{"id":42221,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/development-agreement-ailicec-international-enterprises-ltd.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"development-agreement-ailicec-international-enterprises-ltd","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/development-agreement-ailicec-international-enterprises-ltd.html","title":{"rendered":"Development Agreement &#8211; Ailicec International Enterprises Ltd. and JetFax Inc."},"content":{"rendered":"<pre>                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n                                                                        REDACTED\n\n                             DEVELOPMENT AGREEMENT\n\n     This Agreement is made and entered into as of this 25th day of September,\n1991 by and between Ailicec International Enterprises Ltd., a Hong Kong\ncorporation with offices at Rm. 503 5\/F, Tower B, Hung Hom Commercial Centre,\n37-39 Ma Tau Wai Road, Hung Hom, Kowloon, Hong Kong (\"AILICEC\") and JetFax,\nInc., a Delaware corporation with offices at 978 Hamilton Court, Menlo Park,\nCalifornia 94025 (\"JETFAX\").\n\n                                    RECITALS\n                                    --------\n\n     WHEREAS, JETFAX is engaged in the development of a certain plain paper\nfacsimile product for AILICEC;\n\n     WHEREAS, AILICEC is engaged in the manufacture of facsimile products, and\n\n     WHEREAS, AILICEC and JETFAX have agreed that JETFAX will develop the plain\npaper facsimile product to be owned and manufactured by Ailicec as specified\nbelow;\n\n     NOW, THEREFORE, in consideration of the mutual promises and undertakings\nset forth herein, AILICEC and JETFAX agree as follows:\n\n     1.   Product.\n          ------- \n\n     As used in this Agreement, the term \"Product\" shall mean the plain paper\nfacsimile machine designed and manufactured in accordance with the\nspecifications set forth in Exhibit A-1 annexed hereto, as may subsequently be\nmodified by mutual written agreement between the parties (the \"Specifications\").\n\n     2.   Development and Ownership of the Product.\n          ---------------------------------------- \n\n     (a)  JETFAX shall develop the Product in accordance with this Agreement,\nincluding without limitation, the Specifications, and shall accomplish the\nvarious milestones described in Section 3 by the respective dates set forth\ntherein. AILICEC may provide JETFAX with requests for Specific Product\nrequirements and\/or modifications beyond those established in Exhibit A-1, and\nin response JETFAX shall, within a reasonable time, provide AILICEC with a good\nfaith quotation and revised schedule within which such modifications may be\nimplemented.\n\n     In its discretion, AILICEC may accept or reject such quotation and revised\nschedule. Upon \n\n                                       1\n\n \nAILICEC'S written acceptance thereof, if any, such quotation and revised\nschedule shall be incorporated into this Agreement.\n\n     (b)  All of the following shall be the exclusive property AILICEC:\n\n          (i)  All results of the work of JETFAX in developing the Product,\nincluding without limitation all tangible materials such as the drawings,\ndesigns, prototypes, plans, work papers, schematic diagrams, circuit board\nlayouts, and related documentation; specifically excluding all software source\ncode as described in Section 4 below;\n\n          (ii)  All patent rights, mask work rights and trade secrets in and to\nthe Product hardware, specifically including all inventions, discoveries, ideas,\ntechnology, processes, formulas, production methods, techniques, concepts and\nembodied or incorporated in the Product hardware; and\n\n          (iii)  Copies of all tangible materials containing or embodying any\nof the foregoing.\n\n     Items (i) through (iii) above shall collectively be the \"AILICEC Property.\"\nJETFAX hereby assigns to AILICEC all rights and title to the AILICEC Property as\nthey are generated by JETFAX. JETFAX hereby irrevocably sells, transfers and\nassigns any and all rights that it may have in the AILICEC Property to AILICEC.\nUpon the request of AILICEC, JETFAX shall execute any and all documents or\ninstruments, and take all other actions, necessary or convenient to evidence,\nperfect or confirm AILICEC'S exclusive ownership of the AILICEC Property.\n\n     (c)  JETFAX shall not manufacture or sell the Product, directly or\nindirectly, through any related or unrelated third party, or authorize others to\nmanufacture or sell the Product, without the prior written consent of AILICEC's\nboard of directors.\n\n     3.   Development Milestones and Payments.\n          ----------------------------------- \n\n     (a)  JETFAX shall develop the Product with reference to the Telstar II\nSchedule in Exhibit A-2 and in accordance with the schedule set forth below, and\nAILICEC shall pay JETFAX the following amounts upon the parties' execution of\nthis Agreement and upon JETFAX's completion of each of the following specific\ndevelopment milestones. The milestones referred to below will be achieved on the\ndate indicated and it is AILICEC's sole responsibility to be at hand or have a\nrepresentative present at JETFAX's office if necessary on such dates to\ndetermine the validity of the milestone being reached:\n\n                                       2\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n\n                    Development Milestone\/               Development Work\nMilestone Date        Tasks Accomplished     Payment   Materials Delivered\n--------------      ----------------------   -------   -------------------\n                                                 \n\n\n[*]\n \n\n                                       3\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n    (b)  In the event that the milestone under sections 3(a)(4) or 3(a)(5)is not\ncompleted on the specified Milestone Date set forth ; above, the payment to be\npaid on such Milestone Date shall be reduced by [*] for every one day of delay.\nIn addition to these reductions, JETFAX shall be obligated to reimburse AILICEC\nfor all costs and expenses incurred by AILICEC arising out of or resulting from\nJETFAX's delay in meeting any development milestone set forth above. JETFAX\nshall make such reimbursement within thirty (30) days of AILICEC's submission to\nJETFAX of a reasonably determined statement of such costs and expenses. Any\nreduction in the development payments shall not affect JETFAX's obligations to\ncontinue performance under subsection (a) herein.\n\n    (c)  Except as expressly stated otherwise in this Agreement and in Sections\n3(d) and 6, JETFAX shall bear all of the engineering costs in developing the\nProduct, including without limitation all industrial design, plastic enclosure\ndesign, scanner and document feeder design, and related tasks; all electronic\nhardware and software design and programming; all required prototypes of the\nelectronics hardware to meet the milestones described in Section 3(a) above; and\nall costs associated with writing and documenting the user and service manuals\nin English.\n\n    (d)  Except as expressly stated otherwise in this Agreement and in Sections\n3(c) and 6, AILICEC shall bear all of the costs of all models, prototypes and\/or\ntest fixtures of the document feeders, laser engines and any other mechanical\ncomponents included in the Product; all plastic, metal or other tooling costs to\nbuild either prototypes or production units; all in-circuit testers and other\ntest equipment and fixtures needed for production; all costs associated with any\nshipping carton designs and materials; all printing costs for manuals, control\npanels, and logos. These costs will be reimbursed by AILICEC only if JETFAX\nobtains the prior written approval of AILICEC. AILICEC may, in its discretion\nand by subsequent written agreement with JETFAX, agree to reimburse JETFAX for\ncertain additional costs associated with development of the Product.\n\n    (e)  JETFAX shall send AILICEC, with a copy to Ailicec California\nCorporation (\"ACC\"), a California corporation and an affiliate of AILICEC, a\ndevelopment progress report by facsimile transmission by Monday of each week.\nThis report shall be prepared and approved by Rudy Prince or Lon Radin and shall\ngive the status of the development and an evaluation of whether JETFAX is able\nto meet the development milestone deadlines set forth in subsection (a) herein.\n\n4.  Delivery of AILICEC Property; Software.\n    -------------------------------------- \n\n    (a)  JETFAX shall physically deliver all tangible materials in JETFAX's\npossession in relation to the Product pursuant to Section 3(a) and all AILICEC\nProperty to AILICEC at any location designated by AILICEC and pursuant to\ninstructions given by AILICEC. The parties agree that beyond the final\ndevelopment payment pursuant to Section 3(a)(5) above, JETFAX shall continue the\ndevelopment in good faith until the Specifications are complied with in all\nrespects or as modified and agreed upon between the parties; and all final and\nnecessary documents are provided to AILICEC.\n\n    (b)  The parties acknowledge that AILICEC shall have all rights, title and\ninterest of any kind, nature or description in the source code for software\nincorporated in all the standard features of the Product as described in Exhibit\nA-1 attached hereto (\"Standard Feature Source Code\"), and JETFAX hereby assigns\nto AILICEC full title and interest in the worldwide rights to the Standard\nFeature Source Code, including all \n\n                                       4\n\n \napplicable copyrights and trade secret rights. As the owner of the Standard\nFeature Source Code, AILICEC shall have the unrestricted rights, without further\nobligation to compensate JETFAX, (1) to reproduce and use the Standard Feature\nSource Code in the manufacture, distribution, marketing and sale of the Product,\n(2) to reproduce, decompile, debug, analyze, modify, and\/or upgrade the Standard\nFeature Source Code to the extent necessary to ensure proper operation of the\nProduct in compliance with the Specifications, to address defects therein,\nand\/or to enhance the Product with additional features. Upon request JETFAX\nshall assist AILICEC in correcting any errors or malfunctions in the Standard\nFeature Source Code that may arise in connection with the use or operation of\nthe Product.\n\n    (c)  The parties acknowledge that JETFAX shall retain full title to and\nownership of the source code for the software incorporated in the optional\nfeatures of the Product as described in Exhibit A-1 attached hereto (\"Options\nSource Code\"), including all applicable copyrights and trade secret rights.\nJETFAX hereby grants a perpetual, nonexclusive, worldwide royalty-free license\nto AILICEC to use the Options Source Code (1) to reproduce and use the Options\nSource Code in the manufacture, distribution, marketing and sale of the Product,\n(2) to reproduce, decompile, debug, analyze, modify, upgrade and\/or reverse\nengineer the Options Source Code to the extent necessary to ensure proper\noperation of the Product in compliance with the Specifications, to address\ndefects therein, and\/or to enhance the Product with additional features, all\nwithout further obligation to compensate JETFAX. Upon request and at JETFAX's\nown expense, JETFAX shall assist AILICEC in correcting any errors or\nmalfunctions in the Options Source Code that may arise in connection with the\nuse or operation of the Product.\n\n    (d)  Concurrent with AILICEC's receipt of the final version of the Product\npursuant to Section 3(a)(6) JETFAX shall provide AILICEC with the Standard\nFeature Source Code and the object code version of the Options Source Code on a\nfloppy disk and in printed text form. AILICEC agrees that such Standard Feature\nSource Code and object code version of the Options Source Code shall be held in\nthe strictest confidence for use only by employees or agents of AILICEC. In the\nevent of the bankruptcy or insolvency of JETFAX, the parties acknowledge that\nAILICEC may have the option to purchase JETFAX's ownership right of the Options\nSource Code.\n\n    (e)  AILICEC shall not use the Standard Feature Source Code to develop any\nnew product related or unrelated to the Product for a period of two (2) years\nbeginning on the date that AILICEC commences manufacturing the Product.\nThereafter, AILICEC may develop any new product provided it first offers to\nJETFAX the opportunity to develop such new product jointly with AILICEC. JETFAX\nshall not use the technology provided to AILICEC under this Agreement to develop\n(i) any products which are competitive with and substantially equivalent to the\nProduct for a period of one (1) year beginning on the date that AILICEC\ncommences manufacturing the Product, thereafter, JETFAX may use the technology\nto develop any new product provided it first offers to AILICEC the opportunity\nto jointly develop such new product. AILICEC agrees not to sell, assign or\notherwise transfer the Standard Feature Source Code during the term hereof and\nfor a period of five (5) years beginning on the date that AILICEC commences\nmanufacturing the Product. JETFAX agrees not to sell, assign or otherwise\ntransfer the Options Source Code during the term hereof and for a period of two\n(2) years beginning on the date that AILICEC commences manufacturing the\nProduct.\n\n    5.    Training and Documentation.\n          -------------------------- \n\n    If requested by AILICEC, JETFAX shall provide training-in the manufacturing,\noperation, installation and maintenance of the Product to not less than three\n(3) employees designated by AILICEC, at no charge to \n\n                                       5\n\n \nAILICEC at a location in the United States designated by JETFAX and reasonably\nacceptable to AILICEC. AILICEC shall bear reasonable costs for travel, lodging\nand other reasonable expenses related to such training. The training shall be in\nsuch depth that AILICEC personnel so trained will be able to train other\npersonnel to make, use, install and maintain the Product. JETFAX shall also\nfurnish such trainees, at no charge to AILICEC, with copies of all manuals,\nschematic diagrams, blueprints and all other material required for the\nmanufacture of and training concerning the Product.\n\n    6.    Regulatory Approvals.\n          -------------------- \n\n    Upon AILICEC's final development payment pursuant to Section 3(a)5 above,\nthe parties shall use their best efforts and cooperate, using both parties'\nnames as applicant, to obtain necessary regulatory approvals for the unlimited\ncommercial manufacture, sale and use of the Product, including without\nlimitation an Underwriters Laboratories Listing; Federal Communications\nCommission certification under applicable requirements as appearing in 47 C.F.R.\nSection 15.801 et seq., Part 15, subpart J, as a Class A computing device, and\nin 47 C.F.R. Section 15.801, Part 68; Canadian Department of Commerce\ncertifications for telecommunication equipment and\/or a Canadian Standards\nAssociation Listing for Safety compliance. The out-of-pocket costs of obtaining\nsuch approvals, including the costs of hiring consultants and all necessary\nregistration fees, shall be shared equally between the parties; provided,\nhowever, that the parties shall agree in advance prior to incurring any such \nout-of-pocket costs.\n\n    7.    Warranty by JETFAX.\n          ------------------ \n\n    (a)  JETFAX hereby warrants to AILICEC that the Product shall be free from\ndefects in design, and Products properly manufactured from such design shall be\nsuitable for commercial use and shall be compatible with any widely distributed\nfax machine which conforms to applicable CCITT (Coordinating Committee on\nInternational Telephone and Telegraph) fax transmission protocols in effect as\nof the date of final delivery of the Product pursuant to Sections 3(a)(5) and\n3(a)(b).\n\n    (b)  THE ABOVE WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR\nIMPLIED, INCLUDING, WITHOUT LIMITATION, THE WARRANTIES OF MERCHANTABILITY AND\nFITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL JETFAX BE LIABLE FOR\nSPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES, EVEN IF JETFAX IS ADVISED OF THE\nPOSSIBILITY OF SUCH DAMAGES, EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT.\n\n    8.    Nondisclosure.\n          ------------- \n\n    Neither party shall, at any time during the term of this Agreement, disclose\nto any third person the terms and conditions of this Agreement except (i) with\nthe prior written consent of the other party, which consent shall not be\nunreasonably withheld where such disclosure is necessary to the business\noperations of the party requesting disclosure, or (ii) by reason of legal\ncompulsion in any legal proceeding or pursuant to applicable, laws.\n\n    9.    Indemnification.\n          --------------- \n\n    (a)  AILICEC shall defend, indemnify and hold JETFAX harmless from and\nagainst any and all damage, liability, cost, or expenses (including without\nlimitation reasonable attorney's fees and related costs), \n\n                                       6\n\n \nwhether or not litigation is instituted, incurred by JETFAX based upon or in\nconnection with a willful and material breach by AILICEC of any or all of its\ncovenants in this Agreement.\n\n    (b)  JETFAX shall defend, indemnify and hold AILICEC harmless from and\nagainst any and all damage, liability, cost, or expenses (including without\nlimitation reasonable attorney's fees and related costs), whether or not\nlitigation is instituted, incurred by AILICEC based upon or in connection with a\nwillful and material breach by JETFAX of any or all of its covenants in this\nAgreement.\n\n    (c)  JETFAX shall defend, indemnify and hold AILICEC harmless from and\nagainst any claims of patent, copyright, trade secrets and mask works\ninfringement worldwide. In such event that a third party claims infringement of\npatents, trade secrets, copyrights, mark works rights with respect to AILICEC's\nuse of, sale, licensing or other exploitation of the AILICEC Property, or any\nimpending claim comes to the attention of AILICEC, it shall immediately inform\nJETFAX in writing, stating the full facts of the infringement known to it.\nAILICEC agrees to cooperate fully with JETFAX at the expense of JETFAX if JETFAX\nrequires assistance defending against such claims.\n\n    10.   Term of Agreement.\n          ----------------- \n\n    The term of this Agreement shall commence on the date first written above\nand shall expire when all of the following is completed: (i) the final\ndevelopment payment is made pursuant to Section 3 (a) (5); (ii) demonstration by\nJETFAX that the final working prototype of Product functions properly in\ncompliance with all the Specifications set forth in Exhibit A-1 pursuant to\nsection 3(a)(6); and (iii) all of JETFAX's work materials in relation to the\ndevelopment of the Product, the AILICEC Property, the Standard Feature Source\nCode and the optional features object code pursuant to Section 2(a), 3(a) and\n4(d) have been received by AILICEC.\n\n    11.   Termination.\n          ----------- \n\n    (a)  Notwithstanding Section 10, either party may terminate this Agreement\nprior to its expiration by written notice to the other party, if the other party\nhas materially breached any provision hereof and failed to cure such breach\nwithin thirty (30) days after receipt of written notice from the terminating\nparty describing the breach in reasonable detail.\n\n    (b)  Notwithstanding Sections 10 and 13, AILICEC may (i) cause l no further\npayments to be made to JETFAX pursuant to paragraph 2(f) of the Series E Stock\nPurchase Agreement entered into by JETFAX and ACC on August 18 , 1991 and (ii)\nmake no further payments pursuant to Section 3 of this Agreement by delivering\nwritten notice of termination to JETFAX, if JETFAX fails to meet its obligations\nfor thirty (30) days after the date of the milestone deadlines set forth in\nsubsection (3), (4) and (5) of Section 3(a) above.\n\n    (c)  If JetFax's failure to perform under Section 3(a) continues for thirty\n(30) days after the date of any milestone deadline thereunder, JETFAX shall be\ndeemed to be in material breach of this Agreement, and AILICEC may terminate\nthis Agreement forthwith. JETFAX shall deliver to AILICEC all work materials\ngenerated by JETFAX up to the date of such early termination. JETFAX shall be\nfurther obligated to reimburse AILICEC for all costs and expenses incurred by\nAILICEC arising out of or resulting from JETFAX's failure to perform under\nSection 3(a) up to a maximum of $200,000 and for all prior development payments\nreceived from AILICEC within one year after receiving notice from AILICEC of\nsuch termination of this Agreement.\n\n                                       7\n\n \n    (d)  Any termination of this Agreement in whole or part pursuant to this\nSection shall not preclude resort by the terminating party to any other remedies\navailable to it.\n\n    12.   Confidentiality.\n          --------------- \n\n    (a)  For the purposes of this Agreement, \"Confidential Information\" means\nany information provided by a party to the other party in confidence during the\nterm of this Agreement. Information shall be presumed to be provided in\nconfidence if it is disclosed in writing, or, if disclosed orally, it is\nidentified as \"confidential\" at the time of disclosure and promptly confirmed in\nwriting to be confidential.\n\n    (b)  Neither party shall disclose any Confidential Information of the other\nparty to any third party, or to any of its employees except for persons who\nrequire access to such Confidential Information to accomplish the intended\npurposes of this Agreement. Both parties shall take the same precautions to\nprotect the confidentiality of the other party's Confidential Information that\nthey take with respect to their own valuable, confidential and proprietary\ninformation of like importance, including without limitation having all persons\nwho are permitted access to such Confidential Information execute agreements\nrequiring them not to disclose the Confidential Information. Neither party shall\nuse Confidential Information disclosed by the other party for any purpose other\nthan the purposes for which that Confidential Information was disclosed.\n\n    (c)  The obligations set forth in clause (b) above shall not apply to any\nparticular portion of any Confidential Information that: (i) the disclosing\nparty authorized the recipient party in writing to disclose or copy; (ii) is or\nbecomes publicly available through no act or omission of the recipient party; or\n(iii) came or comes into the possession of the recipient party without\nrestriction and through a source that has not breached any confidential\nrelationship with the disclosing party. Confidential Information shall not be\ndeemed to be \"publicly available\" if only generally described in the public\ndomain or if only portions of the Confidential Information are found in several\nsources in the public domain, even if all such sources, when compiled together,\nspecifically describe such Confidential Information.\n\n    (d)  For the purpose of this Agreement, all information included in the\nAILICEC Property and work materials generated by JETFAX pursuant to this\nAgreement shall be deemed Confidential Information.\n\n    13.   Survival of Obligations.\n          ----------------------- \n\n    Notwithstanding anything to the contrary in this Agreement, the expiration\nor early termination of this Agreement shall not release either JETFAX or\nAILICEC from their respective obligations under Sections 2, 4, 7, 9, 12 and 23\nhereof, and such Sections shall survive such expiration or termination and\nremain in effect. Similarly, such expiration or termination shall not release a\nparty from any liability which has already accrued to the other party as of the\ndate of expiration or termination.\n\n    14.   Assignment.\n          ---------- \n\n    Neither party may assign any rights or delegate any duties under this\nAgreement without the other party's prior written consent, and any attempt to do\nso without such consent shall be void.\n\n    15.   Notices.\n          ------- \n\n                                       8\n\n \n    Except as otherwise provided herein, all notices required or permitted to be\ngiven hereunder shall be in writing and shall be valid and sufficient only if\ndispatched by certified or registered mail, postage prepaid, confirmed facsimile\ntransmission or personal delivery, addressed to the party to be notified at its\naddress first above written, or such other address as such party may designate\nin writing to the other party hereto. In the case of a notice sent by certified\nor registered mail, such notice shall be deemed to have been given ten (10) days\nafter dispatch of the same. In the case of a notice sent by confirmed facsimile\ntransmission or personal delivery, such notice shall be deemed to have been\ngiven upon receipt of same.\n\n    16.   Severability.\n          ------------ \n\n    Any provision or term of this Agreement which is prohibited or unenforceable\nin any jurisdiction shall be, as to such jurisdiction, unenforceable only to the\nextent of such prohibition or unenforceability without invalidating the\nremaining provisions hereof, and any such prohibition or unenforceability in any\njurisdiction shall not invalidate or render unenforceable any provision hereof\nin any other jurisdiction. To the extent permitted by applicable law, JETFAX and\nAILICEC hereby waive any provision of law which prohibits or render\nunenforceable in any respect any provision hereof.\n\n    17.   Counterparts.\n          ------------ \n\n    This Agreement may be executed in one or more counterparts, each of which\nshall be deemed an original, and all of which together shall constitute one and\nthe same instrument. Execution and delivery of this Agreement may be completed\nby execution and delivery of original, signed copies hereof, or by facsimile\ntransmission of executed copies hereof, each of which shall constitute an\noriginal and enforceable counterpart.\n\n    18.   Applicable Law.\n          -------------- \n\n    This Agreement shall in all respects be governed by and construed in\naccordance with the laws of the State of California, without regard to conflicts\nof law provisions thereof and without regard to the United Nations Convention on\nContracts for the International Sale of Goods.\n\n    19.   Entire Agreement.\n          ---------------- \n\n    This Agreement is the final, complete and exclusive agreement between JETFAX\nand AILICEC with respect to the subject matter hereof. the parties hereto shall\nnot be bound by any prior or collateral statement, warranties, representations,\nagreement, arrangements of course of dealing between them affecting the subject\nmatter hereof, and each party hereby represents and warrants to the other that\nin entering into this Agreement it has not relied and is not relying on any such\nstatements, warranties, representations, agreements or course of dealings.\n\n    20.   Effect of Headings.\n          ------------------ \n\n    The headings to the paragraphs of this Agreement are for convenience of\nreference only, they do not form a part of this Agreement and shall not in any\nway affect the interpretation hereof.\n\n    21.   Force Majeure.  Neither party shall be responsible for any failure to\n          -------------                                                        \nperform its obligations hereunder (except for obligations to make any payments\nwhen due) due to any cause or event beyond such \n\n                                       9\n\n \nparty's reasonable control, including without limitation acts of God, war, civil\ncommotion, riots, embargoes, domestic or foreign governmental laws or acts,\nregulations or orders, fires, floods, earthquakes, accidents, machinery\nmalfunctions, quarantines, strikes, lockouts or other labor difficulties. The\naffected party shall give the other party prompt notice of such cause or event\nand in no case any later than seven (7) days after such cause or event. The\nnotice shall describe the nature of the cause or event, including an estimation\nof its expected duration and probable impact on the ultimate performance of the\naffected party's obligations hereunder. Each party shall exercise all reasonable\nefforts to mitigate or limit damages to the other party resulting from the\nnonperformance.\n\n    22.   Compliance with Laws.\n          -------------------- \n\n    The parties shall comply with, at their own expense, all laws, ordinances,\nrules, regulations and other requirements of all governments or agencies of\ndomestic or foreign jurisdictions relating to their respective obligations and\nrights hereunder. The parties agree that the Product and each of their\nrespective obligations and rights hereunder may be subject to the Export\nAdministration Regulations of the U.S. Department of Commerce, as may be amended\nfrom time to time, and agree to comply therewith, and the parties further agree\nto comply with the requirements of the U.S. Foreign Corrupt Practices Act and\nnot to make any payments to third parties which would cause either party to\nviolate such Act.\n\n    23.   Attorney's Fees.  The prevailing party in any action or proceeding to\n          ---------------                                                      \nenforce the terms of this Agreement shall be entitled to reimbursement by the\nother party for all costs (including the reasonable fees, costs and expenses of\nattorneys and other professionals) incurred in connection with such action or\nproceeding.\n\n    24.   Independent Contractors.  No provision of this Agreement shall be\n          -----------------------                                          \nconstrued to constitute either party as the agent, servant, employee, partner,\nor joint venturer of the other party. The parties to this Agreement are and\nshall remain independent contractors. Each party shall retain exclusive\nmanagement, direction, and control of its employees and the work to be performed\nby it hereunder.\n\n    IN WITNESS WHEREOF, the parties have executed or have caused this Agreement\nto be executed by their duly authorized representatives, as of the day and year\nfirst above written.  Agreed to as of this 25th day of September 1991 by and\nbetween:\n\n\nAilcec International                JetFax, Inc.\nEnterprises Ltd.                        \n\nBy: \/s\/ Chung Chiu                  By: \/s\/ Edward R. Prince III  \n    --------------                          ------------------------  \n                                                                 \nTitle: CHAIRMAN                     Title:  PRESIDENT           \n\nDate: September 26, 1991            Date: September 25, 1991  \n                                          \n\n                                       10\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n\n                                  EXHIBIT A-1\n\n                             PRODUCT SPECIFICATION\n\n\n[*]\n\n\n\nSTANDARD FEATURES\n-----------------\n\n[*]\n\n                                       11\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n[*]\n\n\n\nOPTIONAL FEATURES\n------------------\n\n[*]\n\n                                       12\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n                                  EXHIBIT A-2\n\n                      Telstar II Schedule - July 15, 1991\n                      -----------------------------------\n\n\n\n\n             Jul     Aug     Sep     Oct     Nov     Dec     Jan     Feb     Mar\n--------------------------------------------------------------------------------\n                                                  \n\n\n[*]\n\n\n                                       13\n\n \n                                          [*] = CONFIDENTIAL TREATMENT REQUESTED\n\n  Jul      Aug      Sep      Oct      Nov      Dec      Jan       Feb      Mar\n--------------------------------------------------------------------------------\n\n  [*]\n\n\n\n\n\n\n\n\n                                      14\n\n \n                              AMENDMENT AGREEMENT\n\n     THIS AMENDMENT AGREEMENT is made as of February 12, 1997, by and between\nJetFax, Inc., a Delaware corporation with its principal place of business at\n1376 Willow Road, Menlo Park, CA 94025 (\"JetFax\"), and Ailicec International\nEnterprises Limited, a Hong Kong corporation with its principal place of\nbusiness at Unit C, 2\/F., Kaiser Estate, Phase 1, 41 Man Yue Street, Hunghom,\nKowloon, H.K. (\"Ailicec\").\n\n     WHEREAS, JetFax and Ailicec are parties to a Development Agreement dated as\nof September 25, 1991 (the \"Development Agreement\");\n\n     WHEREAS, JetFax and Ailicec are parties to a Manufacturing Agreement dated\nas of October 21, 1991 (the \"Manufacturing Agreement\") and a related Security\nAgreement dated as of October 1991 (the \"Security Agreement\"); and\n\n     WHEREAS, in order, among other things, to clarify their relationship and\ninduce JetFax to raise capital in the public market, Ailicec and JetFax desire\nto amend the Development Agreement as set forth below and to terminate the\nManufacturing Agreement and the Security Agreement;\n\n     NOW, THEREFORE, in consideration of the premises and the mutual covenants\nherein contained, and for other good and valuable consideration, the receipt and\nsufficiency of which are hereby acknowledged, the parties hereto agree as\nfollows:\n\n          1.  Capitalized terms used herein without definition shall have the\nmeanings ascribed to them in the Development Agreement, the Manufacturing\nAgreement or the Security Agreement.\n\n           2.  Section 2 of the Development Agreement is hereby amended by\nadding the following new Section 2(d) at the end thereof:\n\n           (d)  Notwithstanding anything in this Agreement to the contrary,\n     Ailicec hereby grants to JetFax, and JetFax hereby accepts, a non-\n     exclusive, perpetual, fully paid, royalty free, transferable, worldwide\n     right and license, with the right to sublicense, under all of its\n     intellectual property rights, to do any and all of the following:  use,\n     modify, prepare derivative works of, include in other product material,\n     copy and reproduce, make and have made, publicly display, publicly perform,\n     license, \n\n                                      -15-\n\n \n     support, maintain, market, sell and otherwise distribute and otherwise\n     commercialize the Ailicec Property, the Product, the Standard Feature\n     Source Code and any technology, proprietary rights and know-how related\n     thereto and any derivative works thereof. In the event of any conflict\n     between the terms of this Section 2(d) and any other provisions of this\n     Agreement, the terms of this Section 2(d) shall control.\n\n          3.  The third and fifth sentences of Section 4(e) of the Development\nAgreement are hereby amended by deleting the text thereof in their entirety.\n\n          4.  Text intentionally omitted.\n\n          5.  The term  \"Agreement\" as used in the Development Agreement shall\nfor all purposes refer to the Development Agreement as amended by this Amendment\nAgreement.\n\n          6.  The Manufacturing Agreement and the Security Agreement are hereby\nterminated and neither of such agreements shall have any further force or\neffect.\n\n          7.  This Amendment Agreement may be executed in any number of\nduplicate counterparts, each of which shall be deemed an original and all of\nwhich together shall constitute one and the same instrument.\n\n          8.  This Amendment Agreement shall become effective only upon the\nclosing of a public offering by the Company of any of its equity securities\nsufficient to cause the conversion of the Company's Series E Preferred Stock\ninto Common Stock.\n\n                [balance of this page intentionally left blank]\n\n                                      -16-\n\n \n                                                           [Amendment Agreement]\n\n           IN WITNESS WHEREOF, the parties have duly signed this Amendment\nAgreement as of the day and year first written above.\n\n\nJETFAX, INC.                        AILICEC INTERNATIONAL\n                                    ENTERPRISES LIMITED\n\n\n\nBy:  \/s\/Edward R. Prince III        By: \/s\/Chung Chiu\n     -----------------------            ----------------\n     Edward R. Prince III               Chung Chiu\n     President                          Title: Managing Director\n\n                                      -17-\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7940],"corporate_contracts_industries":[9508],"corporate_contracts_types":[9613,9620],"class_list":["post-42221","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-jetfax-inc","corporate_contracts_industries-technology__hardware","corporate_contracts_types-operations","corporate_contracts_types-operations__services"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42221","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42221"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42221"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42221"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42221"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}