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
):
July 4, 2010
Vishay Precision Group, Inc.
(Exact Name of Issuer
as Specified in Charter)
Delaware
|
1-34679
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27-0986328
|
(State or Other Jurisdiction
of
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(Commission File Number)
|
(I.R.S. Employer
Identification
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Incorporation or Organization)
|
|
Number)
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3 Great Valley Parkway, Suite
150
|
|
Malvern, PA
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19355
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(Address of Principal Executive
Offices)
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(Zip
Code)
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(484) 321-5300
(Registrant’s Telephone Number, Including Area
Code)
Not Applicable
(Former Name or Former Address, if Changed
Since Last Report)
Check the appropriate
box below if the Form 8-K 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
[ ] Soliciting material
pursuant to Rule 14a-12 under the Exchange Act
[ ] Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act
[ ] Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
Item 1.01 Entry into a Material Definitive
Agreement.
On July 6, 2010, Vishay
Intertechnology, Inc. (“Vishay”) completed the previously announced spin-off of
Vishay Precision Group, Inc. (“VPG” or the “Company”) through a pro rata
distribution to Vishay shareholders of all of the Company’s outstanding common
stock and Class B common stock (the “Distribution”). In connection with the
Distribution, the Company and its subsidiaries entered into several agreements
with Vishay and its subsidiaries that govern the relationship of the parties
following the spin-off, including the following (collectively referred to as the
“Ancillary Agreements”):
-
Tax Matters Agreement, dated July
6, 2010, between VPG and Vishay;
-
Trademark License Agreement, dated
July 6, 2010, between VPG and Vishay;
-
Transition Services Agreement,
dated July 6, 2010, between VPG and Vishay;
-
Supply Agreement, dated July 6,
2010, between Vishay Advanced Technology, Ltd. (“VAT”) and Vishay Dale
Electronics, Inc. (“Dale”);
-
Secondment Agreement, dated July
6, 2010, between VPG and Vishay;
-
Patent License Agreement, dated
July 6, 2010, between VPG and Dale;
-
Lease Agreement, dated July 4,
2010, between VAT and V.I.E.C. Ltd.;
-
Supply Agreement, dated July 6,
2010, between Dale and VAT;
-
Supply Agreement, dated July 6,
2010, between Vishay Measurements Group, Inc. (“VMG”) and Vishay S.A. (“Vishay
S.A.”);
-
Manufacturing Agreement, dated
July 6, 2010, between Vishay S.A. and Vishay Precision Foil GmbH (“VPG
GmbH”);
-
Intellectual Property License
Agreement, dated July 6, 2010, between Vishay S.A. and VPG
GmbH;
-
Supply Agreement, dated July 6,
2010, between VPG GmbH and Vishay S.A.;
-
Intellectual Property License
Agreement, dated July 6, 2010, between Vishay S.A. and VMG;
-
Lease Agreement, between Vishay
Alpha Electronics Corporation and Vishay Japan Co., Ltd.;
-
Lease Agreement, dated July 6,
2010, between Vishay and VPG; and
-
Lease Agreement, dated July 4,
2010, between Vishay Precision Israel, Ltd. and Vishay Israel, Ltd.
A summary of the
material features of the foregoing agreements can be found in the section
entitled “Certain Relationships and Related Party Transactions
–
Agreements with
Vishay Intertechnology” in the Company’s Information Statement (the “Information
Statement”), filed as Exhibit 99.1 to the Company’s Form 10 Registration
Statement, filed with the Securities and Exchange Commission (the
“
SEC
”
) on June 22,
2010, and is incorporated herein by reference. The Ancillary Agreements are
filed as Exhibits 10.1 - 10.16 to this current report on Form 8-K.
-2-
Item 5.02 Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
Board of Directors
In connection with
the Distribution, Dr. Lior E. Yahalomi and William M. Clancy resigned from the
Company
’
s
board of directors (the
“
Board
”
), effective upon
consummation of the Distribution. Mr. Ziv Shoshani, the Company’s
President and Chief Executive Officer will continue to serve on the Board and
will be joined by the following new directors, who were elected to serve as
directors of the Company effective immediately after the consummation of the
Distribution on July 6, 2010:
-
Marc Zandman (non-executive
chairman)
-
Samuel D.
Broydo
-
Saul Reibstein
-
Timothy Talbert
Information concerning these
individuals, including biographies and compensation information, is included in
the Information Statement under the heading “Management
–
Board of
Directors
”
and is incorporated herein by reference. In addition, information concerning
certain relationships between these individuals and the Company are described in
the Information Statement under the heading “Certain Relationships and Related
Party Transactions
–
Interests in
Vishay Intertechnology; Relationships and Related Party Transactions
”
and is
incorporated herein by reference.
Messrs. Broydo, Talbert and Reibstein
have been appointed to serve as members of each of the Audit Committee, the
Compensation Committee and the Nominating and Corporate Governance of the Board.
The Board has determined that each of Messrs. Broydo, Talbert and Reibstein is
“independent
”
within the meaning of the rules of both the New York Stock Exchange and the SEC,
and that Mr. Reibstein is an “audit committee financial expert
”
under SEC
rules.
Vishay Precision Group,
Inc. 2010 Stock Incentive Program
The Company’s Board of
Directors and Vishay (as the Company’s sole stockholder prior to the
Distribution) approved the adoption of the Vishay Precision Group, Inc. 2010
Stock Incentive Program, which became effective on July 6, 2010 upon
consummation of the Distribution (the “Plan”).
A description of the
material provisions of the of the Plan is included under the section “2010
Compensation from Vishay Precision Group – Equity Awards” in the Information
Statement, which is incorporated herein by reference. The Plan is filed as
Exhibit 10.17 to this Current Report on Form 8-K.
Item 5.03 Amendments to Articles of
Incorporation or Bylaws; Change in Fiscal Year.
The Company’s Board of
Directors and Vishay (as the Company’s sole stockholder prior to the
Distribution) approved the amendment and restatement of the Company’s By-Laws,
which became effective on July 6, 2010 upon consummation of the Distribution (as
so amended and restated, the “Amended and Restated By-Laws”).
A description of the
material provisions of the Amended and Restated By-Laws is included under the
section “Description of Our Capital Stock” in the Information Statement, which
is incorporated herein by reference. The Amended and Restated By-Laws are filed
as Exhibit 3.1 to this Current Report on Form 8-K.
Item 8.01 Other Information
On July 7, 2010, the
Company issued a press release announcing the successful completion of the
Distribution. A copy of the press release is filed as Exhibit 99.1 to this
Current Report on Form 8-K and is incorporated herein by reference.
-3-
Item 9.01 Financial Statements and Exhibits.
Exhibit No.
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Description
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3.2
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Amended and Restated By-Laws of Vishay
Precision Group, Inc., effective July 6, 2010
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10.1
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Tax Matters Agreement, dated July 6, 2010, between Vishay Precision
Group, Inc. and Vishay Intertechnology, Inc.
|
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10.2
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Trademark License Agreement, dated July
6, 2010, between Vishay Precision Group, Inc. and Vishay Intertechnology,
Inc.
|
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10.3
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|
Transition Services Agreement, dated July 6, 2010, between Vishay
Precision Group, Inc. and Vishay Intertechnology, Inc.
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10.4
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Supply Agreement, dated July
6, 2010, between Vishay Advanced Technology, Ltd. and Vishay Dale
Electronics,
Inc. *
*
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10.5
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Secondment Agreement, dated July 6, 2010, between Vishay Precision
Group, Inc. and Vishay Intertechnology, Inc.
|
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10.6
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Patent License Agreement, dated July 6,
2010, between Vishay Precision Group, Inc. and Vishay Dale Electronics,
Inc. * *
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10.7
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Lease Agreement, dated July 4, 2010, between Vishay Advanced
Technology, Ltd. and V.I.E.C. Ltd.
|
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10.8
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Supply Agreement, dated July 6, 2010,
between Vishay Dale Electronics, Inc. and Vishay Advanced Technology, Ltd.
* *
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10.9
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Supply Agreement, dated July 6, 2010, between Vishay Measurements
Group, Inc. and Vishay S.A. * *
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10.10
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Manufacturing Agreement, dated July 6,
2010, between Vishay S.A. and Vishay Precision Foil GmbH
* *
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10.11
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Intellectual Property License Agreement, dated July 6, 2010,
between Vishay S.A. and Vishay Precision Foil GmbH.
|
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10.12
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Supply Agreement, dated July 6, 2010,
between Vishay Precision Foil GmbH and Vishay S.A. * *
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10.13
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Intellectual Property License Agreement, dated July 6, 2010,
between Vishay S.A. and Vishay Measurements Group, Inc.
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10.14
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Lease Agreement, between Vishay Alpha
Electronics Corporation and Vishay Japan Co., Ltd.
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10.15
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Lease Agreement, dated July 6, 2010, between Vishay
Intertechnology, Inc. and Vishay Precision Group, Inc.
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10.16
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Lease Agreement, dated July 4, 2010,
between Vishay Precision Israel, Ltd. and Vishay Israel, Ltd.
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10.17
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Vishay Precision Group, Inc. 2010 Stock
Incentive Program, effective July 6, 2010.
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99.1
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Press release, dated July 7,
2010.
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*
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99.2
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Information Statement of Vishay Precision Group, Inc. (incorporated
by reference to Exhibit 99.1 to Amendment no. 6 to the Form 10
Registration Statement of Vishay Precision Group, Inc., filed with the
Securities and Exchange Commission on June 22,
2010).
|
____________________
* Incorporated by
reference.
* * Confidential
treatment has been accorded to certain portions of this Exhibit. Omitted
portions have been filed separately with the Securities and Exchange
Commission.
-4-
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.
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Vishay Precision Group,
Inc.
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Date: July 7, 2010
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By: /s/ William M.
Clancy
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Name: William M. Clancy
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Title: Executive Vice President and Chief
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Financial
Officer
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-5-
EXHIBIT INDEX
Exhibit No.
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Description
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3.2
|
|
Amended and Restated By-Laws of Vishay
Precision Group, Inc., effective July 6, 2010.
|
10.1
|
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Tax
Matters Agreement, dated July 6, 2010, between Vishay Precision Group,
Inc. and Vishay Intertechnology, Inc.
|
10.2
|
|
Trademark License Agreement, dated July
6, 2010, between Vishay Precision Group, Inc. and Vishay Intertechnology,
Inc.
|
10.3
|
|
Transition Services Agreement, dated July 6, 2010, between Vishay
Precision Group, Inc. and Vishay Intertechnology, Inc.
|
10.4
|
|
Supply Agreement, dated July 6, 2010,
between Vishay Advanced Technology, Ltd. and Vishay Dale Electronics, Inc.
* *
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10.5
|
|
Secondment Agreement, dated July 6, 2010, between Vishay Precision
Group, Inc. and Vishay Intertechnology, Inc.
|
10.6
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Patent License Agreement between Vishay
Precision Group, Inc. and Vishay Dale Electronics, Inc., a subsidiary of
Vishay Intertechnology, Inc. * *
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10.7
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|
Lease
Agreement, dated July 4, 2010, between Vishay Advanced Technology, Ltd.
and V.I.E.C. Ltd.
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10.8
|
|
Supply Agreement, dated July 6, 2010,
between Vishay Dale Electronics, Inc. and Vishay Advanced Technology, Ltd.
* *
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10.9
|
|
Supply
Agreement, dated July 6, 2010, between Vishay Measurements Group, Inc. and
Vishay S.A. * *
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10.10
|
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Manufacturing Agreement, dated July 6,
2010, between Vishay S.A. and Vishay Precision Foil GmbH
* *
|
10.11
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|
Intellectual Property License Agreement, dated July 6, 2010,
between Vishay S.A. and Vishay Precision Foil GmbH.
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10.12
|
|
Supply Agreement, dated July 6, 2010,
between Vishay Precision Foil GmbH and Vishay S.A. * *
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10.13
|
|
Intellectual Property License Agreement, dated July 6, 2010,
between Vishay S.A. and Vishay Measurements Group, Inc.
|
10.14
|
|
Lease Agreement, between Vishay Alpha
Electronics Corporation and Vishay Japan Co., Ltd.
|
10.15
|
|
Lease
Agreement, dated July 6, 2010, between Vishay Intertechnology, Inc. and
Vishay Precision Group, Inc.
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10.16
|
|
Lease Agreement, dated July 4, 2010,
between Vishay Precision Israel, Ltd. and Vishay Israel, Ltd.
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10.17
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Vishay
Precision Group, Inc. 2010 Stock Incentive Program, effective July 6,
2010.
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99.1
|
|
Press release, dated July 7,
2010.
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____________________
* * Confidential
treatment has been accorded to certain portions of this Exhibit. Omitted
portions have been filed separately with the Securities and Exchange
Commission.
AMENDED AND
RESTATED
BYLAWS
OF
VISHAY PRECISION GROUP, INC.
AS OF JULY 6,
2010
__________________
ARTICLE I
STOCKHOLDERS
Section 1.
Certificates Representing
Stock
. The
shares of the corporation shall be represented by certificates in the form
approved by the Board of Directors of the corporation (the “Board”), unless the
Board by resolution provides that some or all classes or series of shares of the
corporation shall be uncertificated shares (provided that no such resolution
shall apply to shares theretofore represented by a certificate unless and until
such certificate is surrendered to the Corporation).
Every holder
of stock that is represented by a certificate shall be entitled to have a
certificate signed by, or in the name of, the corporation by the Chairman or
Vice-Chairman of the Board, if any, or by the President or a Vice-President and
by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary of the corporation certifying the number of shares owned by him in the
corporation. If such certificate is countersigned by a transfer agent other than
the corporation or its employee, or by a registrar other than the corporation or
its employee, any other signature on the certificate may be a facsimile. In case
any officer, transfer agent, or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be such
officer, transfer agent, or registrar before such certificate is issued, it may
be issued by the corporation with the same effect as if he were such officer,
transfer agent, or registrar at the date of issue.
Whenever the
corporation shall be authorized to issue more than one class of stock or more
than one series of any class of stock and whenever the corporation shall issue
any shares of its stock as partly paid stock, the certificates representing
shares of any such class or series or of any such partly paid stock shall set
forth thereon the statements prescribed by the Delaware General Corporation Law,
as amended from time to time (the “General Corporation Law”). Any restrictions
on the transfer or registration of transfer of any shares of stock of any class
or series shall be noted conspicuously on any certificate representing such
shares.
The
corporation may issue a new certificate of stock in place of any certificate
theretofore issued by it, alleged to have been lost, stolen, or destroyed, and
the Board may require the owner of any lost, stolen, or destroyed certificate,
or his legal representative, to give the corporation a bond sufficient to
indemnity the corporation against any claim that may be made against it on
account
of the alleged
loss, theft, or destruction of any such certificate or the issuance of any such
new certificate.
Section 2.
Fractional Share
Interests
. The
corporation may, but shall not be required to, issue fractions of a share. In
lieu thereof it shall either pay in cash the fair value of fractions of a share,
as determined by the Board, to those entitled thereto or issue scrip or
fractional warrants in registered or bearer form over the manual or facsimile
signature of an officer of the corporation or of its agent, exchangeable as
therein provided for full shares, but such scrip or fractional warrants shall
not entitle the holder to any rights or a shareholder except as therein
provided. Such scrip or fractional warrants may be issued subject to the
condition that the same shall become void if not exchanged for certificates
representing full shares of stock, or for full uncertificated shares, before a
specified date, or subject to the condition that the shares of stock for which
such scrip or fractional warrants are exchangeable may be sold by the
corporation and the proceeds thereof distributed to the holders of such scrip or
fractional warrants, or subject to any other conditions which the Board may
determine.
Section 3.
Stock Transfers
. Upon compliance with provisions
restricting the transfer or registration of transfer of shares of stock, if any,
transfers or registration of transfers of shares of stock of the corporation
shall be made only on the stock ledger of the corporation by the registered
holder thereof, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary of the corporation or with a transfer
agent or a registrar, if any, and, if such shares are certificated, on surrender
of the certificate or certificates for such shares of stock properly endorsed
and the payment of all taxes due thereon.
Section 4.
Record Date for
Stockholders
.
For the purpose of determining the stockholders entitled to notice of or to vote
at any meeting of stockholders or any adjournment thereof, or to express consent
to or dissent from any corporate action in writing without a meeting, or for the
purpose of determining stockholders entitled to receive payment of any dividend
or other distribution or the allotment of any rights, or entitled to exercise
any rights in respect of any change, conversion, or exchange of stock, or for
the purpose of any other lawful action, the Board may fix, in advance, a date as
the record date for any such determination of stockholders. Such date shall not
be more than sixty days nor less than ten days before the date of such meeting,
nor more than sixty days prior to any other action. If no record date is fixed,
the record date for the determination of stockholders entitled to notice of or
to vote at a meeting of stockholders shall be at the close of business on the
day next preceding the day on which notice is given, or, if notice is waived, at
the close of business on the day next preceding the day on which the meeting is
held; the record date for determining stockholders for any other purpose shall
be at the close of business on the day on which the Board adopts the resolution
relating thereto. When a determination of stockholders of record entitled to
notice or to vote at any meeting of stockholders has been made as provided in
this paragraph, such determination shall apply to any adjournment thereof;
provided, however, that the Board may fix a new record date for the adjourned
meeting.
Section 5.
Meaning of Certain
Terms
. As used
herein in respect of the right to notice of a meeting of stockholders or a
waiver thereof or to participate or vote thereat or to consent or dissent in
writing in lieu of a meeting, as the case may be, the term “share” or “shares”
or “share of stock” or “shares of stock” or “stockholder” or “stockholders”
refers to an outstanding share
or shares of
stock and to a holder or holders of record of outstanding shares of stock when
the corporation is authorized to issue only one class of shares of stock, and
said reference is also intended to include any outstanding share or shares of
stock and any holder or holders of record of outstanding shares of stock of any
class upon which or upon whom the certificate of incorporation confers such
rights where there are two or more classes or series of shares of stock or upon
which or upon whom the General Corporation Law confers such rights
notwithstanding that the certificate of incorporation may provide for more than
one class or series of shares of stock, one or more of which are limited or
denied such rights thereunder; provided, however, that no such right shall vest
in the event of an increase or a decrease in the authorized number of shares of
stock of any class or series which is otherwise denied voting rights under the
provisions of the certificate of incorporation, including any Preferred Stock
which is denied voting rights under the provisions of the resolution or
resolutions adopted by the Board with respect to the issuance
thereof.
Section 6.
Meetings of
Stockholders
.
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A.
Time
. Each annual meeting of
stockholders shall be held on the date and at the time fixed, from time to
time, by the Board or the Chairman, provided, that the first annual
meeting shall be held on a date within thirteen months after the
organization of the corporation. Thereafter, the corporation shall hold an
annual meeting not less frequently than once every calendar year. A
special meeting of stockholders shall be held on the date and at the time
fixed by the person or persons calling the meeting.
B.
Place
. Annual meetings and special
meetings shall be held at such place, within or without the State of
Delaware, as the Board may, from time to time, fix. Unless otherwise
specified by the person or persons calling a stockholders meeting, the
meeting shall be held at the registered office of the corporation in the
State of Delaware.
C.
Call
. Annual meetings of
stockholders and special meetings of stockholders may be called by the
Board or by the Chairman.
D.
Notice; Waiver of
Notice
.
Written notice of each meeting of stockholders shall be given by the
Chairman of the Board and/or the Secretary of the corporation in
compliance with the provisions of the General Corporation Law and any
other applicable law.
E.
Stockholder
List
.
There shall be prepared and made, at least ten days before every meeting
of stockholders, a complete list of the stockholders, arranged in
alphabetical order, and showing the address of each stockholder and the
number of shares registered in the name of each stockholder. Such list
shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at
least ten days prior to the meeting either at a place within the city or
other municipality or community where the meeting is to be held, which
place shall be specified in the notice of the meting, or if not so
specified, at the place where the meeting is to be held. The list
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shall
also be produced and kept at the time and place where the meeting is to be
held. The list shall also be produced and kept at the time and place of
the meeting during the whole time thereof, and may be inspected by any
stockholder who is present. The stock ledger shall be the only evidence as
to who are the stockholders entitled to examine the stock ledger, the list
required by this section or the books of the corporation, or to vote at
any meeting of stockholders.
F.
Conduct of
Meeting
.
Meetings of the stockholders shall be presided over by one of the
following officers in the order of seniority and if present and acting –
the Chairman of the Board, if any, the Vice-Chairman of the Board, if any,
the President, a Vice-President, a chairman for the meeting chosen by the
Board, or, if none of the foregoing is in office and present and acting,
by a chairman to be chosen by the stockholders. The Secretary of the
corporation, or in his absence, an Assistant Secretary, shall act as
secretary of every meeting, but if neither the Secretary nor an Assistant
Secretary is present the Chairman for the meeting shall appoint a
secretary of the meeting.
G.
Nominations and
Proposals
.
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1.
Nominations of
persons for election to the Board and the proposal of other business to be
considered by the stockholders may be made at an annual meeting of
stockholders (a) pursuant to the corporation’s notice of meeting, (b) by
or at the direction of the Board (or, with respect to director
nominations, by any committee whose responsibilities include director
nominations), or (c) by any stockholder of the corporation who (i) was a
stockholder of record at the time of giving of notice provided for in this
Paragraph G and at the time of an annual meeting, (ii) is entitled to vote
at the meeting and (iii) complies with the notice procedures set forth in
this subsection as to such proposals or nominations. Clause (c) in the
foregoing sentence provides the exclusive means for a stockholder to make
nominations or submit proposals of other business (other than matters
properly brought under Rule 14a-8 under the Securities Exchange Act of
1934, as amended (the “Exchange Act”) and included in the corporation’s
notice of meeting) before an annual meeting of stockholders.
2.
Without
qualification, for any nominations or any other business to be properly
brought before an annual meeting by a stockholder pursuant to this
Paragraph G, the stockholder must have given timely notice thereof in
writing to the Secretary of the corporation, and such other business must
otherwise be a proper matter for stockholder action under the General
Corporation Law. To be timely, a stockholder’s notice shall be delivered
to the Secretary at the principal executive offices of the corporation not
earlier than the close of business on the 90th day and not later than the
close of business on the 60th day prior to the first anniversary of the
preceding annual meeting of stockholders; provided, however, that in the
event that the date of such annual meeting is more than 30 days before or
more than 60 days after such anniversary date, notice by the stockholder
to
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be
timely must be so delivered not later than the close of business on the
later of the 60th day prior to the date of such annual meeting or, if the
first public announcement of the date of such annual meeting is less than
100 days prior to the date of such annual meeting, the 10th day following
the day on which public announcement of the date of such meeting is first
made by the corporation. In no event shall any adjournment or postponement
of an annual meeting or the announcement thereof commence a new time
period for the giving of a stockholder’s notice as described above. To be
in proper form, a stockholder’s notice (whether given pursuant to this
Paragraph G.2 or Paragraph G.4 below) to the Secretary must: (a) set
forth, as to the stockholder giving the notice and the beneficial owner,
if any, on whose behalf the nomination or proposal is made, (i) the name
and address of such stockholder, as they appear on the corporation’s
books, and of such beneficial owner, if any, (ii) (A) the class or series
and number of shares of the corporation which are, directly or indirectly,
owned beneficially and of record by such stockholder and such beneficial
owner, (B) any option, warrant, convertible security, stock appreciation
right, or similar right with an exercise or conversion privilege or a
settlement payment or mechanism at a price related to any class or series
of shares of the corporation or with a value derived in whole or in part
from the value of any class or series of shares of the Corporation,
whether or not such instrument or right shall be subject to settlement in
the underlying class or series of capital stock of the corporation or
otherwise (a “Derivative Instrument”) directly or indirectly owned
beneficially by such stockholder or beneficial owner, if any, and any
other direct or indirect opportunity to profit or share in any profit
derived from any increase or decrease in the value of shares of the
corporation, (C) any proxy, contract, arrangement, understanding or
relationship pursuant to which such stockholder or beneficial owner, if
any, has a right to vote any shares of any security of the corporation or
has granted any such right to any person or persons, (D) any short
interest in any security of the corporation (for purposes of these Bylaws
a person shall be deemed to have a short interest in a security if such
person directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has the opportunity to profit or
share in any profit derived from any decrease in the value of the subject
security), (E) any rights to dividends on the shares of the corporation
owned beneficially by such stockholder that are separated or separable
from the underlying shares of the Corporation, (F) any proportionate
interest in shares of the corporation or Derivative Instruments held,
directly or indirectly, by a general or limited partnership in which such
stockholder is a general partner or, directly or indirectly, beneficially
owns an interest in a general partner and (G) any performance-related fees
(other than an asset-based fee) that such stockholder is entitled to based
on any increase or decrease in the value of shares of the corporation or
Derivative Instruments, if any, as of the date of such notice, including
without limitation any such interests held
by
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members
of such stockholder’s immediate family sharing the same household (which
information shall be supplemented by such stockholder and beneficial
owner, if any, not later than 10 days after the record date for the
meeting to disclose such ownership as of the record date), and (iii) any
other information relating to such stockholder and beneficial owner, if
any, that would be required to be disclosed in a proxy statement or other
filings required to be made in connection with solicitations of proxies
for, as applicable, the proposal and/or for the election of directors in a
contested election pursuant to Section 14 of the Exchange Act and the
rules and regulations promulgated thereunder; (b) if the notice relates to
any business other than a nomination of a director or directors that the
stockholder proposes to bring before the meeting, set forth (i) a brief
description of the business desired to be brought before the meeting, the
reasons for conducting such business at the meeting and any material
interest of such stockholder and beneficial owner, if any, in such
business and (ii) a description of all agreements, arrangements and
understandings between such stockholder and beneficial owner, if any, and
any other person or persons (including their names) in connection with the
proposal of such business by such stockholder; (c) set forth, as to each
person, if any, whom the stockholder proposes to nominate for election or
reelection to the Board (i) all information relating to such person that
would be required to be disclosed in a proxy statement or other filings
required to be made in connection with solicitations of proxies for
election of directors in a contested election pursuant to Section 14 of
the Exchange Act and the rules and regulations promulgated thereunder
(including such person’s written consent to being named in the proxy
statement as a nominee and to serving as a director if elected) and (ii) a
description of all direct and indirect compensation and other material
monetary agreements, arrangements and understandings during the past three
years, and any other material relationships, between or among such
stockholder and beneficial owner, if any, and their respective affiliates
and associates, or others acting in concert therewith, on the one hand,
and each proposed nominee, and his or her respective affiliates and
associates, or others acting in concert therewith, on the other hand,
including, without limitation all information that would be required to be
disclosed pursuant to Rule 404 promulgated under Regulation S-K if the
stockholder making the nomination and any beneficial owner on whose behalf
the nomination is made, if any, or any affiliate or associate thereof or
person acting in concert therewith, were the “registrant” for purposes of
such rule and the nominee were a director or executive officer of such
registrant; and (d) with respect to each nominee for election or
reelection to the Board, include a completed and signed questionnaire,
representation and agreement Paragraph G.8 below. The Corporation may
require any proposed nominee to furnish such other information as may
reasonably be required by the Corporation to determine the eligibility of
such proposed nominee to serve as an independent director of the
Corporation or that
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could be
material to a reasonable stockholder’s understanding of the independence,
or lack thereof, of such nominee.
3.
Notwithstanding
anything in the second sentence of Paragraph G.2 to the contrary, in the
event that the number of directors to be elected to the Board is increased
and there is no public announcement by the corporation naming all of the
nominees for director or specifying the size of the increased Board at
least 100 days prior to the first anniversary of the preceding annual
meeting, a stockholder’s notice required by this Paragraph G shall also be
considered timely, but only with respect to nominees for any new positions
created by such increase, if it shall be delivered to the Secretary at the
principal executive offices of the corporation not later than the close of
business on the 10th day following the day on which such public
announcement is first made by the corporation.
4.
Only such
business shall be conducted at a special meeting of stockholders as shall
have been brought before the meeting pursuant to the corporation’s notice
of meeting (or any supplement thereto) as described in Paragraph D above.
Nominations of persons for election to the Board may be made at a special
meeting of stockholders at which directors are to be elected pursuant to
the corporation’s notice of meeting (or any supplement thereto) (a) by or
at the direction of the Board or (b) provided that the notice of meeting
specifies that directors shall be elected at such meeting, by any
stockholder of the corporation who (i) is a stockholder of record at the
time of giving of notice provided for in this Paragraph G.4 at the time of
the special meeting, (ii) is entitled to vote at the meeting, and (iii)
complies with the notice procedures set forth in Paragraph G.2 as to such
nomination (other than with respect to timing requirements, which shall be
governed by the next sentence). A stockholder’s notice with respect to any
such nomination (including the completed and signed questionnaire,
representation and agreement required by Paragraph G.8 below) shall be
delivered to the Secretary at the principal executive offices of the
corporation not earlier than the close of business on the 90th day prior
to the date of such special meeting and not later than the close of
business on the later of the 60th day prior to the date of such special
meeting or, if the first public announcement of the date of such special
meeting is less than 100 days prior to the date of such special meeting,
the 10th day following the day on which public announcement is first made
of the date of the special meeting and of the nominees proposed by the
Board to be elected at such meeting. In no event shall any adjournment or
postponement of a special meeting or the announcement thereof commence a
new time period for the giving of a stockholder’s notice as described
above. The chairperson of a special meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly
brought before the meeting in accordance with the provisions of
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this
Paragraph G and, if the chairperson should so determine, any such business
not properly brought before the meeting shall not be transacted.
5.
Only such persons
who are nominated in accordance with the procedures set forth in these
Bylaws shall be eligible to serve as directors and only such business
shall be conducted at a meeting of stockholders as shall have been brought
before the meeting in accordance with the procedures set forth in these
Bylaws. Except as otherwise provided by law, the Amended and Restated
Certificate of Incorporation, as it may be amended from time to time (the
“Amended and Restated Certificate of Incorporation”) or these Bylaws, the
Chairman of the meeting shall have the power and duty to determine whether
a nomination or any business proposed to be brought before the meeting was
made or proposed, as the case may be, in accordance with the procedures
set forth in these Bylaws and, if any proposed nomination or business is
not in compliance with these Bylaws, to declare that such defective
proposal or nomination shall be disregarded.
6.
For purposes of
this Paragraph G, “public announcement” shall mean disclosure in a press
release reported by a national news service or in a document publicly
filed by the corporation with the Securities and Exchange Commission
pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and
regulations promulgated thereunder.
7.
Notwithstanding
the provisions of this Paragraph G, a stockholder shall also comply with
all applicable requirements of the Exchange Act and the rules and
regulations thereunder with respect to the matters set forth in Paragraph
G of these Bylaws; provided, however, that any references in these Bylaws
to the Exchange Act or the rules promulgated thereunder are not intended
to and shall not limit the requirements applicable to nominations or
proposals as to any other business to be considered pursuant to Paragraph
G.1(c) or Paragraph G.4 of these Bylaws. Nothing in these Bylaws shall be
deemed to affect any rights (i) of stockholders to request inclusion of
proposals in the corporation’s proxy statement pursuant to Rule 14a-8
under the Exchange Act or (ii) of the holders of any class or series of
shares of the corporation having preference over the Common Stock as to
dividends or upon liquidation if and to the extent provided for under law,
the Amended and Restated Certificate of Incorporation or these Bylaws.
8.
To be eligible to
be a nominee for election or reelection as a director of the corporation,
a person must deliver (in accordance with the time periods prescribed for
delivery of notice under Paragraph G.2 or Paragraph G.4, as applicable) to
the Secretary of the corporation at the principal executive offices of the
Corporation a written questionnaire with respect to the background and
qualification of such person and the background of any other person or
entity on whose behalf the nomination
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is being
made (which questionnaire shall be provided by the Secretary upon written
request) and a written representation and agreement (in the form provided
by the Secretary upon written request) that such person (A) is not and
will not become a party to (1) any agreement, arrangement or understanding
with, and has not given any commitment or assurance to, any person or
entity as to how such person, if elected as a director of the Corporation,
will act or vote on any issue or question (a “Voting Commitment”) that has
not been disclosed to the corporation or (2) any Voting Commitment that
could limit or interfere with such person’s ability to comply, if elected
as a director of the corporation, with such person’s fiduciary duties
under applicable law, (B) is not and will not become a party to any
agreement, arrangement or understanding with any person or entity other
than the corporation with respect to any direct or indirect compensation,
reimbursement or indemnification in connection with service or action as a
director that has not been disclosed therein, and (C) in such person’s
individual capacity and on behalf of any person or entity on whose behalf
the nomination is being made, would be in compliance, if elected as a
director of the corporation, and will comply with all applicable publicly
disclosed corporate governance, conflict of interest, confidentiality and
stock ownership and trading policies and guidelines of the corporation.
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H.
Proxy
Presentation
. Every stockholder may authorize another person or persons to act
for him by proxy in all matters in which a stockholder is entitled to
participate, whether by waiving notice of any meeting, voting or
participating at a meeting, or expressing consent or dissent without a
meeting. Every proxy must be signed by the stockholder or by his
attorney-in-fact. No proxy shall be voted or acted upon after three years
from its date unless such proxy provides for a longer period. A duly
executed proxy shall be irrevocable if it states that it is irrevocable
and, if, and only as long as, it is coupled with an interest sufficient in
law to support an irrevocable power. A proxy may be made irrevocable
regardless of whether the interest with which it is coupled is an interest
in the stock itself or an interest in the corporation
generally.
Notwithstanding anything to the contrary in the preceding
paragraph, a stockholder may authorize another person or persons to act
for the stockholder as proxy by transmitting or authorizing the
transmission of a telegram or other means of electronic transmission to
the person who will be the holder of the proxy or to a proxy solicitation
firm, proxy support service organization or like agent duly authorized by
the person who will be the holder of the proxy to receive such
transmission, provided that any such telegram or other means of electronic
transmission must either set forth or be submitted with information from
which it can be determined that the telegram or other electronic
transmission was authorized by the stockholder.
Any
copy, facsimile telecommunication or other reliable reproduction of the
writing or transmission authorizing another person or persons to act as
proxy for a
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stockholder may be substituted or used in lieu of the original
writing or transmission for any and all purposes for which the original
writing or transmission could be used, provided that such copy, facsimile
telecommunication or other reproduction shall be a complete reproduction
of the entire original writing or transmission.
I.
Inspectors and
Judges
.
The Board, in advance of any meeting, may, but need not, appoint one or
more inspectors of election or judges of the vote, as the case may be, to
act at the meeting or any adjournment thereof. If an inspector or
inspectors or judge or judges are not appointed, the person presiding at
the meeting may, but need not, appoint one or more inspectors or judges.
In case any person who may be appointed as an inspector or judge fails to
appear or act, the vacancy may be filled by appointment made by the Board
in advance of the meeting or at the meeting by the person presiding
thereat. Each inspector or judge, if any, before entering upon the
discharge of his duties, shall take and sign an oath faithfully to execute
the duties of inspector or judge at such meeting with strict impartiality
and according to the best of his ability. The inspectors or judges, if
any, shall determine the number of shares of stock represented at the
meeting, the existence of a quorum, the validity and effect of proxies,
and shall receive votes, ballots or consents, hear and determine all
challenges and questions arising in connection with the right to vote,
count and tabulate all votes, ballots or consents, determine the results,
and do such acts as are proper to conduct the election or vote with
fairness to all stockholders. On request of the person presiding at the
meeting, the inspector or inspectors or judge or judges, if any, shall
make a report in writing of any challenge, question or matter determined
by him or them and execute a certificate of any fact found by him or
them.
J.
Quorum
. Except as the General
Corporation Law or these Bylaws may otherwise provide, the holders of a
majority of the combined voting power of the then outstanding shares of
stock entitled to vote generally in the election of directors, voting
together as a single class, shall constitute a quorum at a meeting of
stockholders for the transaction of any business. The stockholders present
may adjourn the meeting despite the absence of a quorum. When a quorum is
once present to organize a meeting, it is not broken by the subsequent
withdrawal of any shareholders.
K.
Voting
. Each stockholder entitled to
vote in accordance with the terms of the Certificate of Incorporation and
of these Bylaws, or, with respect to the issuance of Preferred Stock, in
accordance with the terms of a resolution or resolutions of the Board,
shall be entitled to one vote, in person or by proxy, for each share of
stock entitled to vote held by such stockholder. In the election of
directors, a plurality of the votes cast shall elect. Any other action
shall be authorized by a majority of the votes cast except where the
Certificate of Incorporation or the General Corporation Law requires a
different percentage of votes and/or a different exercise of voting power.
In the election of directors, voting need not be by ballot. Voting by
ballot shall not be required for any other corporate action except as
otherwise provided by the General Corporation
Law.
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ARTICLE II
DIRECTORS
Section 1.
Functions and
Definition
. The
business of the corporation shall be managed by the Board of the corporation.
The use of the phrase “whole board” herein refers to the total number of
directors which the corporation would have if there were no
vacancies.
Section 2.
Qualifications and
Number
. A
director need not be a stockholder, a citizen of the United States, or a
resident of the State of Delaware. The number of directors constituting the
whole board shall be not less than three and not more than nine. Such number
shall be fixed from time to time by action of the Board, or, if the number is
not fixed, the number shall be five.
Section 3.
Election and Term
. Each director shall serve for a
term of one year, until such earlier or later time as his or her successor is
elected and qualified, or until his or her earlier death or resignation or
removal. Any director may resign at any time upon written notice to the
corporation. In the interim between annual meetings of stockholders or special
meetings of stockholders called for the election of directors and/or for the
removal of one or more directors and for the filling of any vacancies in the
Board, including vacancies resulting from the removal of directors for cause or
the expansion of the size of the Board to create one or more new directorships,
any vacancy in the Board may be filled by the vote of a majority of the
remaining directors then in office, although less than a quorum, or by the sole
remaining director.
Section 4.
Meetings
.
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A.
Time and
Place
.
Meetings of the Board shall be held at such time and at such place within
or without the State of Delaware as shall be specified, in the case of an
annual meeting, by the Board or the Chairman or, in the case of a special
meeting, in the notice given as hereinafter provided for special meetings
of the Board.
B.
First
Meeting
.
Prior to the first annual meeting of the stockholders of the corporation,
the Board shall meet at such time and place as fixed by the directors
appointed to serve thereon in accordance with this Article II. Beginning
immediately after the first annual meeting of the stockholders, each newly
elected Board shall meet immediately after each annual meeting of the
stockholders at which such Board was elected at the same place at which
such annual meeting is held, and no notice of such meeting shall be
necessary, provided a quorum shall be present. In the event such meeting
is not so held immediately after an annual meeting of the stockholders, it
may be held at such time and place as shall be specified in the notice
given as hereinafter provided for special meetings of the
Board.
C.
Call
. No call shall be required
for regular Board meetings for which the time and place have been fixed.
Special meetings may be called by or at the direction of the Chairman of
the Board, the Vice-Chairman of the Board, if any, or the President, or of
a majority of the directors in
office.
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D.
Notice or Actual or
Constructive Waiver
. No notice shall be required
for regular meetings for which the time and place have been fixed.
Written, oral, electronic or any other mode of notice of the time and
place shall be given for special meetings in sufficient time for the
convenient assembly of the directors thereat. The notice of any meeting
need not specify the purpose of the meeting. Any requirement of furnishing
a notice shall be waived by any director who signs a written waiver of
such notice before or after the time stated therein.
Attendance of a Director at a meeting of the Board shall constitute
a waiver of notice of such meeting, except when the Director attends a
meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not
lawfully called or convened.
E.
Quorum and
Action
. A
majority of the whole Board shall constitute a quorum except when a
vacancy or vacancies prevents such majority, whereupon a majority of the
directors in office shall constitute a quorum, provided that such majority
shall constitute at least one-third (1/3) of the whole Board. Any director
may participate in a meeting of the Board by means of a conference
telephone or similar communications equipment by means of which all
directors participating in the meeting can hear each other, and such
participation in a meeting of the Board shall constitute presence in
person at such meeting. A majority of the directors present, whether or
not a quorum is present, may adjourn a meeting to another time and place.
Except as otherwise provided, and except as otherwise provided by the
General Corporation Law, the act of the Board shall be the act by vote of
a majority of the directors present at a meeting, a quorum being present.
The quorum and voting provisions herein stated shall not be construed as
conflicting with any provisions of the General Corporation Law and these
Bylaws which govern a meeting of the Board held to fill vacancies and
newly created directorships in the Board.
F.
Chairman of the
Meeting
.
The Chairman of the Board, if any and if present and acting, shall preside
at all meetings. Otherwise, the Vice-Chairman of the Board, if any and if
present and acting, or the President, if present and acting, or any other
director chosen by the Board, shall
preside.
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Section 5.
Removal of
Directors
.
Subject to the rights of any class or series of stock having a preference over
the Common Stock as to dividends or upon liquidation to elect directors under
specified circumstances, any director may be removed from office with or without
cause by the affirmative vote of the holders of a majority of the combined
voting power of the then outstanding shares of stock entitled to vote generally
in the election of directors, voting together as a single class.
Section 6.
Committees
. The Board may, by resolution
passed by a majority of the whole Board, designate one or more committees of the
whole Board, each committee to consist of two or more of the directors of the
corporation. The Board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. Any such committee, to the extent provided in the
resolution of the
Board, shall
have and may exercise the powers of the Board in the management of the business
and affairs of the corporation, and may authorize the seal of the corporation to
be affixed to all papers which may require it. In the absence or
disqualification of any member of any such committee or committees, the member
or members thereof present at any meeting and not disqualified from voting,
whether or not he or they constitute a quorum, may unanimously appoint another
member of the Board to act at the meeting in the place of any such absent or
disqualified member.
Section 7.
Action in Writing
. Any action required or permitted
to be taken at any meeting of the Board or any committee thereof may be taken
without a meeting if all members of the Board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Board or committee.
Section 8.
Chairman of the
Board
. The
Chairman of the Board, if one is elected, shall preside at all meetings of the
Board and of the stockholders. The Chairman shall perform all duties incident to
the office of Chairman of the Board and shall have such other powers and duties
as the Board assigns to that individual. In the absence of the Chairman, the
Board shall designate a member of the Board as temporary Chairman.
ARTICLE III
OFFICERS
Section 1.
Executive
Officers
. The
Board may elect or appoint a President, one or more Vice Presidents (one or more
of whom may be denominated “Executive Vice President” or “Senior Vice
President”), a Secretary, one or more Assistant Secretaries, a Treasurer, one or
more Assistant Treasurers, and such other officers as they may determine. Any
number of offices may be held by the same person.
Section 2.
Term of Office;
Removal
. Unless
otherwise provided in the resolution of election or appointment, each officer
shall hold office until the meeting of the Board following the next meeting of
shareholders and until his successor has been elected and qualified. The Board
may remove any officer for cause or without cause.
Section 3.
Authority and
Duties
. All
officers, as between themselves and the corporation, shall have such authority
and perform such duties in the management of the corporation as may be provided
in these Bylaws, or, to the extent not so provided, by the Board.
Section 4.
The President
. The President shall be the chief
executive officer of the corporation.
Section 5.
Vice Presidents
. Any Vice President that may have
been appointed, in the absence or disability of the President, shall perform the
duties and exercise the powers of the President, in the order of their
seniority, and shall perform such other duties as the Board shall
prescribe.
Section 6.
The Secretary
. The Secretary shall keep in safe
custody the seal of the corporation and affix it to any instrument when
authorized by the Board, and shall perform such other duties as may be
prescribed by the Board.
Section 7.
The Treasurer
. The Treasurer shall have the care
and custody of the corporate funds, and other valuable effects, including
securities, and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all monies
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the Board. The Treasurer shall
disburse the funds of the corporation as may be ordered by the Board, taking
proper vouchers for such disbursements, and shall render to the President and
the Board, at the regular meetings of the Board, or whenever they may require
it, an account of all his transactions as Treasurer and of the financial
condition of the corporation. If required by the Board, the Treasurer shall give
the corporation a bond for such term, in such sum and with such surety or
sureties as shall be satisfactory to the Board for the faithful performance of
the duties of his office and for the restoration to the corporation, in case of
his death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the corporation.
ARTICLE IV
CORPORATE SEAL
AND
CORPORATE BOOKS
The corporate seal shall be in such
form as the Board shall prescribe. The books of the corporation may be kept
within or without the State of Delaware, at such place or places as the Board
may, from time to time, determine.
ARTICLE V
FISCAL YEAR
The fiscal year of the corporation
shall be fixed, and shall be subject to change, by the Board.
ARTICLE VI
AMENDMENTS
The Bylaws of the corporation may be
adopted, amended or repealed by the Board of Directors or the Stockholders.
TAX MATTERS AGREEMENT
BY AND AMONG
VISHAY INTERTECHNOLOGY, INC.
AND
VISHAY PRECISION GROUP,
INC.
July 6, 2010
TAX MATTERS AGREEMENT
WHEREAS, Vishay Intertechnology, Inc. (“VSH”) and Vishay Precision Group,
Inc. (“VPG”), collectively the “Parties” entered into the Master Separation and
Distribution Agreement dated as of June 22, 2010 (the
“Distribution Agreement”
), pursuant to which (i) VSH will distribute to its stockholders all of
the stock of VPG (the “Distribution”);
WHEREAS, it is the intention of VSH and VPG that the Distribution
qualifies as a tax-free transaction described in Section 355 of the Internal
Revenue Code of 1986, as amended (the
“Code”
);
WHEREAS, VSH has received a private letter ruling from the IRS regarding
certain tax aspects of the Distribution; and
WHEREAS, in contemplation of the Distribution pursuant to which VPG and
certain of its direct and indirect Subsidiaries will cease to be members of the
VSH Affiliated Group of which VSH is the common parent corporation, the Parties
desire to set forth their agreement on the rights and obligations with respect
to handling and allocating Taxes and related matters.
NOW, THEREFORE, in consideration of the foregoing and the terms,
conditions, covenants and provisions of this Agreement and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, hereby agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.1.
Defined Terms
. Capitalized terms used in this Agreement and
not defined herein shall have the meanings set forth in the Distribution
Agreement. For purposes of this Agreement, the following terms have the
following meanings:
“Affiliated Group”
means an affiliated group of corporations (as defined in Section 1504(a) of the
Code).
“Final Determination”
means any final determination of liability in respect of a Tax that,
under Applicable Law, is not subject to further appeal, review or modification
through proceedings or otherwise (including the expiration of a statute of
limitations or a period for the filing of claims for refunds, amended returns or
appeals from adverse determinations), including a “determination” as defined in
Section 1313(a) of the Code or execution of an IRS Form 870AD.
“Income Tax”
means
any U.S. federal, state, local or non-U.S. (i) Tax on or measured by net income
or (ii) franchise Tax.
“Interest”
means
interest at a rate per annum equal to the Prime Rate as published in the
Wall Street Journal
, Eastern
Edition
in effect
from time to time during the period such interest accrues.
“IRS”
means the United States Internal Revenue
Service.
“Israeli Tax Returns”
means the Income Tax
Returns of VATL, Tedea
Huntleigh
International, Tedea Huntleigh Technology and Tedea Huntleigh Industrial
Properties for 2008 and 2009 that are not filed prior to the Effective Time.
“Post-Closing Tax Period”
means any Tax period beginning after the Distribution Date; and, with
respect to a Tax period that begins on or before the Distribution Date and ends
thereafter, the portion of such Tax period beginning after the Distribution
Date.
“Pre-Closing Non-Income Taxes”
means any Taxes of a VPG Entity other than
Income Taxes that are attributable to a Pre-Closing Tax Period, provided,
however, that it shall not include any such Taxes other than Transaction Taxes
that are accrued as a current liability (net of any prepaid taxes) on the
balance sheet of the VPG Entity at the Effective Time.
“Pre-Closing Tax Period”
means any Tax period ending on or before the Distribution Date; and,
with respect to a Tax period that begins on or before the Distribution Date and
ends thereafter, the portion of such Tax period ending on the Distribution Date.
“Proceeding”
means
any claim, examination, suit, action, litigation, assessment or proceeding
(including any Tax audit), whether administrative or judicial.
“Tax
”
or
“
Taxes
”
means all U.S.
federal, state, local, or non-U.S. net or gross income, gross receipts, net
proceeds, sales, use, ad valorem, value added, franchise, , withholding,
payroll, employment, excise, property, deed, stamp, alternative or add-on
minimum, environmental, profits, windfall profits, license, lease, service, use,
occupation, severance, energy, unemployment, social security, worker’s
compensation, capital, or other taxes, assessments, , or other similar
governmental charges, together with any interest, penalties, additions to tax,
or additional amounts with respect thereto.
“Tax Asset”
means
any net operating loss, net capital loss, investment tax credit, foreign tax
credit, charitable deduction or any other credit or tax attribute that could be
carried forward or back to reduce Taxes (including without limitation deductions
and credits related to alternative minimum Taxes).
“Tax Item”
means,
with respect to any Income Tax, any item of income, gain, loss, deduction or
credit.
“Transaction Tax” means a Tax
attributable to the Distribution or any
transaction taken to facilitate the Distribution
.
“Treasury Regulations”
means the U.S. federal income Tax regulations, as amended, including
temporary regulations, promulgated under the Code.
“
VATL”
means Vishay Advanced Technologies, Ltd and
its Subsidiaries after the Effective Time.
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“
VIL Assets”
means the assets of Vishay Israel Limited
that are sold to VATL that are described in agreements between the parties that
refer to the transfer of the (i) Foil and Thermal Shroud business and (ii) the
Bonding business.
“
VIL”
means
Vishay Israel Limited
“VPG Capital Stock”
means all classes or series of stock of VPG and all options, warrants,
derivatives, rights to acquire stock, and other interests and instruments taken
into account for purposes of determining a “50-percent or greater interest”
within the meaning of Section 355(d)(4) of the Code.
“VPG Entity”
means
any member of the VPG Group that was also a Subsidiary of VSH prior to the
Distribution Date.
“VPG Group”
means VPG and its Subsidiaries after the
Effective Time.
“VPG Group Relief Loss”
means an income tax loss of a VPG Entity that could be surrendered to a
member of the VSH Group pursuant to the group relief system in place in the
United Kingdom.
“VPG Separate Tax Return”
means with respect to a VPG Entity, any state or local Income Tax Return
for periods that end prior to or on the Distribution Date that are not filed on
an affiliated, consolidated, combined or unitary basis with one or more members
of the VSH Group.
“VPG Straddle Period Tax Return”
means any Income Tax Return required to be
filed that includes both a Pre-Closing Tax Period and a Post-Closing Tax Period
of any VPG Entity.
“VPG Tax Return”
means any Income Tax Return required to be filed by a member of the VPG Group,
other than a VSH Income Tax Return.
“VPG Taxes”
mean
all Taxes of any member of the VPG Group that are attributable to a Post-Closing
Tax Period.
“VSH Consolidated Group”
means, with respect to U.S. federal Income Taxes, the Affiliated Group
of which VSH is a member, and with respect to any other Income Tax, any
affiliated, consolidated, combined or unitary group of which any member of the
VSH Group is a member.
“
VSH Group
” means
VSH and its Subsidiaries other than the VPG Entities.
“VSH Income Tax Return”
means (i) any U.S. federal Income Tax Return and any state or local
Income Tax Return that has been or will be filed by or with respect to any VSH
Consolidated Group on an affiliated, consolidated, combined or unitary basis for
a period that ends prior to or on or includes the Distribution Date, and (ii)
any VPG Separate Tax Returns.
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“VSH Income Taxes”
means all Income Taxes of any member of the VSH Group and any VPG Entity
attributable to a Pre-Closing Tax Period, including, without limitation, (i) all
Transaction Taxes that are Income Taxes, (ii) all Income Taxes resulting from
the removal of the VPG Entities from any consolidated, unitary or combined
Income Tax Return pursuant to the Distribution, and (iii) any Income Taxes
(after reduction for any foreign tax credit
utilized
with
respect to the inclusion) resulting from the inclusion by a VPG Entity of income
pursuant to Section 951(a)(1)(A) of the Code for income of a non-U.S. VSH Group
member or a VPG Entity that is attributable to a Pre-Closing Tax Period;
provided, however, that VSH Income Taxes shall not include any Income
Taxes(other than Transaction Taxes)
for which there
was an accrual for current taxes (net of any prepaid taxes) on the balance sheet
of the VPG Entity at the Effective Time; and provided further that for purposes
of this definition, the inclusion under Section 951(a)(1)(A) of the Code shall
include only those amounts incurred through the normal operations of the
business and shall not include amounts attributable to extraordinary events or
to material changes in business operations.
ARTICLE II
ADMINISTRATIVE AND COMPLIANCE MATTERS
Section 2.1.
Sole Tax Sharing Agreement
. Any and all existing Tax Sharing Agreements,
whether written or unwritten, between any member of the VSH Group, on the one
hand, and any member of the VPG Group, on the other hand, shall be terminated as
of the Distribution Date as between such Parties. As of the Distribution Date,
neither the members of the VPG Group nor the members of the VSH Group shall have
any further rights or liabilities under any such agreement, and this Agreement
shall be the sole Tax Matters Agreement between the members of the VPG Group and
the members of the VSH Group.
Section 2.2.
Designation of Agent
. VPG and each member of the VPG Group, in
each case with respect to any VSH Consolidated Group of which such Person was a
member on or prior to the Distribution Date, hereby irrevocably authorizes VSH
to designate a member of VSH Group, or a successor of such member, as its agent,
coordinator, and administrator, for the purpose of taking any and all actions
(including the execution of waivers of applicable statutes of limitation) with
respect to any VSH Income Tax Return which are necessary or incidental to the
filing of any Tax Return, any amended Tax Return, or any claim for refund,
credit or offset of Tax (even where an item or Tax Asset giving rise to an
amended Tax Return or refund claim arises in a Post-Closing Tax Period) or to
any Proceedings, and for the purpose of making payments to, or collecting
refunds from, any Taxing Authority, in each case relating to any Pre-Closing Tax
Period.
Section 2.3.
Preparation of VSH Income Tax
Returns
. VSH and the
members of the VSH Group shall prepare or cause to be prepared, with assistance
as needed from the members of the VPG Group, and file or cause to be filed all
VSH Income Tax Returns. Such Tax Returns shall be prepared in a manner that is
consistent with the prior practice of the members of the VSH Group and the VPG
Entities, provided that an inconsistent position may be taken if such position
would not adversely impact any VPG Entity or is required by law, as reasonably
determined by VSH in good faith; provided however, for the avoidance of doubt,
the consolidated tax return that includes the Distribution Date shall include a
calculation of the overall foreign loss, as that term is defined in Section
904(d)(f), (“OFL”) for the group.
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(a)
VSH shall provide to VPG for its comments a
draft of (i) the calculation of the OFL no later than 30 days prior to the due
date for filing the 2010 U.S. federal consolidated Tax Return, including any
extensions thereof, for the review and comment by VPG, and (ii) all VPG Separate
Tax Returns and the portions of each other VSH Income Tax Return that relate to
the VPG Entities (or, at VSH’s option, a pro forma Tax Return that relates
solely to the VPG Entities) no later than 15 days prior to the due date for
filing such Tax Return, including any extensions thereof, for the review and
comments of VPG, which comments shall be given due regard, provided that any
final decision with respect to the reporting of any item on such Tax Return
shall be made by VSH
Section 2.4.
General Allocation of VSH and VPG
Income
. VSH will determine
the items of income, gain, loss, deduction and credit of the VPG Entities to be
included on each VSH Income Tax Return filed by a VSH Consolidated Group for any
taxable year in which any VPG Entity ceases to be a member of the VSH
Consolidated Group in good faith in accordance with Treasury Regulations Section
1.1502-76(b) (or any comparable provision of state or local law).
VPG
and its Affiliates shall file their respective
Tax Returns for the taxable period beginning on the first day after the
Distribution Date consistently with such determinations, except as otherwise
required by law.
(a)
Transaction Treated as Extraordinary
Items
. For purposes of
preparing any federal, state or local Income Tax Return that is filed on a
consolidated, combined or unitary basis for a period that ends on the
Distribution Date, or starts on the day after the Distribution Date, in
determining the apportionment of income and Taxes between any Pre-Closing Tax
Period and Post-Closing Tax Period, any Tax Items relating to the Distributions
shall be treated as extraordinary items described in Treasury Regulations
Section 1.1502-76(b)(2)(ii)(C) and shall (to the extent occurring on or prior to
the Distribution Date) be allocated to Pre-Closing Tax Periods, and any Income
Taxes related to such items shall be treated under Treasury Regulations Section
1.1502-76(b)(2)(iv) as relating to such extraordinary item and shall (to the
extent occurring on or prior to the Distribution Date) be allocated to
Pre-Closing Tax Periods.
(b)
Apportionment of Earnings and Profits and Tax
Attributes
. VSH and VPG
shall jointly determine the portion, if any, of any earnings and profits, Tax
Asset, or other consolidated, combined or unitary attribute to be allocated or
apportioned to the VPG Entities under applicable law and in accordance with the
private letter ruling received with respect to the Distribution from the IRS.
VPG and all members of the VPG Group shall prepare all Tax Returns in accordance
with such determination. In the event that any temporary or final amendments to
Treasury Regulations are promulgated after the date of this Agreement that
provide for any election to apply such regulations retroactively, then any such
election shall be made only to the extent that VSH and VPG collectively agree to
make such election
Section 2.5.
VPG Tax Returns
. VPG and the members of the VPG Group shall
prepare or cause to be prepared, with the assistance of the members of the VSH
Group (to the extent necessary) and file or cause to be filed, all VPG Tax
Returns. VPG shall provide to VSH a draft of each VPG Straddle Period Tax Return
(and any VPG Tax Return with respect to a Pre-Closing Tax Period) (with copies
of any relevant schedules, work papers and other documentation then available)
no later than 15 days prior to the due date, including extensions, for the
filing of such Tax Return, for VSH’s review and approval, which approval shall
not be
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unreasonably withheld,
delayed or conditioned. Any VPG Straddle Period Tax Return (and any VPG Tax
Return with respect to a Pre-Closing Tax Period) shall be prepared in a manner
consistent with the prior practice of the VSH Group and the VPG Entities, unless
otherwise required by law.
Section 2.6.
Preparation of other Tax
Returns
. Except as limited
by Section 2.7 below, any Tax Return required to be filed by VSH or its
Subsidiaries, or VPG or its Subsidiaries for which responsibility is not
specifically allocated in this Article II shall be prepared and filed by the
entity that is required to file the Tax Return; provided, however,
that
(i) such Tax Returns shall be prepared in a
manner consistent with past practice except to the extent otherwise required by
law and (ii) at the request of VPG, VSH shall prepare the Israeli Income Tax
Returns for filing in a timely manner by VPG as mutually agreed by VSH and VPG
(iii) and provided, further however, that, at the request of VSH, VPG shall
provide to VSH a copy of each such Tax Return that is prepared by VPG with
respect to Taxes for which VSH is liable hereunder (with copies of any relevant
schedules, work papers and other documentation then available), and if
practically feasible such Tax Return shall be provided to VSH prior to the
filing of such Tax Returns.
Section 2.7.
Amended Returns
. VPG shall not, and shall not permit any of
its Subsidiaries to, with respect to any VPG Entity, file an amended Tax Return,
or file a Tax Return in a jurisdiction in which the VPG Entity has not
previously filed a Tax Return for a Pre-Closing Period without the prior written
consent of VSH, which shall not be unreasonably withheld, delayed or
conditioned, except as required by law.
Section 2.8.
U.K. Group Relief
Procedures
(a)
With respect to the Income Tax period ending
December 31, 2009, VPG shall cause the VPG Group Relief Loss for the period to
be surrendered to VSH, or its appropriate affiliate to permit the full use of
the loss for such period.
(b)
With respect to the Income Tax period
beginning on January 1, 2010, to the extent permitted by law, the parties shall
allocate a VPG Group Relief Loss for the year 2010 on a closing of the books of
the books basis (as opposed to an allocation based on numbers of days) for the
period January 1, 2010 through the date of the Distribution (the “Pre-Closing
Period”). A VPG Group Relief Loss that is allocated to the Pre-Closing Period
shall be first surrendered to any other VPG Entity, up to the taxable income of
such entity for the Pre-Closing Period, determined on a closing of the books
basis. VPG will cause the remainder of a VPG Group Relief Loss that is allocated
to the Pre-Closing Period to be surrendered to VSH or its appropriate affiliate
(the “VSH Loss Amount”). If based on advice of its tax advisors, VSH reasonably
determines that the VPG Group Relief Loss for 2010 cannot be allocated on a
closing of the books basis, and must be allocated based on the number of days in
the Pre-Closing Period as compared to the number of days in 2010, VPG will
nonetheless first cause an amount of the VPG Group Relief Loss equal to the VSH
Loss Amount to be surrendered to VSH or its appropriate affiliate for 2010, to
the extent permitted by law, and the remainder of the VPG Group Relief Loss for
the year may be surrendered to a VPG Entity.
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(c)
With respect to other Pre-Closing Tax Periods
not addressed in 2.8(a) or 2.8(b), (i) if with respect to U.K. Income Taxes a
member of the VSH Group is audited in the U.K. or files an amended U.K. Income
Tax return and as a result has an Income Tax liability, which could have been
offset by a VPG Group Relief Loss in those years, VPG shall cause the VPG Group
Relief Loss for such period to be surrendered to VSH or it appropriate
affiliate, but only to the extent a VPG Entity has not used the loss, and only
to the extent permitted by Law and (ii).if with respect to U.K. Income Taxes a
VPG Entity is assessed a U.K. Income Tax for which VSH would be responsible
under this Agreement and the amount could have been offset by a VPG Group Relief
Loss in the respective year, VPG shall cause a VPG Group Relief Loss for such
period to be surrendered to such VPG Entity to the extent the VPG Group Relief
Loss has not been utilized.
ARTICLE III
LIABILITY FOR TAXES
Section 3.1.
Responsibility for Income
Taxes
. Subject to the
indemnification provided for in Section 6.1 of this Agreement, VSH shall be
liable for and shall timely pay, or cause to be paid, to VPG, or at VPG’s
request, the applicable Taxing Authority all VSH Income Taxes, whether payable
at the time of the filing of the Tax Return, pursuant to an audit, or otherwise.
The tax liability for a period that begins before and ends after the
Distribution Date, shall be apportioned between VPG and VSH in a manner that
reasonably reflects the portion of such tax liability attributable to VPG for
the Post-Closing Tax Period, and the VPG Entities for the Pre-Closing Tax
Period, respectively, as if there had been a closing of the books on the date of
the Distribution. With respect to the apportionment of Income Taxes, any amounts
that are determined on an annual basis, such as depreciation, Section
951(a)(1)(A) inclusions, etc., shall be apportioned between VSH and VPG based on
the number of days in each of the Pre-Closing Tax Periods and the Post Closing
Tax Periods, respectively. Within 15 days prior to the filing of a VPG Straddle
Period Tax Return, VPG shall provide to VSH for its review and approval (which
shall not be unreasonably withheld, delayed or conditioned) written notice of
the Taxes allocable to VSH pursuant to this Section 3.1 and VSH shall promptly
reimburse VPG for such amounts to the extent the Income Taxes attributable to
the Pre-Closing Tax Periods constitute VSH Income Taxes.
Section 3.2.
Responsibility for Non-Income
Taxes
. VPG and VSH will
each be responsible for one half of any Pre-Closing Non-Income Taxes that are
required to be paid after the Effective Time, other than Transaction Taxes.
Section 3.3.
Responsibility for the Taxes that are
Accrued
. VPG shall be
liable for all Taxes that are accrued as a current liability (net of any prepaid
taxes) on the balance sheet of the VPG Entity at the Effective Time, other than
Transaction Taxes.
ARTICLE IV
REFUNDS AND OTHER MATTERS
Section 4.1.
Refunds and Tax Benefits for
VSH
. Except as otherwise
provided in Section 4.2, VSH shall be entitled to all refunds and credits of any
VSH Income Taxes, and one half of any refund or credit for any Pre-Closing
Non-Income Taxes, including any interest
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thereon, received by a
VPG Entity. VPG shall promptly pay or cause to be paid to VSH all such refunds
received by a VPG Entity. If in lieu of receiving any such refund a VPG Entity
reduces a Tax liability with respect to a Post-Closing Tax Period VPG shall
promptly pay or cause to be paid to VSH the amount of such reduction in Tax
liability when such reduction occurs. It is agreed that any amounts included as
prepaid taxes on the balance sheet of a VPG Entity on the Distribution Date,
whether separately stated or included in the accrual for current income taxes,
shall not constitute a tax refund or credit or benefit for purposes of this
Agreement.
Section 4.2.
Carryforwards and
Carrybacks
. To the extent
permitted by
Applicable Law, VPG
shall (or shall cause or permit the members of the VPG Group to) elect to
relinquish any carryback of a Tax Asset to any Pre-Closing Tax Period. No Party
shall be obligated to compensate any other Party for the carryforward of Tax
Assets from a Pre-Closing Tax Period to a Post-Closing Tax Period or for the
carryback of Tax Assets from a Post-Closing Tax Period to a Pre-Closing Tax
Period. For the avoidance of doubt, if a Tax Asset arises in a Post-Closing Tax
Period on a non-U.S separate company Tax Return, and it is required by law that
it be carried back to a Pre-Closing Tax Period, such carryback will be
permitted, and any
resulting refund, credit or other benefit
shall inure to VPG.
ARTICLE V
COVENANTS AND REPRESENTATIONS
Section 5.1.
Representations of VSH
. VSH represents that as of the date hereof,
and covenants that on the Distribution Date, it has no plan or intention to (i)
become a controlling shareholder or a ten-percent shareholder of VPG after the
Distribution Date within the meaning of Treasury Regulations Sections
1.355-7(d)(7) and (h) or (ii) take any action that would reasonably be expected
to prevent the Distribution from qualifying as a transaction described in
Section 355(a) of the Code, including any action inconsistent with the
information and representations furnished to the IRS in connection with the
request for a private letter ruling with respect to the Distributions or to Tax
counsel in connection with the preparation of the Tax Opinion.
Section 5.2.
Representations of VPG
. VPG and the other members of the VPG Group
represent that as of the date hereof, and covenants that on the Distribution
Date, it has no plan or intention to take any action that would reasonably be
expected to prevent the Distribution from qualifying as a transaction described
in Section 355(a) of the Code or the VPG Common Stock from being treated as
“qualified property” for purposes of Section 355(c)(2) or Section 361(c)(2) of
the Code, including any action inconsistent with the information and
representations furnished to the IRS in connection with the request for a
private letter ruling with respect to the Distributions or to Tax counsel in
connection with the preparation of the Tax Opinion.
Section 5.3.
Covenant of VSH.
VSH covenants that during the two-year period
following the Distribution Date it will not take any action that could prevent
the Distribution from qualifying as a transaction described in Section 355(a) of
the Code.
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Section 5.4.
Covenants of VPG Relating to the
Distribution
.
(a)
VPG covenants and agrees that: (i) during the
two-year period following the Distribution Date, no member of the VPG Group
conducting an active trade or business relied upon in connection with the
Distribution and Separation, which members are Tedea-Huntleigh International
Ltd. and Vishay PM Onboard Ltd., will liquidate, merge or consolidate with any
other Person except for the merger of Tedea-Huntleigh International Ltd. with
its two wholly owned subsidiaries in which Tedea-Huntleigh International Ltd. is
the surviving entity, (ii) during the two-year period following the Distribution
Date, no member of the VPG Group will sell or otherwise dispose of any of its
assets, except in the ordinary course of business, (iii) during the two-year
period following the Distribution Date, VPG will continue (independently from
VSH and with separate employees, officers and directors from VSH) the active
conduct of the historic businesses relied upon in connection with the
Distribution and Separation that were conducted by VPG throughout the five-year
period prior to the Distributions, (iv) it will not take, nor will it permit any
member of the VPG Group to take, any action inconsistent with the information
and representations furnished to the IRS in connection with the request for a
private letter ruling with respect to the Distribution and Separation or to Tax
counsel pursuant to Section 4.3 of the Distribution Agreement, (v) during the
two-year period following the Distribution Date, it will not, and will not
permit any member of the VPG Group, to purchase VPG Capital Stock, (vi) during
the two-year period following the Distribution Date, it will not issue VPG
Capital Stock to any Person, other than pursuant to the exercise of employee,
director or consultant stock options, stock awards, stock purchase rights or
other employment related arrangement under any stock incentive plan in existence
immediately after the Mergers, provided in each case that such stock issuance
meets the requirements for the safe harbor contained in Treasury Regulations
Section 1.355-7(d)(8), (vii) it will not enter into any transaction or, to the
extent it has the right to prohibit any such transaction, permit such
transaction to occur, or enter into negotiations to enter into any transaction
that may cause the Distribution or any Separation Transaction to be treated as
part of a plan or series of related transactions pursuant to which one or more
persons acquire directly or indirectly VPG Capital Stock representing a
“50-percent or greater interest” within the meaning of Section 355(d)(4) of the
Code, and (viii) it will not take any other action that would reasonably be
expected to prevent (i) the Distribution from qualifying as a transaction
described in Section 355(a) of the Code or (ii) the VPG Common Stock from being
treated as “qualified property” for purposes of Section 355(c)(2) or Section
361(c)(2) of the Code.
(b)
Notwithstanding the foregoing, a member of the
VPG Group may take actions inconsistent with the covenants contained in Section
5.04(a), if:
(i)
VPG obtains a ruling from
the IRS to the effect that such actions will not result in the Distribution
being taxable to VSH or their shareholders, or
(ii)
VPG obtains an opinion of
counsel reasonably acceptable to VSH to the same effect as Section 5.04(b)(i),
provided that such opinion is reasonably acceptable to VSH.
Section 5.5.
Other Covenants of VPG
. VPG covenants and agrees that (i) it will
not, and will not cause or permit any member of the VPG Group to (A) take any
action on the
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Distribution Date other
than in the ordinary course of business or (B) make or change any Tax election,
take any Tax position on any Income Tax Return, or take or omit to take any
other action that results in any increased Tax liability or reduction of any Tax
Asset of the VSH or the VPG Entities in respect of any Pre-Closing Tax Period or
Post-Closing Tax Period.
ARTICLE VI
INDEMNIFICATION
Section 6.1.
Indemnification of VSH by
VPG
. VPG shall indemnify
the members of the VSH Group, and hold them harmless from and against any and
all damages, losses, liabilities and expenses (including reasonable expenses of
investigation and reasonable attorneys’ fees and expenses in connection with any
action, suit or proceeding) arising out of, without duplication:
(a)
Any Tax for which any member of the VPG Group
is liable under this Agreement; and
(b)
Any Tax attributable to a misrepresentation or
a breach of any warranty, covenant or obligation in this Agreement by any member
of the VPG Group.
Section 6.2.
Indemnification of VPG by
VSH
. VSH shall indemnify
the members of the VPG Group, and hold them harmless from and against any and
all damages, losses, liabilities and expenses (including reasonable expenses of
investigation and reasonable attorneys’ fees and expenses in connection with any
action, suit or proceeding) arising out of, without duplication:
(a)
Any Tax for which any member of the VSH Group
is liable under this Agreement;
(b)
any Tax attributable to a misrepresentation or
a breach of any warranty, covenant or obligation in this Agreement by any member
of the VSH Group.
ARTICLE VII
PAYMENTS
Section 7.1.
Payments under this
Agreement
. Any payment
required to be made pursuant to this Agreement by one Party to another Party or
Person shall be made according to this Section 7.01.
(a)
In General
. All payments shall be made within the time
prescribed for payment in this Agreement, or if no period is prescribed, within
twenty days after delivery of written notice of the payment due and owing (and
to the extent applicable, approval of the amount of such payment), together with
a schedule calculating in reasonable detail the amounts that are due and owing.
Payments shall be deemed made when received. Any payment that is not made when
due shall bear Interest,
provided, however
, to the extent the amount due and owing is
Taxes, such amount shall not begin to accrue Interest pursuant to this Section
7.01(a) until the later of the time prescribed for payment pursuant to this
Agreement or the time such Taxes are actually paid by the indemnified Party.
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(b)
Treatment of Payments
.
(i)
Payments made pursuant to
this Agreement by any member of the VPG Group to or on behalf of any member of
the VSH Group shall be treated for all Tax purposes as distributions by VPG to
VSH occurring immediately before the Distribution, and none of the Parties shall
take any position inconsistent with such treatment, except to the extent that a
Final Determination with respect to the recipient Party causes any such payment
to not be so treated.
(ii)
Payments made pursuant to
this Agreement by any member of the VSH Group to or on behalf of any member of
the VPG Group shall be treated for all Tax purposes as a reduction in the
distribution occurring before the Distribution, or a contribution to VPG by VSH
immediately prior to the Distribution and none of the Parties shall take any
position inconsistent with such treatment, except to the extent that a Final
Determination with respect to the recipient Party causes any such payment to not
be so treated.
(c)
Except as provided in Article 9 of this
Agreement, in calculating amounts payable to an indemnified Party, the amount of
indemnification payable pursuant to this Agreement shall be computed net of any
Tax benefit actually realized by the indemnified Party or any of its Affiliates
that is related or attributable to such indemnification.
(d)
If any amount paid by an indemnifying Party
pursuant to this Agreement results in any increase in Tax liability or any
reduction of a Tax Asset of the indemnified Party, the indemnifying Party shall
indemnify the indemnified Party and hold it harmless from any interest or
penalty attributable to such increased Tax liability or reduced Tax Asset and
shall pay to the indemnified Party, in addition to amounts otherwise owed, an
additional amount necessary to reflect the Tax consequences of the receipt or
accrual of the relevant payment.
ARTICLE VIII
PROCEEDINGS
Section 8.1.
Notice
. Within ten Business Days after a Party
receives a written notice or other information from a Taxing Authority of the
existence of a Tax issue relating to the application of Section 355(e) to the
Distributions, relating to the qualification of the Distribution as tax-free
transactions described in Section 355 of the Code or that may require
indemnification pursuant to this Agreement (a “
Tax Claim
”) such
Party shall notify the other Party to this Agreement of such issue, and
thereafter shall promptly forward to the other Parties copies of notices and
material communications with any Taxing Authority relating to the Tax Claim. The
failure of one Party to notify the other Party of any Tax matter shall not
relieve such other Party of any liability and/or obligation which it may have
under this Agreement with respect to such Tax matter, except to the extent that
the indemnifying Party’s rights under this Agreement are materially prejudiced
by such failure.
Section 8.2.
Proceedings Generally.
(a)
Proceedings Relating to Income Taxes for
Pre-Closing Tax Periods.
VSH, at its
expense, shall control the defense and settlement of any Proceeding relating to
Income Taxes attributable to a Pre-Closing Tax Period, provided however, that
VPG shall be entitled to
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participate in the
defense of such Proceeding at its own cost and expense, including the right to
attend (or participate in), any meetings (or material conference calls with
respect to which VSH has reasonable advance notice) with Taxing Authorities or
before any judicial authorities in connection with such Proceeding; VSH shall in
good faith keep VPG informed of all developments relating to such Proceeding on
a timely basis, shall in good faith afford VPG the opportunity to review any
submissions related to such Proceeding, shall provide VPG with final copies of
any submissions, and, to the extent such Proceeding could reasonably result in
adverse tax consequences to the VPG Group with respect to Post-Closing Tax
Periods, shall not unreasonably reject any suggestions made by VPG with respect
to such Proceeding, and VSH shall not settle or compromise such Proceeding
without the consent of VPG, which consent shall not be unreasonably withheld,
delayed or conditioned. VPG will fully cooperate and assist VSH in a Proceeding
that VSH controls pursuant to this Section 8.2(a), including making available
personnel and books and records as reasonably requested by VSH. The Parties
shall in good faith cooperate with each other in connection with such Proceeding
and provide such information to each other as may be necessary or useful with
respect to such Proceeding in a timely manner.
(b)
Proceedings Relating to Non-Income Taxes for
Pre-Closing Periods
. VPG,
at its expense
,
shall control the defense and settlement of
any Proceeding relating to any Pre-Closing Non-Income Taxes, provided, however,
that VSH shall be entitled to participate in the defense of such Proceeding at
its own cost and expense including the right to attend (or participate in), any
meetings (or material conference calls with respect to which VPG has reasonable
advance notice) with Taxing Authorities or before any judicial authorities in
connection with such Proceeding; VPG shall keep VSH informed of all developments
relating to such Proceeding on a timely basis, shall in good faith afford VSH
the opportunity to review any submissions related to such Proceeding, shall not
unreasonably reject any suggestions made by VSH with respect to such Proceeding,
and shall provide VSH with final copies of any submissions; and VPG shall not
settle or compromise such Proceeding without the consent of VSH , which consent
shall not be unreasonably withheld, delayed or conditioned. VSH will fully
cooperate and assist VPG in a Proceeding that VPG controls pursuant to this
Section 8.2(a), including making available personnel and books and records as
reasonably requested by VPG. The Parties shall in good faith cooperate with each
other in connection with such Proceeding and provide such information to each
other as may be necessary or useful with respect to such Proceeding in a timely
manner.
(c)
If, with respect to any Proceeding described
in this Article 8 the Party responsible for controlling the Proceeding (the
“Defaulting Party”) fails to diligently prosecute, manage and defend the Tax
Claim by failing to respond in a timely manner to inquires by a Taxing
Authority, or failing to meet a material filing deadline or by a similar action
or inaction and either the other Party (the “
Defending Party
”)
could reasonably be subject to adverse tax consequences if such Tax Claim is not
prosecuted, the Defending Party shall thereafter have the right (but not the
obligation) to defend or prosecute, at the sole cost, expense and risk of the
Defaulting Party, such Tax Claim. The Defending Party shall have full control of
such defense or prosecution and such Proceedings, including any settlement or
compromise thereof. If requested by the Defending Party, the Defaulting Party
shall cooperate in good faith with the Defending Party and its authorized
representatives in order to contest effectively such claim. In the case of any
claim with respect to Taxes that is defended or prosecuted by the Defending
Party pursuant to this Section 8.2(c), the Defending Party shall, from time to
time, be entitled to current
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payment from the
Defaulting Party with respect to costs and expenses incurred by the Defending
Party in connection with such defense or prosecution (including, without
limitation, reasonable attorneys’, accountants’, and experts’ fees and
disbursements, settlement costs, court costs, and any other costs or expenses
for investigating, defending or prosecuting such claim, in each case on an after
tax basis.
ARTICLE IX
SPECIFIC COVENANT WITH RESPECT TO ASSET SALE
Section 9.1.
Transaction
. It is expected that the sale of the VIL
Assets to VATL (the “
VIL Asset Sale
”)
will not create any cash tax liability for VIL in Israel in the tax year of the
sale because of the ability to offset the any gain on the transaction against
the existing net operating loss (“
NOL
”) in
VIL.
Section 9.2.
Filing of Tax Return.
VSH will actively pursue obtaining an opinion
or other acceptable form of advice from its Israeli tax advisors that confirms
at a “more likely than not” or higher level of comfort that the NOL may be used
by VIL to offset any gain on the sale of the VIL Assets (the “
Advice
”). Provided
that VSH receives such Advice, VSHagrees that the Tax Return for VIL that
includes the VIL Asset Sale shall be prepared and filed on the assumption that
the NOL of VIL offsets the gain on the VIL Asset Sale and VSH shall not and
shall not permit any member of the VSH Group to take a different position on any
Tax Return or in any discussion, whether written or oral, with any Tax
Authorities.
Section 9.3.
Impact of Transaction.
If a Final Determination is reached that the
NOL cannot be used to offset the gain, (as opposed to a determination that the
NOL is not sufficiently large to offset the gain, or some other reason), then
VATL shall make a payment to VSH as follows:
(a)
To the extent VATL has been able to amortize
or depreciate the VIL Assets and realize a reduction in its tax, the aggregate
amount of such reduction actually realized by the time of the Final
Determination shall be paid by VATL to VSH within 15 days of the Final
Determination.
(b)
To the extent the VIL Assets at the time of
the Final Determination have not been fully amortized or depreciated for tax
purposes by VATL, and a deferred tax asset is recorded on the books of VATL for
the future tax benefit of the amortization or depreciation of the VIL Assets and
there is no valuation allowance or similar impairment taken against the deferred
tax asset, within 30 days after the Final Determination VATL shall pay to VSH
the net present value of the deferred tax benefit. The net present value shall
be determined using a discount rate equal to the rate of Interest in effect on
the date of the Final Determination.
(c)
In no event shall the amount payable by VPG
pursuant to this Section 9.3 exceed the Tax liability of VIL that arises solely
by virtue of the inability to apply its NOL to offset the gain recognized on the
VIL Asset Sale.
Section 9.4.
Advice Not Received
If the Israeli tax advisors are unable to
render the Advice, and because of that the VIL Tax Return does not offset the
gain on the sale of the VIL Assets with the NOL, VATL shall make a payment to
VSH as follows
:
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(a)
If a deferred tax asset is recorded on the
books of VATL for the future tax benefit of the amortization or depreciation of
the VIL Assets and there is no valuation allowance or similar impairment taken
against the deferred tax asset, within 30 days after VSH pays the Taxes due on
the VIL Asset Sale VATL shall pay to VSH the net present value of the deferred
tax benefit. The net present value shall be determined using a discount rate
equal to the rate of Interest in effect on the date of the payment
.
(b)
In no event shall the amount payable by VPG
pursuant to this Section 9.4 exceed the Tax liability of VIL that arises solely
by virtue of the inability to apply its NOL to offset the gain recognized on the
VIL Asset Sale.
Section 9.5.
Audit Management.
Notwithstanding anything to the contrary in
the this Agreement, if VSH or a VSH Group member receives notice, whether
written or otherwise, that the Israeli tax authorities may challenge the ability
to offset the gain on the VIL asset sale with the NOL, VSH shall promptly notify
VPG. The control of such Proceedings and the settlement shall be handled as
provided in section 8.2(a) of this Agreement.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1.
Cooperation
. The Parties shall each cooperate fully (and
each shall cause its respective Affiliates to cooperate fully) with all
reasonable requests from the other Parties, or from an agent, representative or
advisor to such Parties, including the delivery of information, documents access
to employees etc, in connection with the preparation and filing of Tax Returns,
claims for refund, Proceedings, and other matters, in each case, related to
Taxes covered by this Agreement, and with respect to the preparation by VPG of a
claim for an R&D credit (as provided by Section 41 of the Code) with respect
to the first or second Post-Closing Tax Period following the Distribution
Date.
Section 10.2.
Notices
. All notices, requests and other
communications to any Party hereunder shall be in writing (including facsimile
transmission) and shall be given,
if to VSH, to:
Vishay Intertechnology, Inc.
63 Lancaster Avenue
Malvern, PA
19355-2120
Attention: Dr. Lior E. Yahalomi, Chief
Financial Officer
Facsimile: 610.889.2161
with a copy (which shall not constitute notice)
to:
Kramer Levin Naftalis & Frankel
LLP
1177 Avenue of the
Americas
New York, NY
10036
Attention:
Ernest
S
.
Wechsler,
Esq.
Facsimile: 212.715.8000
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if to VPG,
to:
Vishay Precision Group, Inc.
3 Great Valley Parkway
Suite 150 Malvern, Pa.
19355
Attention: William M. Clancy, Chief Financial Officer
Telephone: 484.321.5306
Facsimile:
484.321.5301
with a copy (which shall not constitute notice)
to:
Pepper Hamilton LLP
3000 Two Logan Square
18
th
& Arch Streets
Philadelphia, PA
19103
Attention: Barry M. Abelson, Esq.
Facsimile No.: 215.689.4803
or to such other address
or facsimile number as such Party may hereafter specify for the purpose by
notice to the other Parties hereto. All such notices, requests and other
communications shall be deemed received on the date of receipt by the recipient
thereof if received prior to 5:00 p.m. on a Business Day in the place of
receipt. Otherwise, any such notice, request or communication shall be deemed to
have been received on the next succeeding Business Day in the place of receipt.
Section 10.3.
Changes in Law
.
(a)
Any reference to a provision of the Code,
Treasury Regulations, or a law of another jurisdiction shall include a reference
to any applicable successor provision or law.
(b)
If, due to any change in Applicable Law or
regulations or their interpretation by any court of law or other governing body
having jurisdiction subsequent to the date hereof, performance of any provision
of this Agreement or any transaction contemplated hereby shall become
impracticable or impossible, the Parties hereto shall use their commercially
reasonable best efforts to find and employ an alternative means to achieve the
same or substantially the same result as that contemplated by such provision.
Section 10.4.
Binding Effect; Benefit;
Assignment
.
(a)
The provisions of this Agreement shall be
binding upon and inure to the benefit of the Parties hereto and their respective
successors and assigns. No provision of this Agreement is intended to confer any
rights, benefits, remedies, obligations or liabilities hereunder upon any Person
other than the Parties hereto and their respective successors and assigns.
(b)
No Party may assign, delegate or otherwise
transfer any of its rights or obligations under this Agreement without the
consent of each other Party hereto.
-15-
Section 10.5.
Authority
. Each of the Parties hereto represents to
each of the other Parties that (a) it has the corporate power (corporate or
otherwise) and authority to execute, deliver and perform this Agreement, (b) the
execution, delivery and performance of this Agreement by it have been duly
authorized by all necessary corporate or other action, (c) it has duly and
validly executed and delivered this Agreement, and (d) this Agreement is a
legal, valid and binding obligation, enforceable against it in accordance with
its terms subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors’ rights generally and
general equity principles.
Section 10.6.
Entire Agreement
. This Agreement, the Distribution Agreement,
and the other Ancillary Agreements constitute the entire agreement between the
Parties with respect to the subject matter of this Agreement and supersede all
prior agreements and understandings, both oral and written, between the Parties
with respect to the subject matter of this Agreement.
Section 10.7.
Governing Law
. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to the conflicts of law rules of such state.
Section 10.8.
Counterparts; Effectiveness
. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument. This Agreement
shall become effective when each Party hereto shall have received a counterpart
hereof signed by all of the other Parties hereto. Until and unless each Party
has received a counterpart hereof signed by the other Party hereto, this
Agreement shall have no effect and no Party shall have any right or obligation
hereunder (whether by virtue of any other oral or written agreement or other
communication).
Section 10.9.
Severability
. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other Governmental Authority to be invalid, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
Party. Upon such a determination, the Parties shall negotiate in good faith to
modify this Agreement so as to affect the original intent of the Parties as
closely as possible in an acceptable manner in order that the transactions
contemplated hereby are consummated as originally contemplated to the fullest
extent possible.
Section 10.10.
Waiver and Amendment
.
(a)
Any provision of this Agreement may be amended
or waived prior to the Effective Time if, but only if, such amendment or waiver
is in writing and is signed, in the case of an amendment, by each Party to this
Agreement or, in the case of a waiver, by each Party against whom the waiver is
to be effective.
(b)
No failure or delay by any Party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof
-16-
preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not exclusive of
any rights or remedies provided by Applicable Law.
Section 10.11.
Interpretation
.
(a)
When a reference is made in this Agreement to
an Article or Section, such reference shall be to an Article or Section of or to
this Agreement unless otherwise indicated.
(b)
Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation.”
(c)
Unless the context requires otherwise, the
terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words in
this Agreement refer to this entire Agreement.
(d)
Unless the context requires otherwise, words
in this Agreement using the singular or plural number also include the plural or
singular, respectively, and the use of any gender herein shall be deemed to
include the other gender.
(e)
Except as otherwise specifically provided
herein, where any action is required to be taken on a particular day and such
day is not a Business Day and, as a result, such action cannot be taken on such
day, then this Agreement shall be deemed to provide that such action shall be
taken on the first Business Day after such day.
(f)
This Agreement was prepared jointly by the
Parties and no rule that it be construed against the drafter will have any
application in its construction or interpretation.
Section 10.12.
Headings
. The headings contained in this Agreement are
inserted for convenience only and shall not be considered in interpreting or
construing any of the provisions contained in this Agreement.
Section 10.13.
Exclusivity
. Except as otherwise explicitly provided in
the Distribution Agreement, all matters related to Taxes or Tax Returns of the
Parties shall be governed by this Agreement. In the event of a conflict, this
Agreement shall govern and control. Notwithstanding any other provision of this
Agreement, in no event shall any Party or any other Person be liable for any
Taxes, expenses or any other losses or damages of any kind pursuant to this
Agreement or otherwise except as expressly set forth herein or in the
Distribution Agreement.
Section 10.14.
Dispute Resolution
. Any disputes arising under this Agreement
shall be resolved by applying Sections 8.2 and 8.3 of the Distribution
Agreement, provided however, that to the extent the dispute is to an amount of
Tax, or an amount or allocation of a Tax Asset, the mediator referenced in
Section 8.2(d) shall, to the extent possible, be a person with a national
reputation as an expert in U.S. federal income tax.
Section 10.15.
Survival
. The covenants and agreements of the Parties
hereunder (including indemnification of the Parties) shall survive until 90 days
following the expiration of
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the applicable statute
of limitations (taking into account all extensions thereof), if any, of the
claim that gave rise to the indemnification. Notwithstanding the foregoing, in
the event of notice for indemnification has been given within the applicable
survival period, such indemnification shall survive until such time as such
claim is finally resolved.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
VISHAY INTERTECHNOLOGY, INC.
|
|
/s/ Lior E.
Yahalomi
|
Name:
|
Lior E. Yahalomi
|
Title:
|
Executive Vice
President and Chief Financial Officer
|
|
|
VISHAY PRECISION GROUP, INC.
|
|
/s/ William M.
Clancy
|
Name:
|
William M. Clancy
|
Title:
|
Executive Vice
President and Chief Financial Officer
|
TRADEMARK LICENSE
AGREEMENT
This
Trademark License Agreement (this “Agreement”) is entered into as of July 6,
2010 (the “Effective Date”), by and between Vishay Intertechnology, Inc., a
corporation organized under the laws of the State of Delaware (“VSH”) and Vishay
Precision Group, Inc., a corporation organized under the laws of the State of
Delaware (“VPG”).
RECITALS
WHEREAS, VSH owns all right, title
and interest in and to the Name (as hereinafter defined) and Mark (as
hereinafter defined) VISHAY, used alone or in connections with other
terms;
WHEREAS, VPG desires to use the
Licensed Marks (as hereinafter defined) on and in connection with the design,
development, manufacture, marketing, provision and performance of VPG Products
and Services (as hereinafter defined);
WHEREAS, VSH is willing to grant to
VPG, and VPG is willing to accept, the right to use the Licensed Marks in
accordance with and subject to the terms of this Agreement.
NOW, THEREFORE, in consideration of
the mutual promises, covenants, agreements, representations and warranties
contained herein, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto hereby agree,
intending to be legally bound, as follows:
ARTICLE 1
LICENSE
OF RIGHTS
Section 1.1.
Rights Licensed
.
Subject to the terms of this Agreement, VSH hereby grants to VPG, and VPG hereby
accepts, a limited, exclusive, royalty-free right and license, to use, directly
or indirectly through subcontractors, the Marks (as defined below) and Names (as
defined below) listed on Schedule A (the “Licensed Marks”) in connection with
the design, development, manufacture, marketing, provision and performance of
the products and services of VPG listed on Schedule B (the “VPG Products and
Services”). Any use of the Licensed Marks on products other than those on
Schedule B is subject to advance written approval by VSH. As used herein, “Mark”
shall mean any trademark, service mark or logo, and “Name” shall mean any entity
name or trade name.
Section 1.2.
Special ‘Mil’ Rights and
SCDs (Customer Source Control Drawings)
Licensed
. In
recognition of the cost, difficulty and bureaucracy involved in attempting to
change the voluminous documentation and specifications related to foil resistor
products qualified to the Mil spec system used by the military and other special
needs customers, this Mil rights license grant is made. Subject to the terms of
this Agreement, VSH hereby grants to VPG, and VPG hereby accepts, a limited,
exclusive, royalty-free right and license, to display VISHAY alone (i.e. without
any other terms) (the “Licensed Mil Mark”) as a marking on foil resistor
products qualified to the Mil spec system, i.e. built on “Mil Qualified” product
lines or SCDs (Customer Source Control Drawings), existing as of the Effective
Date or referred to in Mil drawings or
SCDs (Customer Source
Control Drawings) existing as of the Effective Date, and on Mil drawings and
SCDs relating thereto.
Section 1.3.
Term and Territory
. The licenses granted hereby shall be in
perpetuity so long as this Agreement has not been terminated by its terms (the
“Term”) and shall apply throughout the world (the “Territory”). In the event the
Term terminates, VPG agrees that within twenty-four (24) months thereafter, VPG
will change its corporate name so as not to include the term
VISHAY.
Section 1.4.
Rights in VPG
. For the avoidance of doubt, this Agreement
shall not restrict VPG from using the acronym “VPG” in any Name, or in any Mark,
so long as such Name or Mark does not contain VISHAY (except as otherwise
permitted pursuant hereto).
Section 1.5.
Document and Part Numbers
. VPG shall be permitted to use any document
number on data sheets, package drawings, instructions or other materials posted
to the internet (each a “Document Number”) or any SKU number, part number, or
other number and/or letter sequence printed on or identified with any part (each
a “Part Number”) on or in connection with VPG Products and Services, so long as
such Document Number or Part Number does not contain the prefix or suffix
VSH.
Section 1.6.
VPG Acknowledgement
. VPG acknowledges and agrees that: (i) VSH is
the sole and exclusive owner of all right, title and interest in and to the
Licensed Marks; (ii) all goodwill associated with the Licensed Marks shall inure
to the sole and exclusive benefit of VSH; and (iii) nothing in this Agreement or
any related agreement, instrument or document shall be construed to give VPG any
legal or beneficial ownership interest in or title to the Licensed
Marks.
Section 1.7.
Absence of VSH
Representations
. VPG
agrees and acknowledges that VSH makes no representation or warranty with
respect to: (i) VSH’s right, title and interest in and to the Licensed Marks,
(ii) the absence of any action related to or concerning the Licensed Marks, the
outcome of which could be materially adverse to the rights granted to VPG under
this Agreement; or (iii) the absence of any claim, or basis for any claim, that
the use of the Licensed Marks by VPG under this Agreement violates the rights of
any person.
Section 1.8.
Restrictions
.
(a)
During the Term, and subject to section 1.8(e), VSH shall not, under a
Mark or Name which includes the term VISHAY immediately followed by the term
PRECISION: (i) directly or indirectly, design, develop, manufacture, market or
provide any products, except to the extent such usage exists (and limited to
those products with respect to which such usage exists) immediately following
the Effective Date; or (ii) use such Mark or Name in connection with any aspect
of its business, operations or affairs, whether conducted directly or
indirectly, and whether or not such usage would otherwise require permission of
VPG, except to the extent such usage is not otherwise prohibited by clause (i)
of this paragraph. Without limitation, the foregoing restriction shall apply to
the legal name or fictitious name (“d/b/a”) of any subsidiary of VSH or any
other entity under the control of VSH.
-2-
(b) During the Term, VSH shall not, under a
Mark or Name which includes the acronym “VPG”: (i) directly or indirectly,
design, develop, manufacture, market or provide any products that overlap (i.e.
compete) with any products within the product range of VPG or any of its
subsidiaries as constituted immediately following the Effective Date; or (ii)
use such acronym in connection with any aspect of its business, operations or
affairs, whether conducted directly or indirectly, and whether or not such usage
would otherwise require permission of VPG, except to the extent such usage is
not otherwise prohibited by clause (i) of this paragraph. Without limitation,
the foregoing restriction shall apply to the legal name or fictitious name
(“d/b/a”) of any subsidiary of VSH or any other entity under the control of
VSH.
(c) During the Term, except as otherwise
permitted pursuant to this Agreement, VPG shall not, under a Mark or Name which
includes the term VISHAY INTERTECHNOLOGY or VISHAY, or under the acronym VSH:
(i) directly or indirectly, design, develop, manufacture, market or provide any
products that overlap (i.e. compete) with any products within the product range
of VSH or any of its subsidiaries as constituted immediately following the
Effective Date; or (ii) use such Mark, Name or acronym in connection with any
aspect of its business, operations or affairs, whether conducted directly or
indirectly, and whether or not such usage would require permission of VSH,
unless the term VISHAY is immediately followed by the term PRECISION (so long as
the term PRECISION has no less prominence than the term VISHAY and such Name
does not include the term VISHAY together with the term INTERTECHNOLOGY), except
to the extent such usage is not otherwise prohibited by clause (i) of this
paragraph. Without limitation, the foregoing restriction shall apply to the
legal name or fictitious name (“d/b/a”) of any subsidiary of VPG or any other
entity under the control of VPG.
(d) For the avoidance of doubt, nothing in
this Section 1.8 shall be construed to impose any restriction on the right of
VPG to use the corporate name “Vishay Precision Group, Inc.” (i) in association
with its business with respect to the VPG Products and Services, or (ii) with
respect to the design, development, manufacture, marketing, provision or
performance of goods and services other than the VPG Products and Services, so
long as such other goods and services are not designed, developed, manufactured,
marketed, provided or performed under a Mark containing the term
VISHAY.
(e) For the avoidance of doubt, nothing in
this Section 1.8 shall be construed to impose any restriction on the right of
VSH to use the term PRECISION in a descriptive manner (but not as a Mark or
Name) in connection with the design, development, manufacture, marketing,
provision or performance of any goods or services, so long as the term PRECISION
does not immediately follow the term VISHAY. A non-exhaustive, representative
list of descriptive uses of the term PRECISION permissible by VSH, in marketing
materials, engineering documents, data handbooks and packaging and similar
materials, is shown on Schedule C.
-3-
ARTICLE
2
STANDARDS AND
COMPLIANCE
Section 2.1.
Standards
. All VPG Products and Services designed,
developed, manufactured, marketed, provided or performed under the Licensed
Marks, as applicable, shall be of high quality, free of material defects and
performed with integrity and in a professional manner and shall be in compliance
with applicable law (the “Standards”).
Section 2.2.
Compliance Procedures
.
(a)
VPG shall maintain appropriate process and quality controls with respect
to the VPG Products and Services designed, developed, manufactured, marketed,
provided or performed under the Licensed Marks to assure compliance with the
Standards.
(b)
VSH, itself or through its representatives, shall have the right to
request and receive from VPG, from time to time at reasonable intervals and upon
payment to VPG of its reasonable charges, representative samples of VPG Products
and copies of all marketing materials for VPG Products and Services designed,
developed, manufactured, marketed, provided or performed under the Licensed
Marks (“Promotional Materials”). If, in the commercially reasonable judgment of
VSH, any VPG Products and Services or Promotional Materials do not conform to
the Standards or are not otherwise in accord with this Agreement, VSH shall so
notify VPG, and the parties shall work together in good faith in order that VPG
will remedy such non-conformity or non-compliance. Any dispute under this
Section shall be resolved in accordance with the resolution procedures referred
to in Section 5.16.
Section 2.3.
Transition Period
Activities
.
Notwithstanding anything to the contrary herein, VPG shall be permitted to use
the Licensed Marks in the manner and for the periods set forth
below.
(a)
Products: From the Effective Date until December 31, 2012 (the “Initial
Period”), VPG shall have the right to display VISHAY alone (i.e. without any
other terms) as a marking on foil resistor products provided to any and all
customers, and in drawings relating thereto. For a subsequent period of
twenty-four (24) months following the Initial Period, i.e. until December 31,
2014, VPG shall have the right to sell existing inventory of foil resistor
product displaying the marking VISHAY to VPG customers in existence as of the
last day of the Initial Period. Beginning January 1, 2015, VPG shall have no
right, other than as permitted by Section 1.2, to display VISHAY alone as a
marking on any product or in any drawings.
(b)
Literature: For a period of twelve (12) months following the Effective
Date, VPG shall have the right to distribute marketing materials, Data sheets,
business cards, letter heads and forms displaying the term VISHAY in the manner
such term in displayed in such materials as of the Effective Date. After that
time, all marking of VPG literature shall comply with the terms of the license
grants hereunder.
(c)
Signage: For a period of twelve (12) months following the Effective Date,
VPG shall have the right to display the term VISHAY on office signage in
the
-4-
manner such term is
displayed as of the Effective Date. After that time, all VPG signage shall
comply with the terms of the license grants hereunder.
ARTICLE
3
ADDITIONAL MARKS;
REGISTRATION OF MARKS; ENFORCEMENT
Section 3.1.
Additional Licensed
Marks
. If VPG proposes to use any Mark or Name containing VISHAY that is
not on Schedule A, prior to such use, VPG shall notify VSH in advance in
writing, unless the term PRECISION immediately follows the term VISHAY in such
Mark or Name (with the term PRECISION having no less prominence than the term
VISHAY) and such Mark or Name does not include the term VISHAY together with the
term INTERTECHNOLOGY. If VSH does not object in writing within thirty (30)
business days after receipt of such notice, VSH shall be deemed to have approved
the use of such Mark for the VPG Products and Services only, such Mark shall be
deemed to be a Licensed Mark and such Mark shall be added to Schedule A. If VSH
shall object to the use of a Mark by VPG, the parties shall resolve their
dispute with respect to such objection in accordance with the resolution
procedures referred to in Section 5.16. During the Term, VPG shall be permitted
to use any Mark or Name in which the term VISHAY is immediately followed by the
term PRECISION (so long as the term PRECISION has no less prominence than the
term VISHAY and such Mark or Name does not contain the term VISHAY together with
the term INTERTECHNOLOGY), on or in connection with the VPG Products and
Services, without the need to seek consent to such use by VSH, and upon
notification by VPG to VSH of any such use, such Mark or Name shall be added to
Schedule A.
Section 3.1.
Registration of Licensed
Marks
. At VPG’s reasonable request and expense, VSH shall: (i) take all
reasonably necessary steps to procure registration of any of the Licensed Marks
for the VPG Products and Services; and (ii) maintain any and all such
registrations in full force and effect during the Term so long as such Licensed
Mark is being used by VPG, and VPG shall, at its sole expense, cooperate with
VSH in connection with the forgoing. VPG shall not seek to register any of the
Licensed Marks or any similar Marks, unless authorized by VSH in writing, and
such registration shall be held by VPG on behalf of VSH.
Section 3.2.
Domain Names
. VSH
hereby licenses to, and approves of the use by VPG of the internet domain names
containing the term VISHAY listed on Schedule D (“Licensed Domain Names”). VPG
agrees that, in securing the registration of such domain names, it has acted as
agent of VSH. If VPG proposes to secure the registration of any additional
domain name containing the term VISHAY, it shall notify VSH in advance in
writing, unless the term PRECISION immediately follows the term VISHAY in such
domain name and such domain name does not include the term VISHAY together with
the term INTERTECHNOLOGY. If VSH does not object in writing within thirty (30)
business days after receipt of such notice, VSH shall be deemed to have approved
VPG’s registration of such any such domain name, such domain name shall be
deemed to be a Licensed Domain Name and such domain name shall be added to
Schedule D. If VSH shall object to the registration of a domain name by VPG, the
parties shall resolve their dispute with respect to such objection in accordance
with the resolution procedures referred to in Section 5.16. Without the written
consent of VSH, under no circumstances shall VPG transfer or assign the
registration of any Licensed Domain
-5-
Name to any person other
than a wholly-owned subsidiary without the written consent of VSH or any other
person to whom VPG is permitted to assign sublicense or otherwise transfer its
rights under this Agreement pursuant to Section 5.5.
Section 3.3.
Display of Marks
. The parties agree that it is in their mutual
best interest that, and shall cooperate so that, subject to Section 1.2, the
Licensed Marks utilized by VPG shall appear distinctive from Marks utilized by
VSH, and the Marks utilized by VSH shall appear distinctive from the Licensed
Marks utilized by VPG. Any dispute with respect to the appearance of a Licensed
Mark or a VSH Mark shall be resolved in accordance with the resolution
procedures referred to in Section 5.16.
Section 3.4.
Legal Notices
. VPG shall, to the extent commercially
practicable, place appropriate notices (e.g. ® or ™) to designate the Licensed
Marks as trademarks or service marks.
Section 3.5.
Enforcement
.
(a)
VPG shall, at its own reasonable expense, cooperate fully and promptly
with VSH in the protection of VSH’s rights in the Licensed Marks, in such manner
and to such extent as VSH may reasonably request.
(b)
Each party shall promptly advise the other party in writing of any actual
or potential infringement, or any other unauthorized use of or violation of any
of the Licensed Marks of which it becomes aware (each an “Infringement”). VSH
may take such action as it, in its sole discretion, deems necessary or advisable
to stop any Infringement. VPG may request in writing that VSH institute an
action to stop an Infringement. If VSH receives such a written request and does
not institute such action within thirty (30) days, VPG shall be entitled to
institute such action as it deems necessary or advisable to stop the
Infringement, in which VSH shall be entitled to join. The party not taking the
lead in any action shall cooperate fully with the other party at the other
party’s reasonable request and expense.
(c)
Any monetary recovery or sums obtained in settlement of any action to
stop an Infringement shall be allocated between VSH and VPG as shall be fair and
equitable, taking into account their actual out-of-pocket costs and expenses,
including reasonable attorneys’ fees, and the damages sustained by each of them.
Any dispute with respect to the allocation of recoveries shall be resolved in
accordance with the resolution procedures referred to in Section
5.16.
ARTICLE
4
TERMINATION
Section 4.1.
Termination by VSH
.
(a)
This Agreement may be terminated by VSH if:
(i)
VPG shall (x) willfully, intentionally and in bad faith breach any
material provision of this Agreement or (y) willfully, intentionally and in
bad
-6-
faith fail to cure any
other breach, (A) if under clause (x), such breach is not capable of cure; or
(B) if under either clause (x) or (y), such breach is capable of cure, VSH has
given written notice of such breach to VPG, and such breach has not been cured,
or VSH has not commenced taking (and is not continuing to take) reasonable bona
fide steps to cure such breach, within sixty (60) days of such notice;
or
(ii)
subject to and except as otherwise provided in Section 5.5, VPG shall,
without the written consent of VSH, willfully and intentionally and in bad faith
purport to assign, delegate or otherwise transfer any of its rights, benefits,
powers, duties responsibilities or obligations under this Agreement in violation
of this Agreement; or
(iii)
VPG shall abandon the use of the Licensed Marks; or
(iv)
VPG shall file a petition under Chapter 7 of the U.S. Bankruptcy Code, or
a petition under Chapter 7 of the U.S. Bankruptcy Code shall be filed
involuntarily against VPG and shall not be dismissed within 90 days after VPG
receives notice of such filing.
(b)
To effect the termination of this Agreement, VSH shall deliver to VPG a
written notice of termination, which notice shall specify the basis therefor in
reasonable detail and an effective date of termination not less than ninety (90)
days after the date of delivery to VPG of the notice. If VPG disputes the right
of VSH to terminate this Agreement under any of clauses (i), (ii) or (iii) of
Section 4.1(a) and invokes the dispute resolution procedures referenced in
Section 5.16 no later than fifteen (15) days after VPG has received notice of
termination from VSH, and within such fifteen (15) day period provides notice
thereof to VSH in writing, then if and only so long as VPG is in compliance with
the procedures referenced in Section 5.16, termination shall not be deemed
effective until (i) it shall be determined in accordance with the procedures
referenced in Section 5.16 that VSH is entitled to terminate this Agreement or
(ii) the parties shall otherwise agree.
(c)
If VPG in good faith disputes that VSH has a valid basis for termination,
the parties shall resolve such dispute in accordance with the resolution
procedures referred to in Section 5.16.
(d)
Nothing in this Section shall relieve VPG of liability for breach of this
Agreement, whether or not VSH is entitled to terminate this Agreement on account
of such breach.
Section 4.2.
Termination of Rights
. Upon the termination of this Agreement, all
rights of VPG granted hereunder shall terminate, and any registration of the
foregoing by VPG shall, at VSH’s discretion, be abandoned or transferred to VSH.
Notwithstanding the foregoing, VPG shall have the right to dispose of its then
existing inventory of VPG Products and/or Promotional Materials bearing the
Licensed Marks for a period of up to one (1) year from the date of termination
of this Agreement. All costs associated with the foregoing shall be borne by
VPG.
-7-
Section 4.3.
Survival
. All rights and remedies of the parties in
respect of any breach of this Agreement occurring prior to the effective date of
its termination shall survive the termination of this Agreement. In addition,
the following provisions of this Agreement shall explicitly survive its
termination: Section 1.6 (“VPG Acknowledgment”); Section 1.7 (“Absence of VSH
Representations”); Section 4.1(d) (“Termination by VSH”); Section 4.2
(“Termination of Rights”); this Section 4.3 (“Survival”); and Article 5
(“Miscellaneous”).
ARTICLE
5
MISCELLANEOUS
Section 5.1.
Notices
. All notices, demands and other
communications required to be given to a party hereunder shall be in writing and
shall be deemed to have been duly given if and when personally delivered; one
business day after being sent by a nationally recognized overnight courier; when
transmitted by facsimile and actually received; or five (5) days after being
mailed by registered or certified mail (postage prepaid, return receipt
requested) to such party at the relevant street address or facsimile number set
forth below (or at such other street address or facsimile number as such party
may designate from time to time by written notice in accordance with this
provision):
If to VSH:
|
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With a copy to:
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Vishay Intertechnology, Inc.
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Kramer Levin Naftalis & Frankel LLP
|
63 Lancaster Avenue
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1177 Avenue of the Americas
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Malvern, PA 19366
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New York, New York 10036
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Attn: Dr. Lior Yahalomi, Chief Financial Officer
|
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Attn: Abbe Dienstag, Esq.
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Facsimile: (610) 889-2161
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Facsimile: (212) 715-8000
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Confirm: (610) 644-1300
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Confirm: (212) 715-9100
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-8-
If to VPG:
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With a copy to:
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Vishay Precision Group, Inc.
|
Pepper Hamilton LLP
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3 Great Valley Parkway
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3000 Two Logan Square
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Malvern, PA 19355-1307
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Eighteenth and Arch Streets
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Attn: William M. Clancy,
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Philadelphia, PA 19103-2799
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Chief Financial Officer
|
Attn: Barry Abelson, Esq.
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Facsimile: (484)-321-5300
|
Facsimile: (215) 981-4750
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Confirm: (484)-321-5300
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Confirm: (215) 981-4000
|
Section 5.2.
Further Assurances
. In addition to the actions specifically
provided for elsewhere in this Agreement, VSH and VPG agree to execute or cause
to be executed and to record or cause to be recorded such other agreements,
instruments and other documents, and to take such other action, as reasonably
necessary or desirable to fully effectuate the intents and purposes of this
Agreement.
Section 5.3.
Relationship of the Parties
. This Agreement shall not be construed to
place the parties in the relationship of legal representatives, partners, joint
venturers or agents of or with each other. No party shall have any power to
obligate or bind the other party in any manner whatsoever, except as
specifically provided herein.
Section 5.4.
Third Party Beneficiaries
. Except for the indemnification rights under
this Agreement of any Indemnified Parties (as hereafter defined), the provisions
of this Agreement are solely for the benefit of the parties hereto and their
respective successors and permitted assigns, and are not intended to confer upon
any person, except the parties hereto and their respective successors and
permitted assigns, any rights or remedies hereunder.
Section 5.5.
Assignment and Sublicense
.
(a)
The license shall be assignable or sublicenseable to any direct or
indirect Majority Owned Subsidiary of VPG, provided that VPG shall be
responsible for the compliance by any such Majority Owned Subsidiary with the
terms of this Agreement. As used herein, “Majority Owned Subsidiary of VPG”
means any subsidiary of VPG (x) of which both over 50% of the voting securities
and over 50% of the outstanding equity interests, whether voting or non-voting,
are owned by VPG or by one or more of Majority-Owned Subsidiaries of VPG or by
VPG and one or more of its Majority-Owned Subsidiaries, and (y) which is engaged
in the design, development, manufacture, marketing, provision and performance of
VPG Products and Services as part of the business of VPG under the management
and control of VPG.
(b)
If VPG shall sell or transfer its business of the design, development,
manufacture, marketing, provision and performance of VPG Products and Services
substantially as an entirety, to a single purchaser or other single transferee,
whether such sale or other transfer is structured as a sale of stock, assets or
otherwise, and thereafter VPG shall cease to be engaged in such business, the
purchaser or other transferee shall succeed to the rights and obligations of VPG
under this Agreement; provided such purchaser or other transferee shall execute
documentation in form and substance reasonably satisfactory to VSH agreeing to
be
-9-
bound by the terms of
this Agreement. For the avoidance of doubt, the following actions shall not be
deemed an assignment, delegation or other transfer of VPG’s rights, benefits,
powers, duties, responsibilities or obligations under this Agreement or the
license granted hereby or any interest therein: (1) assignment or transfer of
the stock of VPG, including by way of a merger, consolidation, or other form of
reorganization in which outstanding shares of VPG are exchanged for securities,
or (2) any transaction effected primarily for the purpose of (A) changing VPG’s
state of incorporation or (B) reorganizing VPG into a holding company structure
such that, as a result of any such transaction, VPG becomes a wholly-owned
subsidiary of a holding company owned by the holders of VPG’s securities
immediately prior to such transaction.
(c)
Except as provided in this Section, the license granted hereby shall be
non-assignable and non- sublicenseable. Any purported license or assignment in
violation of this Agreement shall be void.
(d)
This Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors and permitted assigns.
Section 5.6.
Press Releases; Public
Announcements
. Neither
party shall issue any release or make any other public announcement concerning
this Agreement or the transactions contemplated hereby without the prior written
approval of the other party, which approval shall not be unreasonably withheld,
delayed or conditioned; provided, however, that either party shall be permitted
to make any release or public announcement that in the opinion of its counsel it
is required to make by law or the rules of any national securities exchange of
which its securities are listed; provided further that it has made efforts that
are reasonable in the circumstances to obtain the prior approval of the other
party.
Section 5.7.
Waiver of Defaults
. Waiver by any party hereto of any default by
the other party hereto of any provision of this Agreement shall not be construed
to be a waiver by the waiving party of any subsequent or other default, nor
shall it in any way affect the validity of this Agreement or prejudice the
rights of the other party thereafter to enforce each and ever such provision. No
failure or delay by any party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.
Section 5.8.
Severability
. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof shall remain in full force and
effect and shall in no way be affected, impaired or invalidated thereby, so long
as the economic or legal substance of the transactions contemplated hereby, as
the case may be, is not affected in any manner adverse to any party hereto or
thereto. Upon such determination, the parties hereto shall negotiate in good
faith in an effort to agree upon a suitable and equitable provision to effect
the original intent of the parties hereto.
Section 5.9.
Indemnification
. Each of the parties shall indemnify, defend
and hold harmless the other party, each of its respective current and former
directors, officers and employees, and each of their respective heirs,
executors, successors and assigns (“Indemnified
-10-
Parties”), from and
against any and all liabilities relating to, arising out of or resulting from
any breach of, or failure to perform or comply with, any covenant, undertaking
or obligation of, this Agreement by the indemnifying party. In addition, VPG
shall indemnify, defend and hold harmless VSH and its other Indemnified Parties
from and against any and all liabilities relating to, arising out of or
resulting from the sale and/or provision of VPG Products and Services under the
Licensed Marks. All indemnification procedures and payments shall be governed by
Sections 5.6, 5.7 and 5.8 of the Master Separation Agreement between the
parties, dated June 22, 2010 (the “Master Separation Agreement”), as
applicable.
Section 5.10.
LIMITATION OF LIABILITY
. IN NO EVENT SHALL VSH OR VPG BE LIABLE TO
THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, COLLATERAL, INCIDENTAL OR
PUNITIVE DAMAGES OR LOST PROFITS OR FAILURE TO REALIZE EXPECTED SAVINGS OR OTHER
COMMERCIAL OR
ECONOMIC LOSS OF
ANY KIND, ARISING OUT OF THIS AGREEMENT; PROVIDED, HOWEVER, THAT THE FOREGOING
LIMITATIONS SHALL NOT LIMIT EITHER PARTY’S INDEMNIFICATION OBLIGATIONS WITH
RESPECT TO THIRD PARTY CLAIMS.
Section 5.11.
Confidential Information
. VSH and VPG shall hold and shall cause each
of their respective affiliates, directors, officers, employees, agents,
consultants, advisors and other representatives to hold, in strict confidence
and not to disclose or release without the prior written consent of the other
party, any and all proprietary or confidential information, material or data of
the other party that comes into its possession in connection with the
performance by the parties of their rights and obligations under this Agreement.
The provisions of Section 4.6 of the Master Purchase Agreement shall govern,
mutatis mutandis, the confidentiality obligations of the parties under this
Section.
Section 5.12.
Attorneys’ Fees
. In any action hereunder to enforce the
provisions of this Agreement, the prevailing party shall be entitled to recover
its reasonable attorneys’ fees in addition to any other recovery
hereunder.
Section 5.13.
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction.
Section 5.14.
Consent to Jurisdiction
. Subject to the provisions referenced in
Section 5.16, each of the parties irrevocably submits to the jurisdiction of the
federal and state courts located in Philadelphia, Pennsylvania for the purposes
of any suit, action or other proceeding to compel arbitration, for the
enforcement of any arbitration award or for specific performance or other
equitable relief pursuant to Section 5.15. Each of the parties further agrees
that service of process, summons or other document by U.S. registered mail to
such parties address as provided in Section 5.1 shall be effective service of
process for any action, suit or other proceeding with respect to any matters for
which it has submitted to jurisdiction pursuant to this Section. Each of the
parties irrevocably waives any objection to venue in the federal and state
courts located in Philadelphia, Pennsylvania of any action, suit or proceeding
arising out of this Agreement or the transactions contemplated
hereby.
-11-
Section 5.15.
Specific Performance
. The parties hereto agree that the remedy at
law for any breach of this Agreement may be inadequate, and that any party
hereto shall be entitled to specific performance in addition to any other
appropriate relief or remedy, if and to the extent that the remedy of specific
performance is available in accordance with Section 8.2(g) of the Master
Separation Agreement. Such party may, in its sole discretion, to the extent
necessary to prevent serious and irreparable harm as contemplated by Section
8.2(g) of the Master Separation Agreement, apply to a court of competent
jurisdiction for specific performance or injunctive or such other relief as such
court may deem just and proper in order to enforce this Agreement.
Section 5.16.
Dispute Resolution
. The procedures set forth in Article VIII of
the Master Separation Agreement shall apply to the resolution of all disputes
arising under this Agreement, except that all proceedings provided for therein
shall be conducted in Philadelphia, Pennsylvania.
Section 5.17.
Entire Agreement
.
This Agreement and the Schedules hereto, as well as any other agreements and
documents referred to herein, constitute the entire agreement between the
parties with respect to the subject matter hereof and supersede all previous
agreements, negotiations, discussions, understandings, writings, commitments and
conversations between the parties with respect to such subject
matter.
Section 5.18.
Waiver of Jury Trial
. Subject to Section 5.16, EACH OF THE PARTIES
HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
Section 5.19.
Amendments
. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any party hereto, unless such
amendment, supplement or modification is in writing and signed by the authorized
representative of the party against whom it is sought to enforce such amendment,
supplement or modification.
Section 5.20.
Counterparts
. This Agreement may be executed in any number
of counterparts, including by facsimile or electronic signature, and each such
counterpart shall be deemed an original instrument, and all of such counterparts
together shall constitute but one agreement. A facsimile or electronic signature
is deemed an original signature for all purposes under this
Agreement.
[SIGNATURE PAGES
FOLLOW]
-12-
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute this Agreement as of the date first above
written.
VISHAY INTERTECHNOLOGY,
INC.
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By:
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/s/ Lior E. Yahalomi
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Name:
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Lior E. Yahalomi
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Title:
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Executive Vice President and
Chief
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Financial Officer
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VISHAY PRECISION GROUP,
INC.
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By:
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/s/ William M. Clancy
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Name:
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William M. Clancy
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Title:
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Executive Vice President and
Chief
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Financial
Officer
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-13-
SCHEDULE
A*
LICENSED
MARKS
1. Trademarks and Trade
Names
VISHAY (with respect to
Section 1.2 only)
VISHAY
PRECISION
VISHAY FOIL
RESISTORS
2. Entity
Names
Vishay - PM Belgium
N.V.
Vishay - Waste Collection
Systems Belgium N.V.
Vishay Tedea-Huntleigh (Beijing) Electronics Co.,
Ltd
Vishay Precision Measurement Trading (Shanghai) Co., Ltd.
Vishay
Celtron Technologies (Tianjin) Co., Ltd
Vishay PME France
SARL
Vishay Measurements Group
France, S.A.S.
Vishay Precision Foil GmbH
Vishay Measurement Group GmbH
Vishay
Transducers India Limited
Vishay Precision Transducers India Private Limited
Vishay PM Onboard
(Ireland) Limited
Vishay Precision Israel
Ltd.
Vishay Advanced
Technologies, Ltd.
Vishay Precision Foil K.K.
Vishay Precision Holdings B.V.
Vishay -
Waste Collection Systems B.V.
Vishay Revere Transducers Europe B.V.
Vishay
Nobel AS
Vishay Precision Asia
Investments Pte. Ltd.
Vishay Precision España S.L.
Vishay Nobel AB
Vishay Celtron Technologies, Inc.
Vishay
Measurements Group UK Limited
Vishay PM Group Limited
Vishay PM Onboard
Limited
Vishay Precision Group, Inc.
Vishay Measurements Group, Inc.
Vishay
Transducers Ltd.
A-1
Vishay Precision Foil,
Inc.
Vishay BLH, Inc.
* Note that this
Schedule A does not include the Marks set forth on Attachment 1 to Schedule 1.3
or the entity names set forth on Schedule 2.4(a)(iii) (which are not otherwise
listed on this Schedule A) to the Master Separation Agreement, inasmuch as those
Marks and entity names are owned by VPG and no license from VSH is required for
VPG’s use of such Marks and entity names.
A-2
SCHEDULE B
VPG PRODUCTS AND SERVICES
-
Foil resistor strain
gages
-
Transducers (a/k/a load cells) utilizing foil resistor strain
gages
-
Electronic instruments that
measure and control output of transducers utilizing foil resistor strain
gages, and instruments to measure strain
-
Systems for process and force
measurement control and on-board weighing
-
Foil resistors and current sensors
-
Design, planning, testing,
troubleshooting, technical assistance, engineering assistance, training and
similar services provided or performed by VPG on behalf of its customers in
connection with any of the foregoing
-
Any additional products as long as
such products do not overlap (i.e. compete) with any products within the
product range of VSH or any of its subsidiaries as constituted immediately
following the Effective Date.
B-1
SCHEDULE
C
NON-EXHAUSTIVE LIST
OF
PERMISSIBLE USES OF PRECISION BY VSH
1.
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“Vishay” and
“precision” separated, other than by a blank, e.g.
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Vishay’s precision …
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Vishay – precision …
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Vishay: precision …
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… Vishay. Precision …. (end
and start of sentences)
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2.
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Vishay Logo followed with “Precision” in
text.
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3.
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“Vishay + brand + precision”,
e.g.
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Vishay Sfernice Precision
…
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Vishay Sfernice precision
pots
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Vishay Sfernice precision
metal film resistors
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Vishay Sfernice precision
wire wound resistors
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Vishay Dale Precision
….
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Vishay Spectrol precision
….
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Vishay Spectrol precision
pots
-
Vishay BCcomponents
Precision ….
-
Vishay Spectrol Ultra
Precision Hall effect Rotary position sensor
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Vishay Dale Precision Wire
Wound Resistors
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4.
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“Vishay + technology + precision”,
e.g.
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Vishay Film capacitors
precision
-
Vishay Thin film precision
resistors (Dale TFNA, Sfernice)
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Vishay Thin Film Precision
Networks
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5.
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“Precision…” at the beginning of a sentence
(i.e. preceded by no word), e.g.
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Precision wire wound
resistors (Dale)
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Precision power
(Dale)
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Precision film (Dale)
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Precision Thin Film (Dale -
TFNA)
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Precision Thin Film
Technology (Dale - TFNA)
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Precision Low TCR Thin Film
(Dale - TFNA)
Precision Non Magnetic Thin Film Resistors (Dale -
TFNA)
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Precision Automotive Thin
Film (Dale - TFNA)
-
Precision Matched Pair
resistors SOT-23
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Precision Ultra Frequency
Resistors (FC series in Thin Film)
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C-1
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Precision MKP 416…20 (film
capacitors)
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Precision Thin Film Chip Resistor Arrays (Draloric
Beyschlag)
-
Precision Thin Film Chip Resistors (Draloric
Beyschlag)
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Precision Wire wound Cemented Resistors (Draloric
Beyschlag)
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Precision film capacitors
-
Precision 1% to 2%…KP 1830 (film capacitors)
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Precision Feel Rotary Potentiometers (Spectrol 21P)
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6.
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Other uses of word “precision” where
preceded by various words, e.g.
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KP Polypropylene film / foil
precision capacitors
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High Precision Thin Film
Chip Resistor
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High Precision MELF
Resistor
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High Precision MINI-MELF
Resistor
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High Precision Thin Film
Leaded Resistor
-
High Precision Metal Film
Leaded Resistor
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High Precision Thin Film
Chip Resistor Arrays
-
High precision
…(Dale)
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Very High Precision Thin
Film Chip Resistor
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Very High Precision MELF
Resistor
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Very High Precision
MINI-MELF Resistor
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Very High Precision Thin
Film Leaded Resistor
-
Very High Precision Metal
Film Leaded Resistor
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Very High Precision Thin
Film Chip Resistor Arrays
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Ultra Precision Thin Film
Chip Resistor
Arrays
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Ultra Precision Thin Film
Chip Resistor
-
Ultra Precision MELF
Resistor
-
Ultra Precision MINI-MELF
Resistor
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Ultra Precision Thin Film
Leaded Resistor
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Ultra-Precision Thin Film
Flat Chip Resistors
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Ultra Precision Metal Film
Leaded Resistor
-
Ultra Precision Silicon
Based RF
Capacitors
-
Cemented Wirewound Precision
Resistors
-
Semi Precision Thick Film
Chip Resistors
-
Frequency Precision Surface
mount Inductors
-
ACAC 0612 Precision Thin
Film Chip Resistor Arrays
-
ACAS 0612 AT Precision Thin
Film Chip Resistor Arrays
-
ACAS 0606 AT Precision Thin
Film Chip Resistor Arrays
|
|
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7.
|
|
“Precision …” in a sentence following
“Vishay Intertechnology Inc.”, e.g.
|
|
|
|
|
|
-
“Vishay Intertechnology Inc. Precision …”
|
C-2
SCHEDULE
D
LICENSED DOMAIN
NAMES
vishayprecision
vishayfoilresistors
vishaymeasurementsgroup
vishaymg
vishaynobel
vishaypg
vishaypgloadcells
D-1
TRANSITION SERVICES
AGREEMENT
This Transition Services Agreement (this “
Services Agreement
”) is entered into and effective as of the 6th
day of July, 2010 (the “
Effective Date
”), by and between Vishay Intertechnology,
Inc., a corporation organized under the laws of the State of Delaware
(“
Provider
”), and Vishay Precision Group, Inc., a
corporation organized under the laws of the State of Delaware (“
Recipient
”). Provider and Recipient each may be
referred to herein as a “
Party
” and collectively, as the “
Parties
.”
WHEREAS, the Board of Directors of Provider has determined that it is
appropriate and desirable to separate Recipient and Provider into two
publicly-traded companies by separating Provider from Recipient and transferring
to Recipient Provider’s measurement group and foil business (the “
MGF Business
”) (such separation, the “
Separation
”);
WHEREAS, Provider and Recipient have entered into that certain Master
Separation and Distribution Agreement, dated as of the 22
nd
day of June, 2010
(the “
Master Separation
Agreement
”), in order to carry out, effect and
consummate the Separation; and
WHEREAS, to facilitate the Separation, Provider and Recipient deem it to
be appropriate and in the best interests of Provider and Recipient that Provider
provide certain services to Recipient pursuant to the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the mutual promises, covenants,
agreements, representations and warranties contained herein, and for other good
and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the Parties hereby agree as follows:
Article
1
Services
1.1
General
. In accordance with the provisions hereof,
Provider, through its Subsidiaries (as defined below) and their respective
employees, agents or contractors, shall provide to Recipient and its
Subsidiaries, and Recipient shall purchase from Provider, the services described
in
Schedule A
(each a “
Service
” and collectively, the “
Services
”). In addition to a description of each
Service,
Schedule A
shall set forth, where relevant, the maximum
level or amount of each Service, applicable performance times and the pricing
parameters for each Service.
Schedule A
may be amended from time to time by written
agreement of the Parties. For purposes of this Services Agreement, “
Subsidiary
” of any Party means a corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Party or by any one or more
of its Subsidiaries, or by such Party and one or more of its Subsidiaries;
provided
,
however
, that no person that is not directly or
indirectly wholly-owned by the Party shall be a Subsidiary of such Party unless
such Party controls, or has the right, power or ability to control, that person.
1.2
Quality of Services
. Subject to
Section 1.3
, Provider shall perform each of the Services
(i) in a workmanlike and professional manner, (ii) with the same degree of care
as it
exercises in performing
its own functions of a like or similar nature, (iii) utilizing individuals of
suitable experience, training and skill, and (iv) in a timely manner in
accordance with the provisions of this Services Agreement.
1.3
Forecasts
. Recipient shall provide Provider with a
monthly forecast of its requested level of Services not less than fifteen (15)
days prior to the beginning of each calendar month, unless no change in the
existing service levels are forecast for such calendar month. The Service
levels, if any, initially requested by Recipient (the “
Initial Service Levels
”) shall be as set forth on
Schedule A
. Service levels may be decreased from the
Initial Service Levels upon Recipient’s delivery to Provider of written notice
of such decrease specified in reasonable detail at least sixty (60) days in
advance of the month to which the decrease forecast relates. Any increase in the
scope of Services, including the addition of any new Services, shall be
negotiated in good faith by the Parties;
provided
that
Provider shall not be required to perform
additional or enhanced services, except to the extent that it has available
resources and receives compensation acceptable in its reasonable discretion. To
the extent any Services are mischaracterized in
Schedule A
, Provider and Recipient shall negotiate in
good faith to amend
Schedule A
as appropriate.
1.4
Third Party Services
. Each Party acknowledges and agrees that
certain of the Services to be provided under this Services Agreement may have
been, and may continue to be, provided to Recipient, by third parties designated
by Provider. To the extent so provided, Provider shall use commercially
reasonable efforts to (i) cause such third parties to provide such Services in
accordance with the provisions of this Services Agreement and/or (ii) enable
Recipient and its Subsidiaries to avail itself of such Services;
provided
,
however
, that if any such third party is unable or
unwilling to provide any such Services, Provider shall use its commercially
reasonable efforts to determine the manner in which such Services can best be
provided, and, if there is any change to the level or cost of Services provided
as a result, Provider and Recipient shall negotiate in good faith to amend
Schedule A as appropriate.
1.5
Responsible Personnel
. Each Party shall (i) from time to time
designate a senior level manager who shall have overall responsibility for the
administration and operation of this Services Agreement (each, a “
Party Representative
”) and (ii) upon reasonable request of the
other Party, provide such other Party with a list of key management personnel
who may be contacted by such other Party with respect to each Service.
1.6
Consultation
. At either Party’s reasonable request, the
Parties shall meet and discuss the nature, quality and level of Services covered
by this Services Agreement and any modifications a Party may wish to make to the
Services and other matters specified in
Schedule
A
.
1.7
Recovery Procedures
. Provider shall maintain, consistent with
past practices applicable to the MGF Business immediately prior to the
Separation, operational recovery procedures to insure the availability of
systems and the integrity of data relating to the Services at all times. In the
event of the unavailability of any such system or the loss or destruction of any
such data, Provider shall use its commercially reasonable efforts, consistent
with past practices applicable to the MGF Business immediately prior to the
Separation, to restore such systems and recover or replace such data as quickly
and completely as is practicable.
2
1.8
Monitoring and Reports; Books and Records;
Audit Right
.
(a)
Provider shall maintain books and records in
reasonable and customary detail pertaining to the provision of Services pursuant
to this Services Agreement. Provider shall make such books and records available
for inspection by Recipient or its authorized representatives during normal
business hours, upon reasonable notice to Provider, and shall retain such books
and records for periods consistent with the retention policies applicable to the
MGF Business immediately prior to the Separation.
(b)
Upon thirty (30) days’ advance notice to
Provider, Recipient may audit (or cause an independent third party auditor to
audit), during regular business hours and in a manner that complies with the
building and security requirements of Provider, the books, records and
facilities of Provider pertaining to the provision of Services pursuant to this
Services Agreement to the extent necessary to determine Provider’s compliance
with this Services Agreement. For any given Service, Recipient shall have the
right to audit such books, records and facilities of Provider once for each
twelve month period during which payment obligations are due. Any audit under
this
Section 1.8(b)
shall not interfere unreasonably with the
operations of Provider. Recipient shall pay the costs of conducting such audit,
unless the results of an audit reasonably indicate an overpayment by Recipient
of ten percent (10%) or more (such percentage to be determined by reference to
the Services which are subject to the specific audit), in which case, Provider
shall pay the reasonable out-of-pocket costs of Recipient.
(c)
Provider shall provide Recipient, at no cost
to Recipient, with customary reports concerning the performance of the Services
and as Recipient otherwise reasonably requests from time to time.
Article
2
Compensation; Billing
2.1
Service Fees
. In consideration of providing the Services,
Provider will charge Recipient the monthly fees or time and materials fees
indicated for each Service listed on
Schedule A
(each, a “
Service Fee
” and collectively, the “
Service Fees
”). In the event that for any month there
shall be an increase or decrease of the level of any Service by 5% or more
compared to the Initial Service Levels for any Service described on
Schedule A
for which there is a monthly fee, if any, the
Service Fee for such Service shall be adjusted proportionately.
2.2
Expenses
. Provider shall also be entitled to charge
Recipient for its reasonable documented, out-of-pocket costs and expenses
incurred by Provider in providing the Services, as more particularly provided on
Schedule A
(“
Expenses
”).
2.3
Invoices
. Not later than 30 days after the end of each
calendar month, Provider shall send Recipient an invoice that includes in
reasonable detail the Service Fees and Expenses due for Services provided to
Recipient for such month. Payments of invoices shall be made by wire transfer of
immediately available United States funds to one or more accounts specified in
writing by Provider. Payment shall be made within 30 days after the date of
receipt of Provider’s invoice. All amounts payable to Provider hereunder shall
be paid without setoff, deduction, abatement or counterclaim.
3
2.4
Payment Delay
. If Recipient fails to make any payment of a
material invoice within 60 days from the date such payment was due, Provider
shall have the right, at its sole option, upon 10 business days’ written notice
(a “
Suspension
Notice
”), to suspend performance of the Services
until payment has been received.
2.5
Finance Charges
. With respect to the unpaid amount of any
invoice not paid in full within 30 days of receipt, a finance charge of 1% per
month, payable from the date of the invoice to the date payment is received,
shall be due and payable to Provider. In addition, Recipient shall indemnify
Provider for its costs, including reasonable attorneys’ fees and disbursements,
incurred to collect any unpaid amount. Recipient shall not be liable for the
payment of any finance charges pursuant to this
Section 2.5
, and Provider shall not be authorized to
suspend performance pursuant to
Section 2.4
, to the extent, but only to the extent, that
Recipient in good faith is in the process of disputing the fees or expenses to
which such finance charges or performance relates in accordance with
Section 13.2
.
Article
3
Cooperation and Consents
3.1
General
. Each Party shall reasonably cooperate with
and provide assistance to the other Party in carrying out the provisions of this
Services Agreement. Such cooperation shall include, but not be limited to,
exchanging information, providing electronic systems used in connection with the
Services, making adjustments and obtaining all consents, licenses, sublicenses
or approvals necessary to permit each party to perform its obligations
hereunder.
3.2
Transition
. At the request of Recipient in contemplation
of the termination of any Services hereunder, in whole or in part, Provider
shall cooperate with Recipient, at Recipient’s expense, in transitioning such
Services to Recipient or any third-party service provider designated by
Recipient.
3.3
Consents
. Provider will obtain any third-party
consents necessary to enable it to provide the Services as forth on
Schedule 3.3
(the “
Consents
”),
provided
that
Provider shall not be required to pay any
consideration or incur any liability therefor. If any such consent is not
obtained, the parties will reasonably cooperate with one another to achieve a
reasonable alternative arrangement with respect thereto.
Article
4
Confidentiality
4.1
Generally
. In the course of the performance of the
Services, each Party may become aware of confidential and proprietary
information of the other Party (“
Confidential
Information
”). All Confidential Information disclosed by
a Party during the term of this Services Agreement shall remain the property of
the disclosing Party and shall be used by the receiving Party only in accordance
with the provisions of this Services Agreement.
4.2
Identification; Term
. (a) Except in the case of (x) information
that is subject to the confidentiality provisions of Section 4.5 of the Master
Separation Agreement or (y) information exchanged in furtherance of the
performance of the Services hereunder that is of a type that is generally
regarded by the Parties to be confidential information (such as
pricing,
4
customer and production
information), to which this subsection (a) shall not apply, if disclosed in
written form, Confidential Information shall be identified as Confidential
Information by an appropriate legend. For a period of 5 years from the date of
first receipt thereof, the receiving Party shall (i) treat all such information
in the same manner as it treats its own confidential information, in any event
exercising reasonable precautions to prevent the disclosure of such information
to others; (ii) use such information only for the purposes set forth herein; and
(iii) disclose such information only to its employees who have a need to know
such information in the performance of their duties hereunder.
4.3
Exceptions
. The obligations of confidential treatment
under this Article 4 shall not apply to any Confidential Information which (i)
is or becomes publicly known through no wrongful act, fault or negligence of the
receiving Party; (ii) was known by the receiving Party prior to disclosure or is
developed by the receiving Party independently of such disclosure; (iii) was
disclosed to the receiving Party by a third party who was not under any
obligation of confidentiality; (iv) is approved for release by written
authorization of the disclosing Party; or (v) is disclosed pursuant to a
requirement of law or by court order, provided that the receiving Party has
provided the disclosing Party with reasonable opportunity to prevent or limit
such legally required disclosure.
4.4
Injunctive Relief
. Each Party acknowledges and agrees that it
would be difficult to measure the damages that might result from any actual or
threatened breach of this Article 4 and that such actual or threatened breach by
it may result in immediate, irreparable and continuing injury to the other Party
and that a remedy at law for any such actual or threatened breach may be
inadequate. Accordingly, the Parties agree that the non-breaching Party, in its
sole discretion and in addition to any other remedies it may have at law or in
equity, shall be entitled to seek temporary, preliminary and permanent
injunctive relief or other equitable relief, issued by a court of competent
jurisdiction, in case of any such actual or threatened breach (without the
necessity of actual injury being proved and with the necessity of posting bond).
Article
5
Intellectual Property
5.1
Recipient Intellectual
Property
. Except as
otherwise agreed by the Parties, all data, software, or other property or assets
owned or created by Recipient shall remain the sole and exclusive property and
responsibility of Recipient. Provider shall not acquire any rights in any such
data, software or other property or assets pursuant to this Services Agreement.
5.2
Provider Intellectual
Property
. Except as
otherwise agreed by the Parties, all data, software or other property or assets
which are owned by Provider, including without limitation derivative works
thereof and new data or software created by Provider at Provider’s expense
pursuant to the provision of Services and all intellectual property rights
therein (the “
Provider
Property
”), shall be the sole and exclusive property
and responsibility of Provider. Recipient shall not acquire any rights in any
Provider Property pursuant to this Services Agreement.
5
Article
6
Remedies and Limitation of
Liability
6.1
In the event that any Service performed by
Provider hereunder is not performed in accordance with the provisions of
Article 1
, Recipient’s sole remedy shall be, at the
election of Recipient either (i) to require Provider to re-perform such Service
in accordance with
Article 1
without obligation on the part of Recipient
to make payment for such performance, (ii) to provide Recipient with a credit in
an equivalent amount towards the future purchase of Services, as contemplated by
this Services Agreement, or (iii) to require Provider to pay the cost of
replacing such Services with a third-party provider, and Provider shall not be
liable for any other loss or damage on account of the performance of any
Service.
6.2
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO
THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, COLLATERAL, INCIDENTAL OR
PUNITIVE DAMAGES OR LOST PROFITS OR FAILURE TO REALIZE EXPECTED SAVINGS OR OTHER
COMMERCIAL OR ECONOMIC LOSS OF ANY KIND, HOWEVER CAUSED AND ON ANY THEORY OF
LIABILITY (INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS SERVICES
AGREEMENT, WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF ANY
SUCH DAMAGES; PROVIDED, HOWEVER, THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT
EITHER PARTY’S INDEMNIFICATION OBLIGATIONS FOR LIABILITIES WITH
RESPECT TO THIRD PARTY CLAIMS, AS SET FORTH IN
ARTICLE 7
.
6.3
In no event, whether as a result of breach of
contract, indemnity, warranty, tort (including negligence), strict liability, or
otherwise, shall either Party’s liability to the other Party for any loss or
damage arising out of, or resulting from, this Services Agreement or the
furnishing of Services hereunder, in any month exceed three times the monthly
price of the specific Service which gives rise to the claim for such month.
Article
7
Indemnification
7.1
General
. Each Party shall indemnify and hold harmless
the other Party from all claims, liabilities, damages and expenses payable to
third parties arising out of or relating to (i) a breach of this Services
Agreement, (ii) gross negligence, or willful misconduct, or (iii) infringement
of third party intellectual property in the performance of any Service, in each
case, by the indemnifying Party, except to the extent, but only to the extent,
that any such claims, liabilities, damages or expenses are the result of a
breach of this Services Agreement, gross negligence or willful misconduct, or
infringement of third party intellectual property, on the part of the
indemnified Party.
7.2
Special Recipient Indemnity
. Notwithstanding anything to the contrary
herein, Recipient shall indemnify and hold Provider harmless from and against
(i) any tax, penalty, interest, addition to tax, tax surcharge, or other charge
payable by Provider as a result of any sales, use or excise taxes levied or
based on amounts payable pursuant to this Services Agreement, including
privilege or excise taxes based on gross revenues under this Services Agreement
or taxes on the Services rendered to Recipient, provided that Recipient shall
not be
6
responsible for any
taxes levied measured by or based upon the net income of Provider; (ii) claims,
liabilities, damages and expenses arising out of or relating to (a) the content
of or defects in any inventory, material or other property of the Recipient, or
(b) the performance of Services for or on behalf of Recipient hereunder, but
only to the extent such Services have been performed in compliance with this
Services Agreement or otherwise pursuant to the specific written instructions of
Recipient.
7.3
Indemnification Procedures
. Indemnification of Third Party Claims (as
that term is defined in the Master Separation Agreement) shall be governed by
the definitions and procedures set forth in Section 5.6 of the Master Separation
Agreement. Indemnification for direct claims shall be governed by the procedures
set forth in Section 5.7 of the Master Separation Agreement. Payment shall be
made in accordance with the provision of Section 5.8 of the Master Separation
Agreement. For the avoidance of doubt, the provisions of Section 5.5 of the
Master Separation Agreement shall not be applicable to claims under this
Article 7
.
Article
8
Excusable Delays
Neither Party shall be held liable for any delay or failure in
performance of any part of this Services Agreement by reason of any cause beyond
its reasonable control, including, but not limited to, acts of God, acts of
civil or military authority, government regulations, embargoes, epidemics, war,
terrorist acts, riots, fires, explosions, earthquakes, nuclear accidents,
floods, strikes, power blackouts affecting facilities, inability to secure
products or services of other persons or transportation facilities, or acts or
omissions of transportation common carriers, provided that the Party so affected
shall use reasonable commercial efforts to remove such causes of
non-performance. Upon the occurrence of any event of force majeure, the Party
whose performance is prevented shall promptly give written notice to the other
Party and the Parties shall promptly confer in good faith to agree upon
reasonable action to minimize the impact of such event on the Parties.
Article
9
Independent Contractor
9.1
Relationship
. In its performance of Services hereunder,
Provider is an independent contractor to Recipient and nothing in this Services
Agreement shall be deemed to make a Party a partner, principal, joint venturer,
or fiduciary of the other Party. Neither Provider nor any persons performing any
Service on Provider’s behalf shall be deemed to be employees, agents or legal
representatives of Recipient. Nothing in this Services Agreement shall confer
authority upon any Party to enter into any commitment or agreement binding upon
the other Party.
9.2
No Assumption of
Obligations
. Nothing in
this Services Agreement shall be construed as an assumption by Provider of any
financial obligation of Recipient.
9.3
Compensation of Employees
. Provider shall be responsible for payment of
compensation to its employees and shall be responsible for payment of all
federal, state and local
7
taxes or contributions
imposed or required under unemployment insurance, social security and income tax
laws with respect to such persons.
Article
10
Compliance With Laws
In the performance of its duties and obligations under this Services
Agreement, each Party shall comply with all applicable laws. The Parties shall
cooperate fully in obtaining and maintaining in effect all permits and licenses
that may be required for the performance of the Services.
Article
11
Term and Termination
11.1
Term
. The term of this Services Agreement shall
commence on the Effective Date and end on the eighteen (18) month anniversary of
the Distribution Date (as defined in the Master Separation Agreement), unless
terminated earlier in whole or in part as provided in
Section 11.3
.
11.2
[Intentionally omitted.]
11.3
Termination of this Services
Agreement
. This Services
Agreement may be terminated:
(a)
By written agreement of the Parties;
(b)
By Provider in the event an unpaid invoice
resulting in delivery to Recipient of a Suspension Notice under
Section 2.4
is not satisfied within sixty (60) days of
the date of delivery of such notice;
(c)
By either Party upon a material breach (other
than non-payment of Services Fees or Expenses) by the other that is not cured
within thirty (30) days after written notice of such breach from the
non-breaching Party, except that where such breach is not capable of being cured
within 30 days, the breaching Party shall be accorded thirty (30) additional
days to cure such breach if it demonstrates that it is capable of curing such
breach within such additional period;
(d)
Upon thirty (30) days’ advance written notice
by either Party to the other where one Party: (i) commences a voluntary case or
other proceeding seeking liquidation, reorganization, or similar relief or seeks
the appointment of a trustee, receiver, liquidator or other similar official of
it or the taking of possession by any such official in any involuntary case or
other proceeding commenced against it, or makes a general assignment for the
benefit of creditors, or fails generally to pay its debts as they become due; or
(ii) has an involuntary case or other proceeding commenced against it seeking
liquidation, reorganization or other relief with respect to it or substantially
all of its debts or seeks the appointment of a trustee, receiver, liquidator,
custodian or other similar official for such Party or any substantial part of
its property, and such involuntary case or other proceeding remains undismissed
for a period of sixty (60) days; or
8
(e)
Except as may otherwise be set forth on
Schedule A
, by Recipient upon not less
than thirty (30) days’ advance written notice, with respect to all or any part
of any Service provided pursuant to this Services Agreement;
provided
that
neither this Services Agreement nor any
Service to performed by Provider hereunder may be terminated earlier than ninety
(90) days after the Distribution Date; and
provided
further
that to the extent there are any break-up
costs (including commitments made to or in respect of personnel or third parties
due to the requirement to provide the Services and prepaid expenses related to
the Services, or costs related to terminating such commitments) incurred by
Provider as a result of such termination, Recipient shall be solely responsible
for such costs. This
Section 11.3(e)
shall not limit the application of
Section 1.3
.
11.4
Effect
. In the event of termination of this Services
Agreement in its entirety pursuant to this
Article 11
or upon the expiration of the term (as the
same may be extended pursuant to
Section 11.2
), this Services Agreement shall cease to have
further force or effect and neither Party shall have any liability to the other
Party with respect to this Services Agreement, provided that:
(a)
Termination or expiration of this Services
Agreement for any reason shall not release a Party from any liability or
obligation which already has accrued as of the effective date of such
termination or expiration, and shall not constitute a waiver or release of, or
otherwise be deemed to adversely affect, any rights, remedies or claims, which a
Party may have hereunder at law, equity or otherwise or which may arise out of
or in connection with such termination or expiration.
(b)
As promptly as practicable following
termination of this Services Agreement in its entirety or with respect to any
Service to the extent applicable, and the payment by Recipient of all amounts
owing hereunder, Provider shall return all reasonably available material,
inventory and other property of Recipient held by Provider and shall deliver
copies of all of Recipient’s records maintained by Provider with regard to the
Services in Provider’s standard format and media. Provider shall deliver such
property and records to such location or locations as reasonably requested by
Recipient. Provider shall be responsible for the packing and preparation for
shipping of all such material, inventory and other property. Arrangements for
shipping, including the cost of freight and insurance, and the reasonable cost
of packing incurred by Provider shall be the responsibility of and shall be paid
by Recipient.
(c)
Articles 4
,
5
,
6
,
7
,
10
,
12
,
13
and
14
and this
Section 11.4
shall survive any termination or expiration
of this Services Agreement and remain in full force and effect.
Article
12
Notices
All notices, demands and other communications required to be given to a
Party hereunder shall be in writing and shall be deemed to have been duly given
if personally delivered, sent by a nationally recognized overnight courier,
transmitted by facsimile, or mailed by registered or certified mail (postage
prepaid, return receipt requested) to such Party at the relevant street address,
facsimile number or e-mail address set forth below (or at such other street
address,
9
facsimile number or
e-mail address as such Party may designate from time to time by written notice
in accordance with this provision):
|
If to
Provider, to:
|
|
|
|
Vishay
Intertechnology, Inc.
|
|
63 Lancaster
Avenue
|
|
Malvern, PA
19355-2120
|
|
Attention: Dr.
Lior E. Yahalomi, Chief Financial Officer
|
|
Telephone:
610-644-1300
|
|
Facsimile:
610-889-2161
|
|
|
|
with a copy
to:
|
|
|
|
Kramer Levin
Naftalis & Frankel LLP
|
|
1177 Avenue of
the Americas
|
|
New York, NY
10036
|
|
Attention:
Abbe L. Dienstag, Esq.
|
|
Telephone:
212-715-9100
|
|
Facsimile:
212-715-8000
|
|
|
|
If to
Recipient, to:
|
|
|
|
Vishay
Precision Group, Inc.
|
|
3 Great Valley
Parkway
|
|
Malvern, PA
19355-1307
|
|
Attention:
William M. Clancy, Chief Financial Officer
|
|
Telephone:
(484)-321-5300
|
|
Facsimile:
(484)-321-5300
|
|
|
|
with a copy
to:
|
|
|
|
Pepper
Hamilton LLP
|
|
3000 Two Logan
Square
|
|
Eighteenth and
Arch Streets
|
|
Philadelphia,
Pennsylvania 19103-2799
|
|
Attention:
Barry Abelson, Esq.
|
|
Telephone:
215-981-4000
|
|
Facsimile:
215-981-4750
|
Any notice, demand or other communication hereunder shall be deemed given
upon the first to occur of: (i) the fifth (5
th
) day after deposit
thereof, postage prepaid and addressed correctly, in a receptacle under the
control of the United States Postal Service; (ii) transmittal by facsimile
transmission to a receiver or other device under the control of the party to
whom notice is being given; or (iii) actual delivery to or receipt by the party
to whom notice is being given or an employee or agent thereof.
10
Article
13
Governing Law and Dispute
Resolution
13.1
Governing Law
. This Services Agreement and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflict of laws rules thereof to the extent such rules would require the
application of the law of another jurisdiction.
13.2
Dispute Resolution
. The procedures for discussion and
negotiation set forth in this
Section 13.2
shall apply to all disputes, controversies or
claims (whether arising in contract, tort or otherwise) (each, a “
Dispute
”) that may arise out of or relate to, or
arise under or in connection with this Services Agreement or the transactions
contemplated hereby.
(a)
It is the intent of the Parties to use their
respective reasonable best efforts to resolve expeditiously any Dispute between
them with respect to the matters covered hereby that may arise from time to time
on a mutually acceptable negotiated basis. In furtherance of the foregoing, if a
Dispute arises, the respective Party Representatives shall consider the Dispute
for up to seven (7) business days following receipt of a notice from either
Party specifying the nature of the Dispute, during which time the Party
Representatives shall meet in person at least once, and attempt to resolve the
Dispute.
(b)
If the Dispute is not resolved by the end of
the seven (7) day period referred to in
Section 13.2(a)
, or if the Party Representatives agree that
the Dispute can not be resolved by them, either Party may deliver a notice (an
“
Escalation Notice
”) demanding an in-person meeting involving
appropriate representatives of the Parties at a senior level of management of
the Parties (or if the Parties agree, of the appropriate strategic business unit
or division within such entity) (collectively, “
Senior Executives
”). Thereupon, each of the Party
Representatives shall promptly prepare a memorandum stating (i) the issues in
Dispute and each Party’s position thereon, (ii) a summary of the evidence and
arguments supporting each Party’s positions (attaching all relevant documents),
(iii) a summary of the negotiations that have taken place to date, and (iv) the
name and title of the Senior Executive who shall represent each Party. The Party
Representatives shall each deliver such memorandum to its respective Senior
Executive promptly upon receipt of such memorandum from the other Party
Representative. The Senior Executives shall meet for negotiations (which may be
held telephonically) at a mutually agreed time and place within ten (10) days of
the Escalation Notice, and thereafter as often as the Senior Executives deem
reasonably necessary to resolve the Dispute.
(c)
In the event that the Parties, after complying
with the provisions set forth in
Sections 13.2(a)
and
13.2(b)
, are unable to resolve a Dispute that arises
out of or relates to, arises under or in connection with this Services Agreement
or the transactions contemplated hereby, the Parties shall resolve such Dispute
in accordance with the provisions set forth in
Article VIII
of the Master Separation Agreement.
11
Article
14
Miscellaneous
14.1
Amendment
. No provisions of this Services Agreement
shall be amended, modified or supplemented by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification.
14.2
Waiver
.
(a)
Any term or provision of this Services
Agreement may be waived, or the time for its performance may be extended, by the
Party or the Parties entitled to the benefit thereof. Any such waiver shall be
validly and sufficiently given for the purposes of this Services Agreement if,
as to any Party, it is in writing signed by an authorized representative of such
Party.
(b)
Waiver by any Party of any default by the
other Party of any provision of this Services Agreement shall not be construed
to be a waiver by the waiving party of any subsequent or other default, nor
shall it in any way affect the validity of this Services Agreement or any Party
or prejudice the rights of the other Party thereafter to enforce each and ever
such provision. No failure or delay by any Party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
14.3
Assignability
. This Services Agreement shall be binding
upon and inure to the benefit of the Parties, and their respective successors
and permitted assigns;
provided
,
however
, that no Party may assign, delegate or
transfer (by merger, operation of law or otherwise) its respective rights or
delegate its respective obligations under this Services Agreement without the
express prior written consent of the other Party. Notwithstanding the foregoing,
either Party may assign its rights and obligations under this Services Agreement
to any Wholly-owned Subsidiary;
provided
,
however
, that each Party shall at all times remain
liable for the performance of its obligations under this Services Agreement by
any such Wholly-owned Subsidiary. Any attempted assignment or delegation in
violation of this
Section 14.3
shall be void. For purposes of this Services
Agreement, “
Wholly-owned Subsidiary
” of a Party means a Subsidiary of that Party
substantially all of whose voting securities and outstanding equity interest are
owned either directly or indirectly by such Party or one or more of its
Subsidiaries or by such Party and one or more of its Subsidiaries.
14.4
No Subcontracting
. Unless otherwise agreed by Recipient, which
agreement shall not unreasonably be withheld, and except as provided in
Section 1.4
, Provider may not subcontract the
performances of any Services hereunder.
14.5
Third Parties
. Except for the indemnification rights under
this Services Agreement of any Party in their respective capacities as such: (i)
the provisions of this Services Agreement are solely for the benefit of the
Parties and their respective successors and permitted assigns, and are not
intended to confer upon any person, except the Parties and their respective
successors and permitted assigns, any rights or remedies hereunder; (ii) there
are no third party beneficiaries of this Services Agreement; and (iii) this
Services Agreement shall not provide any
12
third party with any
remedy, claim, liability, reimbursement, claim of action or other right in
excess of those existing without reference to this Services Agreement.
14.6
Severability
. If any provision of this Services Agreement
or the application thereof to any person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any Party. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable
provision to effect the original intent of the Parties.
14.7
Attorneys’ Fees
. In any action hereunder to enforce the
provisions of this Services Agreement, the prevailing Party shall be entitled to
recover its reasonable attorneys’ fees in addition to any other recovery
hereunder.
14.8
Counterparts
. This Services Agreement may be executed in
one or more counterparts, each of which when so executed and delivered or
transmitted by facsimile, e-mail or other electronic means, shall be deemed to
be an original and all of which taken together shall constitute but one and the
same instrument. A facsimile or electronic signature is deemed an original
signature for all purposes under this Services Agreement.
14.9
DISCLAIMER OF REPRESENTATIONS AND
WARRANTIES
. EXCEPT FOR THE
REPRESENTATIONS, WARRANTIES AND COVENANTS EXPRESSLY MADE IN THIS SERVICES
AGREEMENT, PROVIDER HAS NOT MADE AND DOES NOT HEREBY MAKE ANY EXPRESS OR IMPLIED
REPRESENTATIONS, WARRANTIES OR COVENANTS, STATUTORY OR OTHERWISE, OF ANY NATURE,
INCLUDING WITH RESPECT TO THE WARRANTIES OF MERCHANTABILITY, QUALITY, QUANTITY,
SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR THE RESULTS OBTAINED OF THE
CONTINUING BUSINESS. ALL OTHER REPRESENTATIONS, WARRANTIES, AND COVENANTS,
EXPRESS OR IMPLIED, STATUTORY, COMMON LAW OR OTHERWISE, OF ANY NATURE, INCLUDING
WITH RESPECT TO THE WARRANTIES OF MERCHANTABILITY, QUALITY, QUANTITY,
SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR THE RESULTS OBTAINED OF THE
CONTINUING BUSINESS ARE HEREBY DISCLAIMED BY PROVIDER.
14.10
Remedies
. The rights and remedies provided herein
shall be cumulative and not exclusive of any rights or remedies provided by law.
14.11
Specific Performance
. The Parties agree that the remedy at law for
any breach of this Services Agreement may be inadequate, and that, as between
Provider and Recipient, any Party by whom this Services Agreement is enforceable
shall be entitled to specific performance in addition to any other appropriate
relief or remedy. Such Party may, in its sole discretion, apply to a court of
competent jurisdiction for specific performance or injunctive or such other
relief as such court may deem just and proper in order to enforce this Services
Agreement as between Provider and Recipient, or prevent any violation hereof,
and, to the extent permitted by
13
applicable law, as
between Provider and Recipient, each Party waives any objection to the
imposition of such relief.
14.12
Consent to Jurisdiction
. Subject to the provisions of
Section 13.2
, each of the Parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to
Section 14.11
Each of the Parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in
Article 12
shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this
Section 14.12
. Each of the Parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Services Agreement or the transactions
contemplated hereby for which it has submitted to jurisdiction pursuant to this
Section 14.12
, and waives any claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum.
14.13
Waiver of jury trial
. Subject to Section 13.2 and Section 14.11,
each of the Parties hereby waives to the fullest extent permitted by applicable
law any right it may have to a trial by jury with respect to any court
proceeding directly or indirectly arising out of and permitted under or in
connection with this agreement or the transactions contemplated by this
agreement. Each of the Parties hereby (a) certifies that no representative,
agent or attorney of any other Party has represented, expressly or otherwise,
that such other Party would not, in the event of litigation, seek to enforce the
foregoing waiver and (b) acknowledges that it has been induced to enter into
this agreement and the transactions contemplated by this agreement, as
applicable, by, among other things, the mutual waivers and certifications in
this Section 14.13.
14.14
Nonrecurring Costs and
Expenses
. Notwithstanding
anything herein to the contrary, any nonrecurring costs and expenses incurred by
the Parties to effect the transactions contemplated hereby which are not
allocated pursuant to the terms of this Agreement shall be the responsibility of
the Party which incurs such costs and expenses.
14.15
Press Releases; Public
Announcements
. Neither
Party shall issue any release or make any other public announcement concerning
this Agreement or the transactions contemplated hereby without the prior written
approval of the other Party, which approval shall not be unreasonably withheld,
delayed or conditioned;
provided
,
however
, that either Party shall be permitted to make
any release or public announcement that in the opinion of its counsel it is
required to make by law or the rules of any national securities exchange of
which its securities are listed;
provided
further
that it has made efforts that are reasonable
in the circumstances to obtain the prior approval of the other Party.
14.16
Construction
. Any uncertainty or ambiguity with respect to
any provision of this Agreement shall not be construed for or against any party
based on attribution of drafting by either party. The headings contained herein
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. In this Agreement, unless a clear contrary
intention appears:
14
(a)
the singular number includes the plural number and vice versa;
(b)
reference to any Person includes such Person’s
successors and assigns but, if applicable, only if such successors and assigns
are not prohibited by this Agreement, and reference to a Person in a particular
capacity excludes such Person in any other capacity or individually;
(c)
reference to any gender includes each other gender;
(d)
reference to any agreement, document or
instrument means such agreement, document or instrument as amended, modified,
supplemented or restated, and in effect from time to time in accordance with the
terms thereof subject to compliance with the requirements set forth herein;
(e)
reference to any applicable law means such
applicable law as amended, modified, codified, replaced or reenacted, in whole
or in part, and in effect from time to time, including rules and regulations
promulgated thereunder, and reference to any section or other provision of any
applicable law means that provision of such applicable law from time to time in
effect and constituting the substantive amendment, modification, codification,
replacement or reenactment of such section or other provision;
(f)
“herein,” “hereby,” “hereunder,” “hereof,”
“hereto” and words of similar import shall be deemed references to this
Agreement as a whole and not to any particular article, section or other
provision hereof;
(g)
“including” (and with correlative meaning
“include”) means including without limiting the generality of any description
preceding such term;
(h)
the Table of Contents and headings are for
convenience of reference only and shall not affect the construction or
interpretation hereof or thereof;
(i)
with respect to the determination of any
period of time, “from” means “from and including” and “to” means “to but
excluding;” and
(j)
references to documents, instruments or
agreements shall be deemed to refer as well to all addenda, exhibits, schedules
or amendments thereto.
14.17
Entire Agreement
. This Services Agreement and the Schedules
hereto, as well as any other agreements and documents referred to herein,
constitute the entire agreement between the Parties with respect to the subject
matter hereof and supersede all previous agreements, negotiations, discussions,
understandings, writings, commitments and conversations between the Parties with
respect to such subject matter. No agreements or understandings exist between
the Parties other than those set forth or referred to herein.
{Signatures appear on
the following page}
15
IN WITNESS WHEREOF, the Parties hereto have caused this Amended and
Restated Transition Services Agreement to be executed by their duly authorized
officers or representatives as of the date first written above.
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VISHAY INTERTECHNOLOGY, INC.
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By:
/s/ Dr. Lior E. Yahalomi
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Name:
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Dr. Lior E. Yahalomi
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Title:
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Executive Vice
President and Chief Financial Officer
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VISHAY PRECISION GROUP, INC.
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By: /s/ William M. Clancy
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Name:
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William M. Clancy
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Title:
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Executive Vice
President and Chief Financial Officer
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SCHEDULE A
TO
TRANSITION SERVICES AGREEMENT
This Schedule A is
comprised of Schedule A-1, Schedule A-2 and Schedule A-3. The Services to be
provided by Provider under Schedule A-1 are referred to generally as the
Corporate Website Services, the EDI Services and the Partners Services. The
Services to be provided by Provider under Schedule A-2 are referred to generally
as the SAP Services. The Services to be provided by Provider under Schedule A-3
are referred to generally as the Finance Support Services. In accordance with
the Services Agreement, the Services to be provided hereunder will be provided
by Provider through its Subsidiaries and their respective employees, agents or
contractors.
Capitalized terms
used but not defined herein have the meaning given to them in that certain
Transition Services Agreement, dated the 6
th
day of July, 2010, by
and between Vishay Intertechnology, Inc., as Provider, and Vishay Precision
Group, Inc., as Recipient (the “Services Agreement”).
For the avoidance of
doubt, any migration services, whether based on a change of provider, a change
of application or otherwise, are considered additional services, the terms of
which shall be negotiated in good faith by Provider and Recipient;
provided
that
Provider shall not be required to perform
such migration services, except to the extent that it has available resources
and receives compensation acceptable in its reasonable discretion.
Vishay Precision Group,
Inc., as Recipient may terminate any Service under this Schedule A by giving
Vishay Intertechnology, Inc., as Provider, at least (30) days’ advance written
notice. The parties do not anticipate total payments under the Transition
Services Agreement and this Schedule A to exceed $300,000 in the first twelve
months or $500,000 in the aggregate.
Schedule A-1
IT SUPPORT SERVICES FOR CORPORATE
WEBSITE, EDI AND PARTNERS
I.
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Terms and IT services provided by Vishay
Global Web Services
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1.
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Transition Services for Corporate
Website
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a.
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The subject
“Corporate Website” comprises the relevant web applications and components
of the Provider’s website which are applicable to the business units
transferred to Recipient.
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b.
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Provider will
only provide support for website components and applications developed by
Provider IT.
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c.
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Provider will not
be responsible to support any modification/enhancement performed by or on
behalf of Recipient any time after execution of the Services
Agreement.
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d.
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Provider will
provide Corporate Website support services (“Corporate Website Services”)
for a period, not to exceed 18 months, starting on the Distribution Date,
subject to extension on the terms set forth in the Services Agreement.
Upon expiration or termination of the Services Agreement, all support for
the website and related programs will be the sole responsibility of
Recipient.
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e.
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The Corporate
Website Services cover 80 man-hours per month of maintenance support to
include non-core modifications and software bug corrections, constituting
the Initial Service Level with respect to the Corporate Website Services.
Provider IT will allocate proper programmer resources for the website
components turned over to Recipient. Unused hours from the previous month
will not be carried over to the succeeding month. In the event the Initial
Service Level (i.e. the budgeted 80 man-hours) is exceeded, Recipient will
be charged on a time and material basis at the Standard Support Rate set
forth in Section III.4 of this Schedule A-1.
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f.
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All of Provider’s
website custom programs and applications are proprietary to Provider and
are provided to Recipient for Recipient’s use only. Recipient will not
copy these programs and will not provide any copy to any third party,
unless it is needed to support Recipient’s operation as it and approved in
advance in writing by Provider.
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2.
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Transition Services for EDI
Services
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a.
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The subject “EDI
Services” comprises the electronic data interchange services for FOILS
sales operation on Recipient’s SAP system hosted in Malvern.
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b.
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The EDI Services
will include operational support, setup of new customers on EDI, and setup
of new EDI message types.
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c.
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The EDI Services
will not include, and Provider will not be responsible to support, any
modification or enhancement performed by or on behalf of Recipient any
time after execution of the Services Agreement.
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d.
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Provider will
provide EDI Services for a period not to exceed 18 months, starting on the
Distribution Date, subject to extension on the terms set forth in the
Services Agreement. Upon expiration or termination of the Services
Agreement, all support for the EDI infrastructure and related programs
will be the sole responsibility of Recipient.
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e.
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The EDI Services
cover 40 man-hours per month of maintenance support to include non-core
modifications and software bug corrections, constituting the Initial
Service Level with respect to the EDI Services. Provider IT will allocate
proper programmer resources. Unused hours from the previous month will not
be carried over to the succeeding month. In the event the Initial Service
Level (i.e. the budgeted 40 man-hours) is exceeded, Recipient will be
charged on a time and material basis at the Standard Support Rate set
forth in Section III.4 of this Schedule A-1.
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3.
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Transition Services for Partners
Services
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a.
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The subject
“Partners” comprises the web SAP-based Internet Transaction Services for
FOILS sales operation on the Recipient’s SAP system hosted in Malvern.
“Internet Transaction Services” means SAP’s method of extending business
applications to a web browser.
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b.
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Provider will
provide operational support for the seven transactions currently available
in Partners (the “Partners Services”). Addition of new transactions other
that the seven currently available in Partners is not covered in this
Schedule A.
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c.
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The Partners
Services will not include, and Provider will not be responsible to
support, any modification or enhancement performed by or on behalf of
Recipient any time after execution of the Services Agreement. In addition,
the
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Partners Services
will not include the setup, migration, or preparation for any similar
Partners implementation other than the interface with Recipient’s SAP
system.
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d.
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Provider will
provide Partners Services for a period not to exceed 18 months, starting
on the Distribution Date, subject to extension on the terms set forth in
the Services Agreement. Upon expiration or termination of the Services
Agreement, all support for the Partners infrastructure and related
programs will be the sole responsibility of Recipient.
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e.
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The Partners
Services cover 40 man-hours per month of maintenance support to include
non-core modifications and software bug corrections, constituting the
Initial Service Level with respect to the Partners Services. Provider IT
will allocate proper programmer resources. Unused hours from the previous
month will not be carried over to the succeeding month. In the event the
Initial Service
Level (i.e. the
budgeted 40 man-hours) is exceeded, Recipient will be charged on a
time-and-material basis at the Standard Support Rate set forth in Section
III.4 of this Schedule A-1.
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II.
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Recipient’s
Responsibilities
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a.
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Recipient Marcom
will be responsible for concept and content of the Recipient’s
website.
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b.
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Recipient, at its
sole cost and expense, shall be responsible for the registration and
subsequent renewal of its website and Partners domain.
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c.
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Recipient agrees
to adopt a key user support community concept, where all issues are first
escalated to the assigned Recipient key user for verification and
resolution.
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d.
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Recipient at its
sole cost and expense, shall be responsible for all operating expenses
associated with the operation of all the systems, including but not
limited to, hardware maintenance, software maintenance, communication
lines, VAN services and usage charges for EDI mailbox , annual license
fees where applicable, system supplies etc. This includes the operating
expenses during the system setup and testing period after execution of the
Services Agreement.
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e.
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Recipient, at its
sole cost and expense, shall be responsible for providing necessary
secured network access, whether on-site or remote access, to allow
Provider to perform the services set forth
herein.
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III.
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Services Fees and
Costs
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1.
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Corporate Website
Services
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USD 4,000 per
month for the Corporate Website Services plus any out of pocket expenses
for licenses, equipment, hardware, IT infrastructure additions to support
additional hardware at Recipient, transportation of hardware to Recipient
sites, and travel-related costs (if required for Provider personnel to
travel) if not already paid for directly by Recipient.
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2.
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EDI Services
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USD 3,200 per
month for EDI Services plus any out of pocket expenses for licenses,
equipment, hardware, IT infrastructure additions to support additional
hardware at Recipient, transportation of hardware to Recipient sites, and
travel-related costs (if required for Provider personnel to travel) if not
already paid for directly by Recipient.
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3.
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Partners Services
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USD 3,200 per
month for Partners Services plus any out of pocket expenses for licenses,
equipment, hardware, IT infrastructure additions to support additional
hardware at Recipient, transportation of hardware to Recipient sites, and
travel-related costs (if required for Provider personnel to travel) if not
already paid for directly by Recipient.
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4.
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Hourly Support Rates
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Standard Website
Support Rate – USD 50/hour
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Standard EDI/Partners Support Rate – USD 80/hour
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The Standard
Website Support Rate applies to hours exceeding the Initial Service Level
for Corporate Website Services as outlined in III.1.
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The Standard
EDI/Partners Support Rate applies to hours exceeding the Initial Service
Level for EDI Services and Partners Services as outlined in III.2 and
III.3 of this Schedule A-1, respectively.
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Schedule A-2
IT SUPPORT SERVICES FOR SAP SYSTEMS
AND APPLICATIONS
I.
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Terms and IT services provided by Vishay
Global Business Applications Services
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1.
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Transition Services for FOILS Sales
operation on SAP
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a.
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Provider will provide operating and application maintenance
support, including non-core modifications and bug fixes for FOILS sales
operation on SAP system/client co-hosted on the platform (all such
support, the “SAP Services”). Operational functions within the SAP
Services include:
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i.
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Order
Management (three selling companies),
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ii.
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Shipping (three selling companies),
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iii.
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Invoicing (three selling companies),
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iv.
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Finished Goods Inventory Management (one manufacturing
company),
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v.
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Accounts Receivable (three selling companies),
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vi.
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General Ledger (three selling companies), and
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vii.
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Warehousing,
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as implemented as of the
Distribution Date.
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b.
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The SAP Services will be provided
during 8 work-hours on 5 work-days EST for routine work. Emergencies will
be attended 24 hours per day, 7 days a week, on a reasonable best efforts
basis.
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c.
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The SAP Services cover 160 man-hours
per month starting from the Distribution Date. Provider IT will allocate
the respective qualified resources for the services, constituting the
Initial Service Level with respect to the SAP Services. Unused hours from
the previous month will not be carried over to the succeeding month. In
the event the Initial Service Level (i.e. the budgeted 160 man-hours) is
exceeded, Recipient will be charged on a time and material basis at the
Standard Support Rate set forth in Section III.2 of this Schedule
A-2.
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d.
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Any additional out of pocket costs
incurred by providing the SAP Services will be charged to Recipient. Any
costs expected to be above 1000 USD will be sent to Recipient for approval
before. Provider assumes no responsibility for service failures due to
delayed approvals or rejections.
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e.
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Provider will provide the SAP
Services for a period, not to exceed 18 months, starting from the
Distribution Date, subject to extension on the terms set forth in
the
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7 of 25
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Services
Agreement. Upon expiration or termination of the Services Agreement,
Provider will stop all SAP services.
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f.
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Provider will hand
over all business data to Recipient in electronic data files within no
later than one week after expiration or termination of the Service
Agreement. Recipient shall specify to Provider in writing the business
data to be archived within 90 days prior to expiration or termination of
the Services Agreement, whichever comes first. In the event Recipient does
not so specify the business data to be archived within such 90-day period,
Recipient may alternatively receive upon request a complete database copy
of the applications listed in Section I.1.g of this Schedule
A-2.
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g.
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The application
hosting will include a productive and a test environment on non-mirrored
IBM servers (ERP instances) and HP servers (warehouse instances) in Vishay
corporate datacenter. Backup will be done daily. Service level parameters
are:
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i.
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Annual Uptime:
98%
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ii.
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Recovery Time
Objective (RTO): 5 work days
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iii.
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Recovery Point
Objective (RPO): 24 hours
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II.
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Recipient’s
Responsibilities
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a.
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Provider will be
able to use its own licenses to operate the SAP systems for FOILS.
Recipient will pay the
respective license depreciation and maintenance costs on a per user basis.
Any additional costs that should be incurred by such a solution will also
be charged to Recipient.
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b.
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Recipient will pay
any costs for additional third party software that is used for the FOILS
interim system. This may include, but is not limited to, the WSW Speedi
consignment package.
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c.
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Recipient will
provide the specification of the business data to be archived to Provider
three months before expiration or termination of the Services Agreement.
The specification has to
list the required business objects and record formats.
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III.
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Services Fees and
Costs
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1.
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SAP Services
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a.
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USD 8,000.00 per
month for the SAP Services outlined in Section I.1.a.-b of this Schedule
A-2.
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b.
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USD 7,400.00 per
month for the SAP Services outlined in Section I.1.g of this Schedule
A-2.
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c.
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Any time and
material and out of pocket expenses as outlined in Section I.1.c.-f of
this Schedule A-2.
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d.
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USD 47.00 per
month for each active user in FOILS interim system on the first day of
such month. Any third party licensing and maintenance costs as outlined in
II.a.-b
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2.
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Hourly Support Rates
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a.
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Standard Support
Rate: USD 50/hour
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For purposes of
this Schedule A-2, the Standard Support Rate applies to hours exceeding
the Initial Service Level for the SAP Services
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b.
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Development
support rate USD 80/hour
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The development
support rate applies to any development not covered by Section Section
I.1.a of this Schedule A-2. This includes but is not limited to any major
application change requests, the migration support to another system
within the Provider during the term of the Services Agreement, and the
archiving of the business data created in the FOILS interim
system.
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9 of 25
Schedule A-3
FINANCE SUPPORT
SERVICES
I.
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Terms and Finance Support Services to be
Provided
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1.
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Finance Support
Services
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a.
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This Schedule A-3
refers to the provision of finance and accounting support from Provider to
support the closing of SAP Foil for the VPG four selling entities located
in US, Germany, Israel and Japan (the “Selling Entities”). Provider
personnel will sit with the Recipient personnel and assist Recipient in
closing the books for the new companies and in recording all accounts and
transactions in SAP and otherwise will provide additional financial and
accounting support services as may be reasonably requested by the Selling
Entities (the “Finance Support Services”).
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b.
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Provider will
provide Finance Support Services to the Recipient until the books of the
Selling Entities have been closed for the second quarter ending after the
Distribution Date.
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II.
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Services Fees and Costs
:
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Provider will provide the Finance Support Services at an
average of $50 per hour per person, $250 per person for each half-day
(i.e. each 4-hour increment) and $500 per person for each full day (i.e.
each 8-hour increment), in each case, based upon such person receiving
$100,000 in annual compensation, working 200 calendar days per year, or as
the parties may otherwise agree. Recipient will reimburse Provider for
reasonable business travel expenses incurred by Provider and its personnel
in connection with the provision of the Finance Support
Services.
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10 of 25
Portions of this exhibit were
omitted and filed separately with the Secretary of the Securities and Exchange
Commission pursuant to an application for confidential treatment filed with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934. Such portions are marked by [***].
SUPPLY AGREEMENT
by and
between
Vishay
Advanced Technology, Ltd.,
an Israeli company,
as Supplier
and
Vishay Dale
Electronics, Inc.,
a Delaware corporation,
as Buyer
Dated as of
July 6, 2010
This SUPPLY AGREEMENT (this
“
Agreement
”) is made as of July 6, 2010 by and
between Vishay Advanced Technology, Ltd., an Israeli company (“
Supplier
”), and Vishay Dale Electronics,
Inc., a Delaware corporation (“
Buyer
”). Supplier and Buyer each may be
referred to herein as a “
Party
” and collectively, as the
“
Parties
”.
WHEREAS, subject to the terms,
conditions, commitments and undertakings herein provided, Supplier is willing to
manufacture and sell those products as set forth on
Exhibit A
hereto (as the same may be modified
from time to time pursuant to the provisions hereof, the “
Products
”) to Buyer, and Buyer desires to
purchase the Products from Supplier, in such quantities as Buyer shall request ,
as provided in this Agreement;
NOW, THEREFORE, in consideration of
the mutual covenants and agreements herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, agree as follows:
ARTICLE
I
DEFINITIONS
For purposes of this Agreement, the
following terms shall have the meanings specified in this Article I:
“
Affiliate
” means, as applied to any Person,
any other Person that, directly or indirectly, controls, is controlled by, or is
under common control with that Person as of the date on which or at any time
during the period for when such determination is being made. For purposes of
this definition, “
control
” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “
controlling
” and “
controlled
” have meanings correlative to the
foregoing.
“
Applicable Law
” means any applicable law, statute,
rule or regulation of any
Governmental Authority, or any outstanding order, judgment, injunction,
ruling or decree by any Governmental Authority.
“
Buyer
” has the meaning set forth in the
preamble of this Agreement.
“
Firm Order
” means Buyer’s non-cancelable
purchase order for Products to be purchased by Buyer from Supplier pursuant to
this Agreement for delivery.
“
FOB
” has the meaning and usage assigned
to such words in the incoterms rules published by the International Chamber of
Commerce.
“
Forecast
” means, with respect to any
relevant period, a good faith non-binding forecast, based on information
available to Buyer at the time of such forecast (which information, if reduced
to writing, shall be made available to Supplier upon reasonable request), of the
Firm Order for each Product that Buyer expects to deliver to Supplier for each
calendar month during such period.
-2-
“
Governmental
Authority
” means
any U.S. or non-U.S. federal, state, local, foreign or international court,
arbitration or mediation tribunal, government, department, commission, board,
bureau, agency, official or other regulatory, administrative or governmental
authority.
“
Group
” means, with respect to any Person,
each Subsidiary of such Person and each other Person that is controlled directly
or indirectly by such Person.
“
Intellectual
Property
” means
all domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and all
patents issuing thereon (including reissues, renewals and re-examinations of the
foregoing); design patents; invention disclosures; mask works; all domestic and
foreign copyrights, whether or not registered, together with all copyright
applications and registrations therefor; all domain names, together with any
registrations therefor and any goodwill relating thereto; all domestic and
foreign trademarks, service marks, trade names, and trade dress, in each case
together with any applications and registrations therefor and all goodwill
relating thereto; all Trade Secrets, commercial and technical information,
know-how, proprietary or Confidential Information, including engineering,
production and other designs, notebooks, processes, drawings, specifications,
formulae, and technology; computer and electronic data processing programs and
software (object and source code), data bases and documentation thereof; all
inventions (whether or not patented); all utility models; all registered
designs, certificates of invention and all other intellectual property under the
laws of any country throughout the world.
“
Last-Time Buy
Order
” has the
meaning set forth in
Section 4.5
.
“
Liability
” means, with respect to any Person,
any and all losses, claims, charges, debts, demands, Actions, causes of action,
suits, damages, obligations, payments, costs and expenses, sums of money,
accounts, reckonings, bonds, specialties, indemnities and similar obligations,
exoneration covenants, obligations under contracts, guarantees, make whole
agreements and similar obligations, and other liabilities and requirements,
including all contractual obligations, whether absolute or contingent, matured
or unmatured, liquidated or unliquidated, accrued or unaccrued, known or
unknown, joint or several, whenever arising, and including those arising under
any Applicable Law, action, threatened or contemplated action (including the
costs and expenses of demands, assessments, judgments, settlements and
compromises relating thereto and attorneys’ fees and any and all costs and
expenses, whatsoever reasonably incurred in investigating, preparing or
defending against any such actions or threatened or contemplated actions) or
order of any Governmental Authority or any award of any arbitrator or mediator
of any kind, and those arising under any contract, in each case, whether or not
recorded or reflected or otherwise disclosed or required to be recorded or
reflected or otherwise disclosed, on the books and records or financial
statements of any Person, including any Liability for taxes.
“
Person
” (whether or not initially
capitalized) means any corporation, limited liability company, partnership,
firm, joint venture, entity, natural person, trust, estate, unincorporated
organization, association, enterprise, government or political subdivision
thereof, or Governmental Authority.
“
Product
” has the meaning set forth in the
preamble of this Agreement.
-3-
“
Product Warranty
” has the meaning set forth in
Section 6.1(a)
.
“
Raw Materials
Cost
” means the
direct cost of material used in a finished Product, including the normal
quantity of material wasted in the production process, purchasing costs, inbound
freight charges and any applicable subcontractor charges.
“
Six-Month
Forecast
” means
a forward-looking Forecast for a period of six consecutive calendar months,
beginning on July 1 and January 1 of each calendar year, or, if earlier with
respect to any Product, the last day of the Term for such Product.
“
Subsidiary
” of any Person means a corporation
or other organization whether incorporated or unincorporated of which at least a
majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries;
provided
,
however
, that no Person that is not
directly or indirectly wholly-owned by any other Person shall be a Subsidiary of
such other Person unless such other Person controls, or has the right, power or
ability to control, that Person.
“
Supplier
” has the meaning set forth in the
preamble of this Agreement.
“
Supplier’s Other Manufacturing
Obligations
”
means the manufacturing obligations and commitments of Supplier to Persons other
than Buyer, including Supplier’s Affiliates.
“
Specifications
” means, with respect to any
Product, the design, composition, dimensions, other physical characteristics,
chemical characteristics, packaging, unit count and trade dress of such Product.
“
Term
” has the meaning set forth in
Section 7.1
.
“
Trade Secrets
” means information, including a
formula, program, device, method, technique, process or other Confidential
Information that derives independent economic value, actual or potential, from
not being generally known to the public or to other Persons who can obtain
economic value from its disclosure or use and is the subject of efforts that are
reasonable, under the circumstances, to maintain its secrecy.
“
Wholly-Owned
Subsidiary
” of a
Person means a Subsidiary of that Person substantially all of whose voting
securities and outstanding equity interest are owned either directly or
indirectly by such Person or one or more of its Subsidiaries or by such Person
and one or more of its Subsidiaries.
The terms “
herein
”, “
hereof
”, “
hereunder
” and like terms, unless otherwise
specified, shall be deemed to refer to this Agreement in its entirety and shall
not be limited to any particular section or provision hereof. The term
“
including
” as used herein shall be deemed to
mean “including, but not limited to.” The term “
days
” shall refer to calendar days
unless specified otherwise. References herein to “
Articles
”, “
Sections
” and “
Exhibits
” shall be deemed to mean Articles,
Sections of and Exhibits to this Agreement unless otherwise
specified.
-4-
ARTICLE
II
PURCHASE AND SALE OF
PRODUCTS
SECTION 2.1
Agreement to Purchase and Sell
Products
. (a)
During the Term, Supplier hereby agrees to manufacture and sell to Buyer, and
Buyer hereby agrees to purchase and accept from Supplier, such amounts of
Products, as from time to time shall be ordered by Buyer.
(b)
All Products to be sold to Buyer
pursuant to this Agreement shall be manufactured by Supplier or an Affiliate of
Supplier;
provided
,
however
, that Supplier may subcontract the
manufacture of any Product to a manufacturer that is not an Affiliate of
Supplier with Buyer’s prior written consent, which consent shall not be
unreasonably withheld,
provided
that any such subcontracting shall
not relieve Supplier of its obligations hereunder.
SECTION 2.2
Product
Specifications
.
(a) Supplier shall manufacture all Products according to the Specifications in
effect as of the date of this Agreement, with such changes or additions to the
Specifications of the Products related thereto as shall be requested by Buyer in
accordance with this Section or as otherwise agreed in writing by the Parties.
All other Products shall be manufactured with such Specifications as the Parties
shall agree in writing.
(b)
Buyer may request changed or
additional Specifications for any Product by delivering written notice thereof
to Supplier not less than one hundred twenty (120) days in advance of the first
Firm Order for such Product to be supplied with such changed or additional
Specifications. Notwithstanding the foregoing, if additional advance time would
reasonably be required in order to implement the manufacturing processes for
production of a Product with any changed or additional Specifications, and to
commence manufacture and delivery thereof, Supplier shall so notify Buyer, and
Supplier shall not be required to commence delivery of such Product until the
passage of such additional time.
(c)
Supplier shall be required to
accommodate any change of, or additions to, the Specifications for any Product,
if
and
only
if
(i) in Supplier’s good faith
judgment, such changed or additional Specifications would not require Supplier
to violate good manufacturing practice, (ii) the representation and warranty of
Buyer deemed made pursuant to Subsection (e) below is true and correct, and
(iii) Buyer agrees to reimburse Supplier for the incremental costs and expenses
incurred by Supplier in accommodating the changed or additional Specifications,
including the costs of acquiring any new machinery and tooling. For the
avoidance of doubt, such costs and expenses shall be payable by Buyer separately
from the cost of Products at such time or times as Supplier shall request.
(d)
Supplier shall notify Buyer in
writing within thirty (30) days of its receipt of any request for changed or
additional Specifications (i) whether Supplier will honor such changed or
additional Specifications, (ii) if Supplier declines to honor such changed or
additional Specifications, the basis therefor and (iii) if applicable, the
estimated costs and expenses that Buyer will be required to reimburse Supplier
in respect of the requested changes or additions, as provided in Subsection (c)
above. Buyer shall notify Supplier in writing within fifteen (15) days after
receiving notice of any required reimbursement whether Buyer agrees to assume
such reimbursement obligation.
-5-
(e)
By its request for any changed or
additional Specifications for any Product, Buyer shall be deemed to represent
and warrant to Supplier that the manufacture and sale of the Product
incorporating Buyer’s changed or additional Specifications, as a result of such
incorporation, will not and could not reasonably be expected to (i) violate or
conflict with any contract, agreement, arrangement or understanding to which
Buyer and/or any of its Affiliates is a party, including this Agreement and any
other contract, agreement, arrangement or understanding with Supplier and/or its
Affiliates, (ii) infringe on any trademark, service mark, copyright, patent,
trade secret or other intellectual property rights of any Person, or (iii)
violate any Applicable Law. Buyer shall indemnify and hold Supplier and its
Affiliates harmless (including with respect to reasonable attorneys’ fees and
disbursements) from any breach of this representation and warranty.
SECTION 2.3
New Products
. If Buyer shall request in writing
that Supplier manufacture and sell to Buyer an item that is not at the time a
Product, Supplier shall consider such request in good faith, giving due
consideration to Supplier’s available manufacturing capacity, Supplier’s Other
Manufacturing Obligations, existing know-how, technical feasibility, cost,
profitability and other relevant factors. Supplier shall inform Buyer within a
reasonable time of Supplier’s determination in principle whether to manufacture
such Product, and if Supplier has determined not to manufacture such Product,
the reasons therefor. If Supplier shall inform Buyer that it is willing in
principle to manufacture and sell such Product, Buyer and Supplier shall
negotiate in good faith with respect to the terms of such manufacture and sale,
including pricing and the Exhibits to this Agreement shall be modified
accordingly;
provided
,
however
, that neither Party shall be bound
with respect to the manufacture and sale of any such Product unless the Parties
shall have so agreed in writing.
SECTION 2.4
Supplier’s Supply
Obligations
.
Supplier shall be obligated to manufacture and sell Products to Buyer, in
accordance with Buyer’s Firm Orders, to the extent of Supplier’s then existing
manufacturing capacity, taking into account Supplier’s Other Manufacturing
Obligations;
provided
,
however
, the Supplier shall give equal
priority to the orders of Buyer, on the one hand, and Supplier’s Other
Manufacturing Obligations, on the other.
SECTION 2.5
Product Changes
. Supplier shall communicate any
change in the Specifications for any Product or its manufacture in accordance
with Supplier’s product change notification process. Buyer shall be deemed to
have accepted such change unless, within thirty (30) days after receipt of
notice from Supplier, Buyer informs Supplier that such change is not acceptable.
If Buyer informs Supplier that such change is not acceptable, Supplier may by
notice to Buyer either (x) continue to supply the Product in accordance with the
original Specifications and manufacturing procedures or (y) terminate this
Agreement with respect to such Product on a date specified by Supplier in a
notice of termination, which date shall not be earlier than one (1) year from
the date of Buyer’s information that it does not accept the change proposed by
Supplier; subject to the right of the Buyer to submit a Last-Time Buy Order in
accordance with
Section 4.5
.
SECTION 2.6
Product
Discontinuation
.
At any time Supplier may notify Buyer that Supplier is discontinuing the
manufacture and sale of a Product. Such discontinuation shall take effect on a
date specified by Supplier in a notice of discontinuation, which date shall not
be
-6-
earlier than
one (1) year from the date of the notice of discontinuation; subject to the
right of the Buyer to submit a Last-Time Buy Order in accordance with
Section 4.5
.
SECTION 2.7
Consultation and
Support
. At
either Party’s reasonable request, the Parties shall meet and discuss the
nature, quality and level of supply services contemplated by this Agreement. In
addition, Supplier will make available on a commercially reasonable basis and at
commercially reasonable times qualified personnel to provide knowledgeable
support service with respect to the Products. The Parties shall negotiate in
good faith with respect to any fees and other charges incurred by Supplier in
providing other than routine product support.
ARTICLE
III
FORECASTS
SECTION 3.1
Forecasts
. (a) As soon as possible, but in no
event later than thirty (30) days following the distribution of shares of common
stock of Vishay Precision Group, Inc. (“VPG”) to the shareholders of Vishay
Intertechnology, Inc. (“Vishay Intertechnology”) under that certain Master
Separation and Distribution Agreement between Vishay Intertechnology and VPG
(the “Master Separation Agreement”), Buyer shall provide to Supplier an initial
Forecast for the period ending on December 31, 2010. Beginning on December 1,
2010, and thereafter, on May 31 and December 1 of each calendar year, Buyer
shall provide to Supplier a Six-Month Forecast for the 6-month period beginning
on the immediately following July 1 and January 1, respectively.
(b)
If it is commercially impracticable
for Buyer to deliver a Six-Month Forecast for a particular Product, Buyer shall
deliver Forecasts to Supplier at such intervals and for such periods as
reasonable under the circumstances, and Supplier shall in good faith consider
such Forecasts delivered by Buyer.
(c)
Supplier shall use all Forecasts
delivered by Buyer under this Agreement for capacity and raw material planning
purposes only, and such Forecasts will not constitute a commitment of any type
by Buyer to purchase any Product.
SECTION 3.2
Forecasts in Excess of
Capacity
. Upon
receipt of each Forecast, Supplier shall determine whether it will have the
capacity to manufacture and sell to Buyer the Products in the forecasted
amounts. If Supplier determines that it will not have the capacity to
manufacture and deliver any Product to Buyer as forecasted, Supplier shall so
notify Buyer as promptly as practicable. Supplier and Buyer shall thereafter
negotiate in good faith in order to match Supplier’s manufacturing capacity with
Buyer’s requirements for the specified Product, such as by advancing or
deferring the delivery of the Product to other periods. In the event that
Supplier and Buyer shall agree to accommodate Buyer’s forecasted requirements in
a manner that will require the expenditure by Supplier of unbudgeted costs and
expenses in addition to the costs and expenses that Supplier would otherwise be
required to expend in order to fulfill its obligations under this Agreement,
Buyer shall be obligated to reimburse Supplier for such costs and expenses as
have actually been expended by Supplier, notwithstanding that the manufacture
and sale of Products in accordance with the Firm Orders subsequently delivered
by Buyer for the relevant periods do not require such expenditure.
-7-
SECTION 3.3
Firm Orders in Excess of
Forecasts
. In
the event that the Firm Order for any Product shall exceed the Forecast
contained in the most recent prior Forecast for such Product (as such Forecast
may have been modified by agreement of the Parties in the manner contemplated in
Section 3.2
; such excess being referred to as
the “
Excess Order
”), Supplier shall notify Buyer, as
promptly as reasonably practicable after receipt of such Firm Order, whether
Supplier has sufficient available capacity to accommodate the Excess Order,
taking into consideration Supplier’s manufacturing capacity for such Product and
Supplier’s Other Manufacturing Obligations. If Supplier shall not have
sufficient available capacity to accommodate the Excess Order, Supplier and
Buyer shall negotiate in good faith in order to match Supplier’s available
manufacturing capacity with Buyer’s requirements for the specified Product, such
as by advancing or deferring the delivery of the Product to other
periods.
ARTICLE
IV
ORDERS AND
PAYMENT
SECTION 4.1
Purchase Orders
. (a) Buyer may place a Firm Order
for the Products with Supplier at any time and from time to time.
(b)
Each Firm Order shall specify (i)
number of units of the Product to be purchased and (ii) the requested delivery
date, provided that Buyer shall request a delivery date with a lead delivery
time that is customary for the particular Product, unless otherwise agreed upon
by the Parties. Supplier agrees to provide Buyer prompt notice if it knows it
cannot meet a requested delivery date.
(c)
If Buyer requires a Product on an
emergency basis and so informs Supplier, and Supplier has the Product available
in its uncommitted inventory, Supplier agrees to use reasonable commercial
efforts to fill the emergency order as promptly as practicable. Buyer agrees to
pay reasonable incremental expenses related to any emergency order.
SECTION 4.2
Shipment
.
(a)
Products will be shipped by Supplier
to Buyer FOB shipping point.
(b)
Supplier shall package all Products
so as to protect them from loss or damage during shipment, in conformity with
good commercial practice, the Specifications and Applicable Law. Buyer shall be
responsible, at its own cost and expense, for the shipment (including, among
other fees, costs and expenses, transit and casualty insurance and third party
fees) of all processed materials by Buyer. Supplier shall cooperate with Buyer
in assembling and coordinating shipments, as reasonably requested by Buyer.
(c)
For the avoidance of doubt, title to
and risk of loss or damage will pass to Buyer upon Buyer’s pick up for transfer
of the Products ordered.
SECTION 4.3
Prices
. Pricing for the Products shall be
as set forth on
Exhibit A
, as such Exhibit may be modified
from time to time by agreement of the Parties. At least thirty (30) days prior
to the beginning of each calendar year, the parties shall negotiate in good
faith changes to the pricing of the Products to be applicable in the ensuing
year. Such pricing shall take into account changes in the cost of manufacturing
the Products, including labor, manufacturing,
-8-
utility and
other direct costs, and other ascertainable market inputs. If the Parties cannot
in good faith agree on pricing for the Products, until such time as the Parties
do so agree, Supplier shall have no obligation to honor any Firm Orders
submitted by Buyer to the extent that such Firm Orders are placed following
expiration of the then current calendar year.
SECTION 4.4
Payment Terms
. Unless otherwise agreed to by the
Parties in writing, Buyer shall make payment separately for each Firm Order.
Buyer shall pay the net amount of all invoice amounts within sixty (60) days of
the date of Supplier’s invoice unless the terms of Supplier’s invoice permits
later payment or allows for prepayment with a discount. Invoices shall not be
sent earlier than the date on which the Products related thereto are delivered
to Buyer.
SECTION 4.5
Last-Time Buy
Order
.
(a)
Buyer shall have a right to place a
written last-time Firm Order for a Product (a “
Last-Time Buy
Order
”) if (i)
Supplier delivers to Buyer notice of its intention not to renew the Term
pursuant to
Section 7.2
; (ii) Supplier terminates this
Agreement in respect of such Product in connection with Buyer’s choice not to
accept a change in such Product under
Section 2.5
; (iii) Supplier delivers to Buyer a
notice of discontinuation of such Product; or (iv) Buyer terminates this
Agreement in connection with a material breach by Supplier pursuant to
Section 7.3
. The right of the Buyer to submit a
Last-Time Buy Order shall entitle Buyer to purchase the Products at the price in
effect for the products as of the time of Buyer’s exercise of such
right.
(b)
A Last-Time Buy Order shall specify
(i) number of units of the Product to be purchased and (ii) the requested
delivery date or dates for such units. If Supplier informs Buyer that it cannot
honor the requested delivery dates because of capacity restraints or otherwise,
the Parties shall negotiate in good faith with respect to delivery dates
mutually acceptable to Supplier and Buyer.
(c)
The Parties hereby agree to use
commercially reasonable efforts to coordinate forecasting and ordering during
the period between the date the Last-Time Buy Order is delivered to Supplier and
the final delivery date to allow for regular supply of Products during such
period.
ARTICLE
V
CONFIDENTIALITY
SECTION 5.1 Supplier and Buyer shall
hold and shall cause each of their respective affiliates, directors, officers,
employees, agents, consultants, advisors and other representatives to hold, in
strict confidence and not to disclose or release without the prior written
consent of the other party, any and all proprietary or confidential information,
material or data of the other party that comes into its possession in connection
with the performance by the parties of their rights and obligations under this
Agreement. The provisions of Section 4.5 of the Master Separation Agreement
shall govern,
mutatis mutandis
, the confidentiality obligations of
the parties under this Section.
-9-
ARTICLE
VI
PRODUCT WARRANTY; LIMITATION OF
LIABILITY
SECTION 6.1
Product Warranty; Merchantability
Warranty
. (a)
Supplier warrants to Buyer that the Products shall, at the time of delivery to
Buyer in accordance with
Section 4.2
: (i) conform to the Specifications
therefor, as provided in
Section 2.2
; (ii) be free from material
defects; and (iii) be manufactured in accordance with good manufacturing
practice and Applicable Law (such warranty being referred to as the
“
Product Warranty
”).
(b) EXCEPT AS SPECIFICALLY PROVIDED
IN THIS AGREEMENT, NO WARRANTIES, OTHER THAN THE PRODUCT WARRANTY, ARE EXPRESSED
OR IMPLIED IN RESPECT OF THE PRODUCTS, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
SECTION 6.2
Defective or Non-Conforming
Products
. (a)
Claims by Buyer relating to the quantity of or damage to any Product or the
failure of any Product to conform to its Specifications must be made within one
(1) year of receipt of such Product and must be in writing, specifying in
reasonable detail the nature and basis of the claim and citing relevant control
or lot numbers or other information to enable identification of the Product in
question. Supplier’s Liability to Buyer for damages for any such claim shall be
limited to a refund for the price of the defective Product plus shipping costs
or, at Buyer’s option, prompt replacement thereof with a Product that complies
with the Product Warranty. Such refund and shipping costs or a replacement shall
constitute Supplier’s sole and exclusive Liability for such claims. For the
avoidance of doubt, nothing shall limit the obligations of Supplier to Buyer in
respect of third party claims against Buyer arising from the failure of any
Product to conform to its Specifications.
(b)
Any notifications to either Party
pursuant to this
Section 6.2
shall be subject to the
confidentiality provisions of
Article V
above.
SECTION 6.3
Indemnification
. (a) Subject to
Section 6.4
, Supplier shall indemnify and hold
Buyer harmless from and against any Liability, including reasonable attorney’s
fees and disbursements, arising out of any third party claim for death, injury
or damage to property resulting from (i) Supplier’s breach of this Agreement; or
(ii) any claim that a Product purchased from Supplier infringes any intellectual
property right of a third party.
(b)
Buyer shall indemnify and hold
harmless Supplier from and against any Liability, including reasonable
attorneys’ fees and disbursements, arising out of any third party claim for
death, injury or damage to property resulting from use of any of the Products
based upon (i) Buyer’s breach of this Agreement; or (ii) any change in condition
of the Products caused by Buyer other than any change in Specifications
requested by Supplier and deemed accepted by Buyer under
Section 2.5
.
(c)
Any Party seeking indemnification
pursuant to this
Section 6.3
shall promptly notify the other
Party of the claim as to which indemnification is sought, shall afford the other
Party, at the other Party’s sole expense, the opportunity to defend or settle
the claim (in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified
-10-
Party with
respect such claim) and shall cooperate to the extent reasonably requested by
the other Party in the investigation and defense of such claim;
provided
,
however
, that any settlement of any such
claim that would adversely affect the rights of the indemnified Party shall
require the written approval of such indemnified Party; and
provided
further
that an indemnified Party shall not
settle any such claim without the written approval of the indemnifying Party.
(d)
The foregoing indemnification
obligations shall survive any termination or expiration of this Agreement, in
whole or in part, or the expiration or termination of the Term.
SECTION 6.4
Limitation of
Liability
. In no
event shall any Party be liable for any special, consequential, indirect,
collateral, incidental or punitive damages or lost profits or failure to realize
expected savings or other commercial or economic loss of any kind, arising out
of any breach of this Agreement, including breach of the Product Warranty, or
any other obligations of any Party hereunder, or any use of the Products, and
each Party hereby knowingly and expressly waives any claims or rights with
respect thereto;
provided
,
however
, that in the event a Party is
required to pay to a third-party claimant any special, consequential, indirect,
collateral, incidental or punitive damages or lost profits or failure to realize
expected savings or other commercial or economic loss on any claim with respect
to which such Party is indemnified by the other Party pursuant to this
Agreement, such Party shall be entitled to indemnification from the other Party
with respect to such third-party special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss to the extent resulting from the
indemnifiable acts or omissions of the other Party.
SECTION 6.5
Insurance
. Each of the Parties shall maintain
general liability insurance covering their activities under this Agreement in
accordance with prudent and customary commercial practices, in such amounts as
shall be agreed upon from time to time by the Parties.
ARTICLE
VII
TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION
SECTION 7.1
Term of Agreement
. Unless earlier terminated pursuant
to
Section 7.3
, the term of this Agreement shall
be perpetual.
SECTION 7.2
Termination
. Either Party may terminate this
Agreement at any time upon prior written notice to the other at least one (1)
year prior to the requested date of termination.
SECTION 7.3
Rights Upon
Termination
.
Following a termination of this Agreement, all further rights and obligations of
the Parties under this Agreement shall terminate.
Notwithstanding the foregoing, the
termination of this Agreement shall not affect the rights and obligations of the
Parties arising prior to such expiration or termination; and
provided
further
that the Parties shall not be
relieved of (i) their respective obligations to pay monies due or which become
due as of or subsequent to the date of expiration or termination, and (ii) any
other respective obligations under this Agreement which specifically survive or
are to be performed after the date of such expiration or termination, including
the provisions of
Article V
and
6.3
. Any Firm Order, including a
Last-Time Buy Order, submitted prior to the expiration or
-11-
termination of
this Agreement shall be filled by Supplier pursuant to the terms hereof even if
the delivery date is after expiration or termination.
ARTICLE
VIII
DISPUTE
RESOLUTION
SECTION 8.1 The terms and provisions
of Article VIII of the Master Separation Agreement relating to the procedures
for resolution of any disputes between the parties, shall apply to all disputes,
controversies or claims (whether sounding in contract, tort or otherwise) that
may arise out of or relate to or arise under or in connection with this
Agreement, or the transactions contemplated hereby,
mutatis mutandis.
ARTICLE
IX
MISCELLANEOUS
SECTION 9.1
Assignment
. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Supplier without the consent of Buyer, to a Wholly-Owned
Subsidiary of Supplier that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Supplier, to a Wholly-Owned Subsidiary of Buyer; or (iii) by either
Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only with
the prior written consent of the other Party;
provided
,
however
, that no such assignment shall
relieve the assigning Party of Liability for its obligations hereunder. The
following actions shall not be deemed an assignment of this
Agreement: (1) assignment or
transfer of the stock of a Party, including by way of a merger, consolidation,
or other form of reorganization in which outstanding shares of a Party are
exchanged for securities, or (2) any transaction effected primarily for the
purpose of (A) changing a Party’s state of incorporation or (B) reorganizing a
Party into a holding company structure such that, as a result of any such
transaction, such Party becomes a Wholly-Owned Subsidiary of a holding company
owned by the holders of such Party’s securities immediately prior to such
transaction. Any attempted assignment other than as provided herein shall be
void. The provisions of this Agreement shall be binding upon, and shall inure to
the benefit of, the successors and permitted assigns of the
Parties.
SECTION 9.2
Force Majeure
. The Parties shall not be liable
for the failure or delay in performing any obligation under this Agreement
(except pursuant to
Section 7.4
) if and to the extent such failure
or delay is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war,
invasion, riot or other civil unrest; (iv) governmental laws, orders,
restrictions, actions, embargoes or blockages; (v) action by any regulatory
authority which prohibits the manufacture, sale or distribution of the Products,
except to the extent due to Supplier’s breach of its obligations hereunder; (vi)
regional, national or foreign emergency; (vii) injunction, strikes, lockouts,
labor trouble or other industrial disturbances; (viii) shortage of adequate
fuel, power, materials, or transportation facilities; or (ix) any other event
which is beyond the reasonable control of the affected Party;
provided
,
however
, that the Party affected shall
promptly notify the other Party of the force majeure condition and shall exert
its reasonable commercial efforts to eliminate, cure or overcome any such causes
and to resume performance of its obligations as soon as possible.
-12-
SECTION 9.3
Intellectual
Property
. All
Intellectual Property owned or created by a Party shall remain its sole and
exclusive property, and the other Party shall not acquire any rights therein by
reason of this Agreement.
SECTION 9.4
Entire Agreement
. This Agreement and the Exhibits
hereto constitute the entire agreement between the Parties with respect to the
subject matter hereof and thereof and supersede all previous agreements,
negotiations, discussions, understandings, writings, commitments and
conversations between the parties with respect to such subject matter. No
agreements or understandings exist between the parties other than those set
forth or referred to herein or therein. If any provision of this Agreement or
the application thereof to any Party or circumstance shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by Applicable Law. In such event, the
Parties shall use their best efforts to replace the invalid or unenforceable
provision with a provision that, to the extent permitted by Applicable Law,
achieves the purposes intended under the invalid or unenforceable provision.
SECTION 9.5
Governing Law
. This Agreement and the legal
relations between the parties shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of laws
rules thereof to the extent such rules would require the application of the law
of another jurisdiction.
SECTION 9.6
Consent to
Jurisdiction
.
Subject to the provisions of
Article VIII
, each of the Parties irrevocably
submits to the jurisdiction of the federal and state courts located in
Philadelphia, Pennsylvania and the City of New York, Borough of Manhattan for
the purposes of any suit, action or other proceeding to compel arbitration, for
the enforcement of any arbitration award or for specific performance or other
equitable relief pursuant to
Section 9.16
. Each of the parties further agrees
that service of process, summons or other document by U.S. registered mail to
such parties address as provided in
Section 9.10
shall be effective service of
process for any action, suit or other proceeding with respect to any matters for
which it has submitted to jurisdiction pursuant to this
Section 9.6
. Each of the parties irrevocably
waives any objection to venue in the federal and state courts located in
Philadelphia, Pennsylvania and the City of New York, Borough of Manhattan of any
action, suit or proceeding arising out of this Agreement or the transactions
contemplated hereby for which it has submitted to jurisdiction pursuant to this
Section 9.6
, and waives any claim that any such
action, suit or proceeding brought in any such court has been brought in an
inconvenient forum.
SECTION 9.7
Independent
Contractor
.
Nothing contained in this Agreement shall constitute a Party as a partner,
employee or agent of the other Party, nor shall any Party hold itself out as
such. Neither Party shall have the right or authority to incur, assume or
create, in writing or otherwise, any warranty, Liability or other obligation of
any kind, express or implied, in the name or on behalf of the other Party, and
each Party is and shall remain an independent contractor, responsible for its
own actions. Except as otherwise explicitly provided herein, each Party shall be
responsible for its own expenses incidental to its performance of this
Agreement.
SECTION 9.8
Set-Off
. The obligation of Buyer to pay the
purchase price for Products shall be unconditional, except as provided in this
Agreement, and shall not be subject to any defense, setoff, counterclaim or
similar right against Supplier or any of its Affiliates that could
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be asserted by
Buyer or any of its Affiliates under any other contract, agreement, arrangement
or understanding or otherwise under Applicable Law.
SECTION 9.9
Waivers
. No claim or right arising out of
or relating to a breach of any provision of this Agreement can be discharged in
whole or in part by a waiver or renunciation of the claim or right unless the
waiver or renunciation is supported by consideration and is in writing signed by
the aggrieved Party. Any failure by any Party to enforce at any time any
provision under this Agreement shall not be considered a waiver of that Party’s
right thereafter to enforce each and every provision of this Agreement.
SECTION 9.10
Notices
. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision):
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If to
Supplier, to:
Vishay
Advanced Technology, Ltd.
c/o Vishay Precision Group, Inc.
3 Great
Valley Parkway
Malvern, PA 19355-1307
Attention: William M. Clancy
Telephone: 484-321-5300
Facsimile: 484-321-5300
with a
copy to:
Pepper
Hamilton LLP
3000 Two Logan Square
Eighteenth and Arch Streets
Philadelphia,
Pennsylvania 19103-2799
Attention: Barry Abelson, Esq.
Telephone:
215-981-4000
Facsimile: 215-981-4750
If to
Buyer, to:
Vishay
Dale Electronics, Inc.
c/o Vishay Intertechnology, Inc.
63
Lancaster Avenue
Malvern, PA 19355-2120
Attention: Dr. Lior E.
Yahalomi
Telephone: 610-644-1300
Facsimile: 610-889-2161
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with a
copy to:
Kramer
Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New
York, NY 10036
Attention: Ernest S. Wechsler, Esq.
Telephone:
212-715-9100
Facsimile: 212-715-8000
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Any notice,
demand or other communication hereunder shall be deemed given upon the first to
occur of: (i) the fifth (5
th
) day after deposit
thereof, postage prepaid and addressed correctly, in a receptacle under the
control of the United States Postal Service; (ii) transmittal by facsimile
transmission to a receiver or other device under the control of the party to
whom notice is being given; (iii) actual delivery to or receipt by the party to
whom notice is being given or an employee or agent thereof; or (iv) one (1) day
after delivery to an overnight carrier.
SECTION 9.11
Headings
. The headings contained herein are
included for convenience of reference only and do not constitute a part of this
Agreement.
SECTION 9.12
Counterparts
. This Agreement may be executed in
one or more counterparts, each of which when so executed and delivered or
transmitted by facsimile, e-mail or other electronic means, shall be deemed to
be an original and all of which taken together shall constitute but one and the
same instrument. A facsimile or electronic signature is deemed an original
signature for all purposes under this Agreement.
SECTION 9.13
Severability
. If any provision of this Agreement
or the application thereof to any Person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable
provision to effect the original intent of the Parties.
SECTION 9.14
Waiver of Default
. (a) Any term or provision of this
Agreement may be waived, or the time for its performance may be extended, by the
party or the parties entitled to the benefit thereof. Any such waiver shall be
validly and sufficiently given for the purposes of this Agreement if, as to any
party, it is in writing signed by an authorized representative of such party.
(b)
Waiver by any party of any default
by the other party of any provision of this Agreement shall not be construed to
be a waiver by the waiving party of any subsequent or other default, nor shall
it in any way affect the validity of this Agreement or any party hereof or
prejudice the rights of the other party thereafter to enforce each and ever such
provision. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate
-15-
as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
SECTION 9.15
Amendments
. No provisions of this Agreement
shall be deemed amended, modified or supplemented by any Party, unless such
amendment, supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification.
SECTION 9.16
Specific
Performance
. The
Parties agree that the remedy at law for any breach of this Agreement may be
inadequate, and that, as between Supplier and Buyer, any Party by whom this
Agreement is enforceable shall be entitled to seek temporary, preliminary or
permanent injunctive or other equitable relief with respect to the specific
enforcement or performance of this Agreement. Such Party may, in its sole
discretion, apply to a court of competent jurisdiction for such injunctive or
other equitable relief as such court may deem just and proper in order to
enforce this Agreement as between Supplier and Buyer, or the members of their
respective Groups, or prevent any violation hereof, and, to the extent permitted
by Applicable Law, as between Supplier and Buyer, each Party waives any
objection to the imposition of such relief.
SECTION 9.17
Waiver of jury
trial
. Subject
to Article VIII, each of the Parties hereby waives to the fullest extent
permitted by Applicable Law any right it may have to a trial by jury with
respect to any court proceeding directly or indirectly arising out of and
permitted under or in connection with this Agreement or the transactions
contemplated hereby. Each of the Parties hereby (a) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (b) acknowledges that it has been induced to
enter into this agreement and the transactions contemplated by this agreement,
as applicable, by, among other things, the mutual waivers and certifications in
this
Section 9.17
.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Parties have
caused this Agreement to be executed by their respective duly authorized
representatives as of the date first written above.
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SUPPLIER:
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By:
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/s/ Lior E.
Yahalomi
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Name:
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Lior E.
Yahalomi
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Title:
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Executive Vice President and Chief
Financial
Officer
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BUYER:
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By:
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/s/ Ziv
Shoshani
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Name:
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Ziv
Shoshani
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Title:
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Authorized Signatory
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-17-
EXHIBIT
A
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PRICE PER
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MINIMUM
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PRODUCT
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ORDER
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TYPE
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DESCRIPTION
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TOLERANCE
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(USD)
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QUANTITY
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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Portions
of this exhibit were
omitted
and filed
separately
with the
Secretary
of the
Securities
and
Exchange
Commission
pursuant
to an
application
for
confidential
treatment
filed with the
Securities
and
Exchange
Commission
pursuant
to Rule 24b-2 under the
Securities
Exchange
Act of 1934. Such
portions
are
marked
by [***].
SECONDMENT AGREEMENT
THIS SECONDMENT AGREEMENT (the “Agreement”) is
made on July 6, 2010 by and between Vishay Intertechnology, Inc., a Delaware
corporation (“
VSH
”), and Vishay Precision Group, Inc., a
Delaware corporation (“
VPG
”).
WHEREAS, VSH has agreed that it will supply to
VPG assistance by seconding two of its employees, Dr. Felix Zandman and Reuben
Katraro (together, the “
Secondees
”) to VPG in accordance with the terms and
conditions of this Agreement.
NOW IT
IS HEREBY AGREED AS FOLLOWS:
1.
Secondment
. VSH shall second the Secondees to VPG for
the time periods described in Section 4, in accordance with the terms and
conditions of this Agreement (the “
Secondment
”).
2.
Commitment to VPG
. Subject to the provisions of
Section 6
, VSH shall be required to make each Secondee
available to VPG for the performances of the Services described in
Section 3
for up to five percent (5%) of such
Secondee’s professional working time on a monthly basis
;
provided
that in no event shall a Secondee be required
to commit more than five (5) hours to the Services for VPG in the course of any
given week.
3.
Services
. Each Secondee will provide VPG with
consulting services in research and development and technology (the
“
Services
”) pursuant to the terms of this Agreement.
Other than the Services, VSH shall not be required to make the Secondees
available for the performance of any services to VPG.
4.
Term
. The term of this Agreement shall commence on
the date of this Agreement and shall continue thereafter until
first anniversary
,
2011 (the “
Initial Term
”), and shall thereafter automatically renew
for additional one year periods (each, a “
Renewal Term
”, and the Initial Term or any such Renewal
Term, the “
Term
”), unless sooner terminated in accordance
with Section 11 of this Agreement or written notice is given by one party to the
other at least 90 days prior to the expiration of the Initial Term or any
Renewal Term, as applicable.
5.
Scheduling
. Subject to the provisions of this Agreement,
the Secondees shall perform the Services when and as requested by the Chief
Executive Officer of VPG. The Chief Executive Officer of VPG shall consult with
the Chief Executive Officer of VSH in good faith in order to schedule the time
and place of the Services of each of the Secondees to VPG so as not to
unreasonably interfere with the performance of the duties and responsibilities
of the Secondee to VSH or impose hardship on the Secondees.
6.
Status
. The Secondees shall at all times be and
remain employees of the VSH, and nothing in this Agreement shall affect the
employment relationship between VSH and each of the Secondees. While a Secondee
is performing services for VPG, he shall hold himself out as a consultant to
VPG, and he shall not, and VPG shall not permit him to, hold himself out as an
employee of VSH.
7.
Obligations of VSH
. VSH shall perform all obligations and
discharge all liabilities which may be imposed on it by law or otherwise in its
capacity as employer of the Secondees, including, without limitation, paying
salary and providing employee benefits.
8.
Consideration
.
(a) In consideration for VSH seconding the
Secondees to VPG, during the Term VPG shall pay to VSH in respect of each
Secondee the amount per annum set forth on
Exhibit A
(the “
Secondment Fee
”). The Secondment Fee shall be payable in
equal monthly installments on or before the first day of each calendar month
during the Term (or if such day is not a business day, the next succeeding
business day).
(b) VPG shall also be responsible for the
payment of any and all reasonable out-of-pocket business expenses incurred by
either of VSH or such Secondee in connection with the performance of the
Services by the Secondees, including, but not limited to, expenses for business
travel and accommodation, in connection with a Secondee’s services as
contemplated by this Agreement. In its discretion, VSH may reimburse a Secondee
for such business expenses, in which case VSH shall be entitled to invoice VPG
for amounts incurred by such Secondee. Payment by VPG shall be due within thirty
(30) days of the date of invoice, unless otherwise agreed between VPG and the
VSH.
(c) All payments by VPG under this Agreement
shall be made without set-off or counterclaim or condition, and otherwise in
accordance with this Agreement.
9.
Liability and Indemnity
.
(a) VSH shall have no liability for any loss
or damage (whether direct or indirect, physical, economic, consequential or
otherwise) arising from or in connection with the provision of the Services to
VPG by the Secondees. VPG agrees and acknowledges that it shall bear full and
sole responsibility for supervising the Secondees’ performance of the Services
during the course of the Secondment.
(b) VPG agrees to indemnify and hold VSH fully
and effectively harmless in respect of all and any liabilities which VSH may
incur to any third party for claims, losses, liabilities or damages or loss of
profit, savings, goodwill, business trade or any other economic loss arising in
connection with the provision of any Services to VPG by the Secondees.
10.
Confidentiality and Intellectual Property
Rights
.
(a) VSH shall cause each Secondee to enter
into agreements as to confidentiality and as to compliance with policies
corresponding to those normally obtained by VPG from its employees and
consultants.
(b) VSH and VPG each agrees to take all
reasonable measures to protect the confidential information and intellectual
property of the other that may, directly or indirectly, be disclosed in
connection with the Secondment. Neither party will improperly use or disclose
any confidential information or intellectual property of the other, without the
other party’s consent,
-2-
and each party agrees to
promptly notify the other of its possession of any confidential information or
intellectual property of the other.
(c) If at any time during the Term either
Secondee alone or jointly discovers or acquires any invention, development,
improvement, process or design whatsoever or any interests therein which shall
relate to or concern the activities of VPG, VSH shall cause each Secondee to be
obligated to communicate full details thereof to VPG, and any such invention
made or discovered as aforesaid shall belong to and be the absolute property of
VPG;
provided
that no such invention, development,
improvement, process or design shall incorporate the proprietary know-how or
other intellectual property of VSH without the consent of VSH and, to the extent
incorporating such know-how or intellectual property, shall not be the property
of VPG unless otherwise agreed by VSH.
11.
Termination
.
(a) VPG may terminate this Agreement at any
time and for any reason upon thirty (30) days advance written notice to
VSH.
(b) Either party may terminate this Agreement
upon the occurrence of any of the following events, upon written notice to the
other party:
(i) with respect to one or both Secondees, in
the event that either party commits a breach of this Agreement which in the case
of a breach capable of remedy is not remedied within thirty (30) days after
written notice has been given to the breaching party;
(ii) with respect to one or both Secondees, if
the other party is unable to pay its debts or upon the institution by or against
such party of insolvency, receivership or bankruptcy proceedings or any other
proceedings for the settlement of such party’s debts, upon such party making an
assignment for the benefit of creditors, or upon such party’s dissolution or
ceasing to do business; or
(iii) with respect to either Secondee, if such
Secondee is unable to properly perform the Services contemplated to be performed
by such Secondee due to such Secondee’s death, disability, injury or any other
reason, if such inability continues for a period of thirty (30) consecutive
working days.
(c) This Agreement shall terminate
automatically, without notice to either party, with respect to either Secondee,
if such Secondee’s employment with VSH is terminated for any reason. In the
event such employment with VSH is terminated, VSH shall provide prompt notice of
same to VPG.
(d) Termination of this Agreement for any
reason shall not affect the rights and obligations of the parties hereunder that
have accrued up to the date of or arising out of such termination or expiry,
including the right to claim damages as a result of a breach of this Agreement,
or any obligations to pay any outstanding payments due to third parties after
the termination date.
-3-
(e) The following provisions shall survive
termination of this Agreement:
Section 10
(“Confidentiality and Intellectual Property
Rights”); and
Section 12
(“Miscellaneous”).
12.
Miscellaneous
.
(a)
Notice
. Any notice to be served on either of the
parties by the other shall be sent by certified first class mail to the business
address of the party to whom it is sent, attention Chief Executive Officer of
the applicable party.
(b)
No Third Party Beneficiaries;
Assignability
. The
provisions of this Agreement are solely for the benefit of the parties hereto
and their respective successors and permitted assigns, and are not intended to
confer upon any other person, including the Secondees, any third party
beneficiary rights under this Agreement. Neither party may assign, delegate or
transfer (by merger, operation of law or otherwise) its respective rights or
delegate its respective obligations under this Agreement without the express
prior written consent of the other party. Notwithstanding the foregoing, either
party will have the right to assign this Agreement to any direct or indirect
wholly-owned subsidiary of such party subject to such party remaining liable for
the fulfillment of its obligations under this Agreement.
(c)
Relationship of the Parties
. Nothing in this Agreement shall be deemed or
construed by the parties, or by any third party, to create the relationship of a
partnership, joint venture or similar relationship between the parties hereto,
and neither party shall be deemed to be the agent of the other party by virtue
of this Agreement, it being understood and agreed that no provision contained
herein shall be deemed to create any relationship between the parties hereto
other than the relationship of independent parties contracting for services.
Neither party has and neither party shall hold itself out as having any
authority to enter into any contract or create any obligation or liability on
behalf of, in the name of, or binding upon the other party or to transact
business in the other party’s name or on its behalf, or make any promises or
representations on behalf of the other party by virtue of this
Agreement.
(d)
Governing Law
. This Agreement is governed by and shall be
construed in accordance with the laws of the State of New York, without regard
to the conflict of laws rules thereof to the extent such rules would require the
application of the law of another jurisdiction.
(e)
Dispute Resolution
. The terms and provisions of Article VIII of
the Master Separation and Distribution Agreement dated as of the 22
nd
day of June, 2010 between VSH and VPG,
relating to the procedures for resolution of any disputes between the parties,
shall apply to all disputes, controversies or claims (whether sounding in
contract, tort or otherwise) that may arise out of or relate to or arise under
or in connection with this Agreement, or the transactions contemplated hereby,
mutatis mutandis
;
provided
that the parties agree that the remedy at
law for any breach of this Agreement may be inadequate, and that, as between VSH
and VPG, any party by whom this Agreement is enforceable shall be entitled to
seek temporary, preliminary or permanent injunctive or other equitable relief
with respect to the specific enforcement or performance of this Agreement. Such
party may, in its sole discretion, apply to a court of competent jurisdiction
for such injunctive or other equitable relief as such court may
-4-
deem just and proper in
order to enforce this Agreement, or prevent any violation hereof, and, to the
extent permitted by applicable law, each party waives any objection to the
imposition of such relief.
(f)
Consent to Jurisdiction
. The parties to this Agreement submit to the
exclusive jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to
Section 11(e)
. Each of the parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Agreement, or the transactions contemplated
hereby for which it has submitted to jurisdiction pursuant to this Section 11.6
and waives any claim that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
(g)
Waiver of jury trial
. Subject to
Section 11(e)
, each of the parties hereby waives to the
fullest extent permitted by applicable law any right it may have to a trial by
jury with respect to any court proceeding directly or indirectly arising out of
and permitted under or in connection with this agreement or the transactions
contemplated by this agreement. Each of the parties hereby (i) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (ii) acknowledges that it has been induced
to enter into this agreement and the transactions contemplated by this
Agreement, as applicable, by, among other things, the mutual waivers and
certifications in this
Section 11(g)
.
(h)
Amendment
. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the party against whom it is sought to enforce such amendment,
supplement or modification.
(i)
Severability
. If any provision of this Agreement or the
application thereof to any person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination, the parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable
provision to effect the original intent of the parties.
(j)
Counterparts
. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered or transmitted
by facsimile, e-mail or other electronic means, shall be deemed to be an
original and all of which taken together shall constitute but one and the same
instrument. A facsimile or electronic signature is deemed an original signature
for all purposes under this Agreement.
-5-
[
Signature Page Follows
]
-6-
IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto on the date first above written.
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VISHAY INTERTECHNOLOGY,
INC.
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By:
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/s/ Lior E.
Yahalomi
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Name:
Lior E. Yahalomi
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Title:
Executive Vice President and
Chief
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Financial
Officer
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VISHAY PRECISION GROUP,
INC.
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By:
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/s/ William M.
Clancy
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Name:
William M. Clancy
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Title:
Executive Vice President and
Chief
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Financial
Officer
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EXHIBIT A
SECONDMENT FEE
VPG will pay to Vishay a
Secondment Fee equal to $60,000 in the aggregate per year in exchange for the
services to be provided by Dr. Felix Zandman and Mr. Reuben Katraro.
Portions of this exhibit were omitted and
filed separately with the Secretary of the Securities and Exchange Commission
pursuant to an application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934. Such portions are marked by [***].
PATENT LICENSE AGREEMENT
This non-exclusive Patent License Agreement (“
Agreement
”) is entered into as of July
6, 2010 (the “
Effective Date
”), by and between Vishay Dale Electronics,
Inc., a Delaware corporation (“
Licensor
”), and Vishay Precision Group, Inc. a
Delaware corporation ("
Licensee
").
RECITALS
:
WHEREAS, Licensor is the assignee of record to United States Patent No.
RE39,660; and
WHEREAS, in order to effect and consummate the separation (the
“
Separation
”) contemplated by that certain Master
Separation and Distribution Agreement between Licensee and Licensor’s affiliate
dated June 22, 2010 (the “
Master Separation Agreement
”), Licensee desires to secure a non-exclusive
license under the Licensed Patent (as defined herein) to manufacture, use and
sell Licensed Products (as defined herein) worldwide.
NOW, THEREFORE, in consideration of the terms and provisions of this
Agreement and the Separation, and for other good and valuable consideration, the
receipt and sufficiency of which is acknowledged by the execution and delivery
hereof, Licensor and Licensee hereby agree as follows:
(a) “
Licensed Patent
” shall mean United States Patent No. RE39,660
and any reissues, reexaminations, divisionals, continuations,
continuations-in-part, extensions, foreign counterparts and any other patents or
patent applications claiming priority to any application in the family of
filings leading to the issuance of United States Patent No.
RE39,660.
(b) “
Licensed Products
” shall mean articles or assemblies listed on
Schedule A
, as it may be amended from time to time in
accordance with the terms of this Agreement.
2.
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License Grant
. Subject to the terms and conditions
set forth in this Agreement, Licensor hereby grants to Licensee, a
non-exclusive, royalty-free, worldwide right and license under the
Licensed Patent to make, have made, use, sell, offer for sale, export and
import Licensed Products.
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3.
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Term
. This Agreement shall commence on the
Effective Date, and, so long as this Agreement has not been terminated by
its terms, continue in full force and effect until the expiration date of
the last to expire patent in the family of the Licensed
Patent.
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4.
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Sublicensing
. The license shall be sublicenseable to
direct or indirect wholly-owned subsidiaries of Licensee, provided that
Licensee shall be responsible for the compliance by its subsidiaries with
the terms of this Agreement. Otherwise, the license shall be
non-assignable and non-sublicensable. Any purported license or assignment
in violation of this Agreement shall be void.
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5.
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Maintenance
. Licensor may in its sole discretion
cease the maintenance of any Licensed
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Patent;
provided
,
however
, that if Licensor elects not to pay a
maintenance fee on the Licensed Patent, it will provide written notice to
that effect to Licensee at least three months before due date of the next
maintenance fee payment thereon, and thereafter, Licensee may elect to pay
the maintenance fee.
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6.
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Patent Marking
. All Licensed Products shall be marked
with and display the number of the United States Licensed Patent as
described in
35 U.S.C. §
287(a)
.
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7.
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Enforcement
. Licensee shall, at its own reasonable
expense, cooperate fully and promptly with Licensor in the protection of
Licensor’s rights in the Licensed Patent, in such manner and to such
extent as Licensor may reasonably request.
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Each
party shall promptly notify the other party in writing of any actual or
potential infringement, or any other unauthorized use of or violation of
the Licensed Patent of which it becomes aware (each an “
Infringement
”). Licensor may take such action as it,
in its sole discretion, deems necessary or advisable to stop any
Infringement. Licensee may request in writing that Licensor institute an
action to stop an Infringement affecting the Licensed Products. If
Licensor receives such a written request and does not institute such
action within thirty (30) days, Licensee shall be entitled to institute
such action as it deems necessary or advisable to stop such Infringement,
in which Licensor shall be entitled to join;
provided
that Licensee shall not compromise or
settle any claim or action regarding the Licensed Patent in any manner
that would affect the rights of Licensor without the written consent of
Licensor, which consent shall not be unreasonably withheld. The party not
taking the lead in any action shall cooperate fully with the other party
at the other party’s reasonable request and expense, including Licensor
joining a suit instituted by Licensee in accordance with this section to
the extent necessary for Licensee to have standing.
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Any
monetary recovery or sums obtained in settlement of any action to stop an
Infringement shall be allocated between Licensor and Licensee as shall be
fair and equitable, taking into account their actual out-of-pocket costs
and expenses, including reasonable attorneys’ fees, and the damages
sustained by each of them. Any dispute with respect to the allocation of
recoveries shall be resolved in accordance with the resolution procedures
referred to in
Section 11(p)
.
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8.
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Warranties of the
Parties
. Licensor
warrants that it has the right and power to enter into this Agreement, and
that there are no outstanding assignments, grants, licenses, encumbrances,
obligations or agreements, either written or oral or implied, that prevent
it from doing so. Licensee warrants that it has the right and power to
enter into this Agreement, and that there are no outstanding assignments,
grants, licenses, encumbrances, obligations or agreements, either written
or oral or implied, that prevent it from doing so.
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9.
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WARRANTY DISCLAIMER
. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, LICENSOR MAKES NO OTHER REPRESENTATION, GUARANTEE OR WARRANTY
OF ANY KIND, EXPRESS, IMPLIED OR OTHERWISE, UNDER THIS AGREEMENT INCLUDING
BUT NOT LIMITED TO REPRESENTATIONS, GUARANTEES OR WARRANTIES AS TO THE
RESULTS TO BE EXPECTED FROM USE OF ANY OF THE INVENTION(S) CLAIMED IN THE
LICENSED PATENT, OR FROM MANUFACTURE OR SALE OF
ANY
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PRODUCT. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, LICENSOR
SHALL HAVE NO RESPONSIBILITY UNDER ANY LEGAL PRINCIPLE TO LICENSEE OR TO
OTHERS FOR THE ABILITY OR INABILITY OF LICENSEE TO USE THE LICENSED
PATENT; FOR THE QUALITY OR PERFORMANCE OF ANY PRODUCTS MANUFACTURED OR
METHODS PRACTICED UNDER THE LICENSED PATENT; FOR THE CLAIMS OF THIRD
PARTIES RELATING TO ANY PRODUCTS MANUFACTURED OR SOLD BY LICENSEE; OR FOR
ANY FAILURE IN PRODUCTION, DESIGN OR OPERATION OF ANY PRODUCT MANUFACTURED
OR SOLD BY LICENSEE. THE LIMITATIONS OF LIABILITY CONTAINED IN THIS
AGREEMENT ARE A FUNDAMENTAL PART OF THE BASIS OF EACH PARTY’S BARGAIN
HEREUNDER, AND NEITHER PARTY WOULD ENTER INTO THIS AGREEMENT ABSENT SUCH
LIMITATIONS.
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10.
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Termination by
Licensor
.
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(a)
This Agreement may be
terminated by Licensor if:
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(i)
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Licensee shall
(x) willfully, intentionally and in bad faith breach any material
provision of this Agreement or (y) willfully, intentionally and in bad
faith fail to cure any other breach, and (i) under clause (x), such breach
is not capable of cure; or (ii) under either clause (x) or (y), such
breach is capable of cure, Licensor has given written notice of such
breach to Licensee, and such breach has not been cured within sixty (60)
days of such notice; or
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(ii)
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Licensee shall
willfully and intentionally and in bad faith purport to assign, delegate
or otherwise transfer any of its rights, benefits, powers, duties
responsibilities or obligations under this Agreement to any person other
than a wholly-owned subsidiary of Licensee without the written consent of
Licensor; or
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(iii)
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Licensee shall
abandon the use of the Licensed Patent; or
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(iv)
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a bankruptcy of
Licensee, or any one or more subsidiaries of Licensee holding more than
forty percent (40%) of its consolidated assets shall occur and be
continuing.
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(b)
To
effect the termination of this Agreement, Licensor shall deliver to Licensee a
written notice of termination, which notice shall specify the basis therefor in
reasonable detail and an effective date of termination not less than thirty (30)
days after the date of delivery to Licensee of the notice. If Licensee in good
faith disputes that Licensor has a valid basis for termination, the parties
shall resolve such dispute in accordance with the resolution procedures referred
to in
Section 11(p)
.
(c)
Nothing in this
Section shall relieve Licensee of liability for breach of this Agreement,
whether or not Licensor is entitled to terminate this Agreement on account of
such breach.
-3-
(d) Upon the termination of this Agreement, all rights of
Licensee granted hereunder shall terminate. Notwithstanding the foregoing,
Licensee shall have the right to continue to dispose of its then existing
inventory of Licensee Products for a period of up to six (6) months from the
date of termination of this Agreement. All costs associated with the foregoing
shall be borne by Licensee.
(e) All rights and remedies of the parties in respect of any
breach of this Agreement occurring prior to the effective date of its
termination shall survive the termination of this Agreement. In addition, the
following provisions of this Agreement shall explicitly survive its termination:
Section 9
(“WARRANTY DISCLAIMER”); and
Section 11
(“Miscellaneous”).
(a)
Notices
. All notices, demands and other communications
required to be given to a party hereunder shall be in writing and shall be
deemed to have been duly given if and when personally delivered; one business
day after being sent by a nationally recognized overnight courier; when
transmitted by facsimile and actually received; or five (5) days after being
mailed by registered or certified mail (postage prepaid, return receipt
requested) to such party at the relevant street address or facsimile number set
forth below (or at such other street address or facsimile number as such party
may designate from time to time by written notice in accordance with this
provision):
If to Licensor:
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With a copy to:
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Vishay Dale Electronics, Inc.
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Kramer Levin Naftalis & Frankel
LLP
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c/o Vishay Intertechnology, Inc.
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1177 Avenue of the Americas
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63 Lancaster Avenue
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New York, New York 10036
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Malvern, PA 19355-2120
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Attn: Abbe Dienstag, Esq.
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Attn: Dr. Lior Yahalomi, Chief Financial Officer
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Facsimile:
(212)
715-8000
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Facsimile:
(610)
889-2161
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Confirm:
(212)
715-9100
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Confirm:
(610)
644-1300
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If to Licensee:
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With a copy to:
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Vishay Precision Group, Inc.
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Pepper Hamilton LLP
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3 Great Valley Parkway
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3000 Two Logan Square
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Malvern, PA 19355-1307
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Eighteenth and Arch Streets
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Attn: William M. Clancy, Chief Financial
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Philadelphia, PA 19103-2799
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Officer
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Attn: Barry Abelson, Esq.
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Facsimile:
(484)-321-5300
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Facsimile:
(215)
981-4750
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Confirm:
(484)-321-5300
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Confirm:
(215)
981-4000
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(b)
Further Assurances
. In addition to the actions specifically
provided for elsewhere in this Agreement, Licensor and Licensee agree to execute
or cause to be executed and to record or cause to be recorded such other
agreements, instruments and other documents, and to take such other action, as
reasonably necessary or desirable to fully effectuate the intents and purposes
of this Agreement.
-4-
(c)
Relationship of the Parties
. This Agreement shall not be construed to
place the parties in the relationship of legal representatives, partners, joint
venturers or agents of or with each other. No party shall have any power to
obligate or bind the other party in any manner whatsoever, except as
specifically provided herein.
(d)
Third Party Beneficiaries
. Except for the indemnification rights under
this Agreement of any Indemnified Parties (as hereafter defined), the provisions
of this
Agreement are solely for
the benefit of the parties hereto and their respective successors and permitted
assigns, and are not intended to confer upon any person, except the parties
hereto and their respective successors and permitted assigns, any rights or
remedies hereunder.
(e)
Assignability
. Subject to
Section 4
, this Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns.
(f)
Press Releases; Public
Announcements
. Neither
party shall issue any release or make any other public announcement concerning
this Agreement or the transactions contemplated hereby without the prior written
approval of the other party, which approval shall not be unreasonably withheld,
delayed or conditioned;
provided
,
however
, that either party shall be permitted to make
any release or public announcement that in the opinion of its counsel it is
required to make by law or the rules of any national securities exchange of
which its securities are listed;
provided
further
that it has made efforts that are reasonable
in the circumstances to obtain the prior approval of the other
party.
(g)
Waiver of Defaults
. Waiver by any party hereto of any default by
the other party hereto of any provision of this Agreement shall not be construed
to be a waiver by the waiving party of any subsequent or other default, nor
shall it in any way affect the validity of this Agreement or prejudice the
rights of the other party thereafter to enforce each and every such provision.
No failure or delay by any party hereto in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
(h)
Severability
. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof shall remain in full force and
effect and shall in no way be affected, impaired or invalidated thereby, so long
as the economic or legal substance of the transactions contemplated hereby, as
the case may be, is not affected in any manner adverse to any party hereto or
thereto. Upon such determination, the parties hereto shall negotiate in good
faith in an effort to agree upon a suitable and equitable provision to effect
the original intent of the parties hereto.
(i)
Indemnification
. Each of the parties shall indemnify, defend
and hold harmless the other party, each of its respective current and former
directors, officers and employees, and each of their respective heirs,
executors, successors and assigns (“
Indemnified Parties
”), from and against any and all liabilities
relating to, arising out of or resulting from any breach of, or failure to
perform or comply with, any covenant, undertaking or obligation of, this
Agreement by the indemnifying party. In addition, Licensee shall indemnify,
defend and hold harmless Licensor and its other Indemnified Parties from and
against any and all liabilities relating to, arising out of or resulting from
the manufacture, marketing, sale, offer for sale or other activity of or with
respect to the Licensed Products or any other products manufactured, sold,
offered for sale or otherwise used by Licensee which incorporate any
-5-
portion of the Licensed Products but only to the extent caused by such
Licensed Products. All indemnification procedures and payments shall be governed
by Sections 5.6, 5.7 and 5.8 of the Master Separation Agreement, as
applicable.
(j)
LIMITATION OF LIABILITY
. IN NO EVENT SHALL LICENSOR OR LICENSEE BE
LIABLE TO THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, COLLATERAL,
INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS OR FAILURE TO REALIZE EXPECTED
SAVINGS OR OTHER
COMMERCIAL OR
ECONOMIC LOSS OF ANY KIND, ARISING OUT OF THIS AGREEMENT; PROVIDED, HOWEVER,
THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT EITHER PARTY’S INDEMNIFICATION
OBLIGATIONS WITH RESPECT TO THIRD PARTY CLAIMS.
(k)
Confidential Information
. Licensor and Licensee shall hold and shall
cause each of their respective affiliates, directors, officers, employees,
agents, consultants, advisors and other representatives to hold, in strict
confidence and not to disclose or release without the prior written consent of
the other party, any and all proprietary or confidential information, material
or data of the other party that comes into its possession in connection with the
performance by the parties of their rights and obligations under this Agreement.
The provisions of Section 4.6 of the Master Purchase Agreement shall govern,
mutatis mutandis
, the confidentiality obligations of the
parties under this Section.
(l)
Attorneys’ Fees
. In any action hereunder to enforce the
provisions of this
Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys’ fees in
addition to any other recovery hereunder.
(m)
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction.
(n)
Consent to Jurisdiction
. Subject to the provisions referenced in
Section 11(p)
, each of the parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania for the purposes of any suit, action or other proceeding to compel
arbitration, for the enforcement of any arbitration award or for specific
performance or other equitable relief pursuant to
Section 11(o)
. Each of the parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in
Section 11(a)
shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this Section. Each of the parties
irrevocably waives any objection to venue in the federal and state courts
located in Philadelphia, Pennsylvania of any action, suit or proceeding arising
out of this Agreement or the transactions contemplated
hereby.
(o)
Specific Performance
. The parties hereto agree that the remedy at
law for any breach of this Agreement may be inadequate, and that any party
hereto shall be entitled to specific performance in addition to any other
appropriate relief or remedy. Such party may, in its sole discretion, apply to a
court of competent jurisdiction for specific performance or injunctive or such
other relief as such court may deem just and proper in order to enforce this
Agreement.
-6-
(p)
Dispute Resolution
. The procedures set forth in Article VIII of
the Master Separation Agreement shall apply to the resolution of all disputes
arising under this Agreement, except that all proceedings provided for therein
shall be conducted in Philadelphia, Pennsylvania.
(q)
Entire Agreement
. This Agreement and the Schedules hereto, as
well as any other agreements and documents referred to herein, constitute the
entire agreement between the parties with respect to the subject matter hereof
and supersede all previous agreements, negotiations, discussions,
understandings, writings, commitments and conversations between the parties with
respect to such subject matter.
(r)
Waiver of Jury Trial
. Subject to
Section 11(p)
, EACH OF THE PARTIES HEREBY WAIVES TO THE
FULLEST EXTENT PERMITTED BY LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH
RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF AND
PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS
AGREEMENT.
(s)
Amendments
. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any party hereto, unless such
amendment, supplement or modification is in writing and signed by the authorized
representative of the party against whom it is sought to enforce such amendment,
supplement or modification.
(t)
Counterparts
. This Agreement may be executed in any number
of counterparts, including by facsimile or electronic signature, and each such
counterpart shall be deemed an original instrument, and all of such counterparts
together shall constitute but one agreement. A facsimile or electronic signature
is deemed an original signature for all purposes under this Agreement.
[SIGNATURE PAGES
FOLLOW]
-7-
IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Agreement as of the date first above written.
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VISHAY DALE ELECTRONICS,
INC.
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By:
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/s/
Lior E. Yahalomi
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Name:
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Lior E. Yahalomi
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Title:
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Executive Vice President and Chief
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Financial
Officer
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VISHAY PRECISION GROUP,
INC.
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By:
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/s/
William M. Clancy
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Name:
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William M. Clancy
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Title:
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Executive Vice President and Chief
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Financial Officer
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-8-
SCHEDULE A
LICENSED PRODUCTS
Current Products
[***]
Future Products
[***]
Portions of this
exhibit were omitted and filed separately with the Secretary of the Securities
and Exchange Commission pursuant to an application for confidential treatment
filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934. Such portions are marked by [***].
LEASE AGREEMENT
Made and signed on the
4 of July, 2010
BETWEEN:
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V.I.E.C. Ltd
.
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Company No. 51-161299-6
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(hereinafter, the “
Lessor
”)
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of the
one part
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A N D:
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Vishay Advanced Technologies Ltd.
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Company No. 51-2868142
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(hereinafter, the “
Lessee
”)
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of the
other part
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WHEREAS:
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The Lessor is the long term leaseholder from the Israel Land
Administration (hereinafter: “
ILA
”) of the land known as parcel 1 in
block 38095 (hereinafter: the “
Land
”) located on Emek Sarah in Beer Sheva,
and the building standing on the Land (hereinafter, the “
Building
”),
and;
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WHEREAS:
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Part of the Building is occupied and operated by the
Lessor;
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WHEREAS:
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The Lessee desires to lease from The Lessor part of the Building
designated in red on the plan attached to this Agreement as
Appendix
A
(hereinafter: the
"Premises"
) for the terms and subject to the
conditions provided in this Agreement;
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THEREFORE
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the parties hereby agree as
follows:
|
1.
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The Lease
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1.01
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The Lessee hereby leases the Premises
from the Lessor in its "as is" condition (hereinafter: the "
Lease
").
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1.02
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The Premises are leased to the Lessee
for a period of five (5) years commencing on July 4
th
2010 and terminating on July 3
th
2015 (hereinafter: the "
Term
").
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1.03
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The Lessee has an option to extend the
Term for five (5) periods of one (1) year each, on the terms and
conditions hereof. The exercise of the option will be by way of sending
the Lessor a written notice of the Lessee’s intention to extend the Term
as above, no later than three (3) months prior to the expiration of the
Term.
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All the terms and conditions of this
Agreement shall apply during the extended term as above, should the Term
be so extended, save for the right to extend the Term.
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1.04
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The Premises are leased to the Lessee to
be used for manufacturing and related commercial purposes, and for no
other purpose.
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2.
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The Rent
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2.01
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In consideration for the Lease, the
Lessee shall pay the Lessor annual rent in the amount of US$78,000
(hereinafter the "
Rent
").
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The annual Rent during the Term and
during the extended term as in section 1.03, should the Term be extended,
shall be linked to US CPI . The base Index for such calculation should be
the CPI known on the date of this Agreement.
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2.02
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The Rent will be paid every year during
the Term, in advance, on the first day of each calendar year of the
Term.
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2.04
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Value Added Tax ("
VAT
") shall be added to every Rent payment
and to any other payment under this Agreement, at the rate applicable at
the time of such payment.
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2.05
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The Rent and all other payments made by
the Lessee shall be paid in the equivalent amount in New Shekels according
to the last representative rate of exchange of the United States dollar
published by the Bank of Israel and known on the date of actual
payment.
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3.
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Additional
Payments
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3.01
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All taxes, fees, levies, municipal and
governmental, which shall apply to the Premises during the Term, shall be
borne and timely paid by the Lessee. Without derogating from the above,
the Lessee shall pay the Proportional
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2
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Share in all taxes, fees and levies
relating to the Common Areas of the Building designated in the blue on the
scheme attached hereto as
Appendix A
(hereinafter the
"
Common Areas
").
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The "
Proportional Share
" shall be calculated accordingly to the
area of the Premises in relation to the total area the Building less the
Common Areas.
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3.02
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The Lessee shall bear and pay during the
Term: (a) all payments and expenses for the any supply of utilities as
compressed air, water and electricity, HVAC (Heat, ventilation, air
condition), industrial gases in accordance with its Proportional Share ;
and (b) all taxes and payments with regard to the conduct in the Premises
of the Lessee's business, including business tax, signs tax, licenses fees
and the like.
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3.03
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Should any payment that the Lessee is
required to bear and pay, be made by the Lessor, the Lessee shall repay
the Lessor any such amount, together with interest.
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3.04
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Throughout the Term, the Lessee shall
bear and pay its Proportional Share in the cost of management and
maintenance of the Building and, with an addition of 5% management
fee.
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4.
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Possession and Use of the
Premises
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4.01
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The Lessee shall not: assign its rights
under this Agreement, or any part thereof, to any entity or person
whatsoever, directly or indirectly, deliver or transfer the Premises or
any part thereof to any entity or person whatsoever; sub-lease the
Premises or any part thereof to any entity or person; permit the use of
the Premises or any part thereof by any entity or person for any period
and in any manner whatsoever; allow others to share possession of the
Premises or any part thereof in any manner; or grant any entity or person
any right in the Premises whether for consideration or without
consideration.
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4.02
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The Lessee shall maintain the Premises
throughout the Term in good condition and not cause any damage or breakage
therein to the Premises or to any of its installations and systems; and
shall be responsible for the immediate repair, at its own expense, of any
damage or breakage (excluding reasonable wear and tear) which may be
caused to the Premises or its installations or
systems.
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3
4.03
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The Lessee shall not: effect any
alterations, make any additions or destroy any part of the Premises and/or
any of its installations and systems, without the prior written consents
of Lessor. The Lessor shall be free to withhold its consent and will not
be obliged to give reasons. The Lessor shall be entitled to prevent
implementation of any act as aforesaid, at any time, and to remove or
destroy any alteration or addition that may be effected without the
Lessor's prior written consent. Should the Lessee breach any of its
obligations as above, the Lessor shall be entitled, in addition to any
other remedy available to it by law, to terminate this
Agreement.
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4.04
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In the event the Lessee has received the
needed approvals and made changes or additions to the Premises (the
"
Changes
"), the Lessee undertakes to restore the
Premises before the end of the Term to their condition as of the date of
execution hereof. Should the Lessee not restore the Premises as required
above, then Lessor may restore the Premises to their previous condition.
In such case, the Lessee will pay Lessor, upon its first demand, all sums
paid by Lessor in connection with such restoration.
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4.05
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Throughout the Term of the Lease the
Lessee shall enjoy common use, together with the Lessor and / or any
possessors of areas in the Building, of the Common Areas. The Lessee
undertakes to the Common Area as expected with regard to areas that are in
common use.
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The Lessee, its employees, visitors, or
clients will not enter those parts of the Building that are not included
in the Premises and are not part of the Common Areas (hereinafter the
"
Lessor's Areas
"),
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5.
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Licenses
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The Lessee undertakes to receive and
hold in full affect, throughout the Term all licenses and permits required
for the purpose of conducting its business in the Premises.
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6.
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Responsibility of the
Lessee
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6.01
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The Lessee is obligated to maintain the
Premises during the Term in good condition, and avoid from causing any
damage or breakage to the Premises or any of its systems or installations,
and to repair immediately and on its
expense
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4
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any damage that may be caused to the
Premises and its systems and installations.
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6.02
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The Lessee shall be responsible for any
damage or breakage that may be caused to the Premises and/or to the
Building and/or to Lessor and/or to any third party in the Premises and/or
in the Building, as a result of the actions and/or omissions of the
Lessee, its employees, visitors, or clients, and/or as a result of the
conduct of the Lessee's business in the Premises.
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6.03
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The Lessor shall not have any liability
or responsibility whatsoever relating to or arising from any such damage
or breakage (including but not limited to, bodily injury) that may be
caused to the Lessee, to the Premises, to its contents, or to any third
party. The Lessee alone shall be responsible for any such injury or
damage, and shall indemnify and/or hold Lessor harmless from any payments
and expenses which may be incurred as a result of such damage or
breaking.
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7.
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Insurance
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Without derogating from the
responsibility of the Lessee as stated in section 6 above, the Lessor
undertakes to hold during the entire Term insurance as
customary.
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8.
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Changes or Additions by
Lessor
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8.01
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The Lessor is entitled to make any
changes in the Building and to initiate changes in the town plan relating
to the Building and to the Land and to request a building permit with
respect to the Land and/or the Building. The Lessee undertakes not to
interfere and not to oppose such changes or requests.
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8.02
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The Lessor shall be entitled, without
need for the Lessee's consent, to initiate and to perform any changes or
additions to the Building, at its absolute discretion as it shall deem fit
from time to time.
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8.03
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Without derogating from the generality
of any section of this Agreement, the Lessee hereby explicitly agrees that
Lessor may at any time, add and/or construct additional floors in the
Building and/or carry out any other construction works and/or changes
and/or additions in the Building; without any limitation and without the
need for the Lessee's consent. The Lessee
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5
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undertakes to enable Lessor to carry out
said work and not to interfere and not to oppose such work or otherwise
disturb.
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9.
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Vacating the
Premises
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Upon the end of the Term, or upon
termination of this Agreement for any reason whatsoever before the end of
the Term, the Lessee undertakes to vacate the Premises and to deliver the
possession thereof to Lessor. The Premises, when the Lessee vacates them,
shall be free and clear of all persons and objects connected to the
Lessee, clean, and in condition in which the Lessee received them from
Lessor, except for reasonable wear and tear.
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10.
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Miscellaneous
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10.01
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All payments that the Lessee undertakes
to pay the Lessor in accordance with this Agreement shall be paid by the
Lessee by way of deposit to Lessor’s account details of will be given by
the Lessor from time to time.
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10.02
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This Agreement is not transferable or
assignable by the Lessee in any manner.
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10.03
|
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The Lessor shall be entitled to transfer
and/or assign any or all of its rights to the Building and/or the
Premises. The Lessor shall be entitled to transfer and/or assign any or
all of its rights and/or liabilities under this Agreement without any
limitation and in its sole and absolute discretion and without any need
for consent of the Lessee.
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10.04
|
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Lessor represents that the Premises are
not mortgaged.
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10.05
|
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This Agreement completely reflects the
agreements and understandings of the parties with respect to the Premises,
and this Agreement supersedes any and all undertakings, representations,
understandings, or agreements, if any, between the parties made prior to
the execution of this Agreement. Any change or addition to this Agreement
must be in writing and be signed by both parties.
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10.06
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To assure payment of the Rent and the
fulfillment of all the lessee's other obligations, including the vacating
of the Premises by the Lessee, the Lessee shall furnish the Lessor, upon
the signing of this Agreement, with promissory note (hereinafter
“the Security”
). The Lessor shall have the right to
use the
|
6
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Security monies or any part thereof in
the event the Lessee breaches its obligations under this
Agreement.
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11.
|
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Addresses and
Notices
|
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12.01
|
|
The
addresses of the parties for the purposes of this Agreement are as
follows:
|
Lessor:
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2 Haofan Street, Holon 58814,
Israel
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Lessee:
|
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2 Haofan Street, Holon 58814,
Israel
|
11.02
|
|
Any notice sent by one party to the
other by registered mail to the addresses abovementioned shall be deemed
as having been delivered within a reasonable time from the date of its
posting at a post office.
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IN WITNESS WHEREOF
, the parties have hereby affixed their
signatures on the day first above written.
|
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VISHAY ADVANCED
TECHNOLOGY, LTD.
|
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V.I.E.C.
LTD.
|
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The Lessee
|
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Lessor
|
By:
|
/s/ Ziv Shoshani
|
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|
By:
|
/s/ Marc Zandman
|
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Title:
|
Authorized
Signatory
|
|
|
Title:
|
Authorized
Signatory
|
|
7
Portions of this exhibit were
omitted and filed separately with the Secretary of the Securities and Exchange
Commission pursuant to an application for confidential treatment filed with the
Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934. Such portions are marked by [***].
SUPPLY AGREEMENT
by and
between
Vishay Dale
Electronics, Inc.,
a
Delaware corporation,
as Supplier
and
Vishay
Advanced Technology, Ltd.,
an Israeli company,
as Buyer
Dated as of
July 6, 2010
This SUPPLY AGREEMENT (this
“
Agreement
”) is made as of July 6, 2010 by and
between Vishay Dale Electronics, Inc., a Delaware corporation (“
Supplier
”), and Vishay Advanced Technology,
Ltd., an Israeli company (“
Buyer
”). Supplier and Buyer each may be
referred to herein as a “
Party
” and collectively, as the
“
Parties
”.
WHEREAS, subject to the terms,
conditions, commitments and undertakings herein provided, Supplier is willing to
manufacture and sell those products as set forth on
Exhibit A
hereto (as the same may be modified
from time to time pursuant to the provisions hereof, the “
Products
”) to Buyer, and Buyer desires to
purchase the Products from Supplier, in such quantities as Buyer shall request ,
as provided in this Agreement;
NOW, THEREFORE, in consideration of
the mutual covenants and agreements herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, agree as follows:
ARTICLE
I
DEFINITIONS
For purposes of this Agreement, the
following terms shall have the meanings specified in this Article I:
“
Affiliate
” means, as applied to any Person,
any other Person that, directly or indirectly, controls, is controlled by, or is
under common control with that Person as of the date on which or at any time
during the period for when such determination is being made. For purposes of
this definition, “
control
” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “
controlling
” and “
controlled
” have meanings correlative to the
foregoing.
“
Applicable Law
” means any applicable law, statute,
rule or regulation of any
Governmental Authority, or any outstanding order, judgment, injunction,
ruling or decree by any Governmental Authority.
“
Buyer
” has the meaning set forth in the
preamble of this Agreement.
“
Confidential
Information
”
means all proprietary, design or operational information, data or material
including, without limitation: (a) specifications, ideas and concepts for goods
and services; (b) manufacturing specifications and procedures; (c) design
drawings and models; (d) materials and material specifications; (e) quality
assurance policies, procedures and specifications; (f) customer, client,
manufacturer and supplier information; (g) computer software and derivatives
thereof relating to design development or manufacture of goods; (h) training
materials and information; (i) inventions, devices, new developments, methods
and processes, whether patentable or unpatentable and whether or not reduced to
practice; (j) all other know-how, methodology, procedures, techniques and Trade
Secrets; (k) proprietary earnings reports and forecasts; (l) proprietary
macro-economic reports and forecasts; (m) proprietary marketing, advertising and
business plans, objectives and strategies; (n) proprietary general market
evaluations and surveys; (o) proprietary financing and credit-
2
related
information; (p) other copyrightable or patented works; (q) the terms of this
Agreement; and (r) all similar and related information in whatever form; in each
case, of one party which has been disclosed by Supplier or members of its Group
on the one hand, or Buyer or members of its Group, on the other hand, in
written, oral (including by recording), electronic, or visual form to, or
otherwise has come into the possession of, the other Group.
“
Firm Order
” means Buyer’s non-cancelable
purchase order for Products to be purchased by Buyer from Supplier pursuant to
this Agreement for delivery.
“
FOB
” has the meaning and usage assigned
to such words in the incoterms rules published by the International Chamber of
Commerce.
“
Forecast
” means, with respect to any
relevant period, a good faith non-binding forecast, based on information
available to Buyer at the time of such forecast (which information, if reduced
to writing, shall be made available to Supplier upon reasonable request), of the
Firm Order for each Product that Buyer expects to deliver to Supplier for each
calendar month during such period.
“
Governmental
Authority
” means
any U.S. or non-U.S. federal, state, local, foreign or international court,
arbitration or mediation tribunal, government, department, commission, board,
bureau, agency, official or other regulatory, administrative or governmental
authority.
“
Group
” means, with respect to any Person,
each Subsidiary of such Person and each other Person that is controlled directly
or indirectly by such Person.
“
Intellectual
Property
” means
all domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and all
patents issuing thereon (including reissues, renewals and re-examinations of the
foregoing); design patents; invention disclosures; mask works; all domestic and
foreign copyrights, whether or not registered, together with all copyright
applications and registrations therefor; all domain names, together with any
registrations therefor and any goodwill relating thereto; all domestic and
foreign trademarks, service marks, trade names, and trade dress, in each case
together with any applications and registrations therefor and all goodwill
relating thereto; all Trade Secrets, commercial and technical information,
know-how, proprietary or Confidential Information, including engineering,
production and other designs, notebooks, processes, drawings, specifications,
formulae, and technology; computer and electronic data processing programs and
software (object and source code), data bases and documentation thereof; all
inventions (whether or not patented); all utility models; all registered
designs, certificates of invention and all other intellectual property under the
laws of any country throughout the world.
“
Last-Time Buy
Order
” has the
meaning set forth in
Section 4.5
.
“
Liability
” means, with respect to any Person,
any and all losses, claims, charges, debts, demands, Actions, causes of action,
suits, damages, obligations, payments, costs and expenses, sums of money,
accounts, reckonings, bonds, specialties, indemnities and similar obligations,
exoneration covenants, obligations under contracts, guarantees, make whole
agreements and similar obligations, and other liabilities and requirements,
including all contractual obligations, whether absolute or contingent, matured
or unmatured, liquidated or unliquidated, accrued or
unaccrued,
known or unknown, joint or several, whenever arising, and including those
arising under any Applicable Law, action, threatened or contemplated action
(including the costs and expenses of demands, assessments, judgments,
settlements and compromises relating thereto and attorneys’ fees and any and all
costs and expenses, whatsoever reasonably incurred in investigating, preparing
or defending against any such actions or threatened or contemplated actions) or
order of any Governmental Authority or any award of any arbitrator or mediator
of any kind, and those arising under any contract, in each case, whether or not
recorded or reflected or otherwise disclosed or required to be recorded or
reflected or otherwise disclosed, on the books and records or financial
statements of any Person, including any Liability for taxes.
“
Person
” (whether or not initially
capitalized) means any corporation, limited liability company, partnership,
firm, joint venture, entity, natural person, trust, estate, unincorporated
organization, association, enterprise, government or political subdivision
thereof, or Governmental Authority.
“
Product
” has the meaning set forth in the
preamble of this Agreement.
“
Product Warranty
” has the meaning set forth in
Section 6.1(a)
.
“
Raw Materials
Cost
” means the
direct cost of material used in a finished Product, including the normal
quantity of material wasted in the production process, purchasing costs, inbound
freight charges and any applicable subcontractor charges.
“
Six-Month
Forecast
” means
a forward-looking Forecast for a period of six consecutive calendar months,
beginning on July 1 and January 1 of each calendar year, or, if earlier with
respect to any Product, the last day of the Term for such Product.
“
Subsidiary
” of any Person means a corporation
or other organization whether incorporated or unincorporated of which at least a
majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries;
provided
,
however
, that no Person that is not
directly or indirectly wholly-owned by any other Person shall be a Subsidiary of
such other Person unless such other Person controls, or has the right, power or
ability to control, that Person.
“
Supplier
” has the meaning set forth in the
preamble of this Agreement.
“
Supplier’s Other Manufacturing
Obligations
”
means the manufacturing obligations and commitments of Supplier to Persons other
than Buyer, including Supplier’s Affiliates.
“
Specifications
” means, with respect to any
Product, the design, composition, dimensions, other physical characteristics,
chemical characteristics, packaging, unit count and trade dress of such Product.
“
Term
” has the meaning set forth in
Section 7.1
.
“
Trade Secrets
” means information, including a
formula, program, device, method, technique, process or other Confidential
Information that derives independent economic value, actual or potential, from
not being generally known to the public or to other Persons who can obtain
economic value from its disclosure or use and is the subject of efforts that are
reasonable, under the circumstances, to maintain its secrecy.
“
Wholly-Owned
Subsidiary
” of a
Person means a Subsidiary of that Person substantially all of whose voting
securities and outstanding equity interest are owned either directly or
indirectly by such Person or one or more of its Subsidiaries or by such Person
and one or more of its Subsidiaries.
The terms “
herein
”, “
hereof
”, “
hereunder
” and like terms, unless otherwise
specified, shall be deemed to refer to this Agreement in its entirety and shall
not be limited to any particular section or provision hereof. The term
“
including
” as used herein shall be deemed to
mean “including, but not limited to.” The term “
days
” shall refer to calendar days
unless specified otherwise. References herein to “
Articles
”, “
Sections
” and “
Exhibits
” shall be deemed to mean Articles,
Sections of and Exhibits to this Agreement unless otherwise
specified.
ARTICLE
II
PURCHASE AND SALE OF
PRODUCTS
SECTION 2.1
Agreement to Purchase and Sell
Products
. (a)
During the Term, Supplier hereby agrees to manufacture and sell to Buyer, and
Buyer hereby agrees to purchase and accept from Supplier, such amounts of
Products, as from time to time shall be ordered by Buyer.
(b)
All Products to be sold to Buyer
pursuant to this Agreement shall be manufactured by Supplier or an Affiliate of
Supplier;
provided
,
however
, that Supplier may subcontract the
manufacture of any Product to a manufacturer that is not an Affiliate of
Supplier with Buyer’s prior written consent, which consent shall not be
unreasonably withheld,
provided
that any such subcontracting shall
not relieve Supplier of its obligations hereunder.
SECTION 2.2
Product
Specifications
.
(a) Supplier shall manufacture all Products according to the Specifications in
effect as of the date of this Agreement, with such changes or additions to the
Specifications of the Products related thereto as shall be requested by Buyer in
accordance with this Section or as otherwise agreed in writing by the Parties.
All other Products shall be manufactured with such Specifications as the Parties
shall agree in writing.
(b)
Buyer may request changed or
additional Specifications for any Product by delivering written notice thereof
to Supplier not less than one hundred twenty (120) days in advance of the first
Firm Order for such Product to be supplied with such changed or additional
Specifications. Notwithstanding the foregoing, if additional advance time would
reasonably be required in order to implement the manufacturing processes for
production of a Product with any changed or additional Specifications, and to
commence manufacture and delivery thereof, Supplier shall so notify Buyer, and
Supplier shall not be required to commence delivery of such Product until the
passage of such additional time.
(c)
Supplier shall be required to
accommodate any change of, or additions to, the Specifications for any Product,
if
and
only
if
(i) in Supplier’s good faith
judgment, such changed
or additional
Specifications would not require Supplier to violate good manufacturing
practice, (ii) the representation and warranty of Buyer deemed made pursuant to
Subsection (e) below is true and correct, and (iii) Buyer agrees to reimburse
Supplier for the incremental costs and expenses incurred by Supplier in
accommodating the changed or additional Specifications, including the costs of
acquiring any new machinery and tooling. For the avoidance of doubt, such costs
and expenses shall be payable by Buyer separately from the cost of Products at
such time or times as Supplier shall request.
(d)
Supplier shall notify Buyer in
writing within thirty (30) days of its receipt of any request for changed or
additional Specifications (i) whether Supplier will honor such changed or
additional Specifications, (ii) if Supplier declines to honor such changed or
additional Specifications, the basis therefor and (iii) if applicable, the
estimated costs and expenses that Buyer will be required to reimburse Supplier
in respect of the requested changes or additions, as provided in Subsection (c)
above. Buyer shall notify Supplier in writing within fifteen (15) days after
receiving notice of any required reimbursement whether Buyer agrees to assume
such reimbursement obligation.
(e)
By its request for any changed or
additional Specifications for any Product, Buyer shall be deemed to represent
and warrant to Supplier that the manufacture and sale of the Product
incorporating Buyer’s changed or additional Specifications, as a result of such
incorporation, will not and could not reasonably be expected to (i) violate or
conflict with any contract, agreement, arrangement or understanding to which
Buyer and/or any of its Affiliates is a party, including this Agreement and any
other contract, agreement, arrangement or understanding with Supplier and/or its
Affiliates, (ii) infringe on any trademark, service mark, copyright, patent,
trade secret or other intellectual property rights of any Person, or (iii)
violate any Applicable Law. Buyer shall indemnify and hold Supplier and its
Affiliates harmless (including with respect to reasonable attorneys’ fees and
disbursements) from any breach of this representation and warranty.
SECTION 2.3
New Products
. If Buyer shall request in writing
that Supplier manufacture and sell to Buyer an item that is not at the time a
Product, Supplier shall consider such request in good faith, giving due
consideration to Supplier’s available manufacturing capacity, Supplier’s Other
Manufacturing Obligations, existing know-how, technical feasibility, cost,
profitability and other relevant factors. Supplier shall inform Buyer within a
reasonable time of Supplier’s determination in principle whether to manufacture
such Product, and if Supplier has determined not to manufacture such Product,
the reasons therefor. If Supplier shall inform Buyer that it is willing in
principle to manufacture and sell such Product, Buyer and Supplier shall
negotiate in good faith with respect to the terms of such manufacture and sale,
including pricing and the Exhibits to this Agreement shall be modified
accordingly;
provided
,
however
, that neither Party shall be bound
with respect to the manufacture and sale of any such Product unless the Parties
shall have so agreed in writing.
SECTION 2.4
Supplier’s Supply
Obligations
.
Supplier shall be obligated to manufacture and sell Products to Buyer, in
accordance with Buyer’s Firm Orders, to the extent of Supplier’s then existing
manufacturing capacity, taking into account Supplier’s Other Manufacturing
Obligations;
provided
,
however
, the Supplier shall give equal
priority to the orders of Buyer, on the one hand, and Supplier’s Other
Manufacturing Obligations, on the other.
SECTION 2.5
Product Changes
. Supplier shall communicate any
change in the Specifications for any Product or its manufacture in accordance
with Supplier’s product change notification process. Buyer shall be deemed to
have accepted such change unless, within thirty (30) days after receipt of
notice from Supplier, Buyer informs Supplier that such change is not acceptable.
If Buyer informs Supplier that such change is not acceptable, Supplier may by
notice to Buyer either (x) continue to supply the Product in accordance with the
original Specifications and manufacturing procedures or (y) terminate this
Agreement with respect to such Product on a date specified by Supplier in a
notice of termination, which date shall not be earlier than the earlier of (I)
one (1) year from the date of Buyer’s information that it does not accept the
change proposed by Supplier and (II) if such notice of termination is delivered
more than ninety (90) days before the end of the then current Term, the end of
such Term; subject to the right of the Buyer to submit a Last-Time Buy Order in
accordance with
Section 4.5
.
SECTION 2.6
Product
Discontinuation
.
At any time Supplier may notify Buyer that Supplier is discontinuing the
manufacture and sale of a Product. Such discontinuation shall take effect on a
date specified by Supplier in a notice of discontinuation, which date shall not
be earlier than one (1) year from the date of the notice of discontinuation;
subject to the right of the Buyer to submit a Last-Time Buy Order in accordance
with
Section 4.5
.
SECTION 2.7
Consultation and
Support
. At
either Party’s reasonable request, the Parties shall meet and discuss the
nature, quality and level of supply services contemplated by this Agreement. In
addition, Supplier will make available on a commercially reasonable basis and at
commercially reasonable times qualified personnel to provide knowledgeable
support service with respect to the Products. The Parties shall negotiate in
good faith with respect to any fees and other charges incurred by Supplier in
providing other than routine product support.
ARTICLE
III
FORECASTS
SECTION 3.1
Forecasts
. (a) As soon as possible, but in no
event later than thirty (30) days following the distribution of shares of common
stock of Vishay Precision Group, Inc. (“VPG”) to the shareholders of Vishay
Intertechnology, Inc. (“Vishay Intertechnology”) under that certain Master
Separation and Distribution Agreement between Vishay Intertechnology and VPG
(the “Master Separation Agreement”), Buyer shall provide to Supplier an initial
Forecast for the period ending on December 31, 2010. Beginning on December 1,
2010, and thereafter, on May 31 and December 1 of each calendar year, Buyer
shall provide to Supplier a Six-Month Forecast for the 6-month period beginning
on the immediately following July 1 and January 1, respectively.
(b)
If it is commercially impracticable
for Buyer to deliver a Six-Month Forecast for a particular Product, Buyer shall
deliver Forecasts to Supplier at such intervals and for such periods as
reasonable under the circumstances, and Supplier shall in good faith consider
such Forecasts delivered by Buyer.
(c)
Supplier shall use all Forecasts
delivered by Buyer under this Agreement for capacity and raw material planning
purposes only, and such Forecasts will not constitute a commitment of any type
by Buyer to purchase any Product.
SECTION 3.2
Forecasts in Excess of
Capacity
. Upon
receipt of each Forecast, Supplier shall determine whether it will have the
capacity to manufacture and sell to Buyer the Products in the forecasted
amounts. If Supplier determines that it will not have the capacity to
manufacture and deliver any Product to Buyer as forecasted, Supplier shall so
notify Buyer as promptly as practicable. Supplier and Buyer shall thereafter
negotiate in good faith in order to match Supplier’s manufacturing capacity with
Buyer’s requirements for the specified Product, such as by advancing or
deferring the delivery of the Product to other periods. In the event that
Supplier and Buyer shall agree to accommodate Buyer’s forecasted requirements in
a manner that will require the expenditure by Supplier of unbudgeted costs and
expenses in addition to the costs and expenses that Supplier would otherwise be
required to expend in order to fulfill its obligations under this Agreement,
Buyer shall be obligated to reimburse Supplier for such costs and expenses as
have actually been expended by Supplier, notwithstanding that the manufacture
and sale of Products in accordance with the Firm Orders subsequently delivered
by Buyer for the relevant periods do not require such expenditure.
SECTION 3.3
Firm Orders in Excess of
Forecasts
. In
the event that the Firm Order for any Product shall exceed the Forecast
contained in the most recent prior Forecast for such Product (as such Forecast
may have been modified by agreement of the Parties in the manner contemplated in
Section 3.2
; such excess being referred to as
the “
Excess Order
”), Supplier shall notify Buyer, as
promptly as reasonably practicable after receipt of such Firm Order, whether
Supplier has sufficient available capacity to accommodate the Excess Order,
taking into consideration Supplier’s manufacturing capacity for such Product and
Supplier’s Other Manufacturing Obligations. If Supplier shall not have
sufficient available capacity to accommodate the Excess Order, Supplier and
Buyer shall negotiate in good faith in order to match Supplier’s available
manufacturing capacity with Buyer’s requirements for the specified Product, such
as by advancing or deferring the delivery of the Product to other
periods.
ARTICLE
IV
ORDERS AND
PAYMENT
SECTION 4.1
Purchase Orders
. (a) Buyer may place a Firm Order
for the Products with Supplier at any time and from time to time.
(b)
Each Firm Order shall specify (i)
number of units of the Product to be purchased and (ii) the requested delivery
date, provided that Buyer shall request a delivery date with a lead delivery
time that is customary for the particular Product, unless otherwise agreed upon
by the Parties. Supplier agrees to provide Buyer prompt notice if it knows it
cannot meet a requested delivery date.
(c)
If Buyer requires a Product on an
emergency basis and so informs Supplier, and Supplier has the Product available
in its uncommitted inventory, Supplier agrees to use reasonable commercial
efforts to fill the emergency order as promptly as practicable. Buyer agrees to
pay reasonable incremental expenses related to any emergency order.
SECTION 4.2
Shipment
.
(a)
Products will be shipped by Supplier
to Buyer FOB shipping point.
(b)
Supplier shall package all Products
so as to protect them from loss or damage during shipment, in conformity with
good commercial practice, the Specifications and Applicable Law. Buyer shall be
responsible, at its own cost and expense, for the shipment (including, among
other fees, costs and expenses, transit and casualty insurance and third party
fees) of all processed materials by Buyer. Supplier shall cooperate with Buyer
in assembling and coordinating shipments, as reasonably requested by Buyer.
(c)
For the avoidance of doubt, title to
and risk of loss or damage will pass to Buyer upon Buyer’s pick up for transfer
of the Products ordered.
SECTION 4.3
Prices
. Pricing for the Products shall be
as set forth on
Exhibit A
, as such Exhibit may be modified
from time to time by agreement of the Parties. At least thirty (30) days prior
to the beginning of each calendar year, the parties shall negotiate in good
faith changes to the pricing of the Products to be applicable in the ensuing
year. Such pricing shall take into account changes in the cost of manufacturing
the Products, including labor, manufacturing, utility and other direct costs,
and other ascertainable market inputs. If the Parties cannot in good faith agree
on pricing for the Products, until such time as the Parties do so agree,
Supplier shall have no obligation to honor any Firm Orders submitted by Buyer to
the extent that such Firm Orders are placed following expiration of the then
current calendar year.
SECTION 4.4
Payment Terms
. Unless otherwise agreed to by the
Parties in writing, Buyer shall make payment separately for each Firm Order.
Buyer shall pay the net amount of all invoice amounts within sixty (60) days of
the date of Supplier’s invoice unless the terms of Supplier’s invoice permits
later payment or allows for prepayment with a discount. Invoices shall not be
sent earlier than the date on which the Products related thereto are delivered
to Buyer.
SECTION 4.5
Last-Time Buy
Order
.
(a)
Buyer shall have a right to place a
written last-time Firm Order for a Product (a “
Last-Time Buy
Order
”) if (i)
Supplier delivers to Buyer notice of its intention not to renew the Term
pursuant to
Section 7.2
; (ii) Supplier terminates this
Agreement in respect of such Product in connection with Buyer’s choice not to
accept a change in such Product under
Section 2.5
; (iii) Supplier delivers to Buyer a
notice of discontinuation of such Product; or (iv) Buyer terminates this
Agreement in connection with a material breach by Supplier pursuant to
Section 7.3
. The right of the Buyer to submit a
Last-Time Buy Order shall entitle Buyer to purchase the Products at the price in
effect for the products as of the time of Buyer’s exercise of such
right.
(b)
A Last-Time Buy Order shall specify
(i) number of units of the Product to be purchased and (ii) the requested
delivery date or dates for such units. If Supplier informs Buyer that it cannot
honor the requested delivery dates because of capacity restraints or otherwise,
the Parties shall negotiate in good faith with respect to delivery dates
mutually acceptable to Supplier and Buyer.
(c)
The Parties hereby agree to use
commercially reasonable efforts to coordinate forecasting and ordering during
the period between the date the Last-Time Buy Order is
delivered to
Supplier and the final delivery date to allow for regular supply of Products
during such period.
ARTICLE
V
CONFIDENTIALITY
SECTION 5.1 Supplier and Buyer shall
hold and shall cause each of their respective affiliates, directors, officers,
employees, agents, consultants, advisors and other representatives to hold, in
strict confidence and not to disclose or release without the prior written
consent of the other party, any and all proprietary or confidential information,
material or data of the other party that comes into its possession in connection
with the performance by the parties of their rights and obligations under this
Agreement. The provisions of Section 4.5 of the Master Separation Agreement
shall govern,
mutatis mutandis
, the confidentiality obligations of
the parties under this Section.
ARTICLE
VI
PRODUCT WARRANTY; LIMITATION OF
LIABILITY
SECTION 6.1
Product Warranty; Merchantability
Warranty
. (a)
Supplier warrants to Buyer that the Products shall, at the time of delivery to
Buyer in accordance with
Section 4.2
: (i) conform to the Specifications
therefor, as provided in
Section 2.2
; (ii) be free from material
defects; and (iii) be manufactured in accordance with good manufacturing
practice and Applicable Law (such warranty being referred to as the
“
Product Warranty
”).
(b) EXCEPT AS SPECIFICALLY PROVIDED
IN THIS AGREEMENT, NO WARRANTIES, OTHER THAN THE PRODUCT WARRANTY, ARE EXPRESSED
OR IMPLIED IN RESPECT OF THE PRODUCTS, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
SECTION 6.2
Defective or Non-Conforming
Products
. (a)
Claims by Buyer relating to the quantity of or damage to any Product or the
failure of any Product to conform to its Specifications must be made within one
(1) year of receipt of such Product and must be in writing, specifying in
reasonable detail the nature and basis of the claim and citing relevant control
or lot numbers or other information to enable identification of the Product in
question. Supplier’s Liability to Buyer for damages for any such claim shall be
limited to a refund for the price of the defective Product plus shipping costs
or, at Buyer’s option, prompt replacement thereof with a Product that complies
with the Product Warranty. Such refund and shipping costs or a replacement shall
constitute Supplier’s sole and exclusive Liability for such claims. For the
avoidance of doubt, nothing shall limit the obligations of Supplier to Buyer in
respect of third party claims against Buyer arising from the failure of any
Product to conform to its Specifications.
(b)
Any notifications to either Party
pursuant to this
Section 6.2
shall be subject to the
confidentiality provisions of
Article V
above.
SECTION 6.3
Indemnification
. (a) Subject to
Section 6.4
, Supplier shall indemnify and hold
Buyer harmless from and against any Liability, including reasonable attorney’s
fees and disbursements, arising out of any third party claim for death, injury
or damage to property
resulting from
(i) Supplier’s breach of this Agreement; or (ii) any claim that a Product
purchased from Supplier infringes any intellectual property right of a third
party.
(b)
Buyer shall indemnify and hold
harmless Supplier from and against any Liability, including reasonable
attorneys’ fees and disbursements, arising out of any third party claim for
death, injury or damage to property resulting from use of any of the Products
based upon (i) Buyer’s breach of this Agreement; or (ii) any change in condition
of the Products caused by Buyer other than any change in Specifications
requested by Supplier and deemed accepted by Buyer under
Section 2.5
.
(c)
Any Party seeking indemnification
pursuant to this
Section 6.3
shall promptly notify the other
Party of the claim as to which indemnification is sought, shall afford the other
Party, at the other Party’s sole expense, the opportunity to defend or settle
the claim (in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified Party with respect such claim) and shall
cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim;
provided
,
however
, that any settlement of any such
claim that would adversely affect the rights of the indemnified Party shall
require the written approval of such indemnified Party; and
provided
further
that an indemnified Party shall not
settle any such claim without the written approval of the indemnifying Party.
(d)
The foregoing indemnification
obligations shall survive any termination or expiration of this Agreement, in
whole or in part, or the expiration or termination of the Term.
SECTION 6.4
Limitation of
Liability
. In no
event shall any Party be liable for any special, consequential, indirect,
collateral, incidental or punitive damages or lost profits or failure to realize
expected savings or other commercial or economic loss of any kind, arising out
of any breach of this Agreement, including breach of the Product Warranty, or
any other obligations of any Party hereunder, or any use of the Products, and
each Party hereby knowingly and expressly waives any claims or rights with
respect thereto;
provided
,
however
, that in the event a Party is
required to pay to a third-party claimant any special, consequential, indirect,
collateral, incidental or punitive damages or lost profits or failure to realize
expected savings or other commercial or economic loss on any claim with respect
to which such Party is indemnified by the other Party pursuant to this
Agreement, such Party shall be entitled to indemnification from the other Party
with respect to such third-party special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss to the extent resulting from the
indemnifiable acts or omissions of the other Party.
SECTION 6.5
Insurance
. Each of the Parties shall maintain
general liability insurance covering their activities under this Agreement in
accordance with prudent and customary commercial practices, in such amounts as
shall be agreed upon from time to time by the Parties.
ARTICLE VII
TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION
SECTION 7.1
Term of Agreement
. Unless earlier terminated pursuant
to
Section 7.3
, the term of this Agreement shall
be perpetual.
SECTION 7.2
Termination
. Either Party may terminate this
Agreement at any time upon prior written notice to the other at least one (1)
year prior to the requested date of termination.
SECTION 7.3
Rights Upon
Termination
.
Following a termination of this Agreement, all further rights and obligations of
the Parties under this Agreement shall terminate.
Notwithstanding the foregoing, the
termination of this Agreement shall not affect the rights and obligations of the
Parties arising prior to such expiration or termination; and
provided
further
that the Parties shall not be
relieved of (i) their respective obligations to pay monies due or which become
due as of or subsequent to the date of expiration or termination, and (ii) any
other respective obligations under this Agreement which specifically survive or
are to be performed after the date of such expiration or termination, including
the provisions of
Article V
and
6.3
. Any Firm Order, including a
Last-Time Buy Order, submitted prior to the expiration or termination of this
Agreement shall be filled by Supplier pursuant to the terms hereof even if the
delivery date is after expiration or termination.
ARTICLE
VIII
DISPUTE
RESOLUTION
SECTION 8.1 The terms and provisions
of Article VIII of the Master Separation Agreement relating to the procedures
for resolution of any disputes between the parties, shall apply to all disputes,
controversies or claims (whether sounding in contract, tort or otherwise) that
may arise out of or relate to or arise under or in connection with this
Agreement, or the transactions contemplated hereby,
mutatis mutandis.
ARTICLE
IX
MISCELLANEOUS
SECTION 9.1
Assignment
. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Supplier without the consent of Buyer, to a Wholly-Owned
Subsidiary of Supplier that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Supplier, to a Wholly-Owned Subsidiary of Buyer; or (iii) by either
Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only with
the prior written consent of the other Party;
provided
,
however
, that no such assignment shall
relieve the assigning Party of Liability for its obligations hereunder. The
following actions shall not be deemed an assignment of this Agreement: (1)
assignment or transfer of the stock of a Party, including by way of a merger,
consolidation, or other form of reorganization in which outstanding shares of a
Party are exchanged for securities, or (2) any transaction effected primarily
for the purpose of (A) changing a Party’s state of incorporation or (B)
reorganizing a Party into a holding company structure such that, as a result of
any such transaction, such Party becomes a Wholly-Owned Subsidiary of a holding
company owned by the holders of such Party’s securities immediately prior to
such transaction. Any attempted assignment other than as provided herein shall
be void. The provisions of this Agreement shall be binding upon, and shall inure
to the benefit of, the successors and permitted assigns of the
Parties.
SECTION 9.2
Force Majeure
. The Parties shall not be liable
for the failure or delay in performing any obligation under this Agreement
(except pursuant to
Section 7.4
) if and to the extent such failure
or delay is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war,
invasion, riot or other civil unrest; (iv) governmental laws, orders,
restrictions, actions, embargoes or blockages; (v) action by any regulatory
authority which prohibits the manufacture, sale or distribution of the Products,
except to the extent due to Supplier’s breach of its obligations hereunder; (vi)
regional, national or foreign emergency; (vii) injunction, strikes, lockouts,
labor trouble or other industrial disturbances; (viii) shortage of adequate
fuel, power, materials, or transportation facilities; or (ix) any other event
which is beyond the reasonable control of the affected Party;
provided
,
however
, that the Party affected shall
promptly notify the other Party of the force majeure condition and shall exert
its reasonable commercial efforts to eliminate, cure or overcome any such causes
and to resume performance of its obligations as soon as possible.
SECTION 9.3
Intellectual
Property
. All
Intellectual Property owned or created by a Party shall remain its sole and
exclusive property, and the other Party shall not acquire any rights therein by
reason of this Agreement.
SECTION 9.4
Entire Agreement
. This Agreement and the Exhibits
hereto constitute the entire agreement between the Parties with respect to the
subject matter hereof and thereof and supersede all previous agreements,
negotiations, discussions, understandings, writings, commitments and
conversations between the parties with respect to such subject matter. No
agreements or understandings exist between the parties other than those set
forth or referred to herein or therein. If any provision of this Agreement or
the application thereof to any Party or circumstance shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by Applicable Law. In such event, the
Parties shall use their best efforts to replace the invalid or unenforceable
provision with a provision that, to the extent permitted by Applicable Law,
achieves the purposes intended under the invalid or unenforceable provision.
SECTION 9.5
Governing Law
. This Agreement and the legal
relations between the parties shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of laws
rules thereof to the extent such rules would require the application of the law
of another jurisdiction.
SECTION 9.6
Consent to
Jurisdiction
.
Subject to the provisions of
Article VIII
, each of the Parties irrevocably
submits to the jurisdiction of the federal and state courts located in
Philadelphia, Pennsylvania and the City of New York, Borough of Manhattan for
the purposes of any suit, action or other proceeding to compel arbitration, for
the enforcement of any arbitration award or for specific performance or other
equitable relief pursuant to
Section 9.16
. Each of the parties further agrees
that service of process, summons or other document by U.S. registered mail to
such parties address as provided in
Section 9.10
shall be effective service of
process for any action, suit or other proceeding with respect to any matters for
which it has submitted to jurisdiction pursuant to this
Section 9.6
. Each of the parties irrevocably
waives any objection to venue in the federal and state courts located in
Philadelphia, Pennsylvania and the City of New York, Borough of Manhattan of any
action, suit or proceeding arising out of this Agreement or the transactions
contemplated hereby for which it has submitted to jurisdiction pursuant to this
Section
9.6
, and waives
any claim that any such action, suit or proceeding brought in any such court has
been brought in an inconvenient forum.
SECTION 9.7
Independent
Contractor
.
Nothing contained in this Agreement shall constitute a Party as a partner,
employee or agent of the other Party, nor shall any Party hold itself out as
such. Neither Party shall have the right or authority to incur, assume or
create, in writing or otherwise, any warranty, Liability or other obligation of
any kind, express or implied, in the name or on behalf of the other Party, and
each Party is and shall remain an independent contractor, responsible for its
own actions. Except as otherwise explicitly provided herein, each Party shall be
responsible for its own expenses incidental to its performance of this
Agreement.
SECTION 9.8
Set-Off
. The obligation of Buyer to pay the
purchase price for Products shall be unconditional, except as provided in this
Agreement, and shall not be subject to any defense, setoff, counterclaim or
similar right against Supplier or any of its Affiliates that could be asserted
by Buyer or any of its Affiliates under any other contract, agreement,
arrangement or understanding or otherwise under Applicable Law.
SECTION 9.9
Waivers
. No claim or right arising out of
or relating to a breach of any provision of this Agreement can be discharged in
whole or in part by a waiver or renunciation of the claim or right unless the
waiver or renunciation is supported by consideration and is in writing signed by
the aggrieved Party. Any failure by any Party to enforce at any time any
provision under this Agreement shall not be considered a waiver of that Party’s
right thereafter to enforce each and every provision of this Agreement.
SECTION 9.10
Notices
. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision):
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If to
Supplier, to:
Vishay
Dale Electronics, Inc.
c/o Vishay Intertechnology, Inc.
63
Lancaster Avenue
Malvern, PA 19355-2120
Attention: Dr. Lior E.
Yahalomi
Telephone: 610-644-1300
Facsimile: 610-889-2161
with a
copy to:
Kramer
Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New
York, NY 10036
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Attention: Ernest S. Wechsler, Esq.
Telephone:
212-715-9100
Facsimile: 212-715-8000
If to
Buyer, to:
Vishay
Advanced Technology, Ltd.
c/o Vishay Precision Group, Inc.
3 Great
Valley Parkway
Malvern, PA 19355-1307
Attention: William M.
Clancy
Telephone: 484-321-5300
Facsimile: 484-321-5300
with a
copy to:
Pepper
Hamilton LLP
3000 Two Logan Square
Eighteenth and Arch Streets
Philadelphia,
Pennsylvania 19103-2799
Attention: Barry Abelson, Esq.
Telephone:
215-981-4000
Facsimile: 215-981-4750
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Any notice,
demand or other communication hereunder shall be deemed given upon the first to
occur of: (i) the fifth (5
th
) day after deposit
thereof, postage prepaid and addressed correctly, in a receptacle under the
control of the United States Postal Service; (ii) transmittal by facsimile
transmission to a receiver or other device under the control of the party to
whom notice is being given; (iii) actual delivery to or receipt by the party to
whom notice is being given or an employee or agent thereof; or (iv) one (1) day
after delivery to an overnight carrier.
SECTION 9.11
Headings
. The headings contained herein are
included for convenience of reference only and do not constitute a part of this
Agreement.
SECTION 9.12
Counterparts
. This Agreement may be executed in
one or more counterparts, each of which when so executed and delivered or
transmitted by facsimile, e-mail or other electronic means, shall be deemed to
be an original and all of which taken together shall constitute but one and the
same instrument. A facsimile or electronic signature is deemed an original
signature for all purposes under this Agreement.
SECTION 9.13
Severability
. If any provision of this Agreement
or the application thereof to any Person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the
transactions
contemplated hereby is not affected in any manner adverse to any party. Upon
such determination, the Parties shall negotiate in good faith in an effort to
agree upon such a suitable and equitable provision to effect the original intent
of the Parties.
SECTION 9.14
Waiver of Default
. (a) Any term or provision of this
Agreement may be waived, or the time for its performance may be extended, by the
party or the parties entitled to the benefit thereof. Any such waiver shall be
validly and sufficiently given for the purposes of this Agreement if, as to any
party, it is in writing signed by an authorized representative of such party.
(b)
Waiver by any party of any default
by the other party of any provision of this Agreement shall not be construed to
be a waiver by the waiving party of any subsequent or other default, nor shall
it in any way affect the validity of this Agreement or any party hereof or
prejudice the rights of the other party thereafter to enforce each and ever such
provision. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
SECTION 9.15
Amendments
. No provisions of this Agreement
shall be deemed amended, modified or supplemented by any Party, unless such
amendment, supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification.
SECTION 9.16
Specific
Performance
. The
Parties agree that the remedy at law for any breach of this Agreement may be
inadequate, and that, as between Supplier and Buyer, any Party by whom this
Agreement is enforceable shall be entitled to seek temporary, preliminary or
permanent injunctive or other equitable relief with respect to the specific
enforcement or performance of this Agreement. Such Party may, in its sole
discretion, apply to a court of competent jurisdiction for such injunctive or
other equitable relief as such court may deem just and proper in order to
enforce this Agreement as between Supplier and Buyer, or the members of their
respective Groups, or prevent any violation hereof, and, to the extent permitted
by Applicable Law, as between Supplier and Buyer, each Party waives any
objection to the imposition of such relief.
SECTION 9.17
Waiver of jury
trial
. Subject
to Article VIII, each of the Parties hereby waives to the fullest extent
permitted by Applicable Law any right it may have to a trial by jury with
respect to any court proceeding directly or indirectly arising out of and
permitted under or in connection with this Agreement or the transactions
contemplated hereby. Each of the Parties hereby (a) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (b) acknowledges that it has been induced to
enter into this agreement and the transactions contemplated by this agreement,
as applicable, by, among other things, the mutual waivers and certifications in
this
Section 9.17
.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties have
caused this Agreement to be executed by their respective duly authorized
representatives as of the date first written above.
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SUPPLIER:
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VISHAY
DALE ELECTRONICS, INC.
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By:
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/s/ Lior E.
Yahalomi
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Name:
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Lior E.
Yahalomi
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Title:
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Executive Vice President and Chief
Financial
Officer
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BUYER:
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VISHAY
ADVANCED TECHNOLOGY, LTD.
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By:
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/s/ Ziv
Shoshani
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Name:
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Ziv
Shoshani
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Title:
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Authorized
Signatory
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EXHIBIT
A
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PRICE PER
QUANTITY
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(USD)
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Minimum
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REF P/N
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DESCRIPTION
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MODEL
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VALUE
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TOL
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All Qty
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Order Qty
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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Portions
of this exhibit were
omitted
and filed
separately
with the
Secretary
of the
Securities
and
Exchange
Commission
pursuant
to an
application
for
confidential
treatment
filed with the
Securities
and
Exchange
Commission
pursuant
to Rule 24b-2 under the
Securities
Exchange
Act of 1934. Such
portions
are
marked
by [***].
Portions of this exhibit were omitted and filed separately with the
Secretary of the
Securities and Exchange Commission pursuant to an
application for confidential treatment
filed with the Securities and
Exchange Commission pursuant to Rule 24b-2 under the
Securities Exchange Act
of 1934. Such portions are marked by [***].
SUPPLY AGREEMENT
by and between
Vishay Measurements
Group, Inc.,
a Delaware corporation,
as Supplier
and
Vishay S.A., a
French company,
as Buyer
Dated as of July 6,
2010
This SUPPLY AGREEMENT (this “
Agreement
”) is made as of July 6, 2010 by and between
Vishay Measurements Group, Inc., a Delaware corporation (“
Supplier
”), and Vishay S.A., a French company
(“
Buyer
”). Supplier and Buyer each may be referred to
herein as a “
Party
” and collectively, as the “
Parties
”.
WHEREAS, subject to the terms, conditions, commitments and undertakings
herein provided, Supplier is willing to manufacture and sell those products as
set forth on
Exhibit A
hereto (as the same may be modified from time
to time pursuant to the provisions hereof, the “
Products
”) to Buyer, and Buyer desires to purchase the
Products from Supplier, in such quantities as Buyer shall request , as provided
in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
meanings specified in this Article I:
“
Affiliate
” means, as applied to any Person, any other
Person that, directly or indirectly, controls, is controlled by, or is under
common control with that Person as of the date on which or at any time during
the period for when such determination is being made. For purposes of this
definition, “
control
” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “
controlling
” and “
controlled
” have meanings correlative to the foregoing.
“
Applicable Law
” means any applicable law, statute, rule or
regulation of any
Governmental
Authority, or any outstanding order, judgment, injunction, ruling or decree by
any Governmental Authority.
“
Buyer
” has the meaning set forth in the preamble of
this Agreement.
“
Confidential Information
” means all proprietary, design or operational
information, data or material including, without limitation: (a) specifications,
ideas and concepts for goods and services; (b) manufacturing specifications and
procedures; (c) design drawings and models; (d) materials and material
specifications; (e) quality assurance policies, procedures and specifications;
(f) customer, client, manufacturer and supplier information; (g) computer
software and derivatives thereof relating to design development or manufacture
of goods; (h) training materials and information; (i) inventions, devices, new
developments, methods and processes, whether patentable or unpatentable and
whether or not reduced to practice; (j) all other know-how, methodology,
procedures, techniques and Trade Secrets; (k) proprietary earnings reports and
forecasts; (l) proprietary macro-economic reports and forecasts; (m) proprietary
marketing, advertising and business plans, objectives and strategies; (n)
proprietary general market evaluations and surveys; (o) proprietary financing
and credit-
2
related information; (p)
other copyrightable or patented works; (q) the terms of this Agreement; and (r)
all similar and related information in whatever form; in each case, of one party
which has been disclosed by Supplier or members of its Group on the one hand, or
Buyer or members of its Group, on the other hand, in written, oral (including by
recording), electronic, or visual form to, or otherwise has come into the
possession of, the other Group.
“
Firm Order
” means Buyer’s non-cancelable purchase order
for Products to be purchased by Buyer from Supplier pursuant to this Agreement
for delivery.
“
FOB
” has the meaning and usage assigned to such
words in the incoterms rules published by the International Chamber of Commerce.
“
Forecast
” means, with respect to any relevant period,
a good faith non-binding forecast, based on information available to Buyer at
the time of such forecast (which information, if reduced to writing, shall be
made available to Supplier upon reasonable request), of the Firm Order for each
Product that Buyer expects to deliver to Supplier for each calendar month during
such period.
“
Governmental Authority
” means any U.S. or non-U.S. federal, state,
local, foreign or international court, arbitration or mediation tribunal,
government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority.
“
Group
” means, with respect to any Person, each
Subsidiary of such Person and each other Person that is controlled directly or
indirectly by such Person.
“
Intellectual Property
” means all domestic and foreign patents and
patent applications, together with any continuations, continuations-in-part or
divisional applications thereof, and all patents issuing thereon (including
reissues, renewals and re-examinations of the foregoing); design patents;
invention disclosures; mask works; all domestic and foreign copyrights, whether
or not registered, together with all copyright applications and registrations
therefor; all domain names, together with any registrations therefor and any
goodwill relating thereto; all domestic and foreign trademarks, service marks,
trade names, and trade dress, in each case together with any applications and
registrations therefor and all goodwill relating thereto; all Trade Secrets,
commercial and technical information, know-how, proprietary or Confidential
Information, including engineering, production and other designs, notebooks,
processes, drawings, specifications, formulae, and technology; computer and
electronic data processing programs and software (object and source code), data
bases and documentation thereof; all inventions (whether or not patented); all
utility models; all registered designs, certificates of invention and all other
intellectual property under the laws of any country throughout the world.
“
Last-Time Buy Order
” has the meaning set forth in
Section 4.5
.
“
Liability
” means, with respect to any Person, any and
all losses, claims, charges, debts, demands, Actions, causes of action, suits,
damages, obligations, payments, costs and expenses, sums of money, accounts,
reckonings, bonds, specialties, indemnities and similar obligations, exoneration
covenants, obligations under contracts, guarantees, make whole agreements and
similar obligations, and other liabilities and requirements, including all
contractual obligations, whether absolute or contingent, matured or unmatured,
liquidated or unliquidated, accrued or
-3-
unaccrued, known or
unknown, joint or several, whenever arising, and including those arising under
any Applicable Law, action, threatened or contemplated action (including the
costs and expenses of demands, assessments, judgments, settlements and
compromises relating thereto and attorneys’ fees and any and all costs and
expenses, whatsoever reasonably incurred in investigating, preparing or
defending against any such actions or threatened or contemplated actions) or
order of any Governmental Authority or any award of any arbitrator or mediator
of any kind, and those arising under any contract, in each case, whether or not
recorded or reflected or otherwise disclosed or required to be recorded or
reflected or otherwise disclosed, on the books and records or financial
statements of any Person, including any Liability for taxes.
“
Person
” (whether or not initially capitalized) means
any corporation, limited liability company, partnership, firm, joint venture,
entity, natural person, trust, estate, unincorporated organization, association,
enterprise, government or political subdivision thereof, or Governmental
Authority.
“
Product
” has the meaning set forth in the preamble of
this Agreement.
“
Product Warranty
” has the meaning set forth in
Section 6.1(a)
.
“
Raw Materials Cost
” means the direct cost of material used in a
finished Product, including the normal quantity of material wasted in the
production process, purchasing costs, inbound freight charges and any applicable
subcontractor charges.
“
Six-Month Forecast
” means a forward-looking Forecast for a
period of six consecutive calendar months, beginning on July 1 and January 1 of
each calendar year, or, if earlier with respect to any Product, the last day of
the Term for such Product.
“
Subsidiary
” of any Person means a corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries;
provided
,
however
, that no Person that is not directly or
indirectly wholly-owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person.
“
Supplier
” has the meaning set forth in the preamble of
this Agreement.
“
Supplier’s Other Manufacturing
Obligations
” means the
manufacturing obligations and commitments of Supplier to Persons other than
Buyer, including Supplier’s Affiliates.
“
Specifications
” means, with respect to any Product, the
design, composition, dimensions, other physical characteristics, chemical
characteristics, packaging, unit count and trade dress of such Product.
“
Term
” has the meaning set forth in
Section 7.1
.
-4-
“
Trade Secrets
” means information, including a formula,
program, device, method, technique, process or other Confidential Information
that derives independent economic value, actual or potential, from not being
generally known to the public or to other Persons who can obtain economic value
from its disclosure or use and is the subject of efforts that are reasonable,
under the circumstances, to maintain its secrecy.
“
Wholly-Owned Subsidiary
” of a Person means a Subsidiary of that
Person substantially all of whose voting securities and outstanding equity
interest are owned either directly or indirectly by such Person or one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries.
The terms “
herein
”, “
hereof
”, “
hereunder
” and like terms, unless otherwise specified,
shall be deemed to refer to this Agreement in its entirety and shall not be
limited to any particular section or provision hereof. The term “
including
” as used herein shall be deemed to mean
“including, but not limited to.” The term “
days
” shall refer to calendar days unless
specified otherwise. References herein to “
Articles
”, “
Sections
” and “
Exhibits
” shall be deemed to mean Articles, Sections
of and Exhibits to this Agreement unless otherwise specified.
ARTICLE II
PURCHASE AND SALE OF
PRODUCTS
SECTION 2.1
Agreement to Purchase and Sell
Products
. (a) During the
Term, Supplier hereby agrees to manufacture and sell to Buyer, and Buyer hereby
agrees to purchase and accept from Supplier, such amounts of Products, as from
time to time shall be ordered by Buyer.
(b)
All Products to be sold to Buyer pursuant to
this Agreement shall be manufactured by Supplier or an Affiliate of Supplier;
provided
,
however
, that Supplier may subcontract the
manufacture of any Product to a manufacturer that is not an Affiliate of
Supplier with Buyer’s prior written consent, which consent shall not be
unreasonably withheld,
provided
that any such subcontracting shall not
relieve Supplier of its obligations hereunder.
SECTION 2.2
Product Specifications
. (a) Supplier shall manufacture all Products
according to the Specifications in effect as of the date of this Agreement, with
such changes or additions to the Specifications of the Products related thereto
as shall be requested by Buyer in accordance with this Section or as otherwise
agreed in writing by the Parties. All other Products shall be manufactured with
such Specifications as the Parties shall agree in writing.
(b)
Buyer may request changed or additional
Specifications for any Product by delivering written notice thereof to Supplier
not less than one hundred twenty (120) days in advance of the first Firm Order
for such Product to be supplied with such changed or additional Specifications.
Notwithstanding the foregoing, if additional advance time would reasonably be
required in order to implement the manufacturing processes for production of a
Product with any changed or additional Specifications, and to commence
manufacture and delivery thereof, Supplier shall so notify Buyer, and Supplier
shall not be required to commence delivery of such Product until the passage of
such additional time.
(c)
Supplier shall be required to accommodate any
change of, or additions to, the Specifications for any Product,
if
and
only
if
(i) in Supplier’s good faith judgment, such
changed
-5-
or additional
Specifications would not require Supplier to violate good manufacturing
practice, (ii) the representation and warranty of Buyer deemed made pursuant to
Subsection (e) below is true and correct, and (iii) Buyer agrees to reimburse
Supplier for the incremental costs and expenses incurred by Supplier in
accommodating the changed or additional Specifications, including the costs of
acquiring any new machinery and tooling. For the avoidance of doubt, such costs
and expenses shall be payable by Buyer separately from the cost of Products at
such time or times as Supplier shall request.
(d)
Supplier shall notify Buyer in writing within
thirty (30) days of its receipt of any request for changed or additional
Specifications (i) whether Supplier will honor such changed or additional
Specifications, (ii) if Supplier declines to honor such changed or additional
Specifications, the basis therefor and (iii) if applicable, the estimated costs
and expenses that Buyer will be required to reimburse Supplier in respect of the
requested changes or additions, as provided in Subsection (c) above. Buyer shall
notify Supplier in writing within fifteen (15) days after receiving notice of
any required reimbursement whether Buyer agrees to assume such reimbursement
obligation.
(e)
By its request for any changed or additional
Specifications for any Product, Buyer shall be deemed to represent and warrant
to Supplier that the manufacture and sale of the Product incorporating Buyer’s
changed or additional Specifications, as a result of such incorporation, will
not and could not reasonably be expected to (i) violate or conflict with any
contract, agreement, arrangement or understanding to which Buyer and/or any of
its Affiliates is a party, including this Agreement and any other contract,
agreement, arrangement or understanding with Supplier and/or its Affiliates,
(ii) infringe on any trademark, service mark, copyright, patent, trade secret or
other intellectual property rights of any Person, or (iii) violate any
Applicable Law. Buyer shall indemnify and hold Supplier and its Affiliates
harmless (including with respect to reasonable attorneys’ fees and
disbursements) from any breach of this representation and warranty.
SECTION 2.3
New Products
. If Buyer shall request in writing that
Supplier manufacture and sell to Buyer an item that is not at the time a
Product, Supplier shall consider such request in good faith, giving due
consideration to Supplier’s available manufacturing capacity, Supplier’s Other
Manufacturing Obligations, existing know-how, technical feasibility, cost,
profitability and other relevant factors. Supplier shall inform Buyer within a
reasonable time of Supplier’s determination in principle whether to manufacture
such Product, and if Supplier has determined not to manufacture such Product,
the reasons therefor. If Supplier shall inform Buyer that it is willing in
principle to manufacture and sell such Product, Buyer and Supplier shall
negotiate in good faith with respect to the terms of such manufacture and sale,
including pricing and the Exhibits to this Agreement shall be modified
accordingly;
provided
,
however
, that neither Party shall be bound with
respect to the manufacture and sale of any such Product unless the Parties shall
have so agreed in writing.
SECTION 2.4
Supplier’s Supply
Obligations
. Supplier
shall be obligated to manufacture and sell Products to Buyer, in accordance with
Buyer’s Firm Orders, to the extent of Supplier’s then existing manufacturing
capacity, taking into account Supplier’s Other Manufacturing Obligations;
provided
,
however
, the Supplier shall give equal priority to
the orders of Buyer, on the one hand, and Supplier’s Other Manufacturing
Obligations, on the other.
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SECTION 2.5
Product Changes
. Supplier shall communicate any change in the
Specifications for any Product or its manufacture in accordance with Supplier’s
product change notification process. Buyer shall be deemed to have accepted such
change unless, within thirty (30) days after receipt of notice from Supplier,
Buyer informs Supplier that such change is not acceptable. If Buyer informs
Supplier that such change is not acceptable, Supplier may by notice to Buyer
either (x) continue to supply the Product in accordance with the original
Specifications and manufacturing procedures or (y) terminate this Agreement with
respect to such Product on a date specified by Supplier in a notice of
termination, which date shall not be earlier than the earlier of (I) one (1)
year from the date of Buyer’s information that it does not accept the change
proposed by Supplier and (II) if such notice of termination is delivered more
than ninety (90) days before the end of the then current Term, the end of such
Term; subject to the right of the Buyer to submit a Last-Time Buy Order in
accordance with
Section 4.5
.
SECTION 2.6
Product Discontinuation
. At any time Supplier may notify Buyer that
Supplier is discontinuing the manufacture and sale of a Product. Such
discontinuation shall take effect on a date specified by Supplier in a notice of
discontinuation, which date shall not be earlier than one (1) year from the date
of the notice of discontinuation; subject to the right of the Buyer to submit a
Last-Time Buy Order in accordance with
Section 4.5
.
SECTION 2.7
Consultation and Support
. At either Party’s reasonable request, the
Parties shall meet and discuss the nature, quality and level of supply services
contemplated by this Agreement. In addition, Supplier will make available on a
commercially reasonable basis and at commercially reasonable times qualified
personnel to provide knowledgeable support service with respect to the Products.
The Parties shall negotiate in good faith with respect to any fees and other
charges incurred by Supplier in providing other than routine product support.
ARTICLE III
FORECASTS
SECTION 3.1
Forecasts
. (a) As soon as possible, but in no event
later than thirty (30) days following the distribution of shares of common stock
of Vishay Precision Group, Inc. (“VPG”) to the shareholders of Vishay
Intertechnology, Inc. (“Vishay Intertechnology”) under that certain Master
Separation and Distribution Agreement between Vishay Intertechnology and VPG
(the “Master Separation Agreement”), Buyer shall provide to Supplier an initial
Forecast for the period ending on December 31, 2010. Beginning on December 1,
2010, and thereafter, on May 31 and December 1 of each calendar year, Buyer
shall provide to Supplier a Six-Month Forecast for the 6-month period beginning
on the immediately following July 1 and January 1, respectively.
(b)
If it is commercially impracticable for Buyer
to deliver a Six-Month Forecast for a particular Product, Buyer shall deliver
Forecasts to Supplier at such intervals and for such periods as reasonable under
the circumstances, and Supplier shall in good faith consider such Forecasts
delivered by Buyer.
(c)
Supplier shall use all Forecasts delivered by
Buyer under this Agreement for capacity and raw material planning purposes only,
and such Forecasts will not constitute a commitment of any type by Buyer to
purchase any Product.
-7-
SECTION 3.2
Forecasts in Excess of
Capacity
. Upon receipt of
each Forecast, Supplier shall determine whether it will have the capacity to
manufacture and sell to Buyer the Products in the forecasted amounts. If
Supplier determines that it will not have the capacity to manufacture and
deliver any Product to Buyer as forecasted, Supplier shall so notify Buyer as
promptly as practicable. Supplier and Buyer shall thereafter negotiate in good
faith in order to match Supplier’s manufacturing capacity with Buyer’s
requirements for the specified Product, such as by advancing or deferring the
delivery of the Product to other periods. In the event that Supplier and Buyer
shall agree to accommodate Buyer’s forecasted requirements in a manner that will
require the expenditure by Supplier of unbudgeted costs and expenses in addition
to the costs and expenses that Supplier would otherwise be required to expend in
order to fulfill its obligations under this Agreement, Buyer shall be obligated
to reimburse Supplier for such costs and expenses as have actually been expended
by Supplier, notwithstanding that the manufacture and sale of Products in
accordance with the Firm Orders subsequently delivered by Buyer for the relevant
periods do not require such expenditure.
SECTION 3.3
Firm Orders in Excess of
Forecasts
. In the event
that the Firm Order for any Product shall exceed the Forecast contained in the
most recent prior Forecast for such Product (as such Forecast may have been
modified by agreement of the Parties in the manner contemplated in
Section 3.2
; such excess being referred to as the
“
Excess Order
”), Supplier shall notify Buyer, as promptly
as reasonably practicable after receipt of such Firm Order, whether Supplier has
sufficient available capacity to accommodate the Excess Order, taking into
consideration Supplier’s manufacturing capacity for such Product and Supplier’s
Other Manufacturing Obligations. If Supplier shall not have sufficient available
capacity to accommodate the Excess Order, Supplier and Buyer shall negotiate in
good faith in order to match Supplier’s available manufacturing capacity with
Buyer’s requirements for the specified Product, such as by advancing or
deferring the delivery of the Product to other periods.
ARTICLE IV
ORDERS AND PAYMENT
SECTION 4.1
Purchase Orders
. (a) Buyer may place a Firm Order for the
Products with Supplier at any time and from time to time.
(b)
Each Firm Order shall specify (i) number of
units of the Product to be purchased and (ii) the requested delivery date,
provided that Buyer shall request a delivery date with a lead delivery time that
is customary for the particular Product, unless otherwise agreed upon by the
Parties. Supplier agrees to provide Buyer prompt notice if it knows it cannot
meet a requested delivery date.
(c)
If Buyer requires a Product on an emergency
basis and so informs Supplier, and Supplier has the Product available in its
uncommitted inventory, Supplier agrees to use reasonable commercial efforts to
fill the emergency order as promptly as practicable. Buyer agrees to pay
reasonable incremental expenses related to any emergency order.
SECTION 4.2
Shipment
.
(a)
Products will be shipped by Supplier to Buyer FOB shipping point.
-8-
(b)
Supplier shall package all Products so as to
protect them from loss or damage during shipment, in conformity with good
commercial practice, the Specifications and Applicable Law. Buyer shall be
responsible, at its own cost and expense, for the shipment (including, among
other fees, costs and expenses, transit and casualty insurance and third party
fees) of all processed materials by Buyer. Supplier shall cooperate with Buyer
in assembling and coordinating shipments, as reasonably requested by Buyer.
(c)
For the avoidance of doubt, title to and risk
of loss or damage will pass to Buyer upon Buyer’s pick up for transfer of the
Products ordered.
SECTION 4.3
Prices
. Pricing for the Products shall be as set
forth on
Exhibit A
, as such Exhibit may be modified from time to
time by agreement of the Parties. At least thirty (30) days prior to the
beginning of each calendar year, the parties shall negotiate in good faith
changes to the pricing of the Products to be applicable in the ensuing year.
Such pricing shall take into account changes in the cost of manufacturing the
Products, including labor, manufacturing, utility and other direct costs, and
other ascertainable market inputs. If the Parties cannot in good faith agree on
pricing for the Products, until such time as the Parties do so agree, Supplier
shall have no obligation to honor any Firm Orders submitted by Buyer to the
extent that such Firm Orders are placed following expiration of the then current
calendar year.
SECTION 4.4
Payment Terms
. Unless otherwise agreed to by the Parties in
writing, Buyer shall make payment separately for each Firm Order. Buyer shall
pay the net amount of all invoice amounts within sixty (60) days of the date of
Supplier’s invoice unless the terms of Supplier’s invoice permits later payment
or allows for prepayment with a discount. Invoices shall not be sent earlier
than the date on which the Products related thereto are delivered to Buyer.
SECTION 4.5
Last-Time Buy Order
.
(a)
Buyer shall have a right to place a written
last-time Firm Order for a Product (a “
Last-Time Buy Order
”) if (i) Supplier delivers to Buyer notice of
its intention not to renew the Term pursuant to
Section 7.2
; (ii) Supplier terminates this Agreement in
respect of such Product in connection with Buyer’s choice not to accept a change
in such Product under
Section 2.5
; (iii) Supplier delivers to Buyer a notice of
discontinuation of such Product; or (iv) Buyer terminates this Agreement in
connection with a material breach by Supplier pursuant to
Section 7.3
. The right of the Buyer to submit a Last-Time
Buy Order shall entitle Buyer to purchase the Products at the price in effect
for the products as of the time of Buyer’s exercise of such right.
(b)
A Last-Time Buy Order shall specify (i) number
of units of the Product to be purchased and (ii) the requested delivery date or
dates for such units. If Supplier informs Buyer that it cannot honor the
requested delivery dates because of capacity restraints or otherwise, the
Parties shall negotiate in good faith with respect to delivery dates mutually
acceptable to Supplier and Buyer.
(c)
The Parties hereby agree to use commercially
reasonable efforts to coordinate forecasting and ordering during the period
between the date the Last-Time Buy Order is
-9-
delivered to Supplier
and the final delivery date to allow for regular supply of Products during such
period.
ARTICLE V
CONFIDENTIALITY
SECTION 5.1 Supplier and Buyer shall hold and shall cause each of their
respective affiliates, directors, officers, employees, agents, consultants,
advisors and other representatives to hold, in strict confidence and not to
disclose or release without the prior written consent of the other party, any
and all proprietary or confidential information, material or data of the other
party that comes into its possession in connection with the performance by the
parties of their rights and obligations under this Agreement. The provisions of
Section 4.5 of the Master Separation Agreement shall govern,
mutatis mutandis
,
the confidentiality obligations of the parties under this Section.
ARTICLE VI
PRODUCT WARRANTY; LIMITATION OF
LIABILITY
SECTION 6.1
Product Warranty; Merchantability
Warranty
. (a) Supplier
warrants to Buyer that the Products shall, at the time of delivery to Buyer in
accordance with
Section 4.2
: (i) conform to the Specifications therefor,
as provided in
Section 2.2
; (ii) be free from material defects; and
(iii) be manufactured in accordance with good manufacturing practice and
Applicable Law (such warranty being referred to as the “
Product Warranty
”).
(b) EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, NO WARRANTIES,
OTHER THAN THE PRODUCT WARRANTY, ARE EXPRESSED OR IMPLIED IN RESPECT OF THE
PRODUCTS, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
SECTION 6.2
Defective or Non-Conforming
Products
. (a) Claims by
Buyer relating to the quantity of or damage to any Product or the failure of any
Product to conform to its Specifications must be made within one (1) year of
receipt of such Product and must be in writing, specifying in reasonable detail
the nature and basis of the claim and citing relevant control or lot numbers or
other information to enable identification of the Product in question.
Supplier’s Liability to Buyer for damages for any such claim shall be limited to
a refund for the price of the defective Product plus shipping costs or, at
Buyer’s option, prompt replacement thereof with a Product that complies with the
Product Warranty. Such refund and shipping costs or a replacement shall
constitute Supplier’s sole and exclusive Liability for such claims. For the
avoidance of doubt, nothing shall limit the obligations of Supplier to Buyer in
respect of third party claims against Buyer arising from the failure of any
Product to conform to its Specifications.
(b)
Any notifications to either Party pursuant to
this
Section 6.2
shall be subject to the confidentiality
provisions of
Article V
above.
SECTION 6.3
Indemnification
. (a) Subject to
Section 6.4
, Supplier shall indemnify and hold Buyer
harmless from and against any Liability, including reasonable attorney’s fees
and disbursements, arising out of any third party claim for death, injury or
damage to property
-10-
resulting from (i)
Supplier’s breach of this Agreement; or (ii) any claim that a Product purchased
from Supplier infringes any intellectual property right of a third
party.
(b)
Buyer shall indemnify and hold harmless
Supplier from and against any Liability, including reasonable attorneys’ fees
and disbursements, arising out of any third party claim for death, injury or
damage to property resulting from use of any of the Products based upon (i)
Buyer’s breach of this Agreement; or (ii) any change in condition of the
Products caused by Buyer other than any change in Specifications requested by
Supplier and deemed accepted by Buyer under
Section 2.5
.
(c)
Any Party seeking indemnification pursuant to
this
Section 6.3
shall promptly notify the other Party of the
claim as to which indemnification is sought, shall afford the other Party, at
the other Party’s sole expense, the opportunity to defend or settle the claim
(in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified Party with respect such claim) and shall
cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim;
provided
,
however
, that any settlement of any such claim that
would adversely affect the rights of the indemnified Party shall require the
written approval of such indemnified Party; and
provided
further
that an indemnified Party shall not settle
any such claim without the written approval of the indemnifying Party.
(d)
The foregoing indemnification obligations
shall survive any termination or expiration of this Agreement, in whole or in
part, or the expiration or termination of the Term.
SECTION 6.4
Limitation of Liability
. In no event shall any Party be liable for
any special, consequential, indirect, collateral, incidental or punitive damages
or lost profits or failure to realize expected savings or other commercial or
economic loss of any kind, arising out of any breach of this Agreement,
including breach of the Product Warranty, or any other obligations of any Party
hereunder, or any use of the Products, and each Party hereby knowingly and
expressly waives any claims or rights with respect thereto;
provided
,
however
, that in the event a Party is required to pay
to a third-party claimant any special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss on any claim with respect to which
such Party is indemnified by the other Party pursuant to this Agreement, such
Party shall be entitled to indemnification from the other Party with respect to
such third-party special, consequential, indirect, collateral, incidental or
punitive damages or lost profits or failure to realize expected savings or other
commercial or economic loss to the extent resulting from the indemnifiable acts
or omissions of the other Party.
SECTION 6.5
Insurance
. Each of the Parties shall maintain general
liability insurance covering their activities under this Agreement in accordance
with prudent and customary commercial practices, in such amounts as shall be
agreed upon from time to time by the Parties.
ARTICLE VII
TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION
SECTION 7.1
Term of Agreement
. Unless earlier terminated pursuant to
Section 7.3
, the term of this Agreement shall be
perpetual.
-11-
SECTION 7.2
Termination
. Either Party may terminate this Agreement at
any time upon prior written notice to the other at least one (1) year prior to
the requested date of termination.
SECTION 7.3
Rights Upon Termination
. Following a termination of this Agreement,
all further rights and obligations of the Parties under this Agreement shall
terminate.
Notwithstanding the
foregoing, the termination of this Agreement shall not affect the rights and
obligations of the Parties arising prior to such expiration or termination; and
provided
further
that the Parties shall not be relieved of (i)
their respective obligations to pay monies due or which become due as of or
subsequent to the date of expiration or termination, and (ii) any other
respective obligations under this Agreement which specifically survive or are to
be performed after the date of such expiration or termination, including the
provisions of
Article V
and
6.3
. Any Firm Order, including a Last-Time Buy
Order, submitted prior to the expiration or termination of this Agreement shall
be filled by Supplier pursuant to the terms hereof even if the delivery date is
after expiration or termination.
ARTICLE VIII
DISPUTE RESOLUTION
SECTION 8.1 The terms and provisions of Article VIII of the Master
Separation Agreement relating to the procedures for resolution of any disputes
between the parties, shall apply to all disputes, controversies or claims
(whether sounding in contract, tort or otherwise) that may arise out of or
relate to or arise under or in connection with this Agreement, or the
transactions contemplated hereby,
mutatis mutandis.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1
Assignment
. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Supplier without the consent of Buyer, to a Wholly-Owned
Subsidiary of Supplier that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Supplier, to a Wholly-Owned Subsidiary of Buyer; or (iii) by either
Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only with
the prior written consent of the other Party;
provided
,
however
, that no such assignment shall relieve the
assigning Party of Liability for its obligations hereunder. The following
actions shall not be deemed an assignment of this Agreement: (1) assignment or
transfer of the stock of a Party, including by way of a merger, consolidation,
or other form of reorganization in which outstanding shares of a Party are
exchanged for securities, or (2) any transaction effected primarily for the
purpose of (A) changing a Party’s state of incorporation or (B) reorganizing a
Party into a holding company structure such that, as a result of any such
transaction, such Party becomes a Wholly-Owned Subsidiary of a holding company
owned by the holders of such Party’s securities immediately prior to such
transaction. Any attempted assignment other than as provided herein shall be
void. The provisions of this Agreement shall be binding upon, and shall inure to
the benefit of, the successors and permitted assigns of the
Parties.
-12-
SECTION 9.2
Force Majeure
. The Parties shall not be liable for the
failure or delay in performing any obligation under this Agreement (except
pursuant to
Section 7.4
) if and to the extent such failure or delay
is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war, invasion,
riot or other civil unrest; (iv) governmental laws, orders, restrictions,
actions, embargoes or blockages; (v) action by any regulatory authority which
prohibits the manufacture, sale or distribution of the Products, except to the
extent due to Supplier’s breach of its obligations hereunder; (vi) regional,
national or foreign emergency; (vii) injunction, strikes, lockouts, labor
trouble or other industrial disturbances; (viii) shortage of adequate fuel,
power, materials, or transportation facilities; or (ix) any other event which is
beyond the reasonable control of the affected Party;
provided
,
however
, that the Party affected shall promptly
notify the other Party of the force majeure condition and shall exert its
reasonable commercial efforts to eliminate, cure or overcome any such causes and
to resume performance of its obligations as soon as possible.
SECTION 9.3
Intellectual Property
. All Intellectual Property owned or created
by a Party shall remain its sole and exclusive property, and the other Party
shall not acquire any rights therein by reason of this Agreement.
SECTION 9.4
Entire Agreement
. This Agreement and the Exhibits hereto
constitute the entire agreement between the Parties with respect to the subject
matter hereof and thereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations between the
parties with respect to such subject matter. No agreements or understandings
exist between the parties other than those set forth or referred to herein or
therein. If any provision of this Agreement or the application thereof to any
Party or circumstance shall be declared void, illegal or unenforceable, the
remainder of this Agreement shall be valid and enforceable to the extent
permitted by Applicable Law. In such event, the Parties shall use their best
efforts to replace the invalid or unenforceable provision with a provision that,
to the extent permitted by Applicable Law, achieves the purposes intended under
the invalid or unenforceable provision.
SECTION 9.5
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction.
SECTION 9.6
Consent to Jurisdiction
. Subject to the provisions of
Article VIII
, each of the Parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to
Section 9.16
. Each of the parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in
Section 9.10
shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this
Section 9.6
. Each of the parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby for which it has submitted to jurisdiction pursuant to this
-13-
Section 9.6
, and waives any claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum.
SECTION 9.7
Independent Contractor
. Nothing contained in this Agreement shall
constitute a Party as a partner, employee or agent of the other Party, nor shall
any Party hold itself out as such. Neither Party shall have the right or
authority to incur, assume or create, in writing or otherwise, any warranty,
Liability or other obligation of any kind, express or implied, in the name or on
behalf of the other Party, and each Party is and shall remain an independent
contractor, responsible for its own actions. Except as otherwise explicitly
provided herein, each Party shall be responsible for its own expenses incidental
to its performance of this Agreement.
SECTION 9.8
Set-Off
. The obligation of Buyer to pay the purchase
price for Products shall be unconditional, except as provided in this Agreement,
and shall not be subject to any defense, setoff, counterclaim or similar right
against Supplier or any of its Affiliates that could be asserted by Buyer or any
of its Affiliates under any other contract, agreement, arrangement or
understanding or otherwise under Applicable Law.
SECTION 9.9
Waivers
. No claim or right arising out of or relating
to a breach of any provision of this Agreement can be discharged in whole or in
part by a waiver or renunciation of the claim or right unless the waiver or
renunciation is supported by consideration and is in writing signed by the
aggrieved Party. Any failure by any Party to enforce at any time any provision
under this Agreement shall not be considered a waiver of that Party’s right
thereafter to enforce each and every provision of this Agreement.
SECTION 9.10
Notices
. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision):
If to Supplier, to:
Vishay Measurements Group
Inc.
c/o Vishay
Precision Group, Inc.
3 Great Valley
Parkway
Malvern, PA
19355-1307
Attention: William M. Clancy
Telephone:
484-321-5300
Facsimile: 484-321-5300
with a copy to:
Pepper Hamilton LLP
3000 Two Logan Square
Eighteenth and Arch Streets
-14-
Philadelphia, Pennsylvania
19103-2799
Attention: Barry Abelson,
Esq.
Telephone:
215-981-4000
Facsimile:
215-981-475
0
If to Buyer,
to:
Vishay S.A.
c/o Vishay Intertechnology,
Inc.
63
Lancaster Avenue
Malvern, PA
19355-2120
Attention: Dr. Lior E.
Yahalomi
Telephone:
610-644-1300
Facsimile:
610-889-2161
with a copy
to:
Kramer Levin Naftalis &
Frankel LLP
1177 Avenue of the
Americas
New
York, NY 10036
Attention: Ernest S. Wechsler,
Esq.
Telephone:
212-715-9100
Facsimile:
212-715-8000
|
Any notice, demand or other
communication hereunder shall be deemed given upon the first to occur of: (i)
the fifth (5
th
) day after deposit thereof, postage prepaid
and addressed correctly, in a receptacle under the control of the United States
Postal Service; (ii) transmittal by facsimile transmission to a receiver or
other device under the control of the party to whom notice is being given; (iii)
actual delivery to or receipt by the party to whom notice is being given or an
employee or agent thereof; or (iv) one (1) day after delivery to an overnight
carrier.
SECTION 9.11
Headings
. The headings contained herein are included
for convenience of reference only and do not constitute a part of this
Agreement.
SECTION 9.12
Counterparts
. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered or transmitted
by facsimile, e-mail or other electronic means, shall be deemed to be an
original and all of which taken together shall constitute but one and the same
instrument. A facsimile or electronic signature is deemed an original signature
for all purposes under this Agreement.
SECTION 9.13
Severability
. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such
-15-
determination, the
Parties shall negotiate in good faith in an effort to agree upon such a suitable
and equitable provision to effect the original intent of the Parties.
SECTION 9.14
Waiver of Default
. (a) Any term or provision of this Agreement
may be waived, or the time for its performance may be extended, by the party or
the parties entitled to the benefit thereof. Any such waiver shall be validly
and sufficiently given for the purposes of this Agreement if, as to any party,
it is in writing signed by an authorized representative of such party.
(b)
Waiver by any party of any default by the
other party of any provision of this Agreement shall not be construed to be a
waiver by the waiving party of any subsequent or other default, nor shall it in
any way affect the validity of this Agreement or any party hereof or prejudice
the rights of the other party thereafter to enforce each and ever such
provision. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
SECTION 9.15
Amendments
. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification.
SECTION 9.16
Specific Performance
. The Parties agree that the remedy at law for
any breach of this Agreement may be inadequate, and that, as between Supplier
and Buyer, any Party by whom this Agreement is enforceable shall be entitled to
seek temporary, preliminary or permanent injunctive or other equitable relief
with respect to the specific enforcement or performance of this Agreement. Such
Party may, in its sole discretion, apply to a court of competent jurisdiction
for such injunctive or other equitable relief as such court may deem just and
proper in order to enforce this Agreement as between Supplier and Buyer, or the
members of their respective Groups, or prevent any violation hereof, and, to the
extent permitted by Applicable Law, as between Supplier and Buyer, each Party
waives any objection to the imposition of such relief.
SECTION 9.17
Waiver of jury trial
. Subject to Article VIII, each of the Parties
hereby waives to the fullest extent permitted by Applicable Law any right it may
have to a trial by jury with respect to any court proceeding directly or
indirectly arising out of and permitted under or in connection with this
Agreement or the transactions contemplated hereby. Each of the Parties hereby
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it has been induced to enter into this agreement and the transactions
contemplated by this agreement, as applicable, by, among other things, the
mutual waivers and certifications in this
Section 9.17
.
[SIGNATURE PAGE FOLLOWS]
-16-
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first written
above.
|
SUPPLIER:
|
|
VISHAY MEASUREMENTS GROUP,
INC.
|
|
|
|
|
By:
|
/s/
William M. Clancy
|
|
|
|
Name: William M. Clancy
|
|
|
|
Title:
Secretary
|
|
|
|
|
|
|
|
|
|
|
BUYER:
|
|
VISHAY S.A.
|
|
|
|
|
By:
|
/s/ Denis Maugest
|
|
|
|
Name:
Denis Maugest
|
|
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Title:
Directeur
General
|
-17-
EXHIBIT A
|
|
|
MINIMUM
|
|
|
PRICE
(c)
|
ORDER
|
Product
|
DESCRIPTION
|
(USD)
|
QUANTITY
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
|
Portions
of this exhibit were
omitted
and filed
separately
with the
Secretary
of the
Securities
and
Exchange
Commission
pursuant
to an
application
for
confidential
treatment
filed with the
Securities
and
Exchange
Commission
pursuant
to Rule 24b-2 under the
Securities
Exchange
Act of 1934. Such
portions
are
marked
by [***].
Portions of this exhibit were omitted and
filed separately with the Secretary of the
Securities and Exchange
Commission pursuant to an application for confidential treatment
filed with
the Securities and Exchange Commission pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934. Such portions are marked by
[***].
MANUFACTURING AGREEMENT
by and between
Vishay S.A., a
French company,
as Manufacturer
and
Vishay Precision Foil
VPG GmbH,
a German company,
as Buyer
Dated as of July 6,
2010
This MANUFACTURING AGREEMENT (this
“
Agreement
”) is made as of July 6, 2010 by and between
Vishay S.A., a French company (“
Manufacturer
”), and Vishay Precision Foil VPG GmbH, a
German company (“
Buyer
”). Manufacturer and Buyer each may be
referred to herein as a “
Party
” and collectively, as the “
Parties
”.
WHEREAS, subject to the terms, conditions,
commitments and undertakings herein provided, Manufacturer is willing to
manufacture those products as set forth on
Exhibit A
hereto (as the same may be modified from time
to time pursuant to the provisions hereof, the “
Products
”) on a contract basis on behalf of Buyer in
such quantities as Buyer shall request , as provided in this Agreement;
NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties, intending to be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following
terms shall have the meanings specified in this Article I:
“
Affiliate
” means, as applied to any Person, any other
Person that, directly or indirectly, controls, is controlled by, or is under
common control with that Person as of the date on which or at any time during
the period for when such determination is being made. For purposes of this
definition, “
control
” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “
controlling
” and “
controlled
” have meanings correlative to the foregoing.
“
Applicable Law
” means any applicable law, statute, rule or
regulation of any Governmental Authority, or any outstanding order, judgment,
injunction, ruling or decree by any Governmental Authority.
“
Buyer
” has the meaning set forth in the preamble of
this Agreement.
“
Confidential Information
” means all proprietary, design or operational
information, data or material including, without limitation: (a) specifications,
ideas and concepts for goods and services; (b) manufacturing specifications and
procedures; (c) design drawings and models; (d) materials and material
specifications; (e) quality assurance policies, procedures and specifications;
(f) customer, client, manufacturer and supplier information; (g) computer
software and derivatives thereof relating to design development or manufacture
of goods; (h) training materials and information; (i) inventions, devices, new
developments, methods and processes, whether patentable or unpatentable and
whether or not reduced to practice; (j) all other know-how, methodology,
procedures, techniques and Trade Secrets; (k) proprietary earnings reports and
forecasts; (l) proprietary macro-economic reports and forecasts; (m) proprietary
marketing, advertising and business plans, objectives and strategies; (n)
proprietary general market evaluations and surveys; (o) proprietary financing
and credit-related information; (p) other copyrightable or patented works; (q)
the terms of this Agreement;
and (r) all similar and
related information in whatever form; in each case, of one party which has been
disclosed by Manufacturer or members of its Group on the one hand, or Buyer or
members of its Group, on the other hand, in written, oral (including by
recording), electronic, or visual form to, or otherwise has come into the
possession of, the other Group.
“
DDU
” has the meaning and usage assigned to such
words in the Incoterms rules published by the International Chamber of Commerce.
“
Ex Works
” has the meaning and usage assigned to such
words in the Incoterms rules published by the International Chamber of Commerce.
“
Firm Order
” means Buyer’s non-cancelable purchase order
for Products to be purchased by Buyer from Manufacturer pursuant to this
Agreement for delivery.
“
Forecast
” means, with respect to any relevant period,
a good faith non-binding forecast, based on information available to Buyer at
the time of such forecast (which information, if reduced to writing, shall be
made available to Manufacturer upon reasonable request), of the Firm Order for
each Product that Buyer expects to deliver to Manufacturer for each calendar
month during such period.
“
Governmental Authority
” means any U.S. or non-U.S. federal, state,
local, foreign or international court, arbitration or mediation tribunal,
government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority.
“
Group
” means, with respect to any Person, each
Subsidiary of such Person and each other Person that is controlled directly or
indirectly by such Person.
“
Intellectual Property
” means all domestic and foreign patents and
patent applications, together with any continuations, continuations-in-part or
divisional applications thereof, and all patents issuing thereon (including
reissues, renewals and re-examinations of the foregoing); design patents;
invention disclosures; mask works; all domestic and foreign copyrights, whether
or not registered, together with all copyright applications and registrations
therefor; all domain names, together with any registrations therefor and any
goodwill relating thereto; all domestic and foreign trademarks, service marks,
trade names, and trade dress, in each case together with any applications and
registrations therefor and all goodwill relating thereto; all Trade Secrets,
commercial and technical information, know-how, proprietary or Confidential
Information, including engineering, production and other designs, notebooks,
processes, drawings, specifications, formulae, and technology; computer and
electronic data processing programs and software (object and source code), data
bases and documentation thereof; all inventions (whether or not patented); all
utility models; all registered designs, certificates of invention and all other
intellectual property under the laws of any country throughout the world.
“
Last-Time Buy Order
” has the meaning set forth in
Section 4.6
.
“
Liability
” means, with respect to any Person, any and
all losses, claims, charges, debts, demands, Actions, causes of action, suits,
damages, obligations, payments, costs and expenses, sums of money, accounts,
reckonings, bonds, specialties, indemnities and similar
-2-
obligations, exoneration
covenants, obligations under contracts, guarantees, make whole agreements and
similar obligations, and other liabilities and requirements, including all
contractual obligations, whether absolute or contingent, matured or unmatured,
liquidated or unliquidated, accrued or unaccrued, known or unknown, joint or
several, whenever arising, and including those arising under any Applicable Law,
action, threatened or contemplated action (including the costs and expenses of
demands, assessments, judgments, settlements and compromises relating thereto
and attorneys’ fees and any and all costs and expenses, whatsoever reasonably
incurred in investigating, preparing or defending against any such actions or
threatened or contemplated actions) or order of any Governmental Authority or
any award of any arbitrator or mediator of any kind, and those arising under any
contract, in each case, whether or not recorded or reflected or otherwise
disclosed or required to be recorded or reflected or otherwise disclosed, on the
books and records or financial statements of any Person, including any Liability
for taxes.
“
Manufacturer
” has the meaning set forth in the preamble of
this Agreement.
“
Manufacturer’s Other Manufacturing
Obligations
” means the
manufacturing obligations and commitments of Manufacturer to Persons other than
Buyer, including Manufacturer’s Affiliates.
“
Person
” (whether or not initially capitalized) means
any corporation, limited liability company, partnership, firm, joint venture,
entity, natural person, trust, estate, unincorporated organization, association,
enterprise, government or political subdivision thereof, or Governmental
Authority.
“
Product
” has the meaning set forth in the preamble of
this Agreement.
“
Product Warranty
” has the meaning set forth in
Section 6.1(a)
.
“
Raw Materials Cost
” means the direct cost of material used in a
finished Product, including the normal quantity of material wasted in the
production process, purchasing costs, inbound freight charges and any applicable
subcontractor charges.
“
Subsidiary
” of any Person means a corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries;
provided
,
however
, that no Person that is not directly or
indirectly wholly-owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person.
“
Specifications
” means, with respect to any Product, the
design, composition, dimensions, other physical characteristics, chemical
characteristics, packaging, unit count and trade dress of such Product.
“
Term
” has the meaning set forth in
Section 7.1
.
-3-
“
Trade Secrets
” means information, including a formula,
program, device, method, technique, process or other Confidential Information
that derives independent economic value, actual or potential, from not being
generally known to the public or to other Persons who can obtain economic value
from its disclosure or use and is the subject of efforts that are reasonable,
under the circumstances, to maintain its secrecy.
“
Wholly-Owned Subsidiary
” of a Person means a Subsidiary of that
Person substantially all of whose voting securities and outstanding equity
interest are owned either directly or indirectly by such Person or one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries.
The terms “
herein
”, “
hereof
”, “
hereunder
” and like terms, unless otherwise specified,
shall be deemed to refer to this Agreement in its entirety and shall not be
limited to any particular section or provision hereof. The term “
including
” as used herein shall be deemed to mean
“including, but not limited to.” The term “
days
” shall refer to calendar days unless
specified otherwise. References herein to “
Articles
”, “
Sections
” and “
Exhibits
” shall be deemed to mean Articles, Sections
of and Exhibits to this Agreement unless otherwise specified.
ARTICLE II
PURCHASE AND SALE OF
PRODUCTS
SECTION 2.1.
Agreement to Purchase and Sell
Products
.
(a)
During the Term, Manufacturer hereby agrees to manufacture and supply on
behalf of Buyer, and Buyer hereby agrees to purchase and accept from
Manufacturer, such amounts of Products, as from time to time shall be ordered by
Buyer.
(b)
All Products to be sold to Buyer pursuant to this Agreement shall be
manufactured by Manufacturer or an Affiliate of Manufacturer.
SECTION 2.2.
Raw Materials
. Manufacturer shall be responsible for the
procurement of raw materials and container and packaging materials, in each case
consistent with the Manufacturer’s customary practices and necessary to
manufacture and package the Products, except that Buyer acknowledges that Vishay
Advanced Technologies, Ltd. (“
VAT
”), or an Affiliate of Buyer, shall supply
foil resistor chips on the terms described in the Supply Agreement between the
Manufacturer, as buyer, and VAT, as supplier, as may be amended or supplemented
from time to time (the “
Supply Agreement
”).
SECTION 2.3.
Product Specifications
.
(a)
Manufacturer shall manufacture all Products according to the
Specifications in effect as of the date of
this Agreement, with such changes or additions to the Specifications of the
Products related thereto as shall be requested by Buyer in accordance with this
Section or as otherwise agreed in writing by the Parties, so long as and only to
the extent that if such requested change or addition requires a change or
addition in the Specifications applicable to the foil resistor chips to be
supplied by VAT under the Supply Agreement, VAT can supply the foil resistor
chips with such change or addition or Buyer is able to identify an appropriate
alternative source of foil resistor chips in the event that VAT is unable to
provide
-4-
such chips. All other
Products shall be manufactured with such Specifications as the Parties shall
agree in writing.
(b)
Buyer may request changed or additional Specifications for any Product by
delivering written notice thereof to Manufacturer not less than one hundred
twenty (120) days in advance of the first Firm Order for such Product to be
supplied with such changed or additional Specifications. Notwithstanding the
foregoing, if additional advance time would reasonably be required in order to
implement the manufacturing processes for production of a Product with any
changed or additional Specifications, and to commence manufacture and delivery
thereof, Manufacturer shall so notify Buyer, and Manufacturer shall not be
required to commence delivery of such Product until the passage of such
additional time.
(c)
Manufacturer shall be required to accommodate any change of, or additions
to, the Specifications for any Product,
if
and
only
if
(i) in Manufacturer’s good faith judgment,
such changed or additional Specifications would not require Manufacturer to
violate good manufacturing practice, (ii) the representation and warranty of
Buyer deemed made pursuant to Subsection (e) below is true and correct, (iii)
Buyer agrees to reimburse Manufacturer for the incremental costs and expenses
incurred by Manufacturer in accommodating the changed or additional
Specifications, including the costs of acquiring any new machinery and tooling,
and (iv) to the extent applicable, a corresponding change of, or addition to,
the Specifications applicable to the materials supplied to the Manufacturer
under the Supply Agreement has been made. For the avoidance of doubt, such costs
and expenses shall be payable by Buyer separately from the cost of Products at
such time or times as Manufacturer shall request.
(d)
Manufacturer shall notify Buyer in writing within thirty (30) days of its
receipt of any request for changed or additional Specifications (i) whether
Manufacturer will honor such changed or additional Specifications, (ii) if
Manufacturer declines to honor such changed or additional Specifications, the
basis therefor and (iii) if applicable, the estimated costs and expenses that
Buyer will be required to reimburse Manufacturer in respect of the requested
changes or additions, as provided in Subsection (c) above. Buyer shall notify
Manufacturer in writing within fifteen (15) days after receiving notice of any
required reimbursement whether Buyer agrees to assume such reimbursement
obligation.
(e)
By its request for any changed or additional Specifications for any
Product, Buyer shall be deemed to represent and warrant to Manufacturer that the
manufacture and sale of the Product incorporating Buyer’s changed or additional
Specifications, as a result of such incorporation, will not and could not
reasonably be expected to (i) violate or conflict with any contract, agreement,
arrangement or understanding to which Buyer and/or any of its Affiliates is a
party, including this Agreement and any other contract, agreement, arrangement
or understanding with Manufacturer and/or its Affiliates, (ii) infringe on any
trademark, service mark, copyright, patent, trade secret or other intellectual
property rights of any Person, or (iii) violate any Applicable Law. Buyer shall
indemnify and hold Manufacturer and its Affiliates harmless (including with
respect to reasonable attorneys’ fees and disbursements) from any breach of this
representation and warranty.
-5-
SECTION 2.4.
Manufacturer’s Supply
Obligations
. Manufacturer
shall be obligated to manufacture and sell Products to Buyer, in accordance with
Buyer’s Firm Orders, to the extent of Manufacturer’s then existing manufacturing
capacity, taking into account Manufacturer’s Other Manufacturing Obligations;
provided
,
however
, the Manufacturer shall give equal priority
to the orders of Buyer, on the one hand, and Manufacturer’s Other Manufacturing
Obligations, on the other.
SECTION 2.5.
Product Changes
. Manufacturer shall communicate any change in
the Specifications for any Product or its manufacture in accordance with
Manufacturer’s product change notification process. Buyer shall be deemed to
have accepted such change unless, within thirty (30) days after receipt of
notice from Manufacturer, Buyer informs Manufacturer that such change is not
acceptable. If Buyer informs Manufacturer that such change is not acceptable,
Manufacturer may by notice to Buyer either (x) continue to supply the Product in
accordance with the original Specifications and manufacturing procedures or (y)
terminate this Agreement with respect to such Product on a date specified by
Manufacturer in a notice of termination, which date shall not be earlier than
the earlier of one (1) year from the date of Buyer’s information that it does
not accept the change proposed by Manufacturer, subject to the right of the
Buyer to submit a Last-Time Buy Order in accordance with
Section 4.5
.
SECTION 2.6.
Product Discontinuation
.
(a)
Discontinuation of Products
. At any time, Manufacturer may notify Buyer
that Manufacturer is discontinuing the manufacture and sale of a Product. Such
discontinuation shall take effect on a date specified by Manufacturer in a
notice of discontinuation, which date shall not be earlier than one (1) year
from the date of the notice of discontinuation; subject to the right of the
Buyer to submit a Last-Time Buy Order in accordance with
Section 4.5
.
(b)
Discontinuation of Foil Chips Under Supply
Agreement
. To the extent
that a discontinuation by VAT under Section 2.5 of the Supply Agreement causes
Manufacturer to be unable to satisfy its obligations under this Agreement,
Manufacturer shall be released from any claims of breach of this Agreement or
the Supply Agreement;
provided
, that Manufacturer will give Buyer a
reasonable opportunity to find alternative sources of foil resistor chips.
SECTION 2.7.
Consultation and Support
. At either Party’s reasonable request, the
Parties shall meet and discuss the nature, quality and level of supply services
contemplated by this Agreement. In addition, Manufacturer will make available on
a commercially reasonable basis and at commercially reasonable times qualified
personnel to provide knowledgeable support service with respect to the Products.
The Parties shall negotiate in good faith with respect to any fees and other
charges incurred by Manufacturer in providing other than routine product
support.
ARTICLE III
FORECASTS
SECTION 3.1.
Forecasts
. As and where warranted, Buyer shall provide
to Manufacturer a Forecast of the Firm Orders Buyer expects in good faith to
deliver to Manufacturer for such period of time specified in such Forecast.
Manufacturer shall use such Forecasts for capacity and
-6-
raw material planning
purposes only and such Forecasts shall not constitute a commitment of any type
by Buyer to purchase the Products.
ARTICLE IV
ORDERS AND PAYMENT
SECTION 4.1.
Purchase Orders
.
(a)
Buyer may place a Firm Order for the Products with Manufacturer at any
time and from time to time.
(b)
Each Firm Order shall specify (i) number of units of the Product to be
purchased and (ii) the requested delivery date, provided that Buyer shall
request a delivery date with a lead delivery time that is customary for the
particular Product, unless otherwise agreed upon by the Parties. Manufacturer
agrees to provide Buyer prompt notice if it knows it cannot meet a requested
delivery date.
(c)
If Buyer requires a Product on an emergency basis and so informs
Manufacturer, and Manufacturer has the Product available in its uncommitted
inventory, Manufacturer agrees to use reasonable commercial efforts to fill the
emergency order as promptly as practicable. Buyer agrees to pay reasonable
incremental expenses related to any emergency order.
SECTION 4.2.
Shipment
.
(a)
Products intended for customers within Europe will be shipped DDU
destination Manufacturer’s customers. Products intended for customers outside of
Europe will be shipped Ex Works Manufacturer’s factory.
(b)
Manufacturer shall package all Products so as to protect them from loss
or damage during shipment, in conformity with good commercial practice, the
Specifications and Applicable Law. Buyer shall be responsible, at its own cost
and expense, for the shipment (including, among other fees, costs and expenses,
transit and casualty insurance and third party fees) of all processed materials
by Buyer. Manufacturer shall cooperate with Buyer in assembling and coordinating
shipments, as reasonably requested by Buyer.
(c)
For the avoidance of doubt, title to and risk of loss or damage will pass
to Buyer upon Buyer’s pick up for transfer of the Products ordered.
SECTION 4.3.
Prices
. Pricing for the Products shall be as set
forth on
Exhibit A
, as such Exhibit may be modified from time to
time by agreement of the Parties, which shall at all times equal the prices
charged by Buyer to its customers for its Products, less a 5% discount. If Buyer
proposes to change the prices for Products charged to its customers for any
calendar year, the parties will discuss the consequences of such change for the
pricing of the Products under this Agreement, including the annual adjustment,
and shall agree in good faith to make such change as shall preserve the intended
economic benefits of this Agreement to each of the Parties.
-7-
SECTION 4.4.
Payment Terms
.
(a)
Unless otherwise agreed to by the Parties in writing, Buyer shall make
payment separately for each Firm Order. Buyer shall pay the net amount of all
invoice amounts within sixty (60) days of the date of Manufacturer’s invoice
unless the terms of Manufacturer’s invoice permits later payment or allows for
prepayment with a discount. Invoices shall not be sent earlier than the date on
which the Products related thereto are delivered to Buyer.
(b)
The Parties hereby agree that Manufacturer shall be entitled to realize a
Gross Profit (as defined below) with respect to the Products invoiced during
each calendar year equal to 25% of the aggregate Operational Cost of such
Products during such calendar year (the “
25% Markup
”). If the actual aggregate Gross Profit for
the Products invoiced during any calendar year is less than 25% of the aggregate
Operational Cost for such Products, Buyer will pay to Manufacturer an amount
equal to the difference between (x) the aggregate Operational Cost for such
Products multiplied by 25% and (y) the actual aggregate Gross Profit realized on
such Products. If the actual aggregate Gross Profit for the Products invoiced
during each calendar year is greater than 25% of the aggregate Operational Cost
for such Products, Manufacturer will pay to Buyer an amount equal to the
difference between (x) the actual aggregate Gross Profit realized on such
Products and (y) the aggregate Operational Cost for such Products multiplied by
25%.
(c)
Within thirty (30) calendar days of the end of each calendar year,
Manufacturer shall furnish Buyer with a calculation, on an aggregate basis, of
the Gross Profit and Operating Cost for the Products invoiced during such
calendar year, together with back-up for such calculation in reasonable detail,
and a statement of the amount due to, or payable by, Manufacturer in accordance
with the provisions of subsection (a) above (the “
Gross Profit
Statement
”). Thereafter, Manufacturer will provide
Buyer and its accountants with access to the records and employees of Buyer, to
the extent reasonably related to Buyer’s evaluation of the Gross Profit
Statement, the calculation of the Gross Profit or the resolution of any dispute
with respect thereto. Within fifteen (15) calendar days after Buyer’s receipt of
the Gross Profit Statement, Buyer shall notify Manufacturer in writing as to
whether Buyer agrees or disagrees with the Gross Profit Statement, which notice,
in the case of a disagreement, shall set forth in reasonable detail the
particulars of such disagreement. In the event that Buyer does not provide a
notice of disagreement within such fifteen (15) calendar day period, then Buyer
shall be deemed to have accepted the calculations and the amounts set forth in
the Gross Profit Statement delivered by Manufacturer, which shall be final,
binding and conclusive for all purposes hereunder. If any notice of disagreement
is timely provided in accordance with this
Section
4.4(c)
, Buyer and Manufacturer shall each use
commercially reasonable efforts for a period of fifteen (15) calendar days
thereafter (or such longer period as they may mutually agree) to resolve any
disagreements with respect to the calculations in the Gross Profit Statement.
If, at the end of such period, Buyer and Manufacturer are unable to resolve any
disagreements as to items in the Gross Profit Statement, then the Parties shall
engage KPMG LLP (the “
Auditor
”) to resolve any remaining disagreements. The
Auditor shall be charged with determining as promptly as practicable, but in any
event within thirty (30) calendar days after the date on which such dispute is
referred to the Auditor, whether the actual Gross Profit as set forth in the
Gross Profit Statement was prepared in accordance with this Agreement whether
and to what extent the actual Gross Profit requires adjustment. The fees and
expenses of the Auditor shall be shared by
-8-
Buyer and Manufacturer
in inverse proportion to the relative amounts of the disputed amounts determined
in favor Buyer and Manufacturer, respectively. The determination of the Auditor
shall be final, binding and conclusive for all purposes hereunder. The date on
which the actual Gross Profit is finally determined in accordance with this
Section 4.4(c)
is referred to as the “
Determination Date
.”
(d)
Non-recurring Costs shall be charged by Manufacturer to Buyer as
incurred, and shall be paid by Buyer to Manufacturer within sixty (60) days of
receipt of the invoice therefore. Manufacturer shall provide such back-up and
detail with respect to any invoice for Non-recurring Costs as Manufacturer
reasonably requests.
(e)
As used in this section—
i.
“Gross Profit” means net sales minus Operational Costs.
ii.
“Operational Costs” means the sum of direct labor costs, raw material
costs and other variable costs, indirect expenses (including without limitation
indirect supervisory costs and allocated use of utilities, space and similar
items), and fixed costs (including without limitation costs of periodic
requalification with the European Space Agency or any other Governmental
Authority and depreciation costs of new tools and equipment), but excluding
Non-recurring Costs. For the avoidance of doubt, costs and expenses of shipping,
insurance and other costs and expenses incurred in connection with the shipment
of the Products, shall constitute Operational Costs (as defined below) subject
to the 25% Markup.
iii.
“Non-recurring Costs” means costs incurred in connection with the
manufacture of Products on a one-time or one-off basis and shall include,
without limitation, costs of Product requalification with the European Space
Agency (other than periodic requalification costs as set forth in Section 4.5),
costs of complying with any change in specifications by the European Space
Agency, and costs of non-routine equipment maintenance (for example, other than
routine maintenance, including preventative maintenance, and calibration).
SECTION 4.5.
Last-Time Buy Order
.
(a)
Buyer shall have a right to place a written last-time Firm Order for a
Product (a “
Last-Time Buy Order
”) if Manufacturer delivers to Buyer notice of
its intention to terminate this Agreement pursuant to
Section 7.2
. The right of the Buyer to submit a Last-Time
Buy Order shall entitle Buyer to purchase the Products at the price in effect
for the products as of the time of Buyer’s exercise of such right.
(b)
A Last-Time Buy Order shall specify (i) number of units of the Product to
be purchased and (ii) the requested delivery date or dates for such units. If
Manufacturer informs Buyer that it cannot honor the requested delivery dates
because of capacity restraints or otherwise, the Parties shall negotiate in good
faith with respect to delivery dates mutually acceptable to Manufacturer and
Buyer.
(c)
The Parties hereby agree to use commercially reasonable efforts to
coordinate forecasting and ordering during the period between the date the
Last-Time Buy Order
-9-
is delivered to
Manufacturer and the final delivery date to allow for regular supply of Products
during such period.
ARTICLE V
CONFIDENTIALITY
SECTION 5.1.
Manufacturer
and Buyer shall hold and shall cause each of their respective affiliates,
directors, officers, employees, agents, consultants, advisors and other
representatives to hold, in strict confidence and not to disclose or release
without the prior written consent of the other party, any and all proprietary or
confidential information, material or data of the other party that comes into
its possession in connection with the performance by the parties of their rights
and obligations under this Agreement. The provisions of Section 4.5 of the
Master Separation and Distribution Agreement between Vishay Intertechnology,
Inc. and Vishay Precision Group, Inc. (the “
Master Separation Agreement
”) shall govern,
mutatis mutandis
,
the confidentiality obligations of the parties under this Section.
ARTICLE VI
QUALITY CONTROL; PRODUCT WARRANTY; LIMITATION
OF LIABILITY
SECTION 6.1.
Quality Control
. Manufacturer shall establish and maintain
such quality control and testing systems for the manufacture of Products for
sale by Buyer to the European Space Agency (“
ESA
”) as shall be required by that customer,
consistent with past practice. Manufacturer shall also designate a technically
competent employee who shall be responsible for the Manufacturer’s quality
control and testing systems and who shall be available to ESA and the other
customers of Buyer for Products to respond to technical inquiries concerning the
Products, inquiries and claims concerning the compliance or non-compliance of
Products with specifications and customer standards and inquiries and claims
concerning quality control and testing issues, including product failure, with
respect to the Products. Manufacturer shall notify Buyer as promptly as
practicable, to the extent reasonable in the circumstances, of inquiries and
claims received from customers of the Buyer as aforesaid.
SECTION 6.2.
Product Warranty; Merchantability
Warranty
.
(a)
Manufacturer warrants to Buyer that the Products shall, at the time of
delivery to Buyer in accordance with
Section 4.2
: (i) conform to the Specifications therefor,
as provided in
Section 2.2
; (ii) be free from material defects; and
(iii) be manufactured in accordance with good manufacturing practice and
Applicable Law (such warranty being referred to as the “
Product Warranty
”), in each case, except to the extent any
such material defect or failure arises from an act or omission of VAT in
manufacturing for, or supplying foil resistor chips to, Buyer.
(b)
EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, NO WARRANTIES, OTHER
THAN THE PRODUCT WARRANTY, ARE EXPRESSED OR IMPLIED IN RESPECT OF THE PRODUCTS,
INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.
-10-
SECTION 6.3.
Defective or Non-Conforming Products;
Recalls
.
(a)
Claims by Buyer relating to the quantity of or damage to any Product or
the failure of any Product to conform to its Specifications must be made within
one (1) year of receipt of such Product and must be in writing, specifying in
reasonable detail the nature and basis of the claim and citing relevant control
or lot numbers or other information to enable identification of the Product in
question. Manufacturer’s liability to Buyer for damages for any such claim shall
be limited to a refund for the price of the defective Product plus shipping
costs or, at Buyer’s option, prompt replacement thereof with a Product that
complies with the Product Warranty. Such refund and shipping costs or a
replacement shall constitute Manufacturer’s sole and exclusive liability for
such claims. For the avoidance of doubt, nothing shall limit the obligations of
Manufacturer to Buyer in respect of third party claims against Buyer arising
from the failure of any Product to conform to its Specifications.
(b)
Any notifications to either Party pursuant to
Section 6.3(a)
shall be subject to the confidentiality
provisions of
Article V
above.
(c)
In the event of a recall of a Product resulting from a breach of this
Agreement by Manufacturer of this Agreement or the gross negligence of
Manufacturer, Manufacturer shall be responsible for all costs associated with
such recall. Except as otherwise provided in the immediately preceding sentence,
Buyer shall be responsible for all costs associated with the recall of a
Product.
SECTION 6.4.
Indemnification
.
(a)
Subject to
Section 6.5
, Manufacturer shall indemnify and hold Buyer
harmless from and against any Liability, including reasonable attorney’s fees
and disbursements, arising out of any third party claim for death, injury or
damage to property resulting from (i) Manufacturer’s breach of this Agreement;
or (ii) any claim that a Product purchased from Manufacturer infringes any
intellectual property right of a third party, except to the extent such claim
relates to intellectual property transferred to Vishay Precision Group, Inc. or
any of its subsidiaries prior to the Distribution Date (as such term is defined
in the Master Separation Agreement).
(b)
Buyer shall indemnify and hold harmless Manufacturer from and against any
Liability, including reasonable attorneys’ fees and disbursements, arising out
of any third party claim for death, injury or damage to property resulting from
use of any of the Products based upon Buyer’s breach of this Agreement.
(c)
Any Party seeking indemnification pursuant to this
Section 6.4
shall promptly notify the other Party of the
claim as to which indemnification is sought, shall afford the other Party, at
the other Party’s sole expense, the opportunity to defend or settle the claim
(in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified Party with respect such claim) and shall
cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim;
provided
,
however
, that any settlement of any such claim that
would adversely affect the rights of the indemnified Party shall require the
written approval of such indemnified Party; and
provided
further
that an
-11-
indemnified Party shall
not settle any such claim without the written approval of the indemnifying
Party.
(d)
The foregoing indemnification obligations shall survive any termination
or expiration of this Agreement, in whole or in part, or the expiration or
termination of the Term.
SECTION 6.5.
Limitation of Liability
. In no event shall any Party be liable for
any special, consequential, indirect, collateral, incidental or punitive damages
or lost profits or failure to realize expected savings or other commercial or
economic loss of any kind, arising out of any breach of this Agreement,
including breach of the Product Warranty, or any other obligations of any Party
hereunder, or any use of the Products, and each Party hereby knowingly and
expressly waives any claims or rights with respect thereto;
provided
,
however
, that in the event a Party is required to pay
to a third-party claimant any special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss on any claim with respect to which
such Party is indemnified by the other Party pursuant to this Agreement, such
Party shall be entitled to indemnification from the other Party with respect to
such third-party special, consequential, indirect, collateral, incidental or
punitive damages or lost profits or failure to realize expected savings or other
commercial or economic loss to the extent resulting from the indemnifiable acts
or omissions of the other Party.
SECTION 6.6.
Insurance
. Each of the Parties shall maintain general
liability insurance covering their activities under this Agreement in accordance
with prudent and customary commercial practices, in such amounts as shall be
agreed upon from time to time by the Parties.
ARTICLE VII
TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION
SECTION 7.1.
Term of Agreement
. Unless earlier terminated pursuant to
Section 7.2
, the term of this Agreement shall be
perpetual.
SECTION 7.2.
Termination
. Either Party may terminate this Agreement at
any time upon prior written notice to the other at least one (1) year prior to
the requested date of termination.
SECTION 7.3.
Rights Upon Termination
. Following a termination of this Agreement,
(a) all further rights and obligations of the Parties under this Agreement shall
terminate, and (b) Buyer shall pay Manufacturer an amount equal to the remaining
book value (determined in accordance with accounting principles generally
accepted in the United States) of any equipment and tools purchased by
Manufacturer after the Distribution Date for the purpose of complying with this
Agreement. Notwithstanding the foregoing, the termination of this Agreement
shall not affect the rights and obligations of the Parties arising prior to such
expiration or termination; and
provided
further
that the Parties shall not be relieved of (i)
their respective obligations to pay monies due or which become due as of or
subsequent to the date of expiration or termination, and (ii) any other
respective obligations under this Agreement which specifically survive or are to
be performed after the date of such expiration or termination, including the
provisions of
Article V
and
Section
6.3
. Any Firm Order, including a Last-Time Buy
Order, submitted prior to
-12-
the expiration or
termination of this Agreement shall be filled by Manufacturer pursuant to the
terms hereof even if the delivery date is after expiration or termination
ARTICLE VIII
DISPUTE RESOLUTION
SECTION 8.1.
The terms and
provisions of Article VIII of the Master Separation Agreement, relating to the
procedures for resolution of any disputes between the parties, shall apply to
all disputes, controversies or claims (whether sounding in contract, tort or
otherwise) that may arise out of or relate to or arise under or in connection
with this Agreement, or the transactions contemplated hereby,
mutatis mutandis.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1.
Assignment
. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Manufacturer without the consent of Buyer, to a Wholly-Owned
Subsidiary of Manufacturer that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Manufacturer, to a Wholly-Owned Subsidiary of Buyer; or (iii) by
either Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only
with the prior written consent of the other Party;
provided
,
however
, that no such assignment shall relieve the
assigning Party of liability for its obligations hereunder. The following
actions shall not be deemed an assignment of this Agreement: (1) assignment or
transfer of the stock of a Party, including by way of a merger, consolidation,
or other form of reorganization in which outstanding shares of a Party are
exchanged for securities, or (2) any transaction effected primarily for the
purpose of (A) changing a Party’s state of incorporation or (B) reorganizing a
Party into a holding company structure such that, as a result of any such
transaction, such Party becomes a Wholly-Owned Subsidiary of a holding company
owned by the holders of such Party’s securities immediately prior to such
transaction. Any attempted assignment other than as provided herein shall be
void. The provisions of this Agreement shall be binding upon, and shall inure to
the benefit of, the successors and permitted assigns of the Parties.
SECTION 9.2.
Force Majeure
. The Parties shall not be liable for the
failure or delay in performing any obligation under this Agreement (except
pursuant to
Section 6.4
) if and to the extent such failure or delay
is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war, invasion,
riot or other civil unrest; (iv) governmental laws, orders, restrictions,
actions, embargoes or blockages; (v) action by any regulatory authority which
prohibits the manufacture, sale or distribution of the Products, except to the
extent due to Manufacturer’s breach of its obligations hereunder; (vi) regional,
national or foreign emergency; (vii) injunction, strikes, lockouts, labor
trouble or other industrial disturbances; (viii) shortage of adequate fuel,
power, materials, or transportation facilities; or (ix) any other event which is
beyond the reasonable control of the affected Party;
provided
,
however
, that the Party affected shall promptly
notify the other Party of the force majeure condition and shall exert its
reasonable commercial efforts to eliminate, cure or overcome any such causes and
to resume performance of its obligations as soon as possible.
-13-
SECTION 9.3.
Intellectual Property
. All Intellectual Property owned or created
by a Party shall remain its sole and exclusive property, and the other Party
shall not acquire any rights therein by reason of this Agreement.
SECTION 9.4.
Entire Agreement
. This Agreement and the Exhibits hereto
constitute the entire agreement between the Parties with respect to the subject
matter hereof and thereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations between the
parties with respect to such subject matter. No agreements or understandings
exist between the parties other than those set forth or referred to herein or
therein. If any provision of this Agreement or the application thereof to any
Party or circumstance shall be declared void, illegal or unenforceable, the
remainder of this Agreement shall be valid and enforceable to the extent
permitted by Applicable Law. In such event, the Parties shall use their best
efforts to replace the invalid or unenforceable provision with a provision that,
to the extent permitted by Applicable Law, achieves the purposes intended under
the invalid or unenforceable provision.
SECTION 9.5.
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction.
SECTION 9.6.
Consent to Jurisdiction
. Subject to the provisions of
Article VIII
, each of the Parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to
Section 9.16
. Each of the parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in
Section 9.10
shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this
Section 9.6
. Each of the parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby for which it has submitted to jurisdiction pursuant to this
Section 9.6
, and waives any claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum.
SECTION 9.7.
Independent Contractor
. Nothing contained in this Agreement shall
constitute a Party as a partner, employee or agent of the other Party, nor shall
any Party hold itself out as such. Neither Party shall have the right or
authority to incur, assume or create, in writing or otherwise, any warranty,
Liability or other obligation of any kind, express or implied, in the name or on
behalf of the other Party, and each Party is and shall remain an independent
contractor, responsible for its own actions. Except as otherwise explicitly
provided herein, each Party shall be responsible for its own expenses incidental
to its performance of this Agreement.
SECTION 9.8.
Set-Off
. The obligation of Buyer to pay the purchase
price for Products shall be unconditional, except as provided in this Agreement,
and shall not be subject to any defense, setoff, counterclaim or similar right
against Manufacturer or any of its Affiliates that
-14-
could be asserted by
Buyer or any of its Affiliates under any other contract, agreement, arrangement
or understanding or otherwise under Applicable Law.
SECTION 9.9.
Waivers
. No claim or right arising out of or relating
to a breach of any provision of this Agreement can be discharged in whole or in
part by a waiver or renunciation of the claim or right unless the waiver or
renunciation is supported by consideration and is in writing signed by the
aggrieved Party. Any failure by any Party to enforce at any time any provision
under this Agreement shall not be considered a waiver of that Party’s right
thereafter to enforce each and every provision of this Agreement.
SECTION 9.10.
Notices
. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision):
If to
Manufacturer, to:
Vishay
S.A.
c/o
Vishay Intertechnology, Inc.
63
Lancaster Avenue
Malvern,
PA 19355-2120
|
Attention:
|
Dr. Lior E. Yahalomi
|
|
Telephone:
|
610-644-1300
|
|
Facsimile:
|
610-889-2161
|
with a
copy to:
Kramer
Levin Naftalis & Frankel LLP
1177
Avenue of the Americas
New
York, NY 10036
|
Attention:
|
Ernest S. Wechsler, Esq.
|
|
Telephone:
|
212-715-9100
|
|
Facsimile:
|
212-715-8000
|
If to
Buyer, to:
Vishay
Precision Foil VPG GmbH
c/o
Vishay Precision Group, Inc.
3
Great Valley Parkway
Malvern,
PA 19355-1307
|
Attention:
|
William M. Clancy
|
|
Telephone:
|
(484)-321-5300
|
|
Facsimile:
|
(484)-321-5301
|
-15-
with a
copy to:
Pepper
Hamilton LLP
3000
Two Logan Square
Eighteenth
and Arch Streets
Philadelphia, Pennsylvania
19103-2799
|
Attention:
|
Barry Abelson, Esq.
|
|
Telephone:
|
215-981-4000
|
|
Facsimile:
|
215-981-4750
|
Any notice, demand or other communication
hereunder shall be deemed given upon the first to occur of: (i) the fifth
(5
th
) day after deposit thereof, postage prepaid
and addressed correctly, in a receptacle under the control of the United States
Postal Service; (ii) transmittal by facsimile transmission to a receiver or
other device under the control of the party to whom notice is being given; (iii)
actual delivery to or receipt by the party to whom notice is being given or an
employee or agent thereof; or (iv) one (1) day after delivery to an overnight
carrier.
SECTION 9.11.
Headings
. The headings contained herein are included
for convenience of reference only and do not constitute a part of this
Agreement.
SECTION 9.12.
Counterparts
. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered or transmitted
by facsimile, e-mail or other electronic means, shall be deemed to be an
original and all of which taken together shall constitute but one and the same
instrument. A facsimile or electronic signature is deemed an original signature
for all purposes under this Agreement.
SECTION 9.13.
Severability
. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable
provision to effect the original intent of the Parties.
SECTION 9.14.
Waiver of Default
.
(a)
Any term or provision of this Agreement may be waived, or the time for
its performance may be extended, by the party or the parties entitled to the
benefit thereof. Any such waiver shall be validly and sufficiently given for the
purposes of this Agreement if, as to any party, it is in writing signed by an
authorized representative of such party.
(b)
Waiver by any party of any default by the other party of any provision of
this Agreement shall not be construed to be a waiver by the waiving party of any
subsequent or other default, nor shall it in any way affect the validity of this
Agreement or any party hereof or prejudice the rights of the other party
thereafter to enforce each and ever such provision. No
-16-
failure or delay by any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.
SECTION 9.15.
Amendments
. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification.
SECTION 9.16.
Specific Performance
. The Parties agree that the remedy at law for
any breach of this Agreement may be inadequate, and that, as between
Manufacturer and Buyer, any Party by whom this Agreement is enforceable shall be
entitled to seek temporary, preliminary or permanent injunctive or other
equitable relief with respect to the specific enforcement or performance of this
Agreement. Such Party may, in its sole discretion, apply to a court of competent
jurisdiction for such injunctive or other equitable relief as such court may
deem just and proper in order to enforce this Agreement as between Manufacturer
and Buyer, or the members of their respective Groups, or prevent any violation
hereof, and, to the extent permitted by Applicable Law, as between Manufacturer
and Buyer, each Party waives any objection to the imposition of such relief.
SECTION 9.17.
Waiver of jury trial
. Subject to Article VIII, each of the Parties
hereby waives to the fullest extent permitted by Applicable Law any right it may
have to a trial by jury with respect to any court proceeding directly or
indirectly arising out of and permitted under or in connection with this
Agreement or the transactions contemplated hereby. Each of the Parties hereby
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it has been induced to enter into this agreement and the transactions
contemplated by this agreement, as applicable, by, among other things, the
mutual waivers and certifications in this
Section 9.17
.
[SIGNATURE PAGE FOLLOWS]
-17-
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first written
above.
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MANUFACTURER:
|
|
|
|
|
VISHAY S.A.
|
|
|
|
|
By:
|
/s/ Denis Maugest
|
|
|
|
Name:
Denis Maugest
|
|
|
Title:
Directeur General
|
|
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BUYER:
|
|
|
|
|
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VISHAY PRECISION FOIL GMBH
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By:
|
/s/ Kai Karstensen
|
|
|
|
Name:
Kai Karstensen
|
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Title:
General
Manager
|
-18-
EXHIBIT A
Products
: Finished RCK Hi rel foil resistor products
[***]
Portions of this exhibit were omitted and
filed separately with the Secretary of the
Securities and Exchange
Commission pursuant to an application for confidential treatment
filed with
the Securities and Exchange Commission pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934. Such portions are marked by
[***].
A-1
INTELLECTUAL PROPERTY LICENSE
AGREEMENT
This Intellectual Property License Agreement (“
Agreement
”) is entered into as of July 6, 2010 (the
“
Effective Date
”), by and between Vishay S.A., a French
company, as licensee
(“
Vishay S.A.
”), and Vishay Precision Foil GmbH (“
VPG GmbH
”).
RECITALS
:
WHEREAS, VPG GmbH is the owner of certain intellectual property formerly
owned by Vishay S.A. and used in the manufacture of finished RCK foil resistor
products (“
Licensed IP
”); and
WHEREAS, in order to effect and consummate the separation (the
“
Separation
”) contemplated by that certain Master
Separation and Distribution Agreement between Vishay S.A. and VPG GmbH’s
affiliate dated as of the 22
nd
day of June, 2010
(the “
Master Separation
Agreement
”), VPG GmbH desires to grant to Vishay S.A. a
non-exclusive license to the Licensed IP to manufacture, use and sell Licensed
Products (as defined herein) on behalf of VPG GmbH; and
NOW, THEREFORE, in consideration of the terms and provisions of this
Agreement and the Separation, and for other good and valuable consideration, the
receipt of which is acknowledged by the execution and delivery hereof, VPG GmbH
and Vishay S.A. hereby agree as follows:
Article I
Definitions
Terms used but not otherwise defined herein shall have the meanings given
to them in this Article I.
A.
|
“
Licensed Products
” shall mean the finished RCK foil
resistor products specified in Schedule A, that were manufactured by
Vishay S.A. prior to the Separation.
|
|
|
B.
|
“
Manufacturing
Agreement
” shall
refer to that certain Manufacturing Agreement dated as of July 6, 2010
between Vishay S.A. and VPG GmbH.
|
Article II
Intellectual Property
License
A.
|
License Grant
. Subject to the terms and conditions
set forth in this Agreement, VPG GmbH hereby grants to Vishay S.A., a
non-exclusive, irrevocable, worldwide right and license to the Licensed IP
to make, have made, use, sell, offer for sale, export and import Licensed
Products. Vishay S.A. may only sell and offer for sale Licensed Products
pursuant to the Manufacturing Agreement to customers of VPG GmbH or as
otherwise approved in writing by VPG GmbH.
|
|
|
B.
|
License Fees
. For the license and rights granted
herein, Vishay S.A. shall pay VPG GmbH
USD10.
|
C.
|
Improvements
. Licensee acknowledges and agrees that
any modification, change, development, enhancement, derivative or
improvement (collectively, “
Improvements
”) made by, or on behalf of, Licensee to
the Licensed IP or Licensed Product, shall be owned exclusively by
Licensor, and to the extent that Licensee retains any rights therein,
Licensee irrevocably assigns all right, title and interest therein to
Licensor. All Improvements shall be deemed Licensed IP or Licensed
Products, as appropriate, and shall be subject to the terms of this
Agreement.
|
|
|
D.
|
Enforcement
. Vishay S.A. shall cooperate fully and
promptly with VPG GmbH in the protection of VPG GmbH’s rights in the
Licensed IP, in such manner and to such extent as VPG GmbH may reasonably
request, and at VPG GmbH’s expense.
|
|
|
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1. Each party
shall promptly notify the other party in writing of any actual or
potential infringement, or any other unauthorized use of or violation of
the Licensed IP of which it becomes aware (each an “
Infringement
”). VPG GmbH may take such action as it,
in its sole discretion, deems necessary or advisable to stop any
Infringement. Vishay S.A. may request in writing that VPG GmbH institute
an action to stop an Infringement affecting the Licensed Products. If VPG
GmbH receives such a written request and does not institute such action
within thirty (30) days, Vishay S.A. shall be entitled to institute such
action as it deems necessary or advisable to stop such Infringement, in
which VPG GmbH shall be entitled to join;
provided
that Vishay S.A. shall not compromise
or settle any claim or action regarding the Licensed IP in any manner that
would affect the rights of VPG GmbH without the written consent of VPG
GmbH, which consent shall not be unreasonably withheld or delayed. The
party not taking the lead in any action shall cooperate fully with the
other party at the other party’s reasonable request and expense, including
VPG GmbH joining a suit instituted by Vishay S.A. in accordance with this
Section to the extent necessary for Vishay S.A. to have standing.
2. Any monetary
recovery or sums obtained in settlement of any action to stop an
Infringement shall be
allocated between VPG GmbH and Vishay S.A. as shall be fair and equitable,
taking into account their actual out-of-pocket costs and expenses,
including reasonable attorneys’ fees, and the damages sustained by each of
them. Any dispute with respect to the allocation of recoveries shall be
resolved in accordance with the resolution procedures referred to in
Article V-P
.
|
Article III
Warranties
A.
|
Warranties of the
Parties
. VPG GmbH
warrants that it has the right and power to enter into this Agreement, and
that there are no outstanding assignments, grants, licenses, encumbrances,
obligations or agreements, either written or oral or implied, that prevent
it from doing so. Vishay S.A. warrants that it has the right and power to
enter into this Agreement, and that there are no outstanding assignments,
grants, licenses, encumbrances, obligations or agreements, either written
or oral or implied, that prevent it from doing so.
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|
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B.
|
WARRANTY DISCLAIMER
. EXCEPT AS EXPRESSLY SET FORTH IN
THIS
|
-
2
-
|
AGREEMENT, NEITHER
PARTY MAKES ANY OTHER REPRESENTATION, GUARANTEE OR WARRANTY OF ANY KIND,
EXPRESS, IMPLIED OR OTHERWISE, UNDER THIS AGREEMENT INCLUDING
REPRESENTATIONS, GUARANTEES OR WARRANTIES AS TO THE RESULTS TO BE EXPECTED
FROM USE OF ANY OF THE LICENSED IP OR FROM MANUFACTURE OR SALE OF ANY
LICENSED PRODUCT. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, VPG
GMBH SHALL HAVE NO RESPONSIBILITY FOR THE ABILITY OR INABILITY OF VISHAY
S.A. TO USE THE LICENSED IP; FOR THE CLAIMS OF THIRD PARTIES RELATING TO
ANY PRODUCTS
MANUFACTURED
OR SOLD BY VISHAY S.A.; OR FOR ANY FAILURE IN PRODUCTION, DESIGN OR
OPERATION OF ANY PRODUCT MANUFACTURED OR SOLD BY VISHAY S.A. THE
LIMITATIONS OF LIABILITY CONTAINED IN THIS AGREEMENT ARE A FUNDAMENTAL
PART OF THE BASIS OF EACH PARTY’S BARGAIN HEREUNDER, AND NEITHER PARTY
WOULD ENTER INTO THIS AGREEMENT ABSENT SUCH
LIMITATIONS.
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Article IV
Term
A.
|
Term
. This Agreement shall remain in full
force and effect for so long as Vishay S.A. is obligated to manufacture
and deliver finished RCK products under the Manufacturing
Agreement.
|
|
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B.
|
Upon the
termination of this Agreement, all rights of Vishay S.A. granted hereunder
shall terminate, and Vishay S.A. shall return or destroy (and certify such
destruction in writing to VPG GmbH if requested), at VPG GmbH’s election,
all embodiments of the Licensed IP.
|
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C.
|
All rights and
remedies of the parties in respect of any breach of this Agreement
occurring prior to the effective date of its termination shall survive the
termination of this Agreement. In addition, the following provisions of
this Agreement shall explicitly survive its termination:
Article III
(“Warranties”);
Article
IV-B
; and
Article V
(“Miscellaneous”).
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Article V
Miscellaneous
A.
|
Notices
. All notices, demands and other
communications required to be given to a party hereunder shall be in
writing and shall be deemed to have been duly given if and when personally
delivered; one business day after being sent by a nationally recognized
overnight courier; when transmitted by facsimile and actually received; or
five (5) days after being mailed by registered or certified mail (postage
prepaid, return receipt requested) to such party at the relevant street
address or facsimile number set forth below (or at such other street
address or facsimile number as such party may designate from time to time
by written notice in accordance with this
provision):
|
-
3
-
If to Vishay S.A.:
Vishay S.A.
c/o Vishay Intertechnology, Inc.
63 Lancaster
Avenue
Malvern, PA 19355-2120
Attention: Dr. Lior E. Yahalomi,
Chief
Financial Officer
Telephone: 610-644-1300
Facsimile:
610-889-2161
If to VPG GmbH:
Vishay Precision Foil GmbH
c/o Vishay Precision Group
3 Great
Valley Parkway
Malvern, PA 19355-1307
Attn: William M. Clancy, Chief
Financial
Officer
Facsimile: (484)-321-5301
Confirm:
(484)-321-5300
|
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With a copy to:
Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the
Americas
New York, New York 10036
Attn: Ernest Wechsler,
Esq.
Facsimile: (212) 715-8000
Confirm: (212) 715-9100
With a copy to:
Pepper Hamilton LLP
3000 Two Logan Square
Eighteenth and Arch
Streets
Philadelphia, PA 19103-2799
Attn: Barry Abelson,
Esq.
Facsimile: (215) 981-4750
Confirm: (215) 981-4000
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B.
|
Further Assurances
. In addition to the actions
specifically provided for elsewhere in this Agreement, VPG GmbH and Vishay
S.A. agree to execute or cause to be executed and to record or cause to be
recorded such other agreements, instruments and other documents, and to
take such other action, as reasonably necessary or desirable to fully
effectuate the intents and purposes of this Agreement.
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C.
|
Relationship of the
Parties
. This
Agreement shall not be construed to place the parties in the relationship
of legal representatives, partners, joint venturers or agents of or with
each other. No party shall have any power to obligate or bind the other
party in any manner whatsoever, except as specifically provided
herein.
|
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D.
|
Third Party
Beneficiaries
.
Except for indemnification of any Indemnified Parties (as hereafter
defined), the provisions of this Agreement are solely for the benefit of
the parties hereto and their respective successors and permitted assigns,
and are not intended to confer upon any person, except the parties hereto
and their respective successors and permitted assigns, any rights or
remedies hereunder.
|
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E.
|
Assignability
. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors
and permitted assigns.
|
|
F.
|
Press Releases; Public
Announcements
.
Neither party shall issue any release or make any other public
announcement concerning this Agreement or the transactions contemplated
hereby without the prior written approval of the other party, which
approval shall not be unreasonably withheld or delayed;
provided
,
however
, that either party shall be permitted
to make any release or public announcement that in the opinion of its
counsel it is required to make by law or the rules of any national
securities exchange of which its securities are listed;
provided further
that it has made efforts
that
|
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4
-
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are reasonable in
the circumstances to obtain the prior approval of the other
party.
|
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G.
|
Waiver of Defaults
. Waiver by any party hereto of any
default by the other party hereto of any provision of this Agreement shall
not be construed to be a waiver by the waiving party of any subsequent or
other default, nor shall it in any way affect the validity of this
Agreement or prejudice the rights of the other party thereafter to enforce
each and every such provision. No failure or delay by any party hereto in
exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right,
power or privilege.
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H.
|
Severability
. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof shall remain in full force
and effect and shall in no way be affected, impaired or invalidated
thereby, so long as the economic or legal substance of the transactions
contemplated hereby, as the case may be, is not affected in any manner
adverse to any party hereto or thereto. Upon such determination, the
parties hereto shall negotiate in good faith in an effort to agree upon a
suitable and equitable provision to effect the original intent of the
parties hereto.
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I.
|
Indemnification
. Each of the parties shall indemnify,
defend and hold harmless the other party, each of its respective current
and former directors, officers and employees, and each of their respective
heirs, executors, successors and assigns (“
Indemnified Parties
”), from and against any and all
liabilities relating to a claim by a third party arising out of or
resulting from any breach of, or failure to perform or comply with, any
covenant, undertaking or obligation of, this Agreement by the indemnifying
party. All indemnification procedures and payments shall be governed by
Sections 5.6, 5.7 and 5.8 of the Master Separation Agreement, as
applicable. The foregoing indemnification obligations shall survive any
termination or expiration of this Agreement.
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J.
|
LIMITATION OF
LIABILITY
. IN NO
EVENT SHALL VPG GMBH OR VISHAY S.A. BE LIABLE TO THE OTHER FOR ANY
SPECIAL, CONSEQUENTIAL, INDIRECT, COLLATERAL, INCIDENTAL OR PUNITIVE
DAMAGES OR LOST PROFITS OR FAILURE TO REALIZE EXPECTED SAVINGS OR OTHER
COMMERCIAL OR ECONOMIC LOSS OF ANY KIND, ARISING OUT OF THIS AGREEMENT;
PROVIDED, HOWEVER, THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT EITHER
PARTY’S INDEMNIFICATION OBLIGATIONS WITH RESPECT TO THIRD PARTY
CLAIMS.
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K.
|
Confidential
Information
. VPG
GmbH and Vishay S.A. shall hold and shall cause each of their respective
affiliates, directors, officers, employees, agents, consultants, advisors
and other representatives to hold, in strict confidence and not to
disclose or release without the prior written consent of the other party,
any and all proprietary or confidential information, material or data of
the other party that comes into its possession in connection with the
performance by the parties of their rights and obligations under this
Agreement. The provisions of Section 4.5 of the Master Purchase Agreement
shall govern,
mutatis mutandis
, the confidentiality obligations of the
parties under this Section.
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5
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L.
|
Attorneys’ Fees
. In any action hereunder to enforce the
provisions of this Agreement, the prevailing party shall be entitled to
recover its reasonable attorneys’ fees in addition to any other recovery
hereunder.
|
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M.
|
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with
the laws of the State of New York, without regard to the conflict of laws
rules thereof to the extent such rules would require the application of
the law of another jurisdiction.
|
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N.
|
Consent to
Jurisdiction
.
Subject to the provisions referenced in
Article V-P
, each of the parties irrevocably
submits to the jurisdiction of the federal and state courts located in
Philadelphia, Pennsylvania for the purposes of any suit, action or other
proceeding to compel arbitration, for the enforcement of any arbitration
award or for specific performance or other equitable relief pursuant to
Article V-P
. Each of the parties further agrees
that service of process, summons or other document by U.S. registered mail
to such parties address as provided in
Article V-A
shall be effective service of process
for any action, suit or other proceeding with respect to any matters for
which it has submitted to jurisdiction pursuant to this Section. Each of
the parties irrevocably waives any objection to venue in the federal and
state courts located in Philadelphia, Pennsylvania of any action, suit or
proceeding arising out of this Agreement or the transactions contemplated
hereby.
|
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O.
|
Specific Performance
. The parties hereto agree that the
remedy at law for any breach of this Agreement may be inadequate, and that
any party hereto shall be entitled to specific performance in addition to
any other appropriate relief or remedy. Such party may, in its sole
discretion, apply to a court of competent jurisdiction for specific
performance or injunctive or such other relief as such court may deem just
and proper in order to enforce this Agreement.
|
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P.
|
Dispute Resolution
. The procedures set forth in Article
VIII of the Master Separation Agreement shall apply to the resolution of
all disputes arising under this Agreement, except that all proceedings
provided for therein shall be conducted in Philadelphia,
Pennsylvania.
|
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Q.
|
Entire Agreement
. This Agreement and the Schedules
hereto, as well as any other agreements and documents referred to herein,
constitute the entire agreement between the parties with respect to the
subject matter hereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations
between the parties with respect to such subject matter.
|
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R.
|
Waiver of Jury Trial
. SUBJECT TO
SECTION L.16
, EACH OF THE PARTIES HEREBY WAIVES TO
THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
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S.
|
Amendments
. No provisions of this Agreement shall
be deemed amended, modified or
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-
6
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|
supplemented by
any party hereto, unless such amendment, supplement or modification is in
writing and signed by the authorized representative of the party against
whom it is sought to enforce such amendment, supplement or
modification.
|
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T.
|
Counterparts
. This Agreement may be executed in any
number of counterparts, including by facsimile or electronic signature,
and each such counterpart shall be deemed an original instrument, and all
of such counterparts together shall constitute but one agreement. A
facsimile or electronic signature is deemed an original signature for all
purposes under this Agreement.
|
[SIGNATURE PAGES
FOLLOW]
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7
-
IN WITNESS WHEREOF, the parties have
caused their duly authorized representatives to execute this Agreement as of the
Effective Date.
|
VISHAY
S.A.
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|
By:
|
/s/ Denis
Maugest
|
|
Name:
|
Denis Maugest
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Title:
|
Directeur General
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VISHAY PRECISION
FOIL GMBH
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By:
|
/s/ Kai Karstensen
|
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Name:
|
Kai Karstensen
|
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Title:
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General Manager
|
[Signature Page to RCK
Intellectual Property License Agreement]
SCHEDULE A
LICENSED PRODUCTS
RCKHR02LEVB
RCKHR02LEVC
RCKHR02ALEVB
RCKHR02ALEVC
Portions of this exhibit were omitted and
filed separately with the Secretary of the Securities and Exchange
Commission pursuant to an application for confidential treatment filed with
the Securities and Exchange
Commission pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934. Such portions are marked by
[***].
SUPPLY AGREEMENT
by and between
Vishay Precision Foil
GmbH
as Supplier
and
Vishay S.A.,
a French company,
as Buyer
Dated as of July 6,
2010
This SUPPLY AGREEMENT (this “
Agreement
”) is made as of July 6, 2010
by and between Vishay Precision Foil GmbH (“
Supplier
”), and Vishay S.A., a French
company (“
Buyer
”). Supplier and
Buyer each may be referred to herein as a “
Party
” and collectively, as the “
Parties
”.
WHEREAS, subject to the terms, conditions, commitments and undertakings
herein provided, Supplier is willing to manufacture and sell those products as
set forth on
Exhibit A
hereto
(as the same may be modified from time to time pursuant to the provisions
hereof, the “
Products
”) to
Buyer, and Buyer desires to purchase the Products from Supplier, in such
quantities as Buyer shall request , as provided in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the
following terms shall have the meanings specified in this Article I:
“
Affiliate
” means, as
applied to any Person, any other Person that, directly or indirectly, controls,
is controlled by, or is under common control with that Person as of the date on
which or at any time during the period for when such determination is being
made. For purposes of this definition, “
control
” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities or other interests, by contract or otherwise, and the terms “
controlling
” and “
controlled
” have meanings correlative
to the foregoing.
“
Applicable Law
” means
any applicable law, statute, rule or regulation of any Governmental Authority,
or any outstanding order, judgment, injunction, ruling or decree by any
Governmental Authority.
“
Buyer
” has the meaning set forth in
the preamble of this Agreement.
“
Confidential
Information
” means all proprietary, design or operational information,
data or material including, without limitation: (a) specifications, ideas and
concepts for goods and services; (b) manufacturing specifications and
procedures; (c) design drawings and models; (d) materials and material
specifications; (e) quality assurance policies, procedures and specifications;
(f) customer, client, manufacturer and supplier information; (g) computer
software and derivatives thereof relating to design development or manufacture
of goods; (h) training materials and information; (i) inventions, devices, new
developments, methods and processes, whether patentable or unpatentable and
whether or not reduced to practice; (j) all other know-how, methodology,
procedures, techniques and Trade Secrets; (k) proprietary earnings reports and
forecasts; (l) proprietary macro-economic reports and forecasts; (m) proprietary
marketing, advertising and business plans, objectives and strategies; (n)
proprietary general market evaluations and surveys; (o) proprietary financing
and credit-related information; (p) other copyrightable or patented works; (q)
the terms of this Agreement; and (r) all similar and related information in
whatever form; in each case, of one party which has been disclosed by Supplier
or members of its Group on the one hand, or Buyer or members of its Group, on
the other hand, in written, oral (including by recording), electronic, or visual
form to, or otherwise has come into the possession of, the other Group.
“
DDP
” has the meaning and
usage assigned to such words in the incoterms rules published by the
International Chamber of Commerce.
“
Firm Order
” means
Buyer’s non-cancelable purchase order for Products to be purchased by Buyer from
Supplier pursuant to this Agreement for delivery.
“
Governmental Authority
”
means any U.S. or non-U.S. federal, state, local, foreign or international
court, arbitration or mediation tribunal, government, department, commission,
board, bureau, agency, official or other regulatory, administrative or
governmental authority.
“
Group
” means, with
respect to any Person, each Subsidiary of such Person and each other Person that
is controlled directly or indirectly by such Person.
“
Intellectual Property
”
means all domestic and foreign patents and patent applications, together with
any continuations, continuations-in-part or divisional applications thereof, and
all patents issuing thereon (including reissues, renewals and re-examinations of
the foregoing); design patents; invention disclosures; mask works; all domestic
and foreign copyrights, whether or not registered, together with all copyright
applications and registrations therefor; all domain names, together with any
registrations therefor and any goodwill relating thereto; all domestic and
foreign trademarks, service marks, trade names, and trade dress, in each case
together with any applications and registrations therefor and all goodwill
relating thereto; all Trade Secrets, commercial and technical information,
know-how, proprietary or Confidential Information, including engineering,
production and other designs, notebooks, processes, drawings, specifications,
formulae, and technology; computer and electronic data processing programs and
software (object and source code), data bases and documentation thereof; all
inventions (whether or not patented); all utility models; all registered
designs, certificates of invention and all other intellectual property under the
laws of any country throughout the world.
“
Last-Time Buy Order
” has the meaning
set forth in
S
ection 3.5
.
“
Liability
” means, with
respect to any Person, any and all losses, claims, charges, debts, demands,
Actions, causes of action, suits, damages, obligations, payments, costs and
expenses, sums of money, accounts, reckonings, bonds, specialties, indemnities
and similar obligations, exoneration covenants, obligations under contracts,
guarantees, make whole agreements and similar obligations, and other liabilities
and requirements, including all contractual obligations, whether absolute or
contingent, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, joint or several, whenever arising, and including
those arising under any Applicable Law, action, threatened or contemplated
action (including the costs and expenses of demands, assessments, judgments,
settlements and compromises relating thereto and attorneys’ fees and any and all
costs and expenses, whatsoever reasonably incurred in investigating, preparing
or defending against any such actions or threatened or contemplated actions) or
order of any Governmental Authority or any award of any arbitrator or mediator
of any kind, and those arising under any contract, in each case, whether or not
recorded or reflected or otherwise disclosed or required to be recorded or
reflected or otherwise disclosed, on the books and records or financial
statements of any Person, including any Liability for taxes.
“
Person
” (whether or not
initially capitalized) means any corporation, limited liability company,
partnership, firm, joint venture, entity, natural person, trust, estate,
unincorporated organization, association, enterprise, government or political
subdivision thereof, or Governmental Authority.
“
Product
” has the meaning set forth in
the preamble of this Agreement.
“
Product Warranty
” has the meaning set
forth in
Section 5.1(a)
.
“
Subsidiary
” of any
Person means a corporation or other organization whether incorporated or
unincorporated of which at least a majority of the securities or interests
having by the terms thereof ordinary voting power to elect at least a majority
of the board of directors or others performing similar functions with respect to
such corporation or other organization is directly or indirectly owned or
controlled by such Person or by any one or more of its Subsidiaries, or by such
Person and one or more of its Subsidiaries;
provided
,
however
, that no Person that is not
directly or indirectly wholly-owned by any other Person shall be a Subsidiary of
such other Person unless such other Person controls, or has the right, power or
ability to control, that Person.
“
Supplier
” has the meaning set forth in
the preamble of this Agreement.
-2-
“
Supplier’s Other Manufacturing
Obligations
” means the manufacturing obligations and commitments of
Supplier to Persons other than Buyer, including Supplier’s Affiliates.
“
Specifications
” means,
with respect to any Product, the design, composition, dimensions, other physical
characteristics, chemical characteristics, packaging, unit count and trade dress
of such Product.
“
Term
” has the meaning set forth in
Section 6.1
.
“
Trade Secrets
” means
information, including a formula, program, device, method, technique, process or
other Confidential Information that derives independent economic value, actual
or potential, from not being generally known to the public or to other Persons
who can obtain economic value from its disclosure or use and is the subject of
efforts that are reasonable, under the circumstances, to maintain its secrecy.
“
Wholly-Owned Subsidiary
”
of a Person means a Subsidiary of that Person substantially all of whose voting
securities and outstanding equity interest are owned either directly or
indirectly by such Person or one or more of its Subsidiaries or by such Person
and one or more of its Subsidiaries.
The terms “
herein
”,
“
hereof
”, “
hereunder
” and like terms, unless
otherwise specified, shall be deemed to refer to this Agreement in its entirety
and shall not be limited to any particular section or provision hereof. The term
“
including
” as used herein shall
be deemed to mean “including, but not limited to.” The term “
days
” shall refer to calendar days
unless specified otherwise. References herein to “
Articles
”, “
Sections
” and “
Exhibits
” shall be deemed to mean
Articles, Sections of and Exhibits to this Agreement unless otherwise specified.
ARTICLE II
PURCHASE AND SALE OF PRODUCTS
Section 2.1.
Agreement to Purchase and Sell
Products
. (a) During the Term, Supplier hereby agrees to manufacture and
sell to Buyer, and Buyer hereby agrees to purchase and accept from Supplier, the
Products in such quantities, within such delivery deadlines and on such other
terms as reasonably necessary to enable Buyer to fill orders submitted by Vishay
Precision Foil GmbH (“VPG GmbH”) for finished RCK foil products under the
Manufacturing Agreement dated as of even date herewith between Buyer and VPG
GmbH, as may be amended or supplemented from time to time (the “
Manufacturing Agreement
”).
Notwithstanding the foregoing, and in the event that Buyer reasonably believes
that Supplier’s manufacturing and delivery schedule will cause Buyer to breach
its obligations under the Manufacturing Agreement, the parties agree to
cooperate in good faith to avoid a breach of either this Agreement or the
Manufacturing Agreement.
(b)
All Products to be sold to Buyer pursuant to this Agreement shall be
manufactured by Supplier or an Affiliate of Supplier;
provided
,
however
, that Supplier may subcontract
the manufacture of any Product to a manufacturer that is not an Affiliate of
Supplier with Buyer’s prior written consent, which consent shall not be
unreasonably withheld,
provided
that any such subcontracting shall not relieve Supplier of its obligations
hereunder.
Section 2.2.
Product Specifications and Changes
.
Supplier shall manufacture all Products according to the Specifications in
effect as of the date of this Agreement, with such changes or additions to the
Specifications of the Products as and to the extent necessary in order to enable
Buyer to comply with the Manufacturing Agreement or as mutually agreed between
the Parties. All other Products shall be manufactured with such Specifications
as the Parties shall agree.
Section 2.3.
Supplier’s Supply Obligations
.
Supplier shall be obligated to manufacture and sell Products to Buyer, in
accordance with Buyer’s Firm Orders, to the extent of Supplier’s then existing
manufacturing capacity, taking into account Supplier’s Other Manufacturing
Obligations;
provided
,
however
, the Supplier shall give equal
priority to the orders of Buyer, on the one hand, and Supplier’s Other
Manufacturing Obligations, on the other.
-3-
Section 2.4.
Product Changes
. Supplier shall
communicate any change in the Specifications for any Product or its manufacture
in accordance with Supplier’s product change notification process. Buyer shall
be deemed to have accepted such change unless, within thirty (30) days after
receipt of notice from Supplier, Buyer informs Supplier that such change is not
acceptable. If Buyer informs Supplier that such change is not acceptable,
Supplier may by notice to Buyer either (x) continue to supply the Product in
accordance with the original Specifications and manufacturing procedures or (y)
terminate this Agreement with respect to such Product on a date specified by
Supplier in a notice of termination, which date shall not be earlier than the
earlier of one (1) year from the date of Buyer’s information that it does not
accept the change proposed by Supplier, subject to the right of the Buyer to
submit a Last-Time Buy Order in accordance with
Section 3.5
. Supplier shall not change
the Specifications if to do so would prevent Buyer from being able to comply
with its obligations under the Manufacturing Agreement.
Section 2.5.
Product Discontinuation
. At any time
Supplier may notify Buyer that Supplier is discontinuing the manufacture and
sale of a Product. Such discontinuation shall take effect on a date specified by
Supplier in a notice of discontinuation, which date shall not be earlier than
one (1) year from the date of the notice of discontinuation; subject to the
right of the Buyer to submit a Last-Time Buy Order in accordance with
Section 3.5
. To the extent that a
discontinuation by VAT under this Section 2.5 causes Buyer to be unable to
satisfy its obligations under the Manufacturing Agreement, Buyer shall be
released from any claims of breach of this Agreement caused by such
discontinuation.
Section 2.6.
Consultation and Support
. At either
Party
’
s
reasonable request, the Parties shall meet and discuss the nature, quality and
level of supply services contemplated by this Agreement. In addition, Supplier
will make available on a commercially reasonable basis and at commercially
reasonable times qualified personnel to provide knowledgeable support service
with respect to the Products. The Parties shall negotiate in good faith with
respect to any fees and other charges incurred by Supplier in providing other
than routine product support.
ARTICLE
III
ORDERS AND PAYMENT
Section 3.1.
Purchase Orders
. (a) Buyer may place a
Firm Order for the Products with Supplier at any time and from time to time.
(b)
Each Firm Order shall specify (i) number of units of the Product to be
purchased and (ii) the requested delivery date, provided that Buyer shall
request a delivery date with a lead delivery time that is customary for the
particular Product, unless otherwise agreed upon by the Parties. Supplier agrees
to provide Buyer prompt notice if it knows it cannot meet a requested delivery
date.
(c)
If Buyer requires a Product on an emergency basis in order to comply with
its obligations under the Manufacturing Agreement and so informs Supplier, and
Supplier has the Product available in its uncommitted inventory, Supplier agrees
to use reasonable commercial efforts to fill the emergency order as promptly as
practicable.
Section 3.2.
Shipment
.
(a)
The Products sold to Buyer shall be delivered DDP Buyer’s factory unless
otherwise agreed by the Parties.
(b)
Supplier shall package all Products so as to protect them from loss or
damage during shipment, in conformity with good commercial practice, the
Specifications and Applicable Law. Buyer shall be responsible, at its own cost
and expense, for the shipment (including, among other fees, costs and expenses,
transit and casualty insurance and third party fees) of all processed materials
by Buyer. Supplier shall cooperate with Buyer in assembling and coordinating
shipments, as reasonably requested by Buyer.
-4-
Section 3.3.
Prices
. Pricing for the Products shall
be as set forth on
Exhibit A
, as
such Exhibit may be modified from time to time by agreement of the Parties. At
least thirty (30) days prior to the beginning of each calendar year, the Parties
shall negotiate in good faith changes to the pricing of the Products to be
applicable in the ensuing year. The Parties will assure that any changes in the
prices are coordinated with pricing changes under the Manufacturing Agreement.
Section 3.4.
Payment Terms
. Unless otherwise agreed
to by the Parties in writing, Buyer shall make payment separately for each Firm
Order. Buyer shall pay the net amount of all invoice amounts within sixty (60)
days of the date of Supplier’s invoice unless the terms of Supplier’s invoice
permits later payment or allows for prepayment with a discount. Invoices shall
not be sent earlier than the date on which the Products related thereto are
delivered to Buyer.
Section 3.5.
Last-Time Buy Order
.
(a)
Buyer shall have a right to place a written last-time Firm Order for a
Product (a “
Last-Time Buy
Order
”) at such time and in such quantities as may be required in order
to comply with a last-time buy order under the Manufacturing Agreement. The
right of the Buyer to submit a Last-Time Buy Order shall entitle Buyer to
purchase the Products at the price in effect for the products as of the time of
Buyer’s exercise of such right.
(b)
A Last-Time Buy Order shall specify (i) number of units of the Product to
be purchased and (ii) the requested delivery date or dates for such units. If
Supplier informs Buyer that it cannot honor the requested delivery dates because
of capacity restraints or otherwise, the Parties shall negotiate in good faith
with respect to delivery dates mutually acceptable to Supplier and Buyer.
(c)
The Parties hereby agree to use commercially reasonable efforts to
coordinate forecasting and ordering during the period between the date the
Last-Time Buy Order is delivered to Supplier and the final delivery date to
allow for regular supply of Products during such period.
ARTICLE IV
CONFIDENTIALITY
Section 4.1.
Supplier and Buyer shall hold and
shall cause each of their respective affiliates, directors, officers, employees,
agents, consultants, advisors and other representatives to hold, in strict
confidence and not to disclose or release without the prior written consent of
the other party, any and all Confidential Information, material or data of the
other party that comes into its possession in connection with the performance by
the parties of their rights and obligations under this Agreement. The provisions
of Section 4.5 of the Master Separation and Distribution Agreement between
Vishay Intertechnology, Inc. and the Buyer shall govern,
mutatis
mutandis
, the
confidentiality obligations of the parties under this Section.
ARTICLE V
PRODUCT WARRANTY; LIMITATION OF LIABILITY
Section 5.1.
Product Warranty; Merchantability
Warranty
. (a) Supplier warrants to Buyer that the Products shall, at the
time of delivery to Buyer in accordance with
Section 3.2
: (i) conform to the
Specifications therefor, as provided in
Section 2.2
; (ii) be free from
material defects; (iii) be manufactured in accordance with good manufacturing
practice and Applicable Law; and (iv) and be suitable for use for manufacturing
the finished RCK products under the Manufacturing Agreement (such warranty being
referred to as the “
Product
Warranty
”).
(b)
EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, NO
WARRANTIES, OTHER THAN THE PRODUCT WARRANTY,
ARE EXPRESSED OR IMPLIED IN RESPECT OF THE PRODUCTS, INCLUDING ANY IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
-5-
Section 5.2.
Defective or Non-Conforming Products
.
(a) Claims by Buyer relating to the quantity of or damage to any Product or the
failure of any Product to conform to its Specifications must be made within one
(1) year of receipt of such Product and must be in writing, specifying in
reasonable detail the nature and basis of the claim and citing relevant control
or lot numbers or other information to enable identification of the Product in
question. Supplier’s liability to Buyer for damages for any such claim shall be
limited to a refund for the price of the defective Product plus shipping costs
or, at Buyer’s option, prompt replacement thereof with a Product that complies
with the Product Warranty. Such refund and shipping costs or a replacement shall
constitute Supplier’s sole and exclusive liability for such claims. For the
avoidance of doubt, nothing shall limit the obligations of Supplier to Buyer in
respect of third party claims against Buyer arising from the failure of any
Product to conform to its Specifications.
(b)
Any notifications to either Party pursuant to this
Section 5.2
shall be subject to the
confidentiality provisions of
Article
V
above.
Section 5.3.
Indemnification
. (a) Subject to
Section 5.4
, Supplier shall indemnify
and hold Buyer harmless from and against any Liability, including reasonable
attorney’s fees and disbursements, arising out of any third party claim for
death, injury or damage to property resulting from (i) Supplier’s breach of this
Agreement; or (ii) any claim that a Product purchased from Supplier infringes
any intellectual property right of a third party.
(b)
Buyer shall indemnify and hold harmless Supplier from and against any
Liability, including reasonable attorneys’ fees and disbursements, arising out
of any third party claim for death, injury or damage to property resulting from
use of any of the Products based upon (i) Buyer’s breach of this Agreement; or
(ii) any change in condition of the Products caused by Buyer.
(c)
Any Party seeking indemnification pursuant to this
Section 5.3
shall promptly notify the
other Party of the claim as to which indemnification is sought, shall afford the
other Party, at the other Party’s sole expense, the opportunity to defend or
settle the claim (in which case the indemnifying Party shall not be responsible
for the attorneys’ fees of the indemnified Party with respect such claim) and
shall cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim;
provided
,
however
, that any settlement of any
such claim that would adversely affect the rights of the indemnified Party shall
require the written approval of such indemnified Party; and
provided
further
that an indemnified Party
shall not settle any such claim without the written approval of the indemnifying
Party.
(d)
The foregoing indemnification obligations shall survive any termination
or expiration of this Agreement, in whole or in part, or the termination of this
Agreement.
Section 5.4.
Limitation of Liability
. In no event
shall any Party be liable for any special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss of any kind, arising out of any
breach of this Agreement, including breach of the Product Warranty, or any other
obligations of any Party hereunder, or any use of the Products, and each Party
hereby knowingly and expressly waives any claims or rights with respect thereto;
provided
,
however
, that in the event a Party is
required to pay to a third-party claimant any special, consequential, indirect,
collateral, incidental or punitive damages or lost profits or failure to realize
expected savings or other commercial or economic loss on any claim with respect
to which such Party is indemnified by the other Party pursuant to this
Agreement, such Party shall be entitled to indemnification from the other Party
with respect to such third-party special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss to the extent resulting from the
indemnifiable acts or omissions of the other Party.
Section 5.5.
Insurance
. Each of the Parties shall
maintain general liability insurance covering their activities under this
Agreement in accordance with prudent and customary commercial practices, in such
amounts as shall be agreed upon from time to time by the Parties.
-6-
ARTICLE VI
TERM OF AGREEMENT; RENEWAL TERM; TERMINATION
Section 6.1.
Term of Agreement
. This Agreement
shall remain in full force and effect for so long as Vishay S.A. is obligated to
manufacture finished RCK products under the Manufacturing Agreement (the “
Term
”).
Section 6.2.
Rights Upon Termination
. Following a
termination of this Agreement, all further rights and obligations of the Parties
under this Agreement shall terminate. Notwithstanding the foregoing, the
termination of this Agreement shall not affect the rights and obligations of the
Parties arising prior to such expiration or termination; and
provided
further
that the Parties shall not be
relieved of (i) their respective obligations to pay monies due or which become
due as of or subsequent to the date of expiration or termination, and (ii) any
other respective obligations under this Agreement which specifically survive or
are to be performed after the date of such expiration or termination, including
the provisions of
Article V
and
6.3
. Any Firm Order, including a
Last-Time Buy Order, submitted prior to the expiration or termination of this
Agreement shall be filled by Supplier pursuant to the terms hereof even if the
delivery date is after expiration or termination.
ARTICLE
VII
DISPUTE RESOLUTION
Section 7.1.
The terms and provisions of
Article VIII of the Master Separation and Distribution Agreement between VSH and
VPG, relating to the procedures for resolution of any disputes between the
parties, shall apply to all disputes, controversies or claims (whether sounding
in contract, tort or otherwise) that may arise out of or relate to or arise
under or in connection with this Agreement, or the transactions contemplated
hereby,
mutatis
mutandis
.
ARTICLE VIII
MISCELLANEOUS
Section 8.1.
Assignment
. This Agreement and the
rights and obligations of a Party hereunder shall be assignable or delegable, in
whole or in part, (i) by Supplier without the consent of Buyer, to a
Wholly-Owned Subsidiary of Supplier that succeeds to the conduct of the foil
resistor business responsible for supplying the Products; (ii) by Buyer without
the consent of Supplier, to a Wholly-Owned Subsidiary of Buyer or to any Person
that succeeds to the obligations of Buyer under the Manufacturing Agreement; or
(iii) by either Party, to any Person who is not a Wholly-Owned Subsidiary of a
Party only with the prior written consent of the other Party;
provided
,
however
, that no such assignment shall
relieve the assigning Party of liability for its obligations hereunder. The
following actions shall not be deemed an assignment of this Agreement: (1)
assignment or transfer of the stock of a Party, including by way of a merger,
consolidation, or other form of reorganization in which outstanding shares of a
Party are exchanged for securities, or (2) any transaction effected primarily
for the purpose of (A) changing a Party’s state of incorporation or (B)
reorganizing a Party into a holding company structure such that, as a result of
any such transaction, such Party becomes a Wholly-Owned Subsidiary of a holding
company owned by the holders of such Party’s securities immediately prior to
such transaction. Any attempted assignment other than as provided herein shall
be void. The provisions of this Agreement shall be binding upon, and shall inure
to the benefit of, the successors and permitted assigns of the Parties.
Section 8.2.
Force Majeure
. The Parties shall not
be liable for the failure or delay in performing any obligation under this
Agreement (except pursuant to
Section
6.4
) if and to the extent such failure or delay is due to (i) acts of
God; (ii) weather, fire or explosion; (iii) war, invasion, riot or other civil
unrest; (iv) governmental laws, orders, restrictions, actions, embargoes or
blockages; (v) action by any regulatory authority which prohibits the
manufacture, sale or distribution of the Products, except to the extent due to
Supplier’s breach of its obligations hereunder; (vi) regional, national or
foreign emergency; (vii) injunction, strikes, lockouts, labor trouble or other
industrial disturbances; (viii) shortage of adequate fuel, power, materials, or
transportation facilities; or (ix) any other event which is beyond the
reasonable control of the affected Party;
provided
,
however
, that the Party affected shall
promptly notify the other Party of the force majeure condition and shall exert
its reasonable commercial efforts to eliminate, cure or overcome any such causes
and to resume performance of its obligations as soon as possible.
-7-
Section 8.3.
Intellectual Property
. All
Intellectual Property owned or created by a Party shall remain its sole and
exclusive property, and the other Party shall not acquire any rights therein by
reason of this Agreement.
Section 8.4.
Entire Agreement
. This Agreement and
the Exhibits hereto constitute the entire agreement between the Parties with
respect to the subject matter hereof and thereof and supersede all previous
agreements, negotiations, discussions, understandings, writings, commitments and
conversations between the parties with respect to such subject matter. No
agreements or understandings exist between the parties other than those set
forth or referred to herein or therein. If any provision of this Agreement or
the application thereof to any Party or circumstance shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by Applicable Law. In such event, the
Parties shall use their best efforts to replace the invalid or unenforceable
provision with a provision that, to the extent permitted by Applicable Law,
achieves the purposes intended under the invalid or unenforceable provision.
Section 8.5.
Governing Law
. This Agreement and the
legal relations between the parties shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflict of laws rules thereof to the extent such rules would require the
application of the law of another jurisdiction.
Section 8.6.
Consent to Jurisdiction
. Subject to
the provisions of
Article VII
,
each of the Parties irrevocably submits to the jurisdiction of the federal and
state courts located in Philadelphia, Pennsylvania and the City of New York,
Borough of Manhattan for the purposes of any suit, action or other proceeding to
compel arbitration, for the enforcement of any arbitration award or for specific
performance or other equitable relief pursuant to
Section 8.16
. Each of the parties
further agrees that service of process, summons or other document by U.S.
registered mail to such parties address as provided in
Section 8.10
shall be effective
service of process for any action, suit or other proceeding with respect to any
matters for which it has submitted to jurisdiction pursuant to this
Section 8.6
. Each of the parties
irrevocably waives any objection to venue in the federal and state courts
located in Philadelphia, Pennsylvania and the City of New York, Borough of
Manhattan of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby for which it has submitted to jurisdiction
pursuant to this Section 8.6, and waives any claim that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient forum.
Section 8.7.
Independent Contractor
. Nothing
contained in this Agreement shall constitute a Party as a partner, employee or
agent of the other Party, nor shall any Party hold itself out as such. Neither
Party shall have the right or authority to incur, assume or create, in writing
or otherwise, any warranty, Liability or other obligation of any kind, express
or implied, in the name or on behalf of the other Party, and each Party is and
shall remain an independent contractor, responsible for its own actions. Except
as otherwise explicitly provided herein, each Party shall be responsible for its
own expenses incidental to its performance of this Agreement.
Section 8.8.
Set-Off
. The obligation of Buyer to
pay the purchase price for Products shall be unconditional, except as provided
in this Agreement, and shall not be subject to any defense, setoff, counterclaim
or similar right against Supplier or any of its Affiliates that could be
asserted by Buyer or any of its Affiliates under any other contract, agreement,
arrangement or understanding or otherwise under Applicable Law.
Section 8.9.
Waivers
. No claim or right arising out
of or relating to a breach of any provision of this Agreement can be discharged
in whole or in part by a waiver or renunciation of the claim or right unless the
waiver or renunciation is supported by consideration and is in writing signed by
the aggrieved Party. Any failure by any Party to enforce at any time any
provision under this Agreement shall not be considered a waiver of that Party’s
right thereafter to enforce each and every provision of this Agreement.
Section 8.10.
Notices
. All notices, demands and
other communications required to be given to a Party hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered,
sent by a nationally recognized overnight courier, transmitted by facsimile, or
mailed by registered or certified mail (postage prepaid, return receipt
requested) to such Party at the relevant street address or facsimile number set
forth below (or at such other street address or facsimile number as such Party
may designate from time to time by written notice in accordance with this
provision):
-8-
If to
Buyer, to:
|
Vishay S.A.
c/o
Vishay Intertechnology, Inc.
63 Lancaster Avenue
Malvern, PA
19355-2120
|
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Attention:
|
Dr. Lior E.
Yahalomi
|
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Telephone:
|
610-644-1300
|
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Facsimile:
|
610-889-2161
|
with a
copy to:
|
Kramer Levin
Naftalis & Frankel LLP
1177 Avenue of the Americas
New York, NY
10036
|
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Attention:
|
Ernest S. Wechsler,
Esq.
|
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Telephone:
|
212-715-9100
|
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Facsimile:
|
212-715-8000
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If to
Supplier, to:
|
Vishay Precision
Foil GmbH
c/o Vishay Precision Group, Inc.
3 Great Valley
Parkway
Malvern, PA 19355-1307
|
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Attention:
|
William M.
Clancy
|
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Telephone:
|
(484)-321-5300
|
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Facsimile:
|
(484)-321-5301
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with a
copy to:
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Pepper Hamilton
LLP
3000 Two Logan Square
Eighteenth and Arch Streets
Philadelphia, Pennsylvania
19103-2799
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Attention:
|
Barry Abelson,
Esq.
|
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Telephone:
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215-981-4000
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Facsimile:
|
215-981-4750
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Any notice, demand or other communication
hereunder shall be deemed given upon the first to occur of: (i) the fifth (5th)
day after deposit thereof, postage prepaid and addressed correctly, in a
receptacle under the control of the United States Postal Service; (ii)
transmittal by facsimile transmission to a receiver or other device under the
control of the party to whom notice is being given; (iii) actual delivery to or
receipt by the party to whom notice is being given or an employee or agent
thereof; or (iv) one (1) day after delivery to an overnight carrier.
Section 8.11.
Headings
. The headings contained
herein are included for convenience of reference only and do not constitute a
part of this Agreement.
Section 8.12.
Counterparts
. This Agreement may be
executed in one or more counterparts, each of which when so executed and
delivered or transmitted by facsimile, e-mail or other electronic means, shall
be deemed to be an original and all of which taken together shall constitute but
one and the same instrument. A facsimile or electronic signature is deemed an
original signature for all purposes under this Agreement.
Section 8.13.
Severability
. If any provision of this
Agreement or the application thereof to any Person or circumstance is determined
by a court of competent jurisdiction to be invalid, void or unenforceable, the
-9-
remaining provisions
hereof, or the application of such provision to Persons or circumstances or in
jurisdictions other than those as to which it has been held invalid or
unenforceable, shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination, the Parties shall negotiate in
good faith in an effort to agree upon such a suitable and equitable provision to
effect the original intent of the Parties.
Section 8.14.
Waiver of Default
. (a) Any term or
provision of this Agreement may be waived, or the time for its performance may
be extended, by the party or the parties entitled to the benefit thereof. Any
such waiver shall be validly and sufficiently given for the purposes of this
Agreement if, as to any party, it is in writing signed by an authorized
representative of such party.
(b)
Waiver by any party of any default by the other party of any provision of
this Agreement shall not be construed to be a waiver by the waiving party of any
subsequent or other default, nor shall it in any way affect the validity of this
Agreement or any party hereof or prejudice the rights of the other party
thereafter to enforce each and ever such provision. No failure or delay by any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.
Section 8.15.
Amendments
. No provisions of this
Agreement shall be deemed amended, modified or supplemented by any Party, unless
such amendment, supplement or modification is in writing and signed by the
authorized representative of the Party against whom it is sought to enforce such
amendment, supplement or modification.
Section 8.16.
Specific Performance
. The Parties
agree that the remedy at law for any breach of this Agreement may be inadequate,
and that, as between Supplier and Buyer, any Party by whom this Agreement is
enforceable shall be entitled to seek temporary, preliminary or permanent
injunctive or other equitable relief with respect to the specific enforcement or
performance of this Agreement. Such Party may, in its sole discretion, apply to
a court of competent jurisdiction for such injunctive or other equitable relief
as such court may deem just and proper in order to enforce this Agreement as
between Supplier and Buyer, or the members of their respective Groups, or
prevent any violation hereof, and, to the extent permitted by Applicable Law, as
between Supplier and Buyer, each Party waives any objection to the imposition of
such relief.
Section 8.17.
Waiver of jury trial
. Subject to
Article VII
, each of the Parties
hereby waives to the fullest extent permitted by Applicable Law any right it may
have to a trial by jury with respect to any court proceeding directly or
indirectly arising out of and permitted under or in connection with this
Agreement or the transactions contemplated hereby. Each of the Parties hereby
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it has been induced to enter into this agreement and the transactions
contemplated by this agreement, as applicable, by, among other things, the
mutual waivers and certifications in this
Section 8.17
.
[SIGNATURE PAGE
FOLLOWS]
-10-
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first written
above
.
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SUPPLIER:
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VISHAY PRECISION FOIL GMBH
|
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By: /s/
Kai Karstensen
|
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Name: Kai Karstensen
|
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Title: General Manager
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BUYER:
|
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VISHAY S.A.
|
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By: /s/
Denis Maugest
|
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Name: Denis Maugest
|
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Title: Directeur General
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EXHIBIT A
Products
: RCK foil resistor chips.
[***]
Portions of this exhibit were omitted and
filed separately with the Secretary of the Securities and
Exchange
Commission pursuant to an application for confidential treatment filed with the
Securities and
Exchange Commission pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934. Such portions are marked by [***].
A-1-
INTELLECTUAL PROPERTY LICENSE
AGREEMENT
This Intellectual Property License Agreement (“
Agreement
”) is entered into as of July 6, 2010 (the
“
Effective Date
”), by and between Vishay S.A., a French
company (“
Licensee
”), and Vishay Measurements Group, Inc. a
Delaware corporation ("
Licensor
").
RECITALS
:
WHEREAS, Licensor is the owner of certain intellectual property formerly
owned by Licensee and used in the manufacture of strain gages (“Licensed IP”);
and
WHEREAS, in order to effect and consummate the separation (the
“
Separation
”) contemplated by that certain Master
Separation and Distribution Agreement dated June 22, 2010 between Vishay
Intertechnology, Inc., a Delaware corporation and Licensee
’
s affiliate, and
Vishay Precision Group, Inc., a Delaware corporation and Licensor’s affiliate
(the “
Master Separation Agreement
”), Licensee desires to secure a non-exclusive
license to the Licensed IP, to manufacture, use and sell Licensed Products (as
defined herein) to its customers.
NOW, THEREFORE, in consideration of the terms and provisions of this
Agreement and the Separation, and for other good and valuable consideration, the
receipt of which is acknowledged by the execution and delivery hereof, Licensor
and Licensee hereby agree as follows:
A.
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Definitions
.
|
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1.
“
Licensed IP
” shall have the meaning set forth in
the Recitals.
|
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2.
“
Licensed Products
” shall mean the strain gages specified
in Schedule A, that were manufactured by Licensee prior to the
Separation.
|
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B.
|
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License Grant
. Subject to the terms and conditions
set forth in this Agreement, Licensor hereby grants to Licensee, a
non-exclusive, irrevocable, worldwide right and license to the Licensed IP
to make, have made, use, sell, offer for sale, export and import Licensed
Products. Licensee may only sell and offer for sale Licensed Products to
its customers existing as of the Effective Date.
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C.
|
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Improvements
. Licensee acknowledges and agrees that
any modification, change, development, enhancement, derivative or
improvement (collectively, “
Improvements
”) made by, or on behalf of, Licensee to
the Licensed IP or Licensed Product, shall be owned exclusively by
Licensor, and to the extent that Licensee retains any rights therein,
Licensee irrevocably assigns all right, title and interest therein to
Licensor. All Improvements shall be deemed Licensed IP or Licensed
Products, as appropriate, and shall be subject to the terms of this
Agreement.
|
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D.
|
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Sublicensing
. This Agreement may be assigned, and
the license may be sublicensed, by Licensee solely to a direct or indirect
wholly-owned subsidiary of Licensee that succeeds Licensee in the
manufacture and sale of the Licensed Products; provided that Licensee
shall be responsible for the compliance by a subsidiary granted a
sublicense with the terms of this Agreement. Except as provided above, the
license and this Agreement shall be non-assignable and non-sublicensable
without the written consent of Licensor. Any purported license or
assignment in violation of this Agreement shall be
void.
|
E.
|
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License Fees
. For the license and rights granted
herein, Licensee shall pay Licensor 5% of the gross amount received from
the sale of Licensed Products, less the amount of any refunds, credits and
allowances actually given by Licensee, and taxes and shipping cost amounts
invoiced and paid by Licensee’s customers.
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F.
|
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Payment
. Licensee shall pay the license fees on
a quarterly basis, within 60 days of the end of each calendar quarter
during the term of the Agreement, for Licensed Products sold during such
quarter, subject to subsequent adjustment for returns and allowances, and
provided that payment of license fees for the first and last calendar
quarter of the term shall be paid on those sales occurring in such
calendar quarters, on and following the Effective Date for the initial
quarter, and on or before the termination date in the quarter in which the
Agreement is terminated.
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G.
|
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Reporting
. During the term of the Agreement,
Licensee will keep and maintain current and accurate records regarding
sales of Licensed Products and the calculation of the amounts paid or
payable by the Licensee to Licensor under this Agreement. Licensor will
submit quarterly sales and revenue reports for the Licensed Product with
each license fee payment, and such other reports as the parties may agree
from time time. Among such other items as the parties may agree, the
quarterly sales reports shall include sufficient detail regarding the sale
of Licensed Products to establish the accuracy of the License Fee
payments.
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H.
|
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Records and Audit
. Not more than once in any twelve (12)
month period of the term of the Agreement, upon written request by
Licensor, Licensee will provide the Licensor and its representative’s
access to its books and records during Licensee’s normal business hours in
order to verify the accuracy of the sales reports, and computations of
amounts due and owing to the Licensor pursuant to this Agreement. In the
event any such audit reveals that the Licensee has underpaid any amounts
due to the Licensor pursuant to this Agreement, Licensee will promptly pay
the deficiency.
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I.
|
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Enforcement
. Licensee shall cooperate fully and
promptly with Licensor in the protection of Licensor’s rights in the
Licensed IP, in such manner and to such extent as Licensor may reasonably
request, and at Licensor’s expense.
|
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1.
Each party shall promptly notify the other party in writing of any actual
or potential infringement, or any other unauthorized use of or violation
of the Licensed IP of which it becomes aware (each an “
Infringement
”). Licensor may take such action as it,
in its sole discretion, deems necessary or advisable to stop any
Infringement. Licensee may request in writing that Licensor institute an
action to stop an Infringement affecting the Licensed Products. If
Licensor receives such a written request and does not institute such
action within thirty (30) days, Licensee shall be entitled to institute
such action as it deems necessary or advisable to stop such Infringement,
in which Licensor shall be entitled to join;
provided
that Licensee shall not compromise or
settle any claim or action regarding the Licensed IP in any manner that
would affect the rights of Licensor without the written consent of
Licensor, which consent shall not be unreasonably withheld or delayed. The
party not taking the lead in any action shall cooperate fully with the
other party at the other party’s reasonable request and expense, including
Licensor joining a suit instituted
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- 2 -
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by Licensee in
accordance with this Section to the extent necessary for Licensee to have
standing.
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2. Any monetary
recovery or sums obtained in settlement of any action to stop an
Infringement shall be
allocated between Licensor and Licensee as shall be fair and equitable,
taking into account their actual out-of-pocket costs and expenses,
including reasonable attorneys’ fees, and the damages sustained by each of
them. Any dispute with respect to the allocation of recoveries shall be
resolved in accordance with the resolution procedures referred to in
Section L.16
.
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J.
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Warranties of the
Parties
. Licensor
warrants that it has the right and power to enter into this Agreement, and
that there are no outstanding assignments, grants, licenses, encumbrances,
obligations or agreements, either written or oral or implied, that prevent
it from doing so. Licensee warrants that it has the right and power to
enter into this
Agreement,
and that there are no outstanding assignments, grants, licenses,
encumbrances, obligations or agreements, either written or oral or
implied, that prevent it from doing so.
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K.
|
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WARRANTY DISCLAIMER
. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY MAKES ANY OTHER REPRESENTATION, GUARANTEE OR
WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
OTHERWISE, UNDER THIS AGREEMENT
INCLUDING REPRESENTATIONS, GUARANTEES OR WARRANTIES AS TO THE RESULTS TO
BE EXPECTED FROM USE OF ANY OF THE LICENSED IP, OR FROM MANUFACTURE OR
SALE OF ANY LICENSED PRODUCT. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, LICENSOR SHALL HAVE NO RESPONSIBILITY FOR THE ABILITY OR
INABILITY OF LICENSEE TO USE THE LICENSED IP; FOR THE CLAIMS OF THIRD
PARTIES RELATING TO ANY PRODUCTS
MANUFACTURED OR SOLD BY LICENSEE; OR FOR ANY FAILURE IN
PRODUCTION, DESIGN OR
OPERATION OF ANY PRODUCT MANUFACTURED OR SOLD BY LICENSEE. THE LIMITATIONS
OF LIABILITY CONTAINED IN THIS AGREEMENT ARE A FUNDAMENTAL PART OF THE
BASIS OF EACH PARTY’S BARGAIN HEREUNDER, AND NEITHER PARTY WOULD ENTER
INTO THIS AGREEMENT ABSENT SUCH LIMITATIONS.
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L.
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Term / Termination
.
|
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1.
Term
.
|
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(a) This Agreement
shall commence on the Effective Date, and, so long as this
Agreement has not been terminated by its
terms, continue in full force and effect until, subject to clause (b) of
this
Section
L.1
the date the six (6) year period beginning on the Effective
Date expires, unless Licensee notifies Licensor prior to expiration of
such six-year period of its intent to extend the initial term of this
Agreement by an additional two (2) year period (the
“
Initial
Term
”
).
Following the Initial Term and subject to clause (b) of this Section L.1,
this Agreement shall automatically renew for additional successive
two-year terms (each, a “Renewal Term
”
) unless
either party notifies the other party in writing within six (6) months of
the expiration of the Initial Term or the then current Renewal Term that
it will not renew this
Agreement.
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- 3 -
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(b)
Notwithstanding the foregoing, Licensee shall have the right to continue
to dispose of its inventory of strain gage products existing as of any
termination for a period of up to two (2) years from the date of
termination of this Agreement.
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2.
Termination by
Licensor
. This
Agreement may be terminated by Licensor by written notice of termination
if:
|
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(a) Licensee files
a petition in bankruptcy; files a petition seeking any reorganization,
arrangement, composition or similar relief under any law regarding
insolvency or relief for debtors; or makes an assignment for the benefit
of creditors;
|
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(b) a receiver,
trustee or similar officer is appointed for the Licensee’s business or
property;
|
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(c) any
involuntary petition or proceeding under bankruptcy or insolvency laws is
instituted against Licensee and not stayed, enjoined, or discharged within
sixty (60) days; or
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(d) Licensee
adopts a resolution for, or undertakes to effect, a discontinuance of its
business or dissolution.
|
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3. Upon the
termination of this Agreement, all rights of Licensee granted hereunder
shall terminate, and Licensee shall return or destroy (and certify such
destruction in writing to Licensor if requested), at Licensor’s election,
all embodiments of the Licensed IP. Notwithstanding the foregoing,
Licensee shall have the right to continue to dispose of its inventory of
Licensee Products existing as of any termination for a period of up to six
(6) months from the date of termination of this
Agreement.
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4. All rights and
remedies of the parties in respect of any breach of this Agreement
occurring prior to the effective date of its termination shall survive the
termination of this Agreement. In addition, the following provisions of
this Agreement shall explicitly survive its termination:
Section F
(“Reporting”),
Section J
(“WARRANTY
DISCLAIMER”);
Section K.3
; and
Section L
(“Miscellaneous”).
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M.
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Miscellaneous
.
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1.
Notices
. All notices, demands and other
communications required to be given to a party hereunder shall be in
writing and shall be deemed to have been duly given if and when personally
delivered; one business day after being sent by a nationally recognized
overnight courier; when transmitted by facsimile and actually received; or
five (5) days after being mailed by registered or certified mail (postage
prepaid, return receipt requested) to such party at the relevant street
address or facsimile number set forth below (or at such other street
address or facsimile number as such party may designate from time to time
by written notice in accordance with this
provision):
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- 4 -
If to Licensee:
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With a copy to:
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Vishay S.A.
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Kramer Levin Naftalis & Frankel LLP
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c/o Vishay Intertechnology, Inc.
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1177 Avenue of the Americas
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63 Lancaster Avenue
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New York, New York 10036
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Malvern, PA 19355-2120
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Attn: Ernest Wechsler, Esq.
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Attention:
Dr. Lior
E. Yahalomi, Chief
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Facsimile:
(212)
715-8000
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Financial Officer
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Confirm:
(212)
715-9100
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Telephone: 610-644-1300
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Facsimile:
610-889-2161
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If to Licensor:
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With a copy to:
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Vishay Measurements Group, Inc.
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Pepper Hamilton LLP
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c/o Vishay Precision Group, Inc.
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3000 Two Logan Square
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3 Great Valley Parkway
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Eighteenth and Arch Streets
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Malvern, PA 19355-1307
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Philadelphia, PA 19103-2799
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Attn: William M. Clancy, Chief Financial
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Attn: Barry Abelson, Esq.
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Officer
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Facsimile:
(215)
981-4750
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Facsimile:
(484)-321-5300
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Confirm:
(215)
981-4000
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Confirm:
(484)-321-5300
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2.
Further Assurances
. In addition to the actions
specifically provided for elsewhere in this Agreement, Licensor and
Licensee agree to execute or cause to be executed and to record or cause
to be recorded such other agreements, instruments and other documents, and
to take such other action, as reasonably necessary or desirable to fully
effectuate the intents and purposes of this Agreement.
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3.
Relationship of the
Parties
. This
Agreement shall not be construed to place the parties in the relationship
of legal representatives, partners, joint venturers or agents of or with
each other. No party shall have any power to obligate or bind the other
party in any manner whatsoever, except as specifically provided
herein.
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4.
Third Party
Beneficiaries
.
Except for indemnification of any Indemnified Parties (as hereafter
defined), the provisions of this Agreement are solely for the benefit of
the parties hereto and their respective successors and permitted assigns,
and are not intended to confer upon any person, except the parties hereto
and their respective successors and permitted assigns, any rights or
remedies hereunder.
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5.
Assignability
. Subject to
Section C
, this Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors
and permitted assigns.
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6.
Press Releases; Public
Announcements
.
Neither party shall issue any release or make any other public
announcement concerning this Agreement or the transactions contemplated
hereby without the prior written approval of the other party, which
approval shall not be unreasonably withheld or delayed;
provided
,
however
, that either party shall be permitted
to make any release or public announcement that in the opinion of its
counsel it is required to make by law or the rules of any national
securities exchange of which its securities are listed;
provided
further
that it has made efforts that are
reasonable in the circumstances to obtain the prior approval of the other
party.
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- 5 -
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7.
Waiver of Defaults
. Waiver by any party hereto of any
default by the other party hereto of any provision of this Agreement shall
not be construed to be a waiver by the waiving party of any subsequent or
other default, nor shall it in any way affect the validity of this
Agreement or prejudice the rights of the other party thereafter to enforce
each and every such provision. No failure or delay by any party hereto in
exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right,
power or privilege.
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8.
Severability
. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof shall remain in full force
and effect and shall in no way be affected, impaired or invalidated
thereby, so long as the economic or legal substance of the transactions
contemplated hereby, as the case may be, is not affected in any manner
adverse to any party hereto or thereto. Upon such determination, the
parties hereto shall negotiate in good faith in an effort to agree upon a
suitable and equitable provision to effect the original intent of the
parties hereto.
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9.
Indemnification
. Each of the parties shall indemnify,
defend and hold harmless the other party, each of its respective current
and former directors, officers and employees, and each of their respective
heirs, executors, successors and assigns (“
Indemnified
Parties
”), from and against any and all
liabilities relating to a claim by a third party arising out of or
resulting from any breach of, or failure to perform or comply with, any
covenant, undertaking or obligation of, this Agreement by the indemnifying
party. In addition, Licensee shall indemnify, defend and hold harmless
Licensor and Licensor’s other Indemnified Parties from and against any and
all liabilities relating to a claim by a third party arising out of or
resulting from the manufacture, sale, or use of to the Licensed Products
manufactured or sold by Licensee, but only to the extent caused by such
Licensed Products, and not to the extent such liabilities arise out of or
result from the Licensed IP, or the use thereof, in or in the manufacture
of, the Licensed Products. All indemnification procedures and payments
shall be governed by Sections 5.6, 5.7 and 5.8 of the Master Separation
Agreement, as applicable. The foregoing indemnification obligations shall
survive any termination or expiration of this
Agreement.
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10.
LIMITATION OF
LIABILITY
. IN NO
EVENT SHALL LICENSOR OR
LICENSEE BE LIABLE TO THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL,
INDIRECT, COLLATERAL, INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS OR
FAILURE TO REALIZE EXPECTED SAVINGS OR OTHER
COMMERCIAL OR ECONOMIC LOSS OF ANY KIND,
ARISING OUT OF THIS AGREEMENT; PROVIDED, HOWEVER, THAT THE FOREGOING
LIMITATIONS SHALL NOT LIMIT EITHER PARTY’S INDEMNIFICATION OBLIGATIONS
WITH RESPECT TO THIRD PARTY CLAIMS.
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11.
Confidential
Information
.
Licensor and Licensee shall hold and shall cause each of their respective
affiliates, directors, officers, employees, agents, consultants, advisors
and other representatives to hold, in strict confidence and not to
disclose or release without the prior written consent of the other party,
any and all proprietary or confidential information, material or data of
the other party that comes into its possession
in
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- 6 -
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connection with
the performance by the parties of their rights and obligations under this
Agreement. The provisions of Section 4.5 of the Master Purchase Agreement
shall govern,
mutatis mutandis
, the confidentiality obligations of the
parties under this Section.
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12.
Attorneys’ Fees
. In any action hereunder to enforce the
provisions of this
Agreement, the prevailing party shall be entitled to recover its
reasonable attorneys’ fees in addition to any other recovery
hereunder.
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13.
Governing Law
. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with
the laws of the State of New York, without regard to the conflict of laws
rules thereof to the extent such rules would require the application of
the law of another jurisdiction.
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14.
Consent to
Jurisdiction
.
Subject to the provisions referenced in
Section L.16
, each of the parties irrevocably
submits to the jurisdiction of the federal and state courts located in
Philadelphia, Pennsylvania for the purposes of any suit, action or other
proceeding to compel arbitration, for the enforcement of any arbitration
award or for specific performance or other equitable relief pursuant to
Section L.16
. Each of the parties further agrees
that service of process, summons or other document by U.S. registered mail
to such parties address as provided in
Section L.1
shall be effective service of process
for any action, suit or other proceeding with respect to any matters for
which it has submitted to jurisdiction pursuant to this Section. Each of
the parties irrevocably waives any objection to venue in the federal and
state courts located in Philadelphia, Pennsylvania of any action, suit or
proceeding arising out of this Agreement or the transactions contemplated
hereby.
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15.
Specific Performance
. The parties hereto agree that the
remedy at law for any breach of this Agreement may be inadequate, and that
any party hereto shall be entitled to specific performance in addition to
any other appropriate relief or remedy. Such party may, in its sole
discretion, apply to a court of competent jurisdiction for specific
performance or injunctive or such other relief as such court may deem just
and proper in order to enforce this Agreement.
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16.
Dispute Resolution
. The procedures set forth in Article
VIII of the Master Separation Agreement shall apply to the resolution of
all disputes arising under this Agreement, except that all proceedings
provided for therein shall be conducted in Philadelphia,
Pennsylvania.
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17.
Entire Agreement
. This Agreement and the Schedules
hereto, as well as any other agreements and documents referred to herein,
constitute the entire agreement between the parties with respect to the
subject matter hereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations
between the parties with respect to such subject
matter.
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18.
Waiver of Jury Trial
. SUBJECT TO
SECTION L.16
, EACH OF THE PARTIES HEREBY WAIVES TO
THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF AND PERMITTED
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- 7 -
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UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.
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19.
Amendments
. No provisions of this Agreement shall
be deemed amended, modified or supplemented by any party hereto, unless
such amendment, supplement or modification is in writing and signed by the
authorized representative of the party against whom it is sought to
enforce such amendment, supplement or modification.
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20.
Counterparts
. This Agreement may be executed in any
number of counterparts, including by facsimile or electronic signature,
and each such counterpart shall be deemed an original instrument, and all
of such counterparts together shall constitute but one agreement. A
facsimile or electronic signature is deemed an original signature for all
purposes under this
Agreement.
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[SIGNATURE PAGES
FOLLOW]
- 8 -
IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Agreement as of the Effective Date.
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VISHAY S.A.
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By:
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/s/ Denis
Maugest
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Name:
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Denis Maugest
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Title:
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Directeur General
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VISHAY MEASUREMENTS GROUP,
INC.
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By:
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/s/ William M.
Clancy
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Name:
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William M.
Clancy
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Title:
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Secretary
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- 9 -
SCHEDULE A
LICENSED PRODUCTS
FAM DESIGNATION
|
PRODUCT
|
JAUGES DE CONTRAINTE
|
JAUGE 21L30 E V 1K N 13 G036
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JAUGES DE CONTRAINTE
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JAUGE 21L60 E P 1K R 24 G013
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JAUGES DE CONTRAINTE
|
JAUGE-G018
|
JAUGES DE CONTRAINTE
|
JAUGE-G036
|
JAUGES DE CONTRAINTE
|
JAUGE-G022
|
JAUGES DE CONTRAINTE
|
JAUGE-G088
|
JAUGES DE CONTRAINTE
|
JAUGE-G096
|
JAUGES DE CONTRAINTE
|
JAUGE-G098
|
JAUGES DE CONTRAINTE
|
JAUGE-G040
|
JAUGES DE CONTRAINTE
|
JAUGE-G1020
|
JAUGES DE CONTRAINTE
|
JAUGE-G1021
|
JAUGES DE CONTRAINTE
|
JAUGE-G079
|
JAUGES DE CONTRAINTE
|
JAUGE-G100
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JAUGES DE CONTRAINTE
|
JAUGE-G1004
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JAUGES DE CONTRAINTE
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JAUGE-G1033
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JAUGES DE CONTRAINTE
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JAUGE-G050
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Building Lease Agreement
by and between
Lessor: Alpha Electronics
Corporation
and
Lessee:
Vishay
Japan
Co., Ltd.
-
1 -
Summary of Lease
(Building Lease Agreement)
(1)
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Lessor
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Alpha Electronics K.K.
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(2)
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Lessee
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Vishay Japan Co., Ltd.
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(3)
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Building
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Name
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VJQC
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Location
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238-1
Itaizawa, Nakatashiro, Yurihonjo-city, Akita
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Structure
and
Size
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One
floor of light steel prefabrication structure
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Total area
of
the building
|
148
square meters
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(4)
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Purpose
|
Products inspection center
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(5)
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Rent
|
Consumption
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Sub total
|
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tax
|
|
Monthly Rent
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295,000 yen
|
14,750 yen
|
309,750 yen
|
Security
Deposit
(12
months worth of
monthly rent)
|
3,540,000 yen
|
Starting day of
rent
|
April 1
st
,
2010
|
(6)
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Term
of lease
|
5 years from the delivery date
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(7)
|
Special provisions
|
-
5 parking lots within Akita
Facility (see Article 8 below)
-
Use of cafeteria of Akita Facility (see Article 8
below)
|
- 2 -
Building Lease Agreement
This Building Lease
Agreement (hereinafter referred to as the
“
Agreement
”
) is made and entered into by and between
Alpha Electronics Corp. (hereinafter referred to as the
“
Lessor
”
) and Vishay Japan Co., Ltd. (hereinafter
referred to as the
“
Lessee
”
) relating to the
Building that is to be leased by the Lessor to the Lessee and that is the
subject of the lease set forth in Column (3) of Summary of Lease (marked with
shaded area of the drawing set forth in Exhibit 1) (hereinafter referred to as
the
“
Building
”
) in the Akita Facility of the Lessee
(
“
Akita
Facility
”
), as follows.
Article 1
(Lease of Building)
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In accordance
with the provisions of this Agreement, the Lessor shall lease the Building
to the Lessee, and the Lessee shall lease the Building from the Lessor.
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Article 2
(Purpose)
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The Lessee
shall use the Building only for the purpose specified in Column (4) of
Summary of Lease, and it may not use the Building for any other purposes
unless the Lessee obtains prior written approval from the Lessor.
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Article 3 (Term
of Lease)
|
1.
|
|
The
term of lease shall be as set forth in Column (6) of Summary of Lease and
shall be automatically renewed on 5 year basis unless otherwise notified
in writing by either party at least 6 months prior to the original or any
extended term of the lease.
|
2.
|
|
Notwithstanding paragraph 1 above, the Lessee may terminate the
lease at any time by giving 6 months prior written notice.
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Article 4
(Rent)
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In
consideration for the lease, use of the 5 parking lots as set forth in
Column (5) of Summary of Lease and the availability of the cafeteria in
Akita Facility for employees of the Lessee and other valuable
considerations, the Lessee agrees to pay the rent as set forth in Column
(5) of Summary of Lease, and the payment of the monthly rent shall be made
in advance before the end of each month immediately preceding the relevant
month (when the payment day falls on a bank holiday, then on the previous
business day) by means of bank transfer to the bank account designated by
the Lessor. Such bank transfer fees shall be borne by the Lessee.
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Article 5
(Division of Expenses to Be
Borne)
|
1.
|
|
The Lessor shall be responsible for expenses as listed
below:
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(1)
|
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Duties
and taxes imposed on the Building and the premises including, but not
limited to, the fixed assets tax and the city planning tax (excluding,
however, those to be charged on facilities or fixtures, etc that the
Lessee adds to the Building and the premises.);
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(2)
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Water
charges;
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(3)
|
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Costs
and expenses relevant to repairing works required to maintain and manage
the Building itself and attached facilities (excluding, however, costs and
expenses relevant to repairs and maintenance, replacement or renewal of
fixtures set forth in Article 11);
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(4)
|
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Any and
all costs and expenses other than those to be borne by the Lessee as set
forth in the following Paragraph 2;
|
2.
|
|
The Lessee shall be responsible for expenses as listed
below:
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(1)
|
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Electricity charges, and for this purpose the Lessee shall install
a separate meter for electricity;
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(2)
|
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Costs
and expenses relevant to the repairs and maintenance, replacement or
renewal of fixtures set forth in Article 11;
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(3)
|
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Costs
and expenses that are determined to be borne by the Lessee through mutual
negotiations between the Lessor and the Lessee; and
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(4)
|
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Any and
all consumption tax and local consumption tax relevant to those set forth
above.
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Article 6
(Security Deposit)
|
1.
|
|
The Lessee shall furnish the Lessor with a security deposit in the
amount set forth in Column (5) of Summary of Lease as the initial security
deposit prior to the first day of the term of the lease by means of bank
transfer to the Bank Account designated by the Lessor.
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2.
|
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The handling of the security deposit set forth in the preceding
Paragraph shall be as follows:
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(1)
|
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The
security deposit does not accrue interest.
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(2)
|
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During
the term of the lease, the Lessee may not demand to set off its payment
obligations of the rent, or any other liabilities to the Lessor against
the security deposit.
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(3)
|
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In the
event of default or liabilities of the Lessee concerning obligations set
forth in this Agreement, including, but not limited to, delayed payment of
the rent, the Lessor may, at any time, after notifying the Lessee thereof,
appropriate a part or the whole of the security deposit for
such.
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(4)
|
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In
accordance with the Item (3) above, if the Lessor appropriates the
security deposit for the liabilities of the Lessee, the Lessee shall make
the security deposit whole by payment of the shortfall within five (5)
business days after the receipt of notice of appropriation.
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3.
|
|
Upon termination of this Agreement and after the completion of
surrender of the Building by the Lessee pursuant to the provisions of
Article 15, the Lessor shall immediately repay
the
|
- 2 -
|
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balance of the
security deposit after appropriating such to fill unpaid rent, restoration
expenses, and any and all liabilities that the Lessee is responsible for
and owing to the Lessor under this Agreement up to the completion of
surrender.
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Article 7 (Care
of Good Manager)
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The Lessee
shall use the Building with the due care of a good manager.
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Article 8
(Cafeteria and Parking Lots)
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During the term
of the lease the Lessor shall furnish the following services:
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(1)
|
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Use of and access to the cafeteria
in the Akita Facility by the employees of the Lessee, and, with a prior
notice and approval, visitors and other persons concerned ;
and
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(2)
|
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use of 5 parking lots in the Akita
Facility for the employees of the Lessee, and, with a prior notice and
approval, temporary use of the parking space by visitors and other persons
concerned.
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Article 9
(Alternation of Original Conditions)
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The Lessee
shall obtain prior written approval of the Lessor to do the following:
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(1)
|
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Creation, addition, removal, improvement or redecoration, etc. of
partitions, fittings or other fixtures and facilities;
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(2)
|
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New
construction, addition or improvement of electrical facilities, plumbing
and sanitary facilities, air-conditioning, gas, telephone and cable
broadcasting system, etc.;
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(3)
|
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Display
or representation of trade names, trade marks and other marks on entrance
doors, outer walls, windows, etc.;
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(4)
|
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Installation of money safe, and delivery and installation of other
heavy items;
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(5)
|
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Replacement of the key of an entrance door; and
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Article 10
(Cleaning, Etc.)
|
1.
|
|
Cleaning services relevant to the Building shall be made by the
Lessee at Lessee’s expenses.
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2.
|
|
General waste and industrial waste resulting from occupancy of the
Building shall be disposed of by the Lessee at its expenses and in its
responsibility.
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Article 11
(Repairs)
|
1.
|
|
If a repair is or seemingly will be required because of damages or
malfunction regarding the Building and the furniture and fixtures, and
facilities owned by or under management of the Lessor, the Lessee shall
notify the Lessor of the same promptly. Repairs that the Lessor
acknowledges necessary upon the receipt of the notice from the Lessee
shall be carried out by
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- 3 -
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the Lessor at the Lessor’s expenses.
|
2.
|
|
Notwithstanding the Paragraph 1 above, the Lessee is responsible
for and makes the repairs of the Building listed below at its expenses,
regardless of the amount and the Lessor shall not bear any responsibility
for any such repairs, monetary or not.
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|
(1)
|
|
Repairs relevant to fittings, lightning appliances, etc. under the
ownership of the Lessee in the Building;
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|
|
(2)
|
|
Small
repairs or normal wear and tear of walls, ceilings, floors, etc. in the
Building;
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|
(3)
|
|
Repairs of damages attributable to the Lessee;
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|
(4)
|
|
Repairs regarding fixtures, work pieces or facilities under the
ownership of the Lessee;
|
3.
|
|
The Lessee shall cooperate with the Lessor in repairs, improvements
or betterment (including maintenance accompanied by stoppage of power or
water supply; hereinafter the same) of the Building, its facilities, or
other maintenance works, etc. carried out by the
Lessor.
|
Article 12
(Expenses on Assets under the Ownership of the Lessee)
|
|
|
The Lessee
shall be responsible for duties and taxes imposed on fixtures, facilities
and other assets that the Lessee owns in the Building (regardless of the
title or name).
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|
Article 13
(Obligation to Compensate for Damages)
|
1.
|
|
If the
Lessor or any other third party suffers damage or expense (including those
suffered as a result of a claim from a third party) in connection with
this Agreement due to willful misconduct or negligence of the Lessee or
its agent, employee, subcontractor, visitor or other person concerned, the
Lessee shall immediately notify the Lessor thereof and with respect to the
matters attributable to the Lessee or its agent, employee, subcontractor,
visitor or other party concerned, immediately compensate for any such
damage or expense by restoring the Building to its original status or by
other method at its own cost in accordance with the Lessor’s
instructions.
|
2.
|
|
If the
Lessee or the Lessor fails to pay the amount payable to the other party
under this Agreement or agreements incidental to this Agreement by the
date designated under this Agreement or such agreements, such defaulting
party shall pay to the other the default interest at an annual rate of
14.5% until the same is paid in full (calculated on a per diem basis of
365 days per year; any fraction smaller than one (1) yen shall be rounded
down). Provided, however, that neither party shall be automatically
excused from the termination of this Agreement by the other party even if
such default interest is paid.
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|
|
Article 14
(Termination of this Agreement)
|
1.
|
|
If either party
commits a material breach with respect to its obligation to the other
party set
|
- 4 -
|
|
forth in this Agreement (including but not limited to a failure to
pay the rent) and does not rectify such breach or failure within thirty
(30) days (or seven (7) days in the case of monetary obligation) after
receiving the written notice from the other party requiring such breach to
be remedied, the other party may terminate this Agreement upon written
notice to the defaulting party.
|
2.
|
|
The Lessor may immediately terminate this Agreement without the
requirement of any proceedings such as a notice to the Lessee in the event
of any of the following acts or facts in respect of the
Lessee.
|
|
|
(1)
|
|
When
failing to pay the rent or other obligations for two (2) months or longer
or delaying the payment several times;
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(2)
|
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When
being subject to provisional attachment (
kari sashiosae
), provisional disposition
(kari shobun
), compulsory execution (
kyosei shikko
), disposition for failure to pay tax
(
taino shobun
), disposition for the suspension of
business at a bank (
ginko torhiki teishi
shobun
) or similar
action;
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|
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(3)
|
|
When a
resolution of dissolution is passed, or a petition for the commencement of
bankruptcy (
hasan
) proceedings, civil rehabilitation
(
minji saisei
) proceedings, corporate reorganization
(
kaisha kosei
) proceedings, special liquidation
(
tokubetsu seisan
) proceedings or any other similar
proceeding is filed;
|
|
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(4)
|
|
If
there is a fact that causes the social credit to be significantly lost or
act that is contrary to public order and good
morals.
|
Article 15
(Obligation to Surrender)
|
1.
|
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If this Agreement
is terminated in accordance with Articles 14 or for any other reason, the
Lessee shall (1) remove at the Lessee’s cost the fixtures, works or
facilities installed in or added to the Building or changed by the Lessee
and furnishings held or used by the Lessee, (2) remove the properties
installed or added by the Lessor at the request of the Lessee and deliver
them at the Lessee’s cost, and (3) surrender and return the Building to
the Lessor after restoring the Building to its original status by
repairing at the Lessee’s cost any breakage or breakdown or wear or tear
(excluding normal wear and tear) caused due to special use by the Lessee
with respect to the Building, fixtures or facilities.
|
2.
|
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If the Lessee
fails to restore the Building to its original status in accordance with
Articles 15.1, the Lessor or a person designated by the Lessor shall
remove the fixtures, facilities and furnishings and repair any breakage or
breakdown or wear or tear caused due to special use by the Lessee with
respect to the Building, fixtures or facilities and the Lessor may request
that the Lessee pay the cost thereof.
|
3.
|
|
If the Lessee
does not remove its properties in the Building even after this Agreement
is
|
- 5 -
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|
terminated and the Building is surrendered by the Lessee, the
Lessor may, at its discretion, dispose of such properties considering that
the Lessee has assigned such properties to the Lessor for free. In such
case, the Lessor may request that the Lessee pay the cost for removing
such properties. If such properties were owned by a third party, the
Lessee shall indemnify the Lessor for damages claimed by such third party
and any other expenses borne by the Lessor so long as the Lessor is in
good faith and without negligence.
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4.
|
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Upon
the surrender of the Building, the Lessee shall not make any claims
against the Lessor regardless of the reasons or nature of such claims,
including any claim for the reimbursement of the necessary expenses or
useful expenses incurred by the Lessee in connection with the Building,
compensation for moving or removal, or key money. In addition, the Lessee
shall not request that the Lessor purchase fixtures and facilities
installed in the Building at the Lessee’s cost.
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Article 16
(Damages Incurred until Completion of Surrender)
|
|
|
If the Lessee
fails to surrender the Building upon termination of this Agreement, the
Lessee shall pay to the Lessor damages equivalent to twice the amount of
the rent for the period from the day following the date of termination of
this Agreement to the date of completion of the
surrender.
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Article 17
(Entry)
|
1.
|
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Unless otherwise required by law
or ordinance, the Lessor shall not enter into the Building without prior
written consent of the Lessee; provided, however, that the Lessee shall
not unreasonably withhold such approval in case where, in the reasonable
judgment of the Lessor, there exists any dangerous condition causing
damage or injury to the Building or neighbors or neighboring Building. If
any damage occurs due to rejection by the Lessee of such approval, the
Lessee shall indemnify from and hold the Lessor and any third party
harmless against any damage suffered thereby.
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2.
|
|
If the Lessor or a person
designated by the Lessor enters the Building in accordance with Article
17.1, the entering party shall keep any trade secret of the Lessee
obtained upon the entry in confidence not only during the term of this
Agreement but also after the termination of this Agreement and shall not
divulge it to a third party.
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|
Article 18
(Exemption of Liability)
|
|
|
The Lessor
shall not be liable for any damage incurred by the Lessee due to cause,
such as force majeure, fire, theft, riot, or damage or operation of the
Building, equipment for electricity, water or air conditioning, or other
equipment, unless the Lessor fails to act with
the
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- 6 -
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|
due care of a
good manager or commits willful misconduct or gross
negligence.
|
|
|
|
Article 19
(Confidentiality)
|
|
|
Neither the
Lessor nor the Lessee shall disclose the information about the parties
concerned obtained under or in connection with this Agreement to a third
party unless the disclosure is necessary under the Applicable Laws or upon
request from the governmental authorities or otherwise agreed between the
parties, or shall use it for any other purpose than the purpose of this
Agreement.
|
|
|
|
Article 20
(Amendment to this Agreement)
|
|
|
The provisions
of this Agreement may be amended or modified only with the written consent
of both parties.
|
|
|
|
Article 21
(Jurisdiction)
|
|
|
The Lessor and
the Lessee agree that any dispute arising in connection with this
Agreement shall be submitted to the exclusive jurisdiction of the Tokyo
District Court as the court of first instance.
|
|
|
|
Article 22
(Good Faith Consultation)
|
|
|
Any doubts in
relation to the interpretation or application of the provisions of this
Agreement or any matters not provided for in this Agreement shall be
resolved upon consultation in good faith between the Lessor and the Lessee
in accordance with the related laws and ordinances and
customs.
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|
|
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Article 22
(Negotiation for the Purchase of the Building)
|
|
|
The Lessor
hereby grants to the Lessee the first refusal right (the “Option”) to buy
the Building and the underlying land (the “Real Building”) exercisable
during the term of the lease, subject to the terms and conditions
mentioned below:
|
|
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(a)
|
|
The Lessor and the Lessee shall
determine the size of the underlying land and identify the boundaries of
parcel of such land;
|
|
|
(b)
|
|
The price for the Real Building
shall be the average market price appraised by two real Building
appraisers practicing in Akita, each one of them appointed by the Lessor
and the Lessee, respectively;
|
|
|
(c)
|
|
The Lessor and the Lessee shall
negotiate in good faith the terms and conditions of the Service Agreement
for the use by the Lessee of the cafeteria and the parking lots in the
Akita Facility.
|
|
|
(d)
|
|
If the Lessee and the Lessor
agree to the matters mentioned in (a) to (c) above, the terms
and
|
- 7 -
conditions of such sale and purchase shall be those as may be generally
used in the sale and purchase agreements for real properties for factory use in
Akita; Provided, however, that the Lessee may designate a third party nominated
by the Lessee as the buyer from among Migdal Company.
IN WITNESS WHEREOF,
the parties caused this Agreement to be signed and sealed in duplicate, and each
party shall retain one copy.
Date: April 1, 2010
Lessor:
|
/s/ Akio
Ogasawara
|
|
Name:
|
Akio Ogasawara
|
Title:
|
Representative Director, Alpha Electronics
Corp.
|
Lessee:
|
/s/ Masaharu
Ozawa
|
|
Name:
|
Masaharu Ozawa
|
Title:
|
Representative Director, Vishay Japan Co.,
Ltd.
|
- 8 -
Exhibit 1
Drawing of the Leased Space
[Map of the Akita Facility
identifying
the Building that is the subject of the Lease
Agreement.]
- 9 -
LEASE AGREEMENT
This lease agreement (the “Lease”) is entered
into on July 6, 2010, between Vishay Intertechnology, Inc. (“Lessor”), a
Delaware corporation, having its principal place of business at 63 Lancaster
Avenue, Malvern, Pennsylvania, and Vishay Precision Group, Inc. (“Lessee”), a
Delaware corporation, having its principal place of business at 3 Great Valley
Parkway, Suite 150, Malvern, Pennsylvania.
RECITALS
The
parties recite and declare:
A. Lessor is the sole owner of an industrial
facility, described below, a portion of which it desires to lease to Lessee (the
“Industrial Facility”).
B. Lessee is a corporation that desires and is
empowered to lease from Lessor a portion of the Industrial Facility.
C. The parties desire to enter into this Lease
to define their respective rights, duties, and liabilities concerning this
Lease.
In consideration of the mutual covenants
contained in this Lease, the parties agree as follows:
SECTION ONE
A.
Lessor leases to Lessee that portion of
Lessor’s Industrial Facility located at 63 Lancaster Avenue, Malvern,
Pennsylvania, described on Schedule A annexed hereto and made a part hereof (the
“Leased Premises”). In addition to the Leased Premises, Lessee and its invitees
shall have the non-exclusive right to use, in common with Lessor and other
tenants, those applicable areas within the Industrial Facility, including the
entrances, roads, driveways, public and fire stairways, sidewalks, exterior
ramps and other similar areas which enable Lessee to obtain full use and
enjoyment of the Leased Premises for all customary purposes.
B.
The Leased Premises will be leased in “as is”
condition and used by Lessee solely for the purpose of conducting quality
assurance activities and operating demo-kit laboratories in accordance with the
terms of this Lease.
SECTION TWO
The term of the Lease shall be for a period of
five (5) years (the “Term”), commencing on July 6, 2010 (the “Commencement
Day”), provided Lessee shall have the right, without penalty or liability, to
terminate this Lease for any reason or no reason prior to the scheduled
expiration of the Term upon not less than thirty (30) days’ prior written notice
to Lessor.
SECTION THREE
Lessee shall pay an annual rent of $73,704
(Seventy Three Thousand Seven Hundred and Four Dollars) (“Rent”) during the Term
of this Lease for the Leased Premises. All payments of Rent shall be payable by
Lessee in equal monthly installments of $6,142 (Six Thousand One Hundred and
Forty Two Dollars) in advance on the first day of each calendar month. Rent for
any partial calendar months included in the Term shall be prorated on a per diem
basis. Except as expressly set forth to the contrary herein, Lessee shall not be
obligated to pay any sum in addition to Rent to Lessor on account of Lessee’s
occupancy of the Leased Premises, the parties intending this Lease to be a
“gross lease”.
Rent payable by Lessee pursuant to this Lease
includes all expenses for water, HVAC, electricity, trash collection, sewer,
plumbing, all other utilities reasonably consumed in the Leased Premises, two
phone lines, Real Property Taxes (as defined below) and, except to the extent
caused by the negligence or willful misconduct of Lessee, maintenance, repair
and replacement of the Leased Premises including security services. As used
herein, the term “Real Property Taxes” shall be deemed to mean the aggregate
amount of all taxes and assessments directly levied, assessed or imposed upon
the Leased Premises, its land and improvements.
SECTION FOUR
A.
Lessee has examined and knows the condition of
the Leased Premises and accepts the Leased Premises in good condition and
working order. Lessee acknowledges that no representations as to the repair of
the Leased Premises or promises to alter, remodel, or improve the Leased
Premises have been made by Lessor.
B.
Lessee shall not hold Lessor liable for any
latent or non latent defects on the Leased Premises.
SECTION FIVE
A.
Lessee shall maintain the Leased Premises in a
clean and operational condition and, subject to the provisions of Section 10(C),
repair at Lessee’s sole cost all damages to the Leased Premises occasioned by
the fault or negligence of Lessee or its agents or employees.
B.
Except for Lessee’s obligations set forth in
Section Five(A) above, Lessor shall be responsible at Lessor’s sole cost and
expense for all maintenance, repairs and replacements to the Leased Premises and
the Industrial Facility. Upon not less than one (1) business day’s notice to
Lessee, Lessor may enter the Leased Premises at any and all reasonable hours to
inspect the Leased Premises and to perform Lessor’s obligations under this
Lease. In connection with any such entry, Lessor shall use reasonable efforts to
minimize any interference with the use of the Leased Premises by Lessee.
C.
Lessor shall furnish all of the following
services to the Leased Premises twenty four (24) hours per day, seven (7) days
per week: (i) heat, air conditioning and water required for the occupancy of the
Leased Premises, (ii) access to the Leased Premises and the Industrial Facility,
including elevators if applicable, (iii) snow and ice removal, (iv) janitorial
services to the Leased Premises Monday through Friday, (v) electricity adequate
for Lessee’s use of the
-2-
Leased Premises and the
Industrial Facility, and (vi) such other services typical for an industrial
building similar to the Industrial Facility.
SECTION SIX
Lessee shall obtain the written approval of
Lessor, not to be unreasonably withheld, conditioned or delayed, prior to making
any alterations or modifications to the Leased Premises. All approved and
completed alterations or modifications shall become part of the Leased Premises
and title to such alterations and modifications shall vest in Lessor. The
alterations or modifications undertaken by Lessee shall be performed and
completed in a good and workmanlike manner.
Upon the expiration of the tenancy hereby
created, if Lessor so requires in writing at the time of its approval, Lessee
shall promptly remove at its sole cost any alterations, additions, improvements
and fixtures other than trade fixtures placed in the Leased Premises by Lessee
and designated in said request, and repair any damage occasioned by such removal
at Lessee’s expense. Notwithstanding the foregoing, Lessee may install any
necessary trade fixtures, equipment and furniture in the Leased Premises without
Lessor’s written approval and all such items shall remain the property of Lessee
during and after the Term.
SECTION SEVEN
A.
Lessee shall not use the Leased Premises for
any unlawful or immoral purpose and shall not conduct any activity in the Leased
Premises that could reasonably be expected to increase the possibility of fire
or any other hazard or materially increase the rate of insurance on the Leased
Premises or the Industrial Facility. Lessee further covenants that it will not
create, maintain or permit a nuisance in or on the Leased Premises. Lessee
further agrees to keep the Leased Premises clean and reasonably free from
rubbish and dirt at all times, and shall store all trash within the areas
designated by Lessor at the Leased Premises and will make the same available for
regular pick-up. Lessee will not burn any trash or garbage at any time in or
about the Industrial Facility.
B.
Lessee, at Lessee’s sole cost and expense,
shall promptly comply with the laws, ordinances and regulations regarding
Lessee’s particular use of the Leased Premises. Lessor, at Lessor’s sole cost
and expense, shall promptly comply with all laws, ordinances and regulations
applicable to the Leased Premises and the Industrial Facility except for
compliance that is Lessee’s responsibility pursuant to the previous sentence.
C.
Lessee shall not cause any Hazardous Materials
to be released, brought upon, stored, produced, emitted, disposed of or used
upon, about or beneath the Leased Premises by Lessee, its agents, employees,
contractors or invitees in violation of Environmental Laws. As used herein, the
term “Hazardous Materials” shall mean any substance or condition (including
mold) that could pose a threat to human health and any flammable, explosive or
radioactive materials, asbestos, formaldehyde foam insulation, polychlorinated
biphenyls, methane, hazardous materials, hazardous wastes, hazardous or toxic
substances or related materials, as defined in the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections
9601, et seq.), the Hazardous Materials Transportation Act, as
-3-
amended (49 U.S.C.
Sections 1801, et seq.), the Resource Conservation and Recovery Act, as amended
(42 U.S.C. Sections 6901, et seq.), the Toxic Substances Control Act, as amended
(15 U.S.C. Sections 2601, et seq.) (collectively, “Environmental Laws”).
SECTION EIGHT
Except as otherwise provided in this Lease,
Lessee agrees that it will not pledge, loan, mortgage, or attempt in any other
manner to dispose of its interest in the Leased Premises or to voluntarily
permit any liens, encumbrances, or legal process to be incurred or levied on the
Leased Premises.
SECTION NINE
A.
Lessee shall not assign its rights and duties
under this Lease or sublease the demised Leased Premises or any part of the
demised Leased Premises.
B.
Lessor, at any time and from time to time, may
make an assignment of its interest in this Lease, the Leased Premises or the
Industrial Facility and in the event of such assignment and the assumption by
the assignee of the covenants and agreements to be performed hereunder by
Lessor, Lessor shall be released from any and all liability hereunder.
SECTION TEN
A.
Except for negligent or willful acts or
omissions of Lessor, its agents, contractors, servants and employees
(collectively, “Lessor Parties”) and subject to the provisions of Section 10(C),
Lessee agrees to indemnify and save Lessor Parties harmless from and against any
and all claims, demands, damages, costs and expenses, including reasonable
attorneys’ fees (collectively, “Loss and Expense”), arising from or in
connection with the Leased Premises. Except for negligent or willful acts or
omissions of Lessee, its agents, contractors, servants or employees
(collectively, “Lessee Parties”) and subject to the provisions of Section 10(C),
Lessor agrees to indemnify and save Lessee Parties harmless from and against any
and all Loss and Expense arising from any failure by Lessor to perform any of
the terms, covenants or conditions of this Lease on Lessor’s part to be
performed or the negligence or willful misconduct of Lessor Parties. The
provisions of this Section Ten shall survive the termination or earlier
expiration of this Lease.
B.
Lessee will, at its own expense, maintain a
policy or policies of comprehensive general liability insurance which will
include coverage for theft with respect to the respective property and
activities in the Leased Premises with the premiums thereon fully paid on or
before due date, issued by and binding upon a reputable insurance company, such
insurance to afford minimum protection of not less than $1,000,000 combined
single limit coverage of bodily injury, property damage or combination thereof.
Lessor shall be listed as an additional insured on Lessee's policy or policies
of comprehensive general liability insurance, and Lessee shall provide Lessor
with current certificates of insurance evidencing Lessee's compliance with this
Section. Lessee shall obtain the agreement of Lessee's insurers to endeavor to
notify Lessor that a policy is due to expire at least (10) days prior to such
expiration. Lessor shall only be required to maintain its standard insurance for
the building of the Leased Premises.
-4-
C.
Lessor and Lessee each hereby release the
other, its officers, directors, employees and agents, from liability or
responsibility (to the other or anyone claiming through or under them by way of
subrogation or otherwise) for any loss or damage to property covered (or
required under this Lease to be covered) by valid and collectible insurance,
even if such loss or damage shall have been caused by fault of negligence of the
other party, or anyone for whom such party may be responsible. Lessor and Lessee
each agree that any insurance policies carried by either party covering the
Leased Premises or their contents will include a waiver of the insurer’s right
of subrogation against the other party during the Term.
SECTION ELEVEN
A.
Lessee shall not be deemed to be in default
hereunder unless an Event of Default, as hereinafter defined, has occurred. The
following shall constitute events of default by Lessee hereunder (each, an
“Event of Default”):
i.
Failure to pay the Rent
or any other sum of money required to be paid by Lessee hereunder when due and
continuance of such failure for five (5) days after notice from Lessor to
Lessee; or
ii.
Failure to comply with or
perform any of the other terms, covenants, conditions or agreements to be
complied with or performed by Lessee and continuance of such failure for thirty
(30) days after notice from Lessor to Lessee, or, if the failure is of such a
character as cannot reasonably be cured within thirty (30) days, failure to
initiate within said thirty (30) day period such action as reasonably can be
taken toward curing the same and/or failure to prosecute such action as promptly
as is reasonably practicable after said action is initiated.
B.
Following the occurrence of an Event of
Default hereunder, Lessor shall have the right to:
(1) reenter and regain possession of the
Leased Premises upon ten (10) days prior written notice to Lessee, remove any
property of Lessee found on the Leased Premises, perform such maintenance and
repairs as may be reasonably required, and relet the Leased Premises upon
commercially reasonable terms, provided all consideration received by Lessor as
a result of such reletting shall be for the account of Lessee. Reentry shall not
release Lessee from the obligation to make payments of Rent or other amounts due
pursuant to this Lease, including Lessor’s reasonable and actual expenses
incurred in preparing the Leased Premises for reletting; or
(2) terminate this Lease, such termination to
be effective ten (10) days following receipt by Lessee of written notice of
Lessor’s intention to terminate this Lease but Lessee shall remain liable for
all its outstanding obligations pursuant to this Lease prior to the effective
date of such termination.
C.
If at any time during the term of this Lease
(a) Lessee shall file in any court a petition of bankruptcy or insolvency or for
reorganization, or for arrangement or for the appointment of a receiver or
trustee of all of all or portion of Lessee’s property; or (b) an involuntary
petition of any kind shall be filed against Lessee, and such petition shall not
be
-5-
vacated or withdrawn
within sixty (60) days after the date of filing thereof; or (c) if Lessee shall
make an assignment for the benefit of creditors; or (d) if the Lessee shall be
adjudicated a bankrupt; or (e) a receiver shall be appointed for the property of
Lessee by order of a court of competent jurisdiction (except where such receiver
shall be appointed in an involuntary proceeding, if he shall not be withdrawn
within sixty (60) days from the date of the appointment), Lessee’s right to
possession hereunder shall terminate ipso facto upon the happening of any one of
such events, and Lessee shall then quit and surrender the Leased Premises to
Lessor, but Lessee shall remain liable for all its outstanding obligations
pursuant to this Lease.
D.
In the event of any Event of Default hereunder
by Lessee, Lessor may immediately or at any time thereafter, upon five (5) days
prior written notice to Lessee and provided such Event of Default remains
uncured, cure such breach for the account and at the expense of
Lessee.
SECTION TWELVE
Lessee shall surrender the Leased Premises
(including all keys thereto) to Lessor on the expiration or termination of this
Lease. At the time of surrender, the Leased Premises shall be in the same
condition as on the Commencement Day, normal wear and tear, casualty,
condemnation and acts of Lessor excepted. If the Leased Premises are not
surrendered at the end of the Term or the sooner termination thereof, (i) Lessee
shall be deemed to be occupying the Leased Premises as a tenant from month to
month, at a monthly Rent equal to twice the Rent payable during the last month
of the Term, and (ii) Lessee shall indemnify Lessor against loss or liability
resulting from Lessee’s delay in so surrendering the Leased Premises and first
arising or accruing on or after sixty (60) days following the expiration or
termination of this Lease, excluding consequential, indirect, punitive and
special damages.
SECTION THIRTEEN
Lessee agrees that this Lease shall be
subordinate to any mortgages or deeds of trust that may hereafter be placed upon
the Leased Premises and to any and all advances to be made thereunder, and to
the interest thereon, and all renewals, replacements and extensions thereof
provided that any such mortgagee or trustee thereunder agrees to recognize
Lessee’s rights hereunder and to not disturb Lessee’s use and occupancy of the
Leased Premises. Lessee shall execute and deliver any commercially reasonable
instruments as may be required to confirm the provisions of this Section
13.
SECTION FOURTEEN
A.
It is agreed that this Lease shall be governed
by, construed, and enforced exclusively in accordance with the laws of the
Commonwealth of Pennsylvania.
B.
LESSOR AND LESSEE EXPRESSLY WAIVE TRIAL BY
JURY IN ANY COURT WITH RESPECT TO ANY CLAIM, COUNTERCLAIM OR CROSS-CLAIM AGAINST
THE OTHER ARISING OUT OF OR CONNECTED IN ANY WAY TO THIS LEASE.
-6-
C.
Unenforceability of any
provision contained in this Lease shall not affect or impair the validity of any
other provision of this Lease.
D.
Waiver by either party
of any breach of any covenant or duty of the other party under this Lease shall
not be deemed to be a waiver of a breach of any covenant or duty of the other
party, or of any subsequent breach of the same covenant or duty.
E.
This Lease may be
executed in any number of counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute but one and the same
instrument.
F.
The various rights and
remedies contained in this Lease shall not be considered as exclusive of any
other right or remedy, but shall be construed as cumulative and shall be in
addition to every other remedy now or hereafter existing at law, in equity, or
by statute.
G.
This Lease shall
constitute the entire agreement between the parties. Any prior understanding or
representation of any kind preceding the date of this Lease shall not be binding
upon either party except to the extent incorporated in this Lease.
H.
Any modification of
this Lease or additional obligation assumed by either party in connection with
this Lease shall be binding only if evidenced in a writing signed by each
party.
I.
Any notice required or
permitted under this Lease shall be in writing, sent by a reputable private
carrier of overnight mail or mailed by United States Certified Mail, Return
Receipt Requested, postage prepaid, in each case to the address set forth
below:
If to Lessee:
|
|
If to Lessor:
|
|
Vishay Precision Group, Inc.
|
|
Vishay Intertechnology,
Inc.
|
3 Great Valley Parkway
|
|
63 Lancaster Avenue
|
Malvern, PA 19355-1307
|
|
Malvern, PA 19355-2120
|
Attn:
|
William M. Clancy,
Chief
|
|
Attention:
|
Dr. Lior E.
Yahalomi,
|
|
Financial Officer
|
|
|
Chief Financial
Officer
|
Facsimile: (484)-321-5300
|
|
Telephone: 610-644-1300
|
Confirm: (484)-321-5300
|
|
Facsimile: 610-889-2161
|
|
With a copy to:
|
|
With a copy to:
|
|
Pepper Hamilton LLP
|
|
Kramer Levin Naftalis & Frankel
LLP
|
3000 Two Logan Square
|
|
1177 Avenue of the Americas
|
Philadelphia, PA 19103-2799
|
|
New York, New York 10036
|
Attn: Barry Abelson, Esq.
|
|
Attn: Ernest Wechsler, Esq.
|
Facsimile: (215) 981-4750
|
|
Facsimile: (212) 715-8000
|
Confirm: (215) 981-4000
|
|
Confirm: (212)
715-9100
|
-7-
Either Lessor or Lessee may, by notice to the
other, change the address(es) to which notices are to be sent. All notices shall
be deemed effective upon receipt or upon refusal to accept
delivery.
J.
This Lease shall be binding upon and shall
inure to the benefit of the parties hereto, their executors, administrators,
successors and permitted assigns.
K.
Lessee shall have the right to use 2 parking
spaces located at the Industrial Facility.
L.
Lessee represents that the undersigned
individual has been duly authorized to execute this Lease on behalf of Lessee
and that the execution and consummation of this Lease by Lessee does not and
shall not violate any provision of any bylaws, certificate of incorporation,
partnership or agreement, or other agreement, order, judgment, governmental
regulation or any other obligations to which Lessee is a party or is subject.
Lessor represents that the undersigned individual has been duly authorized to
execute this Lease on behalf of Lessor and that the execution and consummation
of this Lease by Lessor does not and shall not violate any provision of any
bylaws, certificate of incorporation, partnership or agreement, or other
agreement, order, judgment, governmental regulation or any other obligations to
which Lessor is a party or is subject.
[The remainder of this
page left intentionally blank]
-8-
IN WITNESS WHEREOF the parties have executed
this Lease in duplicate originals upon the dates indicated below.
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VISHAY INTERTECHNOLOGY,
INC.
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By:
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/s/ Marc Frohman
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Printed Name: Marc Frohman
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Title: Senior Vice President, Corporate
General
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Counsel and Corporate
Secretary
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Date: July 6, 2010
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VISHAY PRECISION GROUP,
INC.
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By:
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/s/ William M. Clancy
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Printed Name: William M.
Clancy
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Title: Executive Vice President and
Chief Financial
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Officer
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Date: July 6,
2010
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[Signature page to
Malvern, PA Lease]
SCHEDULE A
LEASED
PREMISES
[Drawing of Vishay Buildings B & C, with
shaded areas
representing leased premises.]
LEASE AGREEMENT
Made and signed on the
4 of July 2010
BETWEEN:
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Vishay Precision Israel
Ltd.,
Company No.
514436914
(hereinafter, the “
Lessor
”)
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of the one
part
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AND:
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Vishay Israel
Ltd.,
Company No.
51-051466-4
(hereinafter,
the “
Lessee
”)
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of the other
part
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WHEREAS:
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The Lessor is
entitled to be registered as the owner of the land known as parcel 21 in
block 6782 (hereinafter: the “
Land
”) located on Haofan, 2 in Holon, and
the building standing on the Land (hereinafter, the “
Building
”), and;
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WHEREAS:
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Part of the
Building is occupied and is being used by the Lessor;
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WHEREAS:
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The Lessee
desires to lease from The Lessor part of the Building designated in red on
the plan attached to this Agreement as
Appendix A
(hereinafter: the
"Premises"
) for the terms and subject to the
conditions provided in this Agreement;
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THEREFORE
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the parties
hereby agree as follows:
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1.
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The Lease
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1.01
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The Lessee hereby
leases the Premises from the Lessor in its "as is" condition (hereinafter:
the "
Lease
").
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1.02
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The Premises are
leased to the Lessee for a period of six months commencing on July 4
th
2010 and
terminating on January 3
rd
, 2011
(hereinafter: the "
Term
").
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1.03
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The Lessee has an
option to extend the Term for an additional period of six months , on the
terms and conditions hereof. The exercise of the option will be by way of
sending the Lessor a written notice of the Lessee’s intention to extend
the Term as above, no later than three (3) months prior to the expiration
of the Term.
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All the terms and
conditions of this Agreement shall apply during the extended term as
above, should the Term be so extended, save for the right to extend the
Term.
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1.04
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The Premises are
leased to the Lessee to be used as offices ,and for no other
purpose.
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2.
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The Rent
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2.01
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In consideration
for the Lease, the Lessee shall pay the Lessor monthly rent in the amount
of US11,570 (hereinafter the "
Rent
").
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The monthly Rent
during the Term and during the extended term as in section 1.03, should
the Term be extended, shall be linked to US CPI . The base Index for such
calculation should be the CPI known on the date of this Agreement.
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2.02
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The Rent will be
paid every month during the Term, in advance, on the first day of each
calendar month of the Term.
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2.04
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Value Added Tax
("
VAT
") shall be added to every Rent payment
and to any other payment under this Agreement, at the rate applicable at
the time of such payment.
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3.
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Additional Payments
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3.01
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All taxes, fees,
levies, municipal and governmental, which shall apply to the Premises
during the Term, shall be borne and timely paid by the Lessee.
Without derogating from the above, the Lessee shall pay the Proportional
Share in all taxes, fees and levies relating to the Common Areas of the
Building designated in the blue on the scheme attached hereto as
Appendix A
(hereinafter the "
Common Areas
").
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2
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The
"
Proportional Share
" shall be calculated according to the
ratio between the area of the Premises and the total area the Building,
excluding the Common Areas.
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3.02
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The Lessee shall
bear and pay during the Term: (a) all payments and expenses for the any
supply of utilities as compressed air, water and electricity, HVAC (Heat,
ventilation, air condition), in accordance with its Proportional Share ;
and (b) all taxes and payments with regard to the conduct in the Premises
of the Lessee's business, including business tax, signs tax, licenses fees
and the like.
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3.03
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Should any
payment that the Lessee is required to bear and pay, be made by the
Lessor, the Lessee shall repay the Lessor any such amount, together with
interest.
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3.04
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Throughout the
Term, the Lessee shall bear and pay its Proportional Share in the cost of
management and maintenance of the Building and with an addition of 5%
management fee.
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4.
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Possession and Use of the
Premises
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4.01
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The Lessee shall
not: assign its rights under this Agreement, or any part thereof, to any
entity or person whatsoever, directly or indirectly, deliver or transfer
the Premises or any part thereof to any entity or person whatsoever;
sub-lease the Premises or any part thereof to any entity or person; permit
the use of the Premises or any part thereof by any entity or person for
any period and in any manner whatsoever; allow others to share possession
of the Premises or any part thereof in any manner; or grant any entity or
person any right in the Premises whether for consideration or without
consideration.
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4.02
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The Lessee shall
maintain the Premises throughout the Term in good condition and not cause
any damage or breakage therein to the Premises or to any of its
installations and systems; and shall be responsible for the immediate
repair, at its own expense, of any damage or breakage (excluding
reasonable wear and tear) which may be caused to the Premises or its
installations or systems.
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4.03
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The Lessee shall
not: effect any alterations, make any additions or destroy any part of the
Premises and/or any of its installations and systems, without the prior
written consents of Lessor. The Lessor shall be free to withhold
its
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3
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consent and
will not be obliged to give reasons. The Lessor shall be entitled to
prevent implementation of any act as aforesaid, at any time, and to remove
or destroy any alteration or addition that may be effected without the
Lessor's prior written consent. Should the Lessee breach any of its
obligations as above, the Lessor shall be entitled, in addition to any
other remedy available to it by law, to terminate this
Agreement.
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4.04
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In the event the
Lessee has received the needed approvals and made changes or additions to
the Premises (the "
Changes
"), the Lessee undertakes to restore the
Premises before the end of the Term to their condition as of the date of
execution hereof. Should the Lessee not restore the Premises as required
above, then Lessor may restore the Premises to their previous condition.
In such case, the Lessee will pay Lessor, upon its first demand, all sums
paid by Lessor in connection with such restoration.
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4.05
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Throughout the
Term of the Lease the Lessee shall enjoy common use, together with the
Lessor and / or any possessors of areas in the Building, of the Common
Areas. The Lessee undertakes to use the Common Area as expected with
regard to areas that are in common use.
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The Lessee, its
employees, visitors, or clients will not enter those parts of the Building
that are not included in the Premises and are not part of the Common Areas
(hereinafter the "
Lessor's Areas
"),
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5.
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Licenses
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The Lessee
undertakes to receive and hold in full affect, throughout the Term all
licenses and permits required for the purpose of conducting its business
in the Premises to the extent such licenses and permits are
required.
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6.
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Responsibility of the
Lessee
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6.01
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The Lessee is
obligated to maintain the Premises during the Term in good condition, and
to avoid from causing any damage or breakage to the Premises or any of its
systems or installations, and to repair immediately and on its expense any
damage that may be caused to the Premises and its systems and
installations.
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4
6.02
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The Lessee shall
be responsible for any damage or breakage that may be caused to the
Premises and/or to the Building and/or to Lessor and/or to any third party
in the Premises and/or in the Building, as a result of the actions and/or
omissions of the Lessee, its employees, visitors, or clients, and/or as a
result of the conduct of the Lessee's business in the Premises.
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6.03
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The Lessor shall
not have any liability or responsibility whatsoever relating to or arising
from any such damage or breakage (including but not limited to, bodily
injury) that may be caused to the Lessee, to the Premises, to its
contents, or to any third party. The Lessee alone shall be responsible for
any such injury or damage, and shall indemnify and/or hold Lessor harmless
from any payments and expenses which may be incurred as a result of such
damage or breaking.
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7.
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Insurance
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Without
derogating from the responsibility of the Lessee as stated in section 6
above, the Lessor undertakes to hold during the entire Term insurance as
customary.
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8.
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Changes or Additions by
Lessor
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8.01
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The Lessor is
entitled to make any changes in the Building and to initiate changes in
the town plan relating to the Building and to the Land and to request a
building permit with respect to the Land and/or the Building. The Lessee
undertakes not to interfere and not to oppose such changes or
requests.
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8.02
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The Lessor shall
be entitled, without need for the Lessee's consent, to initiate and to
perform any changes or additions to the Building, at its absolute
discretion as it shall deem fit from time to time.
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8.03
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Without
derogating from the generality of any section of this Agreement, the
Lessee hereby explicitly agrees that Lessor may at any time, add and/or
construct additional floors in the Building and/or carry out any other
construction works and/or changes and/or additions in the Building;
without any limitation and without the need for the Lessee's consent. The
Lessee undertakes to enable Lessor to carry out said work and not to
interfere and not to oppose such work or otherwise disturb.
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5
9.
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Vacating the
Premises
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At the end of the
Term, or upon termination of this Agreement for any reason whatsoever
before the end of the Term, the Lessee undertakes to vacate the Premises
and to deliver the possession thereof to Lessor. The Premises, when the
Lessee vacates them, shall be free and clear of all persons and objects
connected to the Lessee, clean, and in condition in which the Lessee
received them from Lessor, except for reasonable wear and tear.
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10.
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Miscellaneous
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10.01
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All payments that
the Lessee undertakes to pay the Lessor in accordance with this Agreement
shall be paid by the Lessee by way of deposit to Lessor’s account details
of will be given by the Lessor from time to time.
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10.02
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This Agreement is
not transferable or assignable by the Lessee in any manner.
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10.03
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The Lessor shall
be entitled to transfer and/or assign any or all of its rights to the
Building and/or the Premises. The Lessor shall be entitled to transfer
and/or assign any or all of its rights and/or liabilities under this
Agreement without any limitation and in its sole and absolute discretion
and without any need for consent of the Lessee.
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10.04
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The parties
declare that there are no restrictions or other provisions that limit,
prohibit or otherwise prevent the Parties from entering into this
Agreement
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10.05
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This Agreement
reflects the agreements and understandings of the parties with respect to
the Premises, and this Agreement supersedes any and all undertakings,
representations, understandings, or agreements, if any, between the
parties with respect to the lease of the Premises made prior to the
execution of this Agreement. Any change or addition to this Agreement must
be in writing and be signed by both parties.
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10.06
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To assure payment
of the Rent and the fulfillment of all the lessee's other obligations,
including the vacating of the Premises by the Lessee, the Lessee shall
furnish the Lessor, on the signing of this Agreement, with promissory note
(hereinafter
“the Security”
). The Lessor shall have the right to
use the Security or any part thereof in the event the Lessee breaches its
obligations under this Agreement.
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6
11.
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Addresses and
Notices
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12.01
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The addresses of
the parties for the purposes of this Agreement are as follows:
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Lessor:
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2 Haofan Street, Holon 58814, Israel
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Lessee:
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2 Haofan Street, Holon 58814,
Israel
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11.02
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Any notice sent
by one party to the other by registered mail to the addresses
abovementioned shall be deemed as having been delivered within a
reasonable time from the date of its posting at a post office.
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IN WITNESS WHEREOF
, the parties have hereby affixed their
signatures on the day first above
written.
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VISHAY ISRAEL
LTD.
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VISHAY
PRECISION ISRAEL LTD.
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The Lessee
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The Lessor
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By:
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/s/ Marc Zandman
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By:
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/s/ Ziv Shoshani
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Title:
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Authorized Signatory
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Title:
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Authorized Signatory
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7
Vishay Precision Group Inc. 2010 Stock
Incentive Program
1.
Purpose
The Vishay Precision
Group Inc. 2010 Stock Incentive Program (the “Program”) provides for the grant
of stock options, restricted stock and stock units to executive officers, key
employees and directors of Vishay Precision Group Inc. (the “Company”) and its
subsidiaries. The purpose of the Program is to enhance the long-term performance
of the Company and to provide the selected individuals with an incentive to
improve the growth and profitability of the Company by acquiring a proprietary
interest in the success of the Company.
2.
Definitions
Whenever used in the
Program, the masculine pronoun shall be deemed to include the feminine, the
singular to include the plural, unless the context clearly indicates otherwise,
and the following capitalized words and phrases shall have the meaning set forth
below unless the context plainly requires a different meaning:
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(a)
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“Agreement” means the written agreement between the Company and a
Participant, or other documentation, evidencing an Award.
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(b)
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“Award” means a Stock Option, Restricted Stock, Unrestricted Stock
or Stock Unit.
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(c)
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“Board” means the Board of Directors of the Company.
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(d)
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“Cause” means conduct by a Participant amounting to (1) fraud or
dishonesty against the Company, (2) willful misconduct, repeated refusal
to follow the reasonable directions of the Board of Directors of the
Company, or knowing violation of law in the course of performance of the
duties of Participant's employment with the Company, (3) repeated absences
from work without a reasonable excuse, (4) intoxication with alcohol or
drugs while on the Company's premises during regular business hours, (5) a
conviction or plea of guilty or no contest to a felony or a crime
involving dishonesty, or (6) a breach or violation of any Company policies
regarding employee conduct, or a breach or violation of the terms of any
employment or other agreement between Participant and the
Company.
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(e)
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“Class
B Common Stock” means the Class B common stock, $0.10 par value per share,
of the Company.
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(f)
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“Code”
means the Internal Revenue Code of 1986, as amended.
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(g)
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“Committee” means the Compensation Committee of the Board of
Directors of the Company.
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(h)
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“Common Stock” means the common stock, par value $0.10 per share of
the Company, other than Class B Common Stock.
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(i)
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“Company” means Vishay Precision Group Inc. a Delaware corporation,
or any successor organization.
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(j)
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“Consent” has the meaning prescribed in Section 13
below.
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(k)
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“Disability” means a physical or mental condition which, in the
judgment of the Committee, permanently prevents a Participant from
performing his usual duties for the Company or such other position or job
which the Company makes available to him and for which the Participant is
qualified by reason of his education, training and experience. In making
its determination, the Committee may, but is not required to, rely on
advice of a physician competent in the area to which such Disability
relates. The Committee may make the determination in its sole discretion
and any decision of the Committee shall be binding on all
parties.
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(l)
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“Employee” means a full-time, nonunion, salaried employee, as that
term is understood under the common law, of the Company.
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(m)
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“Exercise Price” means the price per share at which Common Stock
may be purchased upon exercise of a Stock Option.
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(n)
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“Expiration Date” means the last date upon which a Stock Option can
be exercised, as described in Section 6(b).
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(o)
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“Fair
Market Value” means, for any particular date, the last sale price of the
Common Stock on the New York Stock Exchange or, if no reported sales take
place on the applicable date, the average of the high bid and low asked
price of the Common Stock as reported for such date or, if no such
quotation is made on such date, on the next preceding day on which there
were quotations, provided that such quotations shall have been made within
the ten (10) business days preceding the applicable date. In the event
that the Fair Market Value cannot be thus determined, it shall be
determined in good faith by the Committee.
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(p)
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“Involuntary Termination” means a Termination of Employment but
does not include a Termination of Employment for Cause or a Voluntary
Resignation.
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(q)
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“Participant” means an individual to whom an Award is granted
pursuant to the Program.
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(r)
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“Program” means the 2010 Vishay Precision Group Inc. Stock
Incentive Program.
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(s)
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“Program Action” has the meaning prescribed in Section 13
below.
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(t)
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“Restricted Stock” means restricted shares of Common Stock that,
until vested, may not be transferred and are forfeitable.
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-2-
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(u)
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“Retirement” means a Termination of Employment from the Company or
a Subsidiary, with the consent of the Company, on or after the earliest
“normal retirement age”
defined under any tax qualified retirement plan maintained by the
Company.
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(v)
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“Stock Option” or “Option” means a right to purchase shares of
Common Stock granted pursuant to Section 6 of this Program, which shall
not be treated as an incentive stock option under section 422 of the
Code.
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(w)
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“Stock Unit” means the right to receive a share of Common Stock on
a date determined by the Committee and set forth in the applicable
Agreement.
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(x)
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“Subsidiary” means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time
of the granting of the Award, each of the corporations other than the last
corporation in the unbroken chain owns stock equal to 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.
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(y)
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“Termination of Employment” means the termination of the
employee-employer relationship between an Employee and the Company or a
Subsidiary, or the termination of service as a member of the Board,
regardless of the fact that severance or similar payments are made to the
Participant, for any reason, including, but not limited to, a Voluntary
Resignation, Involuntary Termination, termination for Cause, death,
Disability or Retirement. The Committee shall, in its absolute discretion,
determine the effect of all matters and questions relating to a
Termination of Employment, including,
but not by way of limitation, the question of whether a leave of absence
constitutes a Termination of Employment, or whether a Termination of
Employment is for Cause. If a Participant is both an Employee and a member
of the Board or if a Participant ceases to be an Employee or Board member
and immediately commences service in the other capacity, then a
Termination of Employment shall occur
when the Participant` is neither an Employee nor a member of the
Board.
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(z)
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“Unrestricted Stock” means unrestricted shares of Common
Stock.
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(aa)
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“Voluntary Resignation” means a Termination of Employment as a
result of the Participant's resignation.
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3.
Administration
a)
The Program shall be
administered by the Committee, which shall consist of at least two directors who
are not Employees of the Company or a Subsidiary. The members of the Committee
shall be appointed by, and serve at the pleasure of, the Board. To the extent
required for transactions under the Program to qualify for the exemptions
available under Rule 16b-3
-3-
promulgated under the
Securities Exchange Act of 1934, the members of the Committee shall be
“non-employee directors” within the meaning of Rule 16b-3. To the extent
required for compensation realized from Awards to be deductible by the Company
pursuant to section 162(m) of the Code, the members of the Committee shall be
“outside directors” within the meaning of section 162(m). Notwithstanding the
foregoing, no grant of an Award shall be invalidated if the Committee is not so
constituted. If the Committee does not exist, or for any other reason determined
by the Board, the Board may take any action under the Program that would
otherwise be the responsibility of the Committee.
b)
The Committee shall have full authority, in
its discretion, (a) to determine the Employees of the Company or any Subsidiary
to whom Awards shall be granted and the terms and provisions of each Award,
subject to the provisions of this Program, (b) to exercise all of the powers
granted to it under this Program, (c) to construe, interpret and implement the
Program and any Agreement, (d) to prescribe, amend and rescind rules and
regulations relating to this Program, including rules governing its own
operations, (e) to determine the terms and provisions of the respective
Agreement with each Participant, (f) to make all determinations necessary or
advisable in administering the Program, and (g) to correct any defect, supply
any omission and reconcile any inconsistency in the Program. The Committee's
determinations under the Program need not be uniform and may be made by it
selectively among persons who receive, or are eligible to receive, Awards under
the Program (whether or not such persons are similarly situated). The
Committee's decisions shall be final and binding on all Participants.
c)
Action of the Committee shall be taken by the
vote of a majority of its members. The determination of the Committee on all
matters relating to the Program or any Agreement (including, without limitation,
the determination as to whether an event has occurred resulting in a forfeiture
or a termination or reduction of the Company's obligations in accordance with
the terms of this Program) shall be final, binding and conclusive. No member of
the Committee shall be liable for any action or determination made in good faith
with respect to the Program or any award thereunder.
d)
Notwithstanding any other provision of the
Program, the Committee (or the Board acting instead of the Committee), may
delegate to one or more officers of the Company the authority to designate the
individuals (other than such officer(s) or any member of the Board), among those
eligible to receive awards pursuant to the terms of the Program, who will
receive Awards and the size of each such grant, to the fullest extent permitted
by Section 157 of the Delaware General Corporation Law (or any successor
provision thereto).
e)
With respect to Awards granted to members of
the Board who are not employees of the Company, the Program shall be
administered (as otherwise set forth in this Section 3), including determining
which individuals shall receive Awards and the terms of any such Awards, solely
by the Board.
4.
Shares Available
a)
Subject to adjustment in accordance with
Section 4(b), the number of shares of Common Stock for which Awards may be
granted under this Program is 500,000, which may consist of treasury shares or
authorized but unissued shares. The maximum number of shares of
-4-
Common Stock subject to
Awards granted under this Program to any participating Employee for any year
shall not exceed 250,000 shares, subject to adjustment in accordance with
Section 4(b), below. To the extent permitted by law, any shares of Common Stock
attributable to the unexercised or otherwise unsettled portion of any Award that
is forfeited, canceled, expires or terminates for any reason without being
exercised or otherwise settled in full shall again be available for the grant of
Awards under this Program, and any shares of Common Stock tendered to the
Company in payment of the Exercise Price of a Stock Option shall also be
available for the grant of Awards under this Program, provided that no more than
500,000 shares of Common Stock cumulatively shall be available under this
Program at any time.
b)
If there is any change in the outstanding
shares of Common Stock by reason of a stock dividend or distribution, or stock
split-up, or by reason of any merger, consolidation, spinoff or other corporate
reorganization in which the Company is the surviving corporation, the number of
shares that may be delivered under the Program and the number of shares subject
to each outstanding Award, and, if appropriate, the Exercise Price under each
such Option, shall be equitably adjusted by the Committee, whose determination
shall be final, binding and conclusive. After any adjustment made pursuant to
this Section 4(b), the number of shares subject to each outstanding Award shall
be rounded down to the nearest whole number.
5.
Eligibility
Officers, other
Employees of the Company or a Subsidiary, and members of the Board, who are
responsible for or contribute to the management, growth, and profitability of
the business of the Company or a Subsidiary are eligible for participation in
this Program. The selection of individuals for participation in the Program
shall be made by the Committee, based on a subjective evaluation of each
individual's performance and expected future contribution to the Company and its
Subsidiaries, and may take into account the recommendations of the Chief
Executive Officer of the Company.
6.
Granting of Stock Options
a)
Grant of Stock Options
. The Committee, in its discretion, may grant
Stock Options during any year that this Program is in effect to any eligible
Employee. The terms of each Stock Option shall be contained in an Agreement,
which shall contain the number of shares of Common Stock covered by the Option,
the period during which the Option may be exercised, the Exercise Price, and any
additional terms and conditions not inconsistent with this Program that the
Committee deems to be appropriate. The Committee shall have complete discretion
in determining the number of shares of Common Stock subject to each Option grant
(subject to the share limitations set forth in Section 4(a)) and, consistent
with the provisions of this Program, the terms, conditions and limitations
pertaining to each Option. The terms of Options need not be uniform among
Participants. By accepting a Stock Option, a Participant thereby agrees that the
Option shall be subject to all of the terms and conditions of this Program and
the applicable Agreement.
b)
Option Term
. The duration of each Option shall be
specified in the Agreement and shall not exceed ten (10) years.
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c)
Option Price
. The Exercise Price of the Common Stock
purchasable under any Stock Option shall be determined by the Committee and set
forth in each Agreement, subject to adjustment in accordance with Section 4(b).
The Exercise Price shall not be less than the Fair Market Value of a share of
Common Stock on the date the Option is granted.
d)
Exercise of Stock Options
. Each Agreement shall contain a vesting
schedule, which shall specify when the Stock Option shall become vested and thus
exercisable; provided, however, that subsequent to the grant of an Option, the
Committee, at any time before complete termination of such Option, may
accelerate the time or times at which such Option may be exercised in whole or
in part, and may permit the Participant or any other designated person acting
for the benefit of the Participant to exercise all or any part of the Option
during all or part of the remaining Option term specified in Section 6(a),
notwithstanding any provision of the Agreement to the contrary.
e)
Termination of Employment
.
(i)
Death or Disability
. If a Participant has a Termination of
Employment as a result of death or Disability, the time at which the unexercised
portion of any Option becomes exercisable may be accelerated, including to make
the Option immediately exercisable in full. Except as otherwise provided in an
applicable Agreement, the Option, to the extent that it is not exercisable on
the date of termination, shall expire and terminate on such date of termination
and the Option, to the extent that it is exercisable (including after any
acceleration of vesting) on such date of termination, shall expire and terminate
on the earlier of the Expiration Date or first anniversary of the Participant's
death or disability. Any exercise of an Option following a Participant's death
shall be made only by the Participant's executor or administrator, unless the
Participant's will specifically disposes of such award, in which case such
exercise shall be made only by the recipient of such specific disposition. If a
Participant's personal representative or the recipient of a specific disposition
shall be entitled to exercise an Option pursuant to the preceding sentence, such
representative or recipient shall be bound by all the terms and conditions of
the Program and the applicable Agreement which would have applied to the
Participant.
(ii)
Retirement
. If a Participant has a Termination of
Employment due to Retirement, the time at which the unexercised portion of an
Option becomes exercisable may be accelerated, including to make the Option
immediately exercisable in full. Except as otherwise provided in an applicable
Agreement, the Option, to the extent that it is not exercisable on the date of
Retirement, shall expire and terminate on such date of Retirement and the
Option, to the extent that it is exercisable (including after any acceleration
of vesting) on such date of retirement, shall expire and terminate on the
earlier of the Expiration Date of the Option term or the first anniversary of
the Participant's Retirement.
(iii)
Other Termination
. Except as otherwise provided in an
applicable Agreement, if a Participant has a Termination of Employment for
reasons other than as provided in subsections (i) and (ii) above, the Option, to
the extent that it is not exercisable on the date of termination, shall expire
and terminate on such date of termination and the Option, to the extent that it
is exercisable (including after any acceleration of vesting) on such date of
termination, shall expire and terminate on the earlier of the Expiration Date of
the Option or on the 60th day
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after the Participant's
termination; provided, however, that the unexercised portion of any Option
(including any vested portion) shall expire and terminate immediately upon a
Termination of Employment for Cause.
(iv)
In the event that the Company in its sole discretion determines that the
Participant has, at any time during the 12-month period following Termination of
Employment violated the terms of any agreement with the Company or a Subsidiary
regarding (i) engaging in a business that competes with the business of the
Company or any Subsidiary, (ii) interfering in any material respect with any
contractual or business relationship of the Company or any Subsidiary, or (iii)
soliciting the employment of any person who was during such 12-month period, a
director, officer, partner, Employee, agent or consultant of the Company or a
Subsidiary, then (x) all outstanding unexercised Stock Options issued to the
holder pursuant to the Program shall be forfeited and (y) upon written request
from the Company, the Participant shall pay to the Company any gain realized
upon the exercise of an Option within the 12-month period preceding the
violation or such other period as may be set forth in the applicable Agreement.
f)
Transfer of Option
. Unless the Committee determines otherwise at
the time an Option is granted, no Option granted under the Program shall be
assignable or transferable other than by will or by the laws of descent and
distribution, and all Options shall be exercisable during the life of the
Participant only by the Participant or his legal representative.
g)
Substituted Options
. Notwithstanding anything to the contrary in
this Section 6, any Option issued in substitution for an option previously
issued by another entity, which substitution occurs in connection with a
transaction to which Code section 424(a) is applicable, may provide for an
exercise price computed in accordance with such Code section and the regulations
thereunder and may contain such other terms and conditions as the Committee may
prescribe to cause such substitute Option to contain as nearly as possible the
same terms and conditions (including the applicable vesting and termination
provisions) as those contained in the previously issued option being replaced
thereby.
7.
Exercise of Stock Options
A Stock Option shall be
exercised by the delivery of a written notice of exercise to the Vice President
and Secretary of the Company, or such other person specified by the Committee,
setting forth the number of shares of Common Stock with respect to which the
Option is to be exercised, accompanied by full payment of the Exercise Price
and, pursuant to Section 16, any required withholding taxes. Payment of the
Exercise Price for the shares of Common Stock being purchased shall be made: (a)
by certified or official bank check (or the equivalent thereof acceptable to the
Company), or (b) at the discretion of the Committee and to the extent permitted
by law, by such other provision as the Committee may from time to time
prescribe. The Committee may allow exercises to be made by means of a “brokered
cashless exercise,” with the delivery of payment as permitted under Federal
Reserve Board Regulation T, subject to applicable securities law restrictions,
or by any other means which the Committee determines to be consistent with the
Program's purpose and applicable law. Payment shall be made on the date that the
Option or any part thereof is exercised, and no shares shall be issued or
delivered upon exercise of an Option until full payment has been made by the
Participant. Promptly after
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receiving payment of the
full Exercise Price, the Company shall, subject to the provisions of Section 13,
deliver to the Participant, or to such other person as may then have the right
to exercise the Option, a certificate for the shares of Common Stock for which
the Option has been exercised.
8.
Employees Based Outside of the United
States
Notwithstanding any
provision of this Program to the contrary, in order to foster and promote the
achievement of the purposes of the Program, or to comply with these provisions
in other countries in which the Company or any Subsidiary operates or has
Employees, the Committee, in its sole discretion, shall have the power and
authority to (i) determine which Employees employed outside the United States
are eligible to participate in the Program, (ii) modify the terms and conditions
of any options granted to Employees who are employed outside the United States
(including the grant of stock appreciation rights, as described in the following
paragraph, in lieu of Stock Options), and (iii) establish subprograms, modified
Option exercise procedures and other terms and procedures to the extent such
actions may be necessary or advisable.
The Committee in its
discretion may grant stock appreciation rights in lieu of Stock Options to
Employees employed outside the United States. A stock appreciation right shall
provide an Employee the right to receive in cash the difference between the Fair
Market Value of a share of Common Stock on the grant date and the exercise date,
and otherwise shall have the same terms and conditions as a Stock Option granted
hereunder. Stock appreciation rights granted under this Section 8 shall be
considered as Stock Options for the application of the limitations in Section
4(a) of the Program.
9.
No Rights as a Stockholder
No Participant (or other
person having the right to exercise an Option) shall have any of the rights of a
stockholder of the Company with respect to shares subject to an Option until the
issuance of a stock certificate to such person for such shares or the
establishment of an account evidencing ownership of such shares in
uncertificated form, except as otherwise provided in Section 4(b).
10.
Restricted Stock
a)
Restricted Stock Grants
. The Committee may grant Restricted Stock to
such key persons, in such amounts, and subject to such vesting and forfeiture
provisions and other terms and conditions as the Committee shall determine in
its sole discretion, subject to the provisions of the Program. The terms of a
grant of Restricted Stock shall be contained in an Agreement, which shall
contain the number of shares of Restricted Stock granted, when the Restricted
Stock vests and any additional terms and conditions not inconsistent with this
Program that the Committee deems to be appropriate If the Restricted Stock is
newly issued by the Company, the Participant must make payment to the Company or
its exchange agent in an amount at least equal
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to the par value of the
shares as required by the Committee and in accordance with the Delaware General
Corporation Law.
b)
Issuance of Stock
Certificate(s)
. Promptly
after the Committee grants Restricted Stock to a Participant, the Company or its
exchange agent shall issue to the Participant a stock certificate or stock
certificates for the shares of Common Stock covered by the Award or shall
establish an account evidencing ownership of the stock in uncertificated form.
Upon the issuance of such stock certificate(s) or establishment of such account,
the Participant shall have the rights of a stockholder with respect to the
restricted stock, subject to: (i) the nontransferability restrictions and
forfeiture provision described in Sections 10(d) and 10(e); (ii) in the
Committee’s discretion, a requirement that any dividends paid on such shares
shall be held in escrow until all restrictions on such shares have lapsed; and
(iii) any other restrictions and conditions contained in the applicable
Agreement.
c)
Custody of Stock
Certificate(s)
. Unless the
Committee shall otherwise determine, any stock certificates issued evidencing
shares of restricted stock shall remain in the possession of the Company until
such shares are free of any restrictions specified in the applicable Agreement.
The Committee may direct that such stock certificate(s) bear a legend setting
forth the applicable restrictions on transferability or, if the Restricted Stock
is in book entry form, that such book entry or account be subject to electronic
coding or stop order indicating that such shares of Restricted Stock are
restricted by the terms of the Program. Such legend, electronic coding or stop
order shall not be removed until such shares of Restricted Stock vest.
d)
Nontransferability
. Restricted Stock may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as otherwise
specifically provided in this Program or the applicable Agreement. The Committee
at the time of grant shall specify the date or dates (which may depend upon or
be related to a period of continued employment with the Company, the attainment
of performance goals or other conditions or a combination of such conditions) on
which the nontransferability of the restricted stock shall laps.
e)
Termination of Employment
. Except as may otherwise be provided by the
Committee at any time prior to a Participant’s Termination of Employment, a
Participant’s Termination of Employment for any reason (including death) shall
cause the immediate forfeiture of all Restricted Stock that has not yet vested
as of the date of such Termination of Employment. Unless the Board or the
Committee determines otherwise, all dividends paid on such shares also shall be
forfeited, whether by termination of any escrow arrangement under which such
dividends are held, by the Participant’s repayment of dividends received
directly, or otherwise.
11.
Unrestricted Stock
The Committee may grant
(or sell at a purchase price at least equal to par value) shares of Common Stock
free of restrictions under the Program, to such key persons and in such amounts
as the Committee shall determine in its sole discretion. Shares may be thus
granted or sold in respect of past services or other valid consideration.
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12.
Stock Units
a)
Stock Unit Grants
. The Committee may grant Stock Units to such
key persons, in such amounts, and subject to such terms and conditions as the
Committee shall determine in its discretion, subject to the provisions of the
Program. The terms of a grant of Stock Units shall be contained in an Agreement,
which shall contain the number of Stock Units granted, whether the Stock Unit is
subject to vesting and, to the extent applicable, when the Stock Units vest,
when the shares of Common Stock will be issued and any additional terms and
conditions not inconsistent with this Program that the Committee deems to be
appropriate. Unless the applicable Agreement provides otherwise, a share of
Common Stock will be issued immediately upon vesting of a Stock Unit. Stock
Units may be awarded independently of or in connection with any other Award
under the Program.
b)
Nontransferability
. Stock Units may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as otherwise
specifically provided in this Program or the applicable Agreement.
c)
Vesting
. Stock Units may be granted fully vested or
subject to vesting. If a Stock Units is subject to vesting, the Committee at the
time of grant shall specify the date or dates (which may depend upon or be
related to a period of continued employment with the Company, the attainment of
performance goals or other conditions or a combination of such conditions) on
which the Stock Units shall vest.
d)
Termination of Employment
. Except as may otherwise be provided by the
Committee at any time prior to a Participant’s Termination of Employment, a
Participant’s termination of employment for any reason (including death) shall
cause the immediate forfeiture of all Stock Units that have not yet vested as of
the date of such Termination of Employment.
13.
Consents and Approvals
If the Committee shall
at any time determine that any Consent (as hereinafter defined) is necessary or
desirable as a condition of, or in connection with, the issuance of shares under
the Program or the taking of any other action thereunder (each such action being
hereinafter referred to as a “Program Action”), then such Program Action shall
not be taken, in whole or in part, unless and until such Consent shall have been
effected or obtained to the full satisfaction of the Committee. The term
“Consent” as used herein with respect to any Program Action means (a) any and
all listings, registrations or qualifications in respect thereof upon any
securities exchange or under any federal, state or local law, rule or
regulation, (b) any and all written agreements and representations by the
Participant with respect to the disposition of shares, or with respect to any
other matter, which the Committee shall deem necessary or desirable to comply
with the terms of any such listing, registration or qualification or to obtain
an exemption from the requirement that any such listing, qualification or
registration be made and (c) any and all consents, clearances and approvals in
respect of a Program Action by any governmental or other regulatory bodies.
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14.
Change in Control
a)
Change in Control Defined
. A “Change in Control” shall be deemed to
have occurred at such time as:
(i)
a “person” or “group” within the meaning of Section 13(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”) (other than the Company or
any of its Subsidiaries or any employee benefit plans of the Company or any of
its Subsidiaries or any Permitted Holders) becomes the direct or indirect
“beneficial owner”, as defined in Rule 13d-3 under the Exchange Act, of 50% or
more, in the aggregate, of the voting power of the (x) Common Stock and Class B
Common Stock then outstanding or (y) other capital stock into which the Common
Stock or Class B Common Stock is reclassified or changed;
(ii)
the consummation of any share exchange, consolidation or merger of the
Company pursuant to which the Common Stock will be converted into cash,
securities or other property or any sale, lease or other transfer in one
transaction or a series of transactions of all or substantially all of the
consolidated assets of the Company and its Subsidiaries, taken as a whole, to
any person other than to a Subsidiary of the Company; provided, however, that a
transaction where the holders of the Common Stock and the Class B Common Stock
immediately prior to such transaction own, directly or indirectly, more than 50%
of aggregate voting power of all classes of common equity of the continuing or
surviving corporation or transferee entitled to vote generally in the election
of directors immediately after such event shall not be a Change in Control;
(iii)
the Continuing Directors cease to constitute at least a majority of the
Company’s board of directors; or
(iv)
the stockholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company.
“Permitted Holder” means each of Dr. Felix Zandman or his wife, children
or lineal descendants, the Estate of Mrs. Luella B. Slaner or her children or
lineal descendants, any trust established for the benefit of such persons, or
any “person” (as such term is used in Section 13(d) or 14(d) of the Exchange
Act), directly or indirectly, controlling, controlled by or under common control
with any such person mentioned in this paragraph or any trust established for
the benefit of such persons or any charitable trust or non-profit entry
established by a Permitted Holder, or any group in which such Permitted Holders
hold more than a majority of the voting power of the Common Stock and Class B
Common Stock deemed to be beneficially owned by such group.
“Continuing Director” means a director who either was a member of the
Board of Directors on April 1, 2008 or who becomes a member of the Board of
Directors subsequent to that date and whose election, appointment or nomination
for election by the stockholders of the Company is duly approved by a majority
of the Continuing Directors on the Board of Directors at the time of such
approval, either by a specific vote or by approval of the proxy statement issued
by the Company on behalf of the Board of Directors in which such individual is
named as nominee for director.
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b)
Effect of a Change in
Control
.
(i)
Upon the occurrence of a Change in Control, the Committee may cause all
or some of the Awards outstanding under the Program to be fully vested as of the
effective date of the Change in Control.
(ii)
Upon the occurrence of a Change in Control that results in (i) a
dissolution or liquidation of the Company, (ii) a sale of all or substantially
all of the Company’s assets, (iii) a merger or consolidation involving the
Company in which the Company is not the surviving corporation or (iv) a merger
or consolidation involving the Company in which the Company is the surviving
corporation but the holders of shares of Common Stock receive securities of
another corporation and/or other property, including cash, the Committee shall,
in its absolute discretion (which may include not treating all Options
uniformly), elect to either:
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1.
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amend
each Stock Option so that it becomes exercisable in full at least two
weeks before the occurrence of such event and expires upon the occurrence
of such event;
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2.
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cancel, effective immediately prior to the occurrence of such
event, each Stock Option outstanding immediately prior to such event
(whether or not then exercisable), and, in full consideration of such
cancellation, pay to the Participant an amount in cash, for each share of
Common Stock subject to such Stock Option equal to the excess of (x) the
value, as determined by the Committee in its absolute discretion, of the
property (including cash) received by the holder of a share of Common
Stock as a result of such event over (y) the exercise price of such Stock
Option; or
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3.
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provide for the exchange of each Stock Option outstanding
immediately prior to such event (whether or not then exercisable) for an
option on some or all of the property which a holder of the number of
shares of Common Stock subject to such Stock Option would have received
and, incident thereto, make an equitable adjustment as determined by the
Committee in its absolute discretion in the exercise price of the Stock
Option, or the number of shares or amount of property subject to the Stock
Option or, if appropriate, provide for a cash payment to the Participant
in partial consideration for the exchange of the Stock
Option.
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(iii)
The Committee shall appropriately adjust outstanding grants of Stock
Units to reflect any dividend, stock split, reverse stock split,
recapitalization, merger, consolidation, combination, exchange of shares or
similar corporate change in order to prevent the enlargement or dilution of
rights of Participants.
15.
Limitations Imposed by Section
162(m)
a)
Qualified Performance-Based
Compensation
. The
Committee may make the granting and/or vesting of an Award subject to the
attainment of one or more pre-established objective performance goals during a
performance period, as set forth below. It is intended that
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the compensation
realized by the Participant from such Awards would qualify as “qualified
performance-based compensation” within the meaning of Code section 162(m).
(i)
Performance Goals
. Prior to the ninety-first (91st) day of the
applicable performance period or during such other period as may be permitted
under section 162(m) of the Code, the Committee shall establish one or more
objective performance goals with respect to such performance period. Such
performance goals shall be expressed in terms of one or more of the following
criteria: (a) earnings (either in the aggregate or on a per-share basis,
reflecting dilution of shares as the Committee deems appropriate and, if the
Committee so determines, net of or including dividends); (b) adjusted net income
(meaning net income, excluding specified items of income, expense, gain or loss,
including, without limitation, any or all of restructuring and related severance
costs, fixed asset or inventory write-downs and related purchase commitment
charges, impairment charges for goodwill or indefinite-lived intangible assets,
and individually material one-time gains or charges); (c) adjusted operating
income (meaning operating income, excluding specified items of income, expense,
gain or loss, including, without limitation, any or all of restructuring and
related severance costs, fixed asset or inventory write-downs and related
purchase commitment charges, impairment charges for goodwill or indefinite-lived
intangible assets, and individually material one-time gains or charges), (d)
gross or net sales; (e) cash flow(s) (including either operating or net cash
flows); (f) financial return ratios; (g) total shareholder return, shareholder
return based on growth measures or the attainment by the shares of a specified
value for a specified period of time, share price or share price appreciation;
(h) value of assets, return or net return on assets, net assets or capital
(including invested capital); (i) adjusted pre-tax margin; (j) margins, profits
and expense levels; (k) dividends; (l) market share, market penetration or other
performance measures with respect to specific designated products or product
groups and/or specific geographic areas; (m) reduction of losses, loss ratios or
expense ratios; (n) reduction in fixed costs; (o) operating cost management; (p)
cost of capital; (q) debt reduction; (r) productivity improvements; (s)
inventory turnover measurements; or (t) customer satisfaction based on specified
objective goals or a Company-sponsored customer survey. Each such performance
goal (A) may be expressed (1) with respect to the Company as a whole or with
respect to one or more divisions or business units, (2) on a pre-tax or
after-tax basis, (3) on an absolute and/or relative basis, and (B) may employ
comparisons with past performance of the Company (including one or more
divisions) and/or the current or past performance of other companies, and in the
case of earnings-based, net income-based or operating income-based measures, may
employ comparisons to net revenues, capital, stockholders' equity and shares
outstanding.
To the extent
applicable, the measures used in performance goals set under the Program shall
be determined in accordance with generally accepted accounting principles
(“GAAP”) and in a manner consistent with the methods used in the Company's
regular reports on Forms 10-K and 10-Q, without regard to any of the following,
unless otherwise determined by the Committee consistent with the requirements of
section 162(m)(4)(C) and the regulations thereunder:
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1.
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all
items of gain, loss or expense for a fiscal year that are related to
special, unusual or non-recurring items, events or circumstances affecting
the Company or the financial statements of the
Company;
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2.
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all
items of gain, loss or expense for a fiscal year that are related to (i)
the disposal of a business or discontinued operations or (ii) the
operations of any business acquired by Company during the fiscal year;
and
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3.
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all
items of gain, loss or expense for a fiscal year that are related to
changes in accounting principles or to changes in applicable law or
regulations.
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4.
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To the
extent any objective performance goals are expressed using any earnings or
sales-based measures that require deviations from GAAP, such deviations
shall be at the discretion of the Committee and established at the time
the applicable performance goals are
established.
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(ii)
Performance Period
. The Committee in its sole discretion shall
determine the length of each performance period.
b)
Nonqualified Deferred
Compensation
.
Notwithstanding any other provision hereunder, if and to the extent that the
Committee determines the Company’s federal tax deduction in respect of an Award
may be limited as a result of section 162(m) of the Code, the Committee may take
the following actions:
(i)
With respect to Options, the Committee may delay the exercise or payment,
as the case may be, in respect of such Options until a date that is within 30
days after the date that compensation paid to the grantee no longer is subject
to the deduction limitation under section 162(m) of the Code. In the event that
a Participant exercises an Option at a time when the grantee is a 162(m) covered
employee, and the Committee determines to delay the exercise or payment, as the
case may be, in respect of such Option, the Committee shall credit a cash amount
equal to the Fair Market Value of the Common Stock payable to the Participant to
a book account. The amount credited to the book account shall be paid to the
Participant within 30 days after the date that compensation paid to the grantee
no longer is subject to the deduction limitation under section 162(m) of the
Code. The Participant shall have no rights in respect of such book account and
the amount credited thereto shall not be transferable by the Participant other
than by will or laws of descent and distribution. The Committee may credit
additional amounts to such book account as it may determine in its sole
discretion. Any book account created hereunder shall represent only an unfunded,
unsecured promise by the Company to pay the amount credited thereto to the
Participant in the future.
(ii)
With respect to Restricted Stock or Stock Units, the Committee may
require the Participant to surrender to the Committee any certificates with
respect to Restricted Stock and agreements with respect to Stock Units, in order
to cancel the awards of such Restricted Stock or Stock Units. In exchange for
such cancellation, the Committee shall credit to a book account a cash amount
equal to the Fair Market Value of the shares of Common Stock subject to such
Awards. The amount credited to the book account shall be paid to the Participant
within 30 days after the date that compensation paid to the grantee no longer is
subject to the deduction limitation under section 162(m) of the Code. The
Participant shall have no rights in respect of such book account and the amount
credited thereto shall not be transferable by the Participant other than by will
or laws of descent and distribution. The Committee may credit
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additional amounts to
such book account as it may determine in its sole discretion. Any book account
created hereunder shall represent only an unfunded, unsecured promise by the
Company to pay the amount credited thereto to the Participant in the future.
16.
Tax Withholding
The Company shall
withhold any taxes required to be withheld by federal, state or local government
in connection with an Award. The Company shall have the right to require a
Participant to remit to the Company an amount sufficient to satisfy any federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for shares. A Participant may pay the withholding
tax in cash, or, if the Agreement provides, a Participant may also elect to have
the number of shares of Common Stock he is to receive reduced by the smallest
number of whole shares of Common Stock which, when multiplied by the Fair Market
Value of the shares determined as of the date on which the amount of tax to be
withheld is determined, is sufficient to satisfy federal, state and local, if
any, withholding taxes arising from the Award. Any such election must be made on
or before the date on which the amount of tax required to be withheld is
determined.
17.
Right of Discharge Reserved
Nothing in the Program
or in any Agreement shall confer upon any Participant the right to continue as
an Employee or executive officer of the Company or any Subsidiary, or affect any
right which the Company may have to terminate such Employee or executive
officer.
18.
Amendment
The Board may amend the
Program, and the Committee may amend any outstanding Agreement, in any respect
whatsoever, except that, other than pursuant to Section 14(b), no amendment to
an outstanding Agreement shall materially impair any rights or materially
increase any obligations of any Participant under any Award without the consent
of the Participant (or, after the Participant's death, the person succeeding to
the Participant’s interests with respect to the Award). An amendment shall be
subject to stockholder approval to the extent necessary for compliance with Code
section 162(m) and other applicable law or regulation.
19.
Term of the Program
This Program shall be
effective as of [July 6, 2010], subject to approval by the stockholders of the
Company. The Program shall terminate upon the earlier of (i) the date on which
all Common Stock available under this Program have been issued, (ii) the tenth
anniversary of the effective date, or (iii) the termination of this Program by
the Committee subject to approval of the Board of Directors of the Company. No
Award may be granted after the termination of the Program. Any outstanding
Awards as of the date the Program terminates shall remain in full force and
effect, subject to the terms of the Program and the relevant Agreement relating
to such Award.
20.
Indemnification
Each person who is or
shall have been a member of the Committee, or of the Board of Directors, shall
be indemnified and held harmless by the Company from and against any loss, cost,
liability
-15-
or expense that may be
imposed upon or reasonably incurred by such person in connection with or
resulting from any claim, action, suit or proceeding to which such person may be
a party or in which such person may be involved by reason of any action taken or
failure to act under the Program and against and from any and all amounts paid
by such person in settlement thereof with the Company's approval, or paid by
such person in satisfaction of any judgment in any such action, suit or
proceeding against such person, provided such person shall give the Company an
opportunity, at its own expense, to handle and defend the same before such
person undertakes to handle and defend it on such person's own behalf. The
foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled from the Company, as a
matter of law, or otherwise.
21.
Successors
All obligations of the
Company under the Program, with respect to any Award granted hereunder, shall be
binding on any successor to the Company, whether the existence of such successor
is the result of a direct or indirect purchase, merger consolidation or
otherwise, of all or substantially all of the business and/or assets of the
Company.
22.
Severability
In the event any
provision of the Program shall be held illegal or invalid for any reason, such
illegality or invalidity shall not affect the remaining parts of the Program,
and the Program shall be construed and enforced as if the illegal or invalid
provision had not been included.
23.
Governing Law
This Program and any
grant of Awards made and any action taken hereunder shall be subject to and
construed and interpreted in accordance with the laws of the State of Delaware,
without giving effect to principles of conflict of laws.
-16-
Vishay Precision Group Begins Trading on the
NYSE
MALVERN, PA – July 7,
2010 – Vishay Precision Group, Inc. (“VPG”) today announced that its shares
began trading on the New York Stock Exchange (“NYSE”) under the ticker symbol
VPG, following the completion of its spin-off from Vishay Intertechnology, Inc.
(“Vishay”) (NYSE: VSH).
Under the terms of the
spin-off, Vishay common stockholders of record as of 5:00 p.m. on June 25, 2010,
the record date for the distribution, received 1 share of VPG common stock for
every 14 shares of Vishay common stock they held, and Vishay Class B common
stockholders of record as of 5:00 p.m. on June 25, 2010 received 1 share of VPG
Class B common stock for every 14 shares of Vishay Class B common stock they
held.
“Our listing on the New
York Stock Exchange is an exciting day in the history of Vishay Precision Group,
and represents a new beginning for us as an independent publicly traded
company,” said Ziv Shoshani, president and chief executive officer of VPG.
“VPG is a leading
provider of sensors and sensor based systems for high precision measurement of
force, weight, pressure and currents, built on our proprietary resistive foil
technology. Our customers around the world can continue to rely on VPG, as an
independently publically traded company, to provide them with the quality
products and solutions they have come to expect from us. By building on our
leadership position we believe we will create value for our
stockholders.”
About Vishay Precision
Group
Vishay Precision Group
produces sensors based on resistive foil technology, and sensor-based
systems. We provide vertically integrated products and solutions for
multiple growing markets in the areas of stress measurement, industrial
weighing, and manufacturing process control. As a spin-off from Vishay
Intertechnology, we have a decades-long track record of innovation in foil
precision resistors, current sensors, and strain gages, which has served as a
foundation for our more recent expansion into strain gage instrumentation, load
cells and transducers, load cell modules, and complete systems for process
control and on-board weighing. Vishay Precision Group may be found on the
Internet at www.vishaypg.com.
Certain statements
contained in this release are forward-looking statements within the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. They include
statements regarding anticipated benefits and effects of the transaction for
both Vishay Intertechnology and Vishay Precision Group. These statements are
based on current expectations only and are subject to uncertainties and
assumptions. Factors that could influence the anticipated benefits and effects
of the spin-off include general business, economic and market conditions,
circumstances affecting the businesses of Vishay Intertechnology or Vishay
Precision Group discussed in the Annual Form 10-K Report of Vishay
Intertechnology and in the Form 10 of Vishay Precision Group or changes in
Vishay’s strategic plans and programs. We undertake no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
CONTACTS:
Vishay Precision Group
Bill Clancy
Chief Financial Officer
(484) 321-5300
Joele Frank, Wilkinson
Brimmer Katcher
Sharon Stern / Jennifer Friedman
(212) 355-4449