press release announcing the Agreement. A copy of this press release is attached hereto as Exhibit 99.1 and is being furnished with this report.
In accordance with General Instructions B.2 of Form 8-K, the information in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to this Current Report on Form 8-K.
Forward Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this Current Report, including statements regarding the Companys fulfillment of purchase orders, business strategy, and plans are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause the Companys actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In addition, projections, assumptions and estimates of the Companys future performance and the future performance of the markets in which the Company operates are necessarily subject to a high degree of uncertainty and risk. In some cases, you can identify forward-looking statements by terms such as may, will, would, could, should, expect, plan, anticipate, could, intend, target, project, contemplate, believe, estimate, predict, potential or continue or the negative of these terms or other similar expressions. The forward-looking statements in this Current Report are only predictions. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, operating results, business strategy, short-term and long-
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term business operations and objectives. These forward- looking statements speak only as of the date of this Current Report and are subject to a number of risks, uncertainties and assumptions. The events and circumstances reflected in such forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, the Company operates in a very competitive and rapidly changing environment. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict all risks and uncertainties. Except as required by applicable law, the Company does not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits.
Portions of this exhibit have been redacted in compliance with Regulation S-K Item 601(b)(10).
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ONE STOP SYSTEMS, INC. | ||||
Dated: August 8, 2019 | By: |
/s/ Steve Cooper |
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Steve Cooper | ||||
President and Chief Executive Officer |
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Exhibit 10.1
Certain identified information has been omitted from this document because it is not material and would be competitively harmful if publicly disclosed, and has been marked with [***] to indicate where omissions have been made.
Domestic Strategic Sourcing Agreement |
TABLE OF CONTENTS
AN AGREEMENT BETWEEN RAYTHEON COMPANY AND ONE STOP SYSTEMS, INC. |
1 | |||
PURPOSE OF AGREEMENT |
1 | |||
ARTICLE 1 DEFINITIONS |
1 | |||
ARTICLE 2 PURCHASE ORDER TERMS AND CONDITIONS |
2 | |||
ARTICLE 3 PRICING |
4 | |||
ARTICLE 4 PAYMENTS AND DELIVERY |
5 | |||
ARTICLE 5 NOTICES AND COMMUNICATIONS |
5 | |||
ARTICLE 6 TERMINATION |
6 | |||
ARTICLE 7 DISPUTES AND GOVERNING LAW |
6 | |||
ARTICLE 8 PURCHASE ORDERS AND CONTRACTUAL AUTHORITY |
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ARTICLE 9 CONFIGURATION CHANGES & OBSOLESCENCE |
7 | |||
ARTICLE 10 INTERNATIONAL OFFSETS |
7 | |||
ARTICLE 11 REPRESENTATIONS |
8 | |||
ARTICLE 12 RELEASE OF INFORMATION |
8 | |||
ARTICLE 13 REPORT OF PARTICIPATION |
8 | |||
ARTICLE 14 QUALIFICATION |
8 | |||
ARTICLE 16 VERIFICATION |
9 | |||
ARTICLE 17 THIRD PARTY PROCUREMENTS |
9 | |||
ARTICLE 18 TRUTH IN NEGOTIATIONS ACT (TINA) COMPLIANCE |
10 | |||
ARTICLE 19 COMPLIANCE WITH LAW |
10 | |||
ARTICLE 20 EXPORT/IMPORT CONTROL |
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ARTICLE 21 STANDARDS OF BUSINESS ETHICS AND CONDUCT |
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ARTICLE 22 SURVIVABILITY |
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ARTICLE 23 SUSTAINABILITY |
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ARTICLE 24 ASSIGNMENT, SUBCONTRACTING, PLACE OF PERFORMANCE AND ORGANIZATIONAL CHANGE |
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ARTICLE 25 SUPPLIER DIVERSITY |
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ARTICLE 26 ENTIRE AGREEMENT |
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RAYTHEON PROPRIETARY | Page | iii |
AN AGREEMENT BETWEEN RAYTHEON COMPANY AND ONE STOP SYSTEMS INC.
DOMESTIC STRATEGIC SOURCING AGREEMENT NUMBER 4650001094
This Agreement is entered into as of this 30th day of April, 2019, (Effective Date) and is made by and between Raytheon Company, a corporation organized and existing under the laws of the State of Delaware and having offices at [***], (hereinafter referred to as Buyer), and One Stop Systems Inc., a Corporation organized and existing under the laws of the State of Delaware and having offices at 2235 Enterprise Street, Suite 110, Escondido California, 92029 (hereinafter referred to as Seller).
Subject to the terms and conditions of this Agreement, Seller agrees to sell and Buyer shall have the option to purchase the Products and Services, at the price, description, and quantity set forth in Exhibit A or Exhibit B, as applicable, which are attached to and made a part of this Agreement. This Agreement shall apply to all Products or Services manufactured to mutually agreed specifications, including Custom Products. No Product or Service shall be provided to Buyer by virtue of this Agreement itself.
PURPOSE OF AGREEMENT
This Agreement is intended to facilitate the provision of Product and Services by Seller, on an as needed basis, and to establish the applicable terms and conditions. This Agreement itself does not authorize the provision of Product or Services to Buyer. This Agreement is not a commitment on the part of Buyer to purchase any Product or Services from Seller or to make any purchase at all.
ARTICLE 1 DEFINITIONS
1.1 |
Agreement means this Agreement and all Exhibits attached to or incorporated in this Agreement by reference and Purchase Orders issued under this Agreement by Buyer |
1.2 |
Buyer means the entity set forth in the preamble above and any Participants, as defined below. |
1.3 |
Custom Product means a product manufactured to mutually agreed specifications, including a modified standard product, both as described in Exhibit A. |
1.4 |
Customer means any customer of the Buyer, including, but not limited to, the United States Government, or a domestic or foreign end user of the Products or Services procured under this Agreement. |
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1.5 |
Option Term means the additional Term of this Agreement that may be elected by Buyer pursuant to Section 15.3, below. |
1.6 |
Participants means Buyer, Buyers wholly or partially owned subsidiaries and affiliates, divisions, joint ventures or business units, and Buyers subcontractors, but excluding successors in interest by divestiture. |
1.7 |
Party or Parties means Seller and Buyer as hereinafter referred to individually as Party and collectively as Parties. |
1.8 |
Product means those items listed in Exhibit A covered by this Agreement and subsequent associated Purchase Orders. |
1.9 |
Purchase Order means Buyers purchase order or subcontract issued to the Seller for the Products or Services listed in Exhibits A and B, during the term of this agreement. |
1.10 |
Requirements means the actual Customer prime or higher tier contract orders that may necessitate the procurement of the Products or Services listed in the attached Exhibits. |
1.11 |
Seller means the entity set forth in the preamble above and any of Sellers wholly or partially owned subsidiaries and affiliates, divisions, joint ventures or business units, but excluding successors in interest by divestiture. |
1.12 |
Service means those services listed in Exhibit B, Value Add Services Pricing Schedule attached to and made a part of this Agreement. |
1.13 |
Similar Quantities means quantities of Products in the amounts/ranges listed in Exhibit A. |
1.14 |
Term means the period of effectivity of this Agreement set forth in Article 15, EFFECTIVE DATE, TERM, OPTION TERM, including the Option Term, if exercised by Buyer. |
ARTICLE 2 PURCHASE ORDER TERMS AND CONDITIONS
2.1 |
Seller shall furnish the Products and Services under Purchase Orders in accordance with all applicable provisions set forth in this Agreement and the provisions and clauses referenced in those Purchase Orders. |
Sellers acceptance of this Agreement shall constitute Sellers agreement to comply with the terms and conditions and clauses set forth in this Agreement for all Purchase Orders submitted under this Agreement. The Terms and Conditions and applicable documents below are set forth in an order of precedence. In case of an ambiguity or inconsistency between any of the documents, the higher listed document shall take precedence over the lower listed document. However,
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if a Purchase Order placed under this Agreement contains additional or different terms and conditions and clauses, and Seller accepts that Purchase Order, such acceptance shall constitute Sellers agreement to comply with the terms and conditions and clauses set forth in that Purchase Order as applied to that Purchase Order and to all subsequent Purchase Orders placed under this Agreement. In the event that Seller objects to any of the additional or different terms and conditions or clauses that are referenced in a Purchase Order, Seller shall promptly notify Buyer in writing that it is unwilling to accept the Purchase Order and the parties will in good faith negotiate only the additional or different terms and conditions and clauses. Such negotiated terms and conditions and clauses will then be applicable to such Purchase Order and to all subsequent Purchase Orders placed under this Agreement. Seller agrees that the negotiation, if any, of such additional terms and conditions and clauses shall be conducted only with the Raytheon Supply Chain professional issuing the Purchase Order.
The Terms and Conditions and Applicable Documents below are set forth in decreasing order of precedence.
2.1.1 |
Terms & Conditions of Purchase as follows: |
a. |
Written provisions on the face of the Purchase Order or EDI transmission. |
b. |
This Agreement, Document [***], dated the [***], exclusive of Exhibits |
c. |
Prime or higher tier contract flowdown terms and conditions and clauses, incorporated in Purchase Orders issued pursuant to this Agreement |
d. |
TC-001 General Terms and Conditions of Purchase Modified for use with One Stop Systems dated September 19, 2018 |
e. |
TC-Update (version posted on Buyer web page on date that Purchase Order is issued) |
f. |
TC-003 General Terms and Conditions of Purchase Supplement 2, Government Contract Provisions from the Department of Defense FAR Supplement (version posted on Buyer web page on date that Purchase Order is issued) |
g. |
TC-002 General Terms and Conditions of Purchase Supplement 1, Government Contract Provisions from the Federal Acquisition Regulation (version posted on Buyer web page on date that Purchase Order is issued) |
h. |
TC-HARDCODE Solicitation Attachment; Standard Hard-Coded Purchase Order Terms and Conditions (version posted on Buyer web page on date that Purchase Order is issued) |
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i. |
Exhibit A The Product List |
j. |
Exhibit B Value-add Services Pricing Schedule |
k. |
Exhibit D Statement of Work, [***]-, dated [***] |
l. |
Exhibit E All specifications, exhibits, drawings or other documents that are referenced in this Agreement or applicable Purchase Order, but are not attached hereto are hereby incorporated by reference. |
m. |
Exhibit F Proprietary Information Agreement dated May 18, 2016. |
ARTICLE 3 PRICING
3.1 |
Pricing shall be firm fixed price and as set forth in Exhibit A and Exhibit B attached hereto. Such pricing, and the Terms and Conditions of this Agreement shall be valid for the Term set forth in Article 15. |
3.2 |
The Exhibit A quantities are forecasted ordering requirements derived from Buyers anticipated Customer Requirements and that the Buyers option to purchase such quantities from Seller is contingent upon, and limited to, the actual Customer Requirements for such products during the term of this Agreement. Buyer makes no representation that it will purchase the forecasted requirements herein and reserves the right to purchase such products elsewhere. In the event that the actual requirements are less than the Exhibit A quantities, Buyer shall incur no liability of any kind for failure to purchase the Exhibit A quantities of the product. Buyers determination of purchase Requirements shall be final and conclusive. |
3.3 |
However, Seller will immediately extend to Buyer any price reductions or changes to more favorable terms and conditions offered or given by Seller to others, including its most favored customer, during the term of this Agreement for the same or Similar Quantities. Any price reductions or changes to more favorable terms and conditions shall be made effective as of the date of such offering or giving by Seller and Buyer and Seller shall amend this Agreement to reflect such price reductions and changes to terms and conditions. Exhibit A and/or Exhibit B contains pricing which shall constitute the baseline from which discounts and earned volume rebates, if applicable, shall be measured. |
In addition to the foregoing, Buyer reserves the right to market test the pricing of Exhibit A and/or Exhibit B at any time during the term of this Agreement. If it is objectively determined that due to market changes or other factors the Products and/or Services of Exhibit A and/or Exhibit B are available from suppliers other than Seller at prices below Exhibit A and/or Exhibit B pricing, Seller agrees to lower its Exhibit A and/or Exhibit B pricing to meet market pricing. In the event Seller cannot agree to lower its pricing as provided for herein, Buyer may elect to
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RAYTHEON PROPRIETARY | Page | 4 |
either terminate this Agreement or delete the affected Products or Services, both without further liability or obligations to Seller.
3.4 |
Consistent with U.S. Government procurement regulations and federal law, Seller may be requested to provide, and agrees to provide when requested by Raytheon, written support for the pricing charged to Raytheon. In addition to Sellers submission of a written quotation, such support may include data that aid in the price comparison of Sellers Products and Services with similar products and services of third parties, and may further include elements of cost that are supportable by current, recognized statistical data available to Raytheon and subject to verification upon independent review. Seller agrees that its prices may also be subject to review and audit by the US Government and agrees to cooperate in the performance of any such reviews and audits. |
3.5 |
All values provided herein are in United States Dollars (USD), unless expressly specified to the contrary. The prices to be paid for Products and Services delivered under this Agreement are in USD and are not subject to adjustment for losses or gains resulting from fluctuation in non-USD exchange rates, the risk of which is to Sellers account. |
ARTICLE 4 PAYMENTS AND DELIVERY
4.1 |
Invoices at a minimum shall include Buyers Purchase Order number this Agreement number, Product number, unit price, and quantity. |
4.2 |
Seller shall comply with Buyers delivery bar-code requirements. |
ARTICLE 5 NOTICES AND COMMUNICATIONS
5.1 |
All communications and notices from Buyer to Seller pursuant to this Agreement shall be sent to the address set forth herein: |
One Stop Systems, Inc.
2235 enterprise Street
Suite 110
Escondido, CA 92029
[***]
[***]
Phone: [***]
Fax: [***]
5.2 |
All communications and notices from Seller to Buyer pursuant to this Agreement shall be sent to the Buyers Representative at the address set forth herein: |
Raytheon Company [***]
[***]
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RAYTHEON PROPRIETARY | Page | 5 |
[***]
[***]
[***]
Phone: [***]
5.3 |
Each Party may change its address or point of contact from time to time by written notice to the other. |
ARTICLE 6 TERMINATION
Buyer reserves the right to terminate this Agreement in accordance with Section 4 (Termination for Convenience) and Section 5 (Termination for Default ) of TC-001 General Terms and Conditions of Purchase, in effect as of the date of any dispute, is incorporated into this Agreement but with Purchase Order being replaced with Agreement, by giving thirty (30) days written notice to the Seller whether or not any quantities have been purchased from Seller, but the terms and conditions of this Agreement will continue to apply to any Purchase Orders Buyer may place with Seller prior to the expiration or termination of this Agreement.
ARTICLE 7 DISPUTES AND GOVERNING LAW
Section 7 (Disputes and Governing Law) of TC-001 General Terms and Conditions of Purchase, in effect as of the date of any dispute, is incorporated into this Agreement as if set out in full as ARTICLE 7 DISPUTES AND GOVERNING LAW, but with Purchase Order being replaced with Agreement.
ARTICLE 8 PURCHASE ORDERS AND CONTRACTUAL AUTHORITY
8.1 |
All Purchase Orders shall incorporate this Agreement by reference. |
The failure of Buyer to incorporate the Agreement by reference in its Purchase Order(s) shall not affect the applicability of the Agreement to such Purchase Order(s). Each Purchase Order, though subject to the provisions of this Agreement, will be a separate order between Buyer and Seller.
8.2 |
This Agreement shall be amended only by mutual agreement signed by the Parties. A change issued under the Changes clause of the Terms and Conditions of Purchase Orders shall not be deemed to be an amendment to this Agreement. |
8.3 |
If Seller has more than one manufacturing location, Seller shall identify a common sales point as the Raytheon Account Management Office. |
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8.4 |
Buyer shall not be liable for any commitments made, costs incurred, or obligations undertaken in connection with a Purchase Order prior to issuance of a formal Purchase Order through EDI or by hard copy Purchase Order, as set forth in this Article. |
ARTICLE 9 CONFIGURATION CHANGES & OBSOLESCENCE
Seller shall not make any changes in the manufacture of items to be delivered pursuant to Purchase Orders issued hereunder in manufacturing processes, materials, design, form, fit, or function or in any other way without prior written notification to Buyer. Buyer reserves the right to terminate this Agreement and any Purchase Orders issued hereunder in accordance with Article 6, TERMINATION, if any changes by Seller do not meet Buyers approval.
In the event that a part, raw material or component forming any part of any item listed in referenced Exhibit(s) becomes obsolete, is planned for obsolescence for any reason, or the manufacture of any Product hereunder is to be discontinued by Seller, Seller shall provide notice as provided for herein to allow Buyer to purchase sufficient quantities of the obsolete item to satisfy life-time quantity requirements of the associated end item or Seller shall re-qualify a new part, raw material or component accordingly as defined herein to ensure their commitments to Buyer as defined in this Agreement are met for the items listed in referenced Exhibit(s). In addition, Seller shall (1) notify Buyer as soon as practicable, but in no event less than six (6) months prior to any of the above referenced events, and (2) use its best efforts to mitigate any cost and / or schedule impact to Buyer.
ARTICLE 10 INTERNATIONAL OFFSETS
In consideration of the issuance of each Purchase Order and in order to aid Buyer in meeting its offset obligations, Seller agrees to notify the Buyer reasonably in advance of placing any offset eligible purchase order or subcontract or modification thereof (Offset Eligible Procurement, as defined below) in support of the Purchase Order , and include in such notification the following information: (1) a description of the supplies or services to be subcontracted, (2) identification of the proposed subcontractor including name, business address, country in which the subcontractor is performing the proposed work, and the country in which the subcontractor is incorporated or authorized to do business, and (3) the proposed subcontract price. Upon placement of such subcontract, Seller shall provide to Buyer a copy of each purchase order or subcontract placed with such subcontractor. For purposes of this Article 10, an Offset Eligible Procurement is a purchase order or subcontract or modification thereof placed with an international supplier or placed with a domestic supplier where Seller, using commercially reasonable efforts, has knowledge that the domestic supplier will be procuring from international sources.
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ARTICLE 11 REPRESENTATIONS
Seller represents and warrants to the Buyer that Seller is, and shall continue to be in compliance with all applicable Federal, State and Local laws, regulations and ordinances and further represents and warrants to Buyer that the Exhibit pricing fairly reflects manufacturing, selling and delivery cost savings resulting from quantity sales of Products and Services derived as a result of Sellers normal course of business.
Seller represents and warrants throughout the term of this Agreement and until all of Sellers obligations under all Purchase Orders have been performed:
a. |
Seller shall not be suspended or debarred by the U.S. Government; |
b. |
Seller shall remain financially solvent as reasonably determined by Buyer based upon an independent auditor or established public rating firm such as Dun & Bradstreet; |
c. |
Seller shall maintain any required qualifications on all products; and, |
d. |
Seller agrees to provide Buyer with Annual Certifications and Representations, CR-003. |
ARTICLE 12 RELEASE OF INFORMATION
Section 11 (Release of Information) of TC-001 General Terms and Conditions of Purchase, in effect as of the date of any dispute, is incorporated into this Agreement as if set out in full as ARTICLE 12 RELEASE OF INFORMATION, but with Purchase Order being replaced with Agreement.
ARTICLE 13 REPORT OF PARTICIPATION
Seller shall maintain a cumulative record of all Purchase Orders placed by Buyer and shall be prepared to provide written reports to Buyer upon request of the total, cumulative purchases illustrating standard or list prices as appropriate, and cumulative Exhibit A and/or Exhibit B pricing under this Agreement, within twenty (20) days of the request.
ARTICLE 14 QUALIFICATION
Buyers requirements for Products and Services may necessitate Sellers qualification to selected process, systems, or functional requirements such as the Defense Logistics Agencys Qualified Parts List process. In the event that Seller or any of its suppliers is not presently qualified, or qualification is suspended or revoked, or Seller or any of its suppliers receives notice from the Defense Logistics Agency that it is delinquent in meeting the requirements to maintain qualification, Seller will immediately notify Buyer of such notice, suspension, or
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revocation and shall provide appropriate qualification test plans and subsequent reports as required by Buyer. Such plans shall be subject to Buyers approval. Buyers approval of Sellers test and qualification plan(s) is intended to provide confidence in Sellers ability to qualify specific products and does not constitute an opinion or warranty that Sellers plans will be successful or compliant to specifications or other requirements. Seller shall bear all costs for such qualification, including first article units if required. Production orders shall be built in parallel to qualification at the risk of Seller, if such pre-qualification production is required to meet Buyers required delivery dates.
ARTICLE 15 EFFECTIVE DATE, TERM, OPTION TERM
15.1 |
This Agreement shall take effect on the Effective Date. |
15.2 |
The Term of this Agreement shall be the period of five (5) years from the Effective Date. Any Purchase Order issued during the Term shall continue in effect under the provisions hereof until performance thereunder is completed. |
ARTICLE 16 VERIFICATION
Buyer may validate the consistency of Purchase Orders issued hereunder, invoices received, and the pricing and discounts as contained in Exhibit A and/or Exhibit B hereto. Any overcharges discovered by Buyer during audits shall be reimbursed to Buyer against the specific Purchase Order overcharged. In the event that a representative sampling of Purchase Orders indicates that in excess of five percent (5%) of Purchase Orders have been overcharged, Buyer has the right to extrapolate the average overcharge and receive reimbursement for all products purchased during the audit period.
ARTICLE 17 THIRD PARTY PROCUREMENTS
17.1 |
Seller agrees to extend the pricing set forth in Exhibit A and Exhibit B to Participants as Buyer may from time to time designate. Prior to the disclosure or extension of the pricing set forth in Exhibit A and Exhibit B, Seller shall confirm that Buyer has entered into a Non-Disclosure Agreement with Participant protecting such pricing and other Raytheon related information that Seller intends to disclose. Seller may also require Participant to enter into a mutually acceptable Non-Disclosure Agreement between Seller and Participant. This Agreement pricing is to be extended to Participant by Seller, as directed by Buyer, only for Products and Services to be acquired by Participant for the direct benefit of Raytheon and its affiliates or subsidiaries. |
17.2 |
Seller shall require Participant to specify Buyers Agreement number on its orders. Seller agrees that Buyer shall have no responsibility or liability with respect to any purchase orders issued other than by the Buyer hereunder. |
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17.3 |
Unless otherwise agreed by Buyer in writing, Buyer shall not be responsible for costs of any export or import licenses, transportation, duties, taxes, or any other costs or requirements incidental to such designated Participants purchase of Products or Services from Seller. |
17.4 |
Seller agrees to pass on the provisions of Article 17, to any company where Buyer has set up kitting arrangements for Sellers parts. This would include non-franchised kitters or distributors as designated by Buyer. |
ARTICLE 18 TRUTH IN NEGOTIATIONS ACT (TINA) COMPLIANCE
In the event Buyers customer or Buyers customer contract require subcontractor Cost or Pricing Data for any specific release hereunder, Seller agrees to provide such data, to negotiate a downward adjustment of price, if the data so warrants, and to execute the required Certificate of Current Cost or Pricing Data at the conclusion of negotiations or at the request of Buyer.
ARTICLE 19 COMPLIANCE WITH LAW
Seller warrants that the work to be performed under this Agreement and the Purchase Order shall be compliant with all requirements set out in the Raytheon General Terms and Conditions of Purchase (TC-001) Section 19Compliance with Law as may be modified or supplemented as described in Section 2.1, above, and which is incorporated by this reference . Sellers obligations under that Section 19 shall be for the term of this Agreement and shall survive this Agreement per Article 22, SURVIVABILITY, below.
ARTICLE 20 EXPORT/IMPORT CONTROL
Seller warrants that the work to be performed under this Agreement and the Purchase Order shall be compliant with all requirements set out in the Raytheon General Terms and Conditions of Purchase (TC-001) Section 23 Export / Import Controls as as may be modified or supplemented from time to time as described in Section 2.1 above and which is incorporated by this reference. Sellers obligations under that Section 23 shall be for the term of this Agreement and shall survive this Agreement per Article 22, SURVIVABILITY, below.
ARTICLE 21 STANDARDS OF BUSINESS ETHICS AND CONDUCT
By the acceptance of this Agreement, Seller represents that it has not participated in any conduct in connection with this Agreement that violates the Standards of Business Ethics and Conduct of Raytheon Company (available at www.raytheon.com) or, alternatively, equivalent Business Ethics and Conduct Standards of Seller. If, at any time, Buyer determines that Seller is in violation of the applicable Standards of Business Ethics and Conduct, Buyer may terminate
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this Agreement and all or any of the Purchase Orders upon written notice to Seller and Buyer shall have no further obligation to Seller.
ARTICLE 22 SURVIVABILITY
Sellers obligations that by their very nature must survive expiration, termination, or completion of this Agreement and the Purchase Orders, including but not limited to obligations under the Termination, Release of Information, Compliance with Law, Export/Import Controls, and Electronic Transmissions provisions of this Agreement, shall survive expiration, termination or completion of this Agreement and the Purchase Orders.
ARTICLE 23 SUSTAINABILITY
Seller shall take commercially reasonable steps to support green and energy conservation initiatives.
ARTICLE 24 ASSIGNMENT, SUBCONTRACTING, PLACE OF PERFORMANCE AND ORGANIZATIONAL CHANGE
Seller may not assign any rights or delegate any of its obligations due or to become due under this Agreement without the prior written consent of Buyer. Any purported assignment or delegation by Seller without such consent shall be void. Seller shall not subcontract or otherwise transfer any part of this Agreement without the prior written consent of Buyer. Buyer shall not be obligated to any subcontractor for the materials, products, or services of any subcontractor whether or not Buyer has consented to or designated a subcontractor. Approval of a subcontractor is not a release or waiver of any obligation of Seller or right of Buyer. Seller is responsible for all actions or inactions of any subcontractor and shall bind its obligations under these terms. Buyer may assign this Agreement to any affiliated company or any successor in interest. Before Seller performs or subcontracts any part of the work contemplated under any Purchase Order under this Agreement in a location outside of the United States, or procures any part of the goods for such Purchase Order from such location, Seller shall notify the Buyer and secure Buyers prior written consent to do so. Seller shall promptly notify the Buyer in writing of any organizational changes made by Seller, including name or ownership changes, mergers or acquisitions.
ARTICLE 25 SUPPLIER DIVERSITY
Buyer is committed to the utilization of Small Businesses and encourages the use of Small Businesses whenever and wherever possible. Seller is encouraged to utilize Small Businesses in the provision of the Products and Services.
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ARTICLE 26 ENTIRE AGREEMENT
26.1 |
This Agreement, together with the items set forth in Section 2.1.1 and the Purchase Orders, is the entire agreement between the Parties relative to the purchase of the Products listed in Exhibit A, the Product List and the Services covered by this Agreement. This Agreement supersedes any prior or contemporaneous written or oral agreements dealing with the same subject matter, and may not be amended or modified except by subsequent agreement in writing by duly authorized officers or representatives of the Parties. |
26.2 |
A change issued under the Changes clause of the Terms and Conditions of Purchase Orders shall not be deemed an amendment to this Agreement, unless specifically identified as such in the written Amendment. |
26.3 |
In the event any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid or unenforceable, the remaining provisions of this Agreement shall be unimpaired and the invalid or unenforceable provision shall be replaced by a mutually acceptable provision which, being valid and enforceable, comes closest to the intention of the Buyer and Seller underlying the invalid or unenforceable provision. |
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
RAYTHEON COMPANY | Jim Ison, on behalf of itself and its wholly or partially owned subsidiaries and affiliates, divisions, locations, joint ventures or business units. | |
[***] | Name: Jim Ison | |
[***] | ||
/s/ | Title: Vice President Sales and Marketing | |
Signature | /s/ Jim Ison | |
Signature |
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End of Enclosure Document
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Exhibit A Product List
[***]
Exhibit B Value-add Services Pricing
[***]
Exhibit 99.1
OSS Awarded $36 Million Contract to Provide Flash Storage Arrays for
Military Radar Application
ESCONDIDO, Calif., August 8, 2019 One Stop Systems, Inc. (Nasdaq: OSS), the leading provider of specialized high-performance computing solutions, has won a five-year sole source agreement valued at $36 million to provide flash storage arrays to a prime contractor for the U.S. Navy. The systems will be used within state-of-the-art Navy surveillance aircraft deployed worldwide.
Under the agreement, OSS will supply full mil-spec flash storage systems that include removable canisters, allowing collected data to be removed from the aircraft and transferred to ground stations. The systems store real-time data collected from advanced airborne sensors (AAS), including radar and other sensors. The contract includes airborne and ground systems, spare canisters and support services.
We are excited to receive this agreement which solidifies our long-term production of these flash arrays, said Steve Cooper, president and CEO of OSS. These products showcase the benefits of our award-winning flash array technology, including high-performance, small size, light weight and portability.
Shipments based on this contract are anticipated to begin in Q3 of 2019. For additional details, please see the companys Form 8-K filed today and posted to the SEC Filings page on the company website.
About One Stop Systems
One Stop Systems, Inc. (OSS) designs and manufactures innovative specialized high-performance computing modules and systems, including customized servers, compute accelerators, expansion systems, flash storage arrays and ION Accelerator storage software. These products are used for deep learning, AI, defense, finance and entertainment applications, and empower scientists, engineers, creators and other professionals to push the boundaries of their industries.
For more information, go to www.onestopsystems.com.
Forward-Looking Statements
One Stop Systems (OSS) cautions you that statements in this press release that are not a description of historical facts are forward-looking statements. These statements are based on the companys current beliefs and expectations. The inclusion of forward-looking statements should not be regarded as a representation by One Stop Systems that any of our plans will be achieved. Actual results may differ from those set forth in this press release due to the risk and uncertainties inherent in our business, including, without limitation: the value of the contract, schedule of shipments, follow-on orders, the number of items delivered to customers and the performance of products for the intended application; as well as risks described in our prior press releases and in our filings with the Securities and Exchange Commission (SEC), including under the heading Risk Factors in our Annual Report on Form 10-K and any subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and we undertake no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
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Media Contact:
Katie Rivera
One Stop Systems, Inc.
Tel (760) 745-9883
Email contact
Investor Relations:
Ronald Both or Grant Stude
CMA
Tel (949) 432-7557
Email contact
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