PRICE PROTECTION
FOR
CHANNELS AGREEMENT
between
Taiwan Kolin Company Limited
and
Syntax Groups Corporation
This Agreement
(“Agreement”) is made and entered into, by and between
Taiwan Kolin Company Limited, incorporated in Taiwan, whose
registered office is at 11/F No.86, Section 1, Chung Citing
South Road, Taipei, Taiwan (the “Manufacturer”) and
Syntax Groups Corporation, incorporated in the State of California,
the United States of America, whose registered office is at 20480
East Business Parkway, City of Industry, CA 91789, U.S.A.
(“Syntax”).
WHEREAS, Syntax
designs various consumer electronic-related Products (as hereafter
defined) for manufacture and distribution under and in connection
with the trademarks and trade name, inter alia, ÖLEVIA
; and
WHEREAS,
Manufacturer is a designer and manufacturer of Liquid Crystal
Display (LCD) and Liquid Crystal On Silicon
(LCOS) televisions and has in place the necessary facilities,
permits, licenses and financing to satisfy Syntax’s
requirements for such LCD and LCOS Products.
Pursuant to the
Manufacturing Agreement dated March 9, 2004, Syntax has
appointed the Manufacturer to manufacture the products in the
consumer electronic field, which includes but not limited to the
LCD/ LCOS TV product line. Currently, the Manufacturer is
manufacturing 20,” 27” and 30” LCD TVs for Syntax
and shall expand the product line to other sizes of LCD TV and LCOS
TV from time to time agreed by both parties (the
“Products”).
Syntax has
offered mark down allowance against the change of the price of the
Products held as inventory in the sales channels (the
“Channels”) according to normal market norm and
practice.
Page 1 of 4
The
Manufacturer wishes to provide a counter price protection to Syntax
against the mark down allowance offered to the Channels.
NOW, THEREFORE,
in consideration of the mutual benefits to be derived from this
Agreement, the receipt and sufficiency of which are hereto hereby
agree as follows:
|
3
|
|
PRICE PROTECTION
|
|
|
|
|
|
3.1.
|
|
The
Manufacturer agrees to offer the price protection to Syntax against
50% of the mark down allowance offered by Syntax to the Channels.
Prior approval of the Manufacturer shall be obtained if any price
protection claimed by Syntax to the Manufacturer higher than 50% as
agreed.
|
|
|
|
|
|
3.2.
|
|
Syntax shall prepare a monthly price
protection report to specify the mark down allowance to respective
Channels and the total price protection amount at the end of each
calendar month, and submit forthwith the report to the Manufacturer
for verification and confirmation.
|
|
|
|
|
|
3.3.
|
|
Upon confirmation of the price
protection amount agreed by both parties, the Manufacturer shall
settle 50% of the total price protection amount at the beginning of
the following calendar month by issuing a credit memorandum which
shall be applied to off-set the total outstanding account payable
owed to the Manufacturer by Syntax.
|
|
|
|
|
|
4
|
|
CATASTROPHIC FAILURE OF THE
PRODUCTS
|
|
|
|
|
|
4.1.
|
|
In
the event that there is a catastrophic failure of the Products
occurred in the Channels as defined according to market practice,
Syntax shall inform forthwith the Manufacturer about the event and
take necessary steps to minimize the loss from the
event.
|
|
|
|
|
|
4.2.
|
|
The
Manufacturer agrees to reimburse all expenses and loss incurred in
the event of catastrophic failure of the Products upon receipt of a
written statement from Syntax to claim such
reimbursement.
|
|
|
|
|
|
4.3.
|
|
The
Manufacturer may issue a credit memorandum which shall be applied
to off-se
|
|
