Exhibit 10.5
CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL
PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED
AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION.
ADLT DEVELOPMENT
AGREEMENT
This ADLT Development Agreement
(this “ ADLT Development Agreement ”) is being
entered into by and between Advanced Lighting
Technologies, Inc., an Ohio corporation, with offices at 32000
Aurora Road, Solon, Ohio 44139 and its Affiliates (“
ADLT ”) and Fiberstars, Inc., a California
corporation, with offices at 32000 Aurora Road, Solon, Ohio 44139
(“ FIBERSTARS ”). Each of FIBERSTARS and
ADLT is a “ Party ” and are “
Parties ” to this ADLT Development
Agreement.
RECITALS
WHEREAS :
(a)
The Parties have entered into that
certain Master Services Agreement (the “ Master Services
Agreement ”) of even date herewith which, among other
things, contemplates that the Parties will enter into several
ancillary agreements, including this ADLT Development Agreement;
and
(b)
The Parties desire that ADLT provide
certain consulting and development services to FIBERSTARS pursuant
to the terms and conditions of this ADLT Development
Agreement. The initial development services contemplated by
this Agreement are for the Projects as defined below and as further
defined and described in Attachment A , attached
hereto.
NOW, THEREFORE , in consideration of the premises and the
covenants contained herein, intending to be legally bound, the
Parties hereto agree as follows:
1.
SCOPE.
This ADLT Development Agreement and
all attachments hereto is being entered into and is being made
pursuant to that Master Services Agreement to which this ADLT
Development Agreement is attached as Exhibit A and is
incorporated therein by reference. Collectively, the Master
Services Agreement and its attached Ancillary Documents (as defined
therein), constitute the Agreement. This ADLT Development
Agreement provides the terms and conditions under which ADLT as the
Supplying Party will perform certain development Services and
provide the Custom Deliverables hereunder to FIBERSTARS as the
Purchasing Party, as more fully described in this ADLT Development
Agreement.
2.
DEFINITIONS.
Capitalized terms used but not
otherwise defined in this ADLT Development Agreement shall have the
same meanings as provided in the Master Services Agreement.
For the purposes of this ADLT Development Agreement, ADLT,
hereinafter shall be the Supplying Party and FIBERSTARS hereinafter
shall be the Purchasing Party. Unless otherwise
specified, references to Sections
are to Sections of this ADLT Development Agreement. For
purposes of this ADLT Development Agreement, the following terms
shall have the respective meanings indicated below:
2.1.
“ Affiliates ” is
defined in Section 3.4 of the Master Services
Agreement.
2.2.
“ Agreement ” is
defined in Section 1 of the Master Services
Agreement.
2.3.
“ ADLT Development Term
” is defined in Section 7.1.
2.4.
“ Ancillary Document(s)
” is defined in Section 1 of the Master Services
Agreement.
2.5.
“ Background IP ”
is defined in Section 15.1 of the Master Services
Agreement.
2.6.
“ Change Order ”
is defined in Section 3.10 of the Master Services
Agreement.
2.7.
“ Commencement Date
” is defined in Section 3.12 of the Master Services
Agreement.
2.8.
“ Confidential
Information ” is defined in Section 3.13 of the
Master Services Agreement.
2.9.
“ Custom Deliverable(s)
” is defined in Section 3.15 of the Master Services
Agreement.
2.10.
“ Deliverable(s)
” is defined in Section 3.16 of the Master Services
Agreement.
2.11.
“ Developed IP ”
means, collectively, all Custom Deliverables, together with all
inventions, original works of authorship, artwork, photographs,
developments, concepts, know-how, improvements and trade secrets
which are made by ADLT (solely or jointly with others) within the
scope of and during the period in which ADLT provides Services to
FIBERSTARS under this ADLT Development Agreement.
2.12.
“ Fiber Optic Lighting
Applications ” shall mean any lighting applications
involving remote source lighting and either (i) fiber optics,
or (ii) light pipes, or (iii) other light
guides.
2.13.
“ Filing ( s
)” is defined in Section 5.5.
2.14.
“ Intellectual Property
Right ( s )” is defined in Section 3.25 of
the Master Services Agreement.
2.15.
“ IP Indemnitor ”
and “ IP Indemnitee ” is defined in
Section 12.2 of the Master Services Agreement.
2.16.
“ Master Services
Agreement ” is defined in the recitals.
2.17.
“ Non-Conformance
” is defined in Section 3.6.
2.18.
“ Periodic Payment (
s )” are defined and set forth in
Attachment B to this ADLT Development
Agreement.
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2.19.
“ Project ( s
)” is defined in the recitals and is further defined and
described in Attachment A to this ADLT Development
Agreement.
2.20.
“ Purchasing Party
” is defined in Section 3.41 of the Master Services
Agreement.
2.21.
“ Quarterly Notice
” is the document delivered to ADLT in substantially the form
attached hereto as Attachment C at the beginning
of each calendar quarter after the Quarterly Review by FIBERSTARS
(as made effective upon signature by FIBERSTARS’ authorized
representative), which shall provide, among other things:
(i) FIBERSTARS’ authorization to continue the Services
and Custom Deliverables hereunder as scheduled and described in one
or more milestones for the forthcoming calendar quarter;
(ii) FIBERSTARS’ confirmation of the Periodic Payments
associated with the performance and delivery of the Services and
Custom Deliverables in the forthcoming calendar quarter pursuant to
Section 4.1; or (iii) in the alternative, provide ADTL
notice of termination or suspension of the Services and Custom
Deliverables pursuant to the Section 3.2 and the other terms
and conditions of this ADLT Development Agreement.
2.22.
“ Quarterly Review
” is defined in Section 3.2.
2.23.
“ Services ”
notwithstanding the definition of Services found in the Master
Services Agreement, as used herein Services are defined in
Attachment A hereto.
2.24.
“ Statement(s) of Work
” or “ SOW ” is defined in
Section 3.45 of the Master Services Agreement.
2.25.
“ Specification(s)
” is defined in Section 3.44 of the Master Services
Agreement.
2.26.
“ Supplying Party
” is defined in Section 3.47 of the Master Services
Agreement.
2.27.
“ Term ” is
defined in Section 21 of the Master Services
Agreement.
2.28.
“ Termination by
Non-Renewal ” is defined in
Section 7.3(c).
2.29.
“ Termination for
Convenience ” is defined in Section 7.2.
2.30.
“ Termination for
Default ” is defined in Section 22.2 of the Master
Services Agreement.
3.
OBLIGATIONS OF
ADLT.
3.1.
Services and
Deliverables .
During the ADLT Development Term and subject to the terms and
conditions of this ADLT Development Agreement, ADLT will perform
the Services described on the SOW attached hereto as
Attachment A (for the purposes of this ADLT Development
Agreement, the “ Services ”), and will provide
to FIBERSTARS the related Custom Deliverables in connection
therewith, in accordance with the terms and conditions of this ADLT
Development Agreement. The Services and the related Custom
Deliverables set forth on Attachment A shall be
scheduled and divided into
3
monthly and quarterly milestones (as
applicable) for the Projects beginning on the Commencement Date and
up through December 31, 2006. All Deliverables provided
hereunder shall be considered Custom Deliverables under the
Agreement. ADLT shall perform all Services hereunder and
provide the Custom Deliverables in compliance with the
Specifications, as set forth and mutually agreed under a SOW issued
hereunder or as amended by a Change Order. Notwithstanding
anything herein or in the Master Services Agreement to the
contrary, no Change Order issued under this ADLT Development
Agreement, other than termination pursuant to Section 3.2
hereof, shall be effective unless executed by both Parties’
chief executive officers or by both Parties’ designated and
authorized representatives.
3.2.
Quarterly Reviews; Quarterly
Notice to Continue, Suspend or Terminate. Not less than fifteen (15) days prior to
the end of each calendar quarter, the Parties shall meet together
to review the results of the Services and the Custom Deliverables
delivered by ADLT over the course of such calendar quarter (“
Quarterly Review ”). Within five
(5) business days after each Quarterly Review, in addition to
its other rights (including a Termination for Convenience)
FIBERSTARS shall have the right to immediately terminate, suspend
or continue the Services and Custom Deliverables for the
forthcoming calendar quarter by providing ADLT notice in its
Quarterly Notice which shall explicitly indicate and provide, as
applicable:
(a)
FIBERSTARS’ termination of
this ADLT Development Agreement;
(b)
FIBERSTARS’ notice of
suspension of the Services and Custom Deliverables which shall
include a good faith estimate regarding the expected date of
recommencement; or
(c)
FIBERSTARS’ authorization to
continue the Services and Custom Deliverables hereunder as
scheduled and described for the forthcoming calendar quarter and
the corresponding Periodic Payments therewith.
In the case of an authorization to
continue the Services and Custom Deliverables (under
Section 3.2(c)), the Parties may by mutual consent amend the
Services, Custom Deliverables, Periodic Payments, scheduled
milestone dates, or any other term hereunder by attaching a Change
Order (executed pursuant to Section 3.1) to the Quarterly
Notice.
Upon receipt of Quarterly Notice
providing for termination under Section 3.2(a), ADLT shall
immediately cease all Services and Custom Deliverables which
termination shall be considered a Termination for Convenience with
all Periodic Payment and amounts owed by FIBERSTARS treated as such
under Section 7.3. In case of a suspension under
Section 3.2(b), ALDT shall immediately cease all Services and
Custom Deliverables and FIBERSTARS shall immediately pay all
Periodic Payments or amounts owed to ADLT as if such suspension was
a Termination for Convenience under Section 7.3.
3.3.
Facilities and
Personnel . ADLT
shall furnish all of the facilities, equipment and personnel needed
for ADLT to perform the Services. To the extent that the
Services and the Custom Deliverables require an interface with
FIBERSTARS Equipment or products
4
then FIBERSTARS shall provide such
assistance and technical support, at FIBERSTARS’ own cost, as
may be necessary to facilitate and enable ADLT to perform the
Services.
3.4.
Project Management and Routine
Progress Reports .
ADLT will manage the Services to be performed hereunder.
FIBERSTARS will provide assistance to ADLT on an as-needed basis
and according to the terms of this ADLT Development
Agreement. In addition to the Quarterly Review, ADLT will
conduct periodic joint status meetings with FIBERSTARS, which
meetings will cover the current status of the Services, indicate
the progress of the work being performed (including any Custom
Deliverable in progress), estimate the time required for completion
of the applicable Services and Custom Deliverables, and identify
actual and anticipated problem areas, the impact thereof on
ADLT’s work effort, and the actions being taken and
recommended to be taken to remedy such problems. On or before
the tenth (10 th ) day of each month during the ADLT
Development Term, ADLT will also provide monthly written progress
reports on the work performed during the preceding month, and the
status of the Services.
3.5.
Technical Input
. Questions, comments, or
other technical communication between AD
