Exhibit 10.21
CONFIDENTIAL TREATMENT REQUEST
[*] indicates information that has been omitted pursuant to a
confidential
treetment request and this information has been filed under
Separate Cover with
the Commission.
[*]
SUPPLY AND LICENSE AGREEMENT
THIS IS AN AGREEMENT, ("Agreement") dated 4/7/03 ("Effective Date")
between [*]
located at [*] ("[*]") and SheerVision, Inc., located at 4276
Admirable Drive,
Rancho Palos Verdes, California 91275 ("SheerVision").
WITNESSTHETH
WHEREAS, [*] distributes and sells optical products for the medical
products
market; and
WHEREAS, SheerVision designs and manufactures premium quality
optical products;
and
WHEREAS, [*] and SheerVision wish to enter into a relationship
wherein
SheerVision develops and manufactures premium quality optical
products under the
[*] label, for [*] to market and distribute.
NOW THEREFORE, in consideration of mutual promises and agreements
set forth
herein, the parties agree as follows:
1.
PRODUCT
SheerVision will develop and manufacture certain products for [*]
under
the terms
and conditions of this Agreement. The products contemplated by
this
Agreement are further described in SCHEDULE A (the
"Product(s)").
Products
may be added or deleted from this Agreement with mutual written
agreement
by [*] and SheerVision.
2. TERMS
OF THIS AGREEMENT
A.
PAYMENT.
(i) TERMS OF
PAYMENT
Terms of payment will be net thirty (30) days from the receipt
of
invoice. Notwithstanding the foregoing, for the first order
placed
under this agreement, dated April 8, 2003 for 500 Products, one
half
of the total invoice amount shall be paid upon the issuance of
said
purchase order with the remaining balance due net thirty (30)
days
from receipt of invoice.
(ii) SET OFF
[*] shall be entitled at all times to set off any amount owing
to
SheerVision from [*] against any amount due or owing [*] from
SheerVision.
B.
DELIVERY
FOB [*]'s USA location as listed above.
C.
ADDITIONAL
TERMS & CONDITIONS
[*] standard Terms and Conditions as stated above shall apply to
all
transactions hereunder unless otherwise modified by this
Agreement.
* Portions of this exhibit have been omitted and filed separately
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, as
amended.
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SUPPLY AND LlCENSE AGREEMENT
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3.
QUANTITY, PRICING AND STANDARDS OF PERFORMANCE
A.
QUANTITY /
ROLLING FORECAST/ ORDERS
i. There
is no fixed minimum or maximum quantity per annum.
ii. The quantity
of Product to be purchased during this Agreement
is based on a rolling forecast, provided for every six-month
period
under this Agreement, beginning on the Effective Date. Orders
will
be for a minimum of 300 Products.
iii.
Orders will be placed
through standard [*] purchase order. [*]
may make changes to orders up to 45 days before delivery
without
penalty.
B.
PRICING
The price per unit for the Products during the Term of this
Agreement is set forth in SCHEDULE A.
C.
TIMING
SheerVision acknowledges that in providing the Products to [*]
time
is of the essence. If SheerVision fails to provide the Products
within ten (10) days of the date specified on the monthly
Purchase
Order, it will pay or credit to [*] [*] of the specified order
and
[*] for each additional ten (10) days which the delivery of the
Product is delayed.
D.
QUALITY
All Product delivered under this Agreement must meet all
applicable
requirements to include performance specifications, workmanship
standards and suitability for its intended purpose. Product shall
be
undamaged and in "new" condition. Final acceptance of all
Product
shall take place at [*]'s location prior to use. Product shall
include test data where required including certification to all
applicable standards and specifications.
Products must be coded to permit tracking by batch, lot, date
or
similar identifying number to allow for efficient methods of
identification once sold into the market.
E.
PRODUCT
SPECIFICATIONS
SheerVision will provide detailed Product specifications and
will
provide Product as per those specifications, as attached in
SCHEDULE
C. [*] may change specifications according to the Engineering
Change
Order
("ECO") process to be mutually developed by the parties within
eight (8) weeks of the Effective Date. After completion, the
ECO
process will be incorporated herein as SCHEDULE D (not yet
completed). SheerVision will notify [*] (verbally followed by
written notice within twenty-four (24) hours) if possible at
the
time of ordering/release or earlier and prior to the shipment of
any
specification, optical or cosmetic changes from what has been
previously agreed upon which may affect form, fit, function or
cosmetic issues. [*] will notify SheerVision (verbally followed
by
written notice within twenty-four(24) hours) if the Product in
its
modified
form is acceptable to [*]. Any costs associated with
correcting any material received at [*]'s possession without
prior
notice and approval of specification changes will be the
responsibility of SheerVision.
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SUPPLY AND LICENSE AGREEMENT
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F.
MARKETING
MATERIALS
[*] will provide marketing materials and specifications for the
same
as
needed. SheerVision will make all marketing materials for the
Product available in digital format to [*] including without
limitation, including images, user manuals and training
materials.
G.
PACKAGING
AND SHIPMENT
SheerVision will ship Product to [*]'s location in accordance
with
good commercial practice, acceptable to common carriers for
shipment
in the specified manner and adequate to insure safe arrival of
the
goods at [*]'s place of business. Individual Product packaging
will
be those wooden boxes SheerVision currently provides customers.
Changes to Product packaging can be made at [*]'s request upon
at
least sixty (60) days' notice and reasonable price changes to
accommodate either lower or higher costs of such packaging
changes
will be subject to mutual negotiation.
H.
COST
REDUCTION/CONTINUOUS PROCESS IMPROVEMENT
SheerVision and [*] will conduct regular joint Product review
process to provide a basis for future cost reductions and
Product
improvements. These price reductions can be implemented at any
time
during the Term, upon mutual agreement of the parties.
SheerVision
also agrees to pursue actively a process improvement program
aimed
at reducing cycle time and improve quality. The parties will meet
at
least once every 18 months under this Agreement, for the purpose
of
reviewing quantities and pricing. The parties will work in good
faith to reach mutual agreements as to the foregoing.
I.
COMPLIANCE
WITH LAWS
SheerVision will conduct all activities under this Agreement in
full
compliance with the laws and regulations of the United States
as
well as those required for obtaining and maintaining CE mark
approval in the European market. SheerVision will provide [*] a
copy
of its CE mark certification book.
4.
WARRANTY
A.
WARRANTY
SheerVision warrants that all Products delivered hereunder shall
be
free from defects in workmanship, material and manufacture, of
merchantable quality, fit for their generally intended use, and
shall comply with the requirements of this Agreement, including
any
drawings or specifications incorporated herein or samples
furnished
by SheerVision, and, where design is SheerVision's
responsibility,
be free from defects in design, for a period of 18 months after
purchase.
SheerVision warrants that it shall at all times faithfully,
industriously, and to the best of its ability, experience, and
talents, render all of the services that may be required of
SheerVision pursuant to the express and implied terms of this
Agreement.
The foregoing warranties shall constitute conditions and are in
addition to all other warranties, whether expressed or implied,
and
shall survive any delivery, inspection, acceptance, or payment
by
[*].
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SUPPLY AND LICENSE AGREEMENT
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B.
FAILURE TO
COMPLY
If any Product delivered hereunder does not meet the warranties
specified herein or otherwise applicable, [*] may at its option
(i)
require
SheerVision to correct at no cost to [*] any defective or
nonconforming Product by repair or replacement, or (ii) return
such
defective nonconforming Product at SheerVision's expense to
SheerVision and recover from the SheerVision the order price
thereof, or (iii) if SheerVision has failed to correct the
problem
within 30 days from the date the nonconforming Product is
returned,
correct the defective or nonconforming Product itself and
charge
SheerVision with the cost of such correction. The foregoing
remedies
are in addition to all other remedies at law or in equity or
under
this Agreement and shall not be deemed to be inclusive. All
warranties shall run to the [*] and to its customers.
C.
RESPONSIBILITY
[*]'s approval of the SheerVision's Product or design shall not
relieve SheerVision of the warranties set forth herein, nor shall
it
constitute a waiver by [*] of any drawing or specification
requirements for one or more of the remaining Product to be
delivered hereunder unless so stated by [*] in writing. The
provisions of this Paragraph shall not limit or affect the rights
of
[*] under the Paragraph entitled "INSPECTION".
5.
INSPECTION
A.
INCOMING
INSPECTION
All Products shall be subject to inspection and test by [*] to
the
extent practicable at all times and places, including, but not
limited to, the period of manufacture and prior to final
acceptance.
If inspection or test is made by [*] on SheerVision's premises,
Sheer
