AGREEMENT OF SENSOR MODULE’S MANUFACTURE AND SALES

　　马来西亚电子元器件产销协议

　　TABLE OF CONTENTS

　　1. Definitions; Interpretation. 定义与解释

　　1.1. Definitions. 定义

　　1.2. Terms Elsewhere Defined; Plurals. 其他定义、复数

　　1.3. Schedules. 本协议附件

　　2. Manufacturing; Exclusive Rights. 产品制作、独家销售权

　　2.1. Manufacturing. 产品制作

　　2.2. Other Products. 其他产品

　　2.3. Exclusive Rights. 独家权利

　　3. Terms of Sale. 销售条款

　　4. Quality. 产品质量

　　5. Engineering Services. 技术服务

　　6. Audit and Access Rights. 审计和获得审计文件的权利

　　6.1. Audit. 审计

　　6.2. Access to Facilities. 从相关分支机构获取资料

　　7. Intellectual Property and Licenses. 知识产权与许可

　　7.1. Ownership. 所有权

　　7.2. No Other Grants. 无其他授权

　　8. Warranties; Out of Warranty Repair. 服务承诺与保修期届满后的维护

　　8.1. Manufacturing. 对产品制作的承诺

　　8.2. Remedy. 对不合格产品的补救措施

　　8.3. Limited Remedy; Exception. 补救措施的限制范围及例外情况的处置

　　8.4. Intellectual Property. 知识产权

　　8.5. Compliance with Laws. 遵守法律

　　8.6. Out of Warranty Repair. 保修期届满后的维护

　　8.7. Parts Availability. 零配件的供应

　　9. Indemnification. 保障和保护责任

　　10. Limitation of Liability. 责任限制

　　11. Term and Termination. 协议有效期与终止

　　11.1. Term. 有效期

　　11.2. Renewal. 协议续期

　　11.3. Termination. 协议终止

　　11.4. Effect of Termination. 协议终止后有关条款的效力

　　11.5. Survival. 效力持续

　　12. Confidentiality Obligations. 保密义务

　　12.1.Confidential Information. 保密信息

　　12.2.Return, Employees. 保密资料的返还与对其雇员的责任

　　12.3.Exceptions. 除外情况

　　12.4. Time. 保密期限

　　12.5. Injunctive Relief. 寻求法院的禁令救济

　　13. General Provisions. 一般性规定

　　13.1. Entire Agreement. 协议的完整性

　　13.2. Conflict. 订单与本协议不一致的处理

　　13.3.Succession and Assignment. 权利义务的承继与转让

　　13.4. Right to Setoff. 款项抵扣权

　　13.5. Notices. 通知

　　13.6. Designated Coordinators. 指定合作商

　　13.7. Further Assurances. 其他保证

　　13.8.No Waiver. 不放弃权利

　　13.9.Interpretation, Amendment in Writing. 解释、书面变更

　　13.10. Governing Law; Venue. 管辖法律与司法属地

　　13.11. No Agency. 非相互代理关系

　　13.12. Multiple Counterparts. 副本

　　13.13. Severability. 条款的可分割性

　　13.14. Force Majeure. 不可抗力

　　SCHEDULE A： TERMS AND CONDITIONS OF SALE 附件A： 销售条款与条件

　　1. PARTY B PURCHASE ORDER TERMS & CONDITIONS 乙方订单的条款与条件

　　2. PURCHASE ORDERS AND FORECASTS 购买订单与预计

　　3. PRICE, PAYMENT, AND TAXES 价格、支付与税收

　　4. SAFETY STOCK 安全存货

　　5. SHIPPING AND DELIVERY 装运与交付

　　6. CANCELLATION AND RESCHEDULING 订单的撤销与另外安排

　　7. PRICE ADJUSTMENTS 价格调整

　　8. VALUED CUSTOMER STATUS 重要客户待遇

　　This Manufacturing and Sales Agreement (Agreement) is made and entered into Feb. 5th , 2004 (the Effective Date) by and between Technology Sdn. Bhd., a Malaysia corporation with its principal place of business located at B-6-12, Block B, Plaza Mont’Kiara, 2, Jalan Kiara, Mont’Kiara, 50480 Kuala Lumpur, Malaysia ("PARTY A") and Europe S. A., a Switzerland corporation with its principal place of business at Moulin du Chou D, CH-1122, ROMANEL-SUR-MORGES, Switzerland. (PARTY B).

　　A. Whereas PARTY A desires to manufacture and sell, and PARTY B desires to purchase certain products, M2(Sensor Module) under the terms and conditions of this Agreement;

　　B. Whereas PARTY B agreed to purchase of the agreed parts in the agreed price and quantity level at least 1 years from the start of manufacturing of the first phase, unless the PARTY A fails to meet the quality level requirement of PARTY B; and

　　C. Whereas PARTY B and PARTY A agreed to cooperate together for mutual interest and will strive to honor the terms and conditions of this Agreement.

　　Therefore, PARTY B and PARTY A agree as follows:

　　1. Definitions; Interpretation. 定义与解释

　　1.1. Definitions. 定义

　　In this Agreement, including the Schedules and Exhibits hereto, the following terms have the following meanings:

　　(a) Affiliate means any entity, which is controlled by, controls or is under common control of a party to this Agreement. For this purpose, the word "control" means the direct or indirect ownership of more than fifty (50%) percent of the voting equity of such entity (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority).

　　(b) Intellectual Property Rights means all inventions, patents and patent applications (including reissues, divisions, continuations, continuations-in-part), trade secrets, know-how, drawings, copyrights, mask-work and other intellectual property rights, whether or not filed, perfected, registered or recorded, and whether now or hereafter existing, filed issued or acquired.

　　(c) PARTY B means PARTY B Europe S. A. together with, where the context requires, its Affiliates.

　　(d) Parts means the products described in the attached Exhibit A. Such Exhibit may be amended in writing from to time by mutual agreement of the parties, and any other parts added to such Exhibit shall be included in the definition of Parts.

　　1.2. Terms Elsewhere Defined; Plurals. 其他定义、复数

　　Terms defined elsewhere In this Agreement shall have the meaning ascribed thereto. Terms denoting the plural shall include the singular, and vice versa.

　　1.4. Schedules. 本协议附件

　　The following schedules and exhibits attached hereto form part of this Agreement:

　　Schedule or Exhibit Title

　　Schedule A TERMS AND CONDITIONS OF SALE

　　Schedule B Quality Requirements :

　　Quality Agreement

　　Exhibit A Quotation (Including P/N, U/P, payment term & Delivery term) & Specifications.

　　2. Manufacturing; Exclusive Rights. 产品制作、独家销售权

　　2.1. Manufacturing. 产品制作

　　PARTY A agrees to manufacture, test, and sell the Parts to PARTY B or its Affiliates or designates.

　　2.2. Other Products. 其他产品

　　If PARTY A develops or distributes any other parts and parts features, excluding those developed using the proprietary information of its other customers, that could compete with any Parts, PARTY A shall offer such parts and parts features to PARTY B on terms and conditions at least as favorable as the terms and conditions upon which such parts and parts features are offered to others.

　　2.3. Exclusive Rights. 独家权利

　　In the event that the Parts are developed or designed only for PARTY B, PARTY A agrees that PARTY B shall have exclusive rights to sell the Parts, and PARTY A agrees not to manufacture or sell Parts or products substantially similar to Parts for or to any person other than PARTY B or its Affiliates or designate without the prior written consent and approval of PARTY B.

　　3. Terms of Sale. 销售条款

　　Parts will be sold at the prices and according to TERMS AND CONDITIONS OF SALE set out in Schedule A, which incorporates Exhibit A.

　　4. Quality. 产品质量

　　Each Parts shall be manufactured to conform to the warranties stated in Section 10 and the Quality Requirements set out in Schedule B, as such Schedule may be amended in writing from time to time by PARTY B with reasonable prior notice to PARTY A.

　　5. Engineering Services. 技术服务

　　If requested by PARTY B, PARTY A will provide engineering and development services to PARTY B, at rates and according to development schedules to be determined on agreement of the parties. All technology resulting from such services shall be subject to Section 8 of this Agreement.

　　6. Audit and Access Rights. 审计和获得审计文件的权利

　　6.1. Audit. 审计

　　PARTY A shall retain for a period of at least three (3) years after the expiration of this Agreement all books and records reasonably required for the computation or verification of compliance with this Agreement. Not more than twice per calendar year during normal business hours and upon thirty (30) days notice, an independent auditor appointed by PARTY B may inspect the books and records of PARTY A related to the performance of its obligations under this Agreement.

　　6.2. Access to Facilities. 从相关分支机构获取资料

　　In connection with any of PARTY B’s rights and PARTY A 's obligations under this Agreement, PARTY A shall provide PARTY B with reasonable access to PARTY A's and its subcontractors' manufacturing and business facilities, business documents, records, information, inventory, and personnel upon PARTY B’s request. If PARTY A fails to promptly provide such access PARTY B may terminate this Agreement without liability. In addition, PARTY B shall have the review and inspection rights set out in the Schedules and Exhibits hereto.

　　7. Intellectual Property and Licenses. 知识产权与许可

　　7.1. Ownership. 所有权

　　PARTY B and PARTY A shall respectively retain ownership of all Intellectual Property Rights with respect to the Parts based on their own development. To the extent, if any, that PARTY A owns Intellectual Property Rights that are or will be incorporated in the Parts, PARTY A hereby grants to PARTY B an unrestricted, non-exclusive, royalty-free, perpetual, transferable license to make, have made, use, sell, offer for sale such Intellectual Property Rights.

　　7.2. No Other Grants. 无其他授权

　　Except as expressly provided in this Agreement, no other licenses, or transfer of technology, express or implied, are granted by either party to the other party. Either party shall not reverse engineer, decompile, disassemble, or create unauthorized derivative works of the other party’s property or that of its Affiliates or licensors. Except as expressly provided herein, nothing in this Agreement confers upon PARTY A any right to use PARTY B’s trademarks, trade names, or service marks or those of its Affiliates in connection with any Parts, service, promotion or publication.

　　8. Warranties; Out of Warranty Repair. 服务承诺与保修期届满后的维护

　　8.1. Manufacturing. 对产品制作的承诺

　　PARTY A represents and warrants that for the period beginning on the date of delivery to PARTY B or its Affiliates or designate and ending on the expiry date of the warranty PARTY B extends to its end-users for the particular Parts (the Warranty Period), each Parts shall (a) conform to the specifications and the Quality Requirements in the attached Schedule B, as amended in writing from time to time by PARTY B, (b) be free from defects in workmanship, manufacturing, and materials. The warranty for replaced or reworked Parts shall be the longer of the remainder of the Warranty Period and ninety (90) days from the date replacement Part is delivered to PARTY B or its Affiliates or designate.

　　8.2. Remedy. 对不合格产品的补救措施

　　Any Parts which do not meet the warranty under Section 9.1 (Defective Parts) will, at the election of PARTY B, (a) be replaced by PARTY A with Parts which are not defective, (b) be repaired or reworked by PARTY A, or (c) be rejected by PARTY B, with the applicable purchase amount to be promptly, at PARTY B’s option, either refunded or credited to PARTY B by PARTY A. PARTY A shall bear all risk and costs such as labor, material inspection and shipping to and from PARTY B’s facilities associated with Defective Parts. In addition, PARTY B shall have the remedies set out in Schedule B for Defective Parts, including Defective Parts that constitute an Epidemic Condition (as defined in such Schedule).

　　8.3. Limited Remedy; Exception. 补救措施的限制范围及例外情况的处置

　　PARTY A’s liability for Defective Parts shall be limited to PARTY B’s remedies under Section 9.2, except in cases where (a) the Defective Parts have either been placed on the market for sale to end-users or (b) sold to a third party for incorporation into another Parts. In such cases, PARTY A shall also be liable for consequential damages to PARTY B.

　　8.4. Intellectual Property. 知识产权

　　PARTY A further represents and warrants that PARTY A either has ownership of, or has sufficient rights in, any technology to be provided by it and incorporated into the Parts to enter into and perform this Agreement, and that such technology does not infringe the Intellectual Property Rights of any third party, and PARTY A is not aware of and has not received any notice of any claim by a third party that any such technology infringes the Intellectual Property Rights of any third party.

　　8.5. Compliance with Laws. 遵守法律

　　PARTY A represents and warrants that PARTY A and all its subcontractors and agents involved in the manufacturing and/or delivery of all Parts strictly adhere, and shall continue throughout the term of this Agreement to strictly adhere, to all applicable labor, employment, and workplace safety laws and regulations of Switzerland, including those laws and regulations governing the working conditions, wages, hours, and minimum age of the work force. Upon written request of PARTY B, PARTY A shall provide PARTY B with a certificate of compliance with the requirements of this Section 9.5 in such form as PARTY B may reasonably request.

　　8.6. Out of Warranty Repair. 保修期届满后的维护

　　For a period of two (2) years after the expiration of the Warranty Period, PARTY A will offer PARTY B replacement Parts at the then current price of such replacement Parts. For a period of three (3) years after the termination of this Agreement PARTY A will provide post-warranty repairs, at PARTY B’s request, on a reasonable time and materials basis.

　　8.7. Parts Availability. 零配件的供应

　　PARTY A shall maintain a reasonable quantity of replacement Parts for the Parts for a period of three (3) years after PARTY A ships the last part of Parts to PARTY B under this Agreement.

　　9. Indemnification. 保障和保护责任

　　PARTY A shall at its own expense defend indemnify, defend and hold harmless PARTY B, its Affiliates and their customers from and against any and all losses, liabilities, claims, obligations, costs, and expenses (including reasonable attorneys’fees), which result from, arise in connection with or are related in any way to any allegation of (i) PARTY A 's negligence, errors or omission, (ii) infringement of any patent, copyright, trade secret or other third party intellectual property right anywhere in the world, which arises from or is related to the Part, or (iii) personal injury or property damage that arises from is related to defects in manufacture or design of the Part. PARTY A shall not be obligated to indemnify PARTY B, its Affiliates, or their customers for any third party claims that arise solely from the written specifications supplied by PARTY B.

　　10. Limitation of Liability. 责任限制

　　In no event shall PARTY B be liable for any lost profits, special, incidental, consequential or indirect damages arising out of or in connection with this Agreement, whether or not it has been advised of such liability. The essential purpose of this provision is to limit PARTY B’s potential liability arising out of this Agreement.

　　11. Term and Termination. 协议有效期与终止

　　11.1. Term. 有效期

　　Unless earlier terminated in accordance with Section 13.3, this Agreement shall take effect on the Effective Date and shall be for a term of two (2) years.

　　11.2. Renewal. 协议续期

　　This Agreement and all of its terms and conditions shall be renewed for successive terms of one (1) year from the last day of the previous term, unless this Agreement is terminated in accordance with Section 13.3.

　　11.3. Termination. 协议终止

　　PARTY B may terminate this Agreement with or without cause on written notice to PARTY A, such termination to be effective on the sixtieth (60th) day after dispatch of such notice. PARTY A may terminate this Agreement if PARTY B breaches any material term of this Agreement and has not cured or begun to cure such breach within sixty (60) days after written notice thereof. Either party may terminate this Agreement if the other party is adjudicated bankrupt or makes an assignment for the benefit of creditors, or if a receiver, liquidator or trustee is appointed for the other party's affairs.

　　11.4. Effect of Termination. 协议终止后有关条款的效力

　　Upon termination of this Agreement, PARTY B shall be relieved of all obligations under this Agreement, except (a) PARTY B's obligation to pay PARTY A according to the terms of the applicable purchase order(s) for Parts which have been delivered to and accepted by PARTY B, for which payment has not yet been made and (b) PARTY B may in its sole discretion elect to reaffirm a purchase order or orders in effect prior to the termination, in which case PARTY B shall be obligated to pay PARTY A according to the terms of the applicable purchase order for the Parts manufactured and delivered in accordance with such purchase order. In addition, in the event PARTY B elects to reaffirm a purchase order or orders in effect prior to the termination, PARTY A shall be obligated to manufacture and deliver the ordered Parts in accordance with this Agreement, including the Schedules and Exhibits hereto. Any credits owed to PARTY A under this Agreement or otherwise which are unpaid on the date of termination shall be paid in cash within thirty (30) days of the date of termination. In addition, in the event of termination of this Agreement the terms of Section 3 of Schedule A of this Agreement shall apply.

　　11.5. Survival. 效力持续

　　The provisions of this Agreement which by their nature extend beyond the expiration or termination of this Agreement will survive and remain in effect until all obligations are satisfied.

　　12. Confidentiality Obligations. 保密义务

　　12.1.Confidential Information. 保密信息During the course of this Agreement, either party will receive confidential and proprietary information of the other party, including but not limited to information regarding the Products, or any part, component or portion thereof, concepts, techniques, drawings, specifications, processes, computer programs, designs and systems, manufacturing and marketing information (together, "Confidential Information"). Receiving party agrees it will not, during the term of the Agreement or thereafter, disclose any Confidential Information, directly or indirectly, to any person or entity, other than its own employees and subcontractors who have a need to know such information in order for receiving party and/or such subcontractors to perform their obligations under this Agreement. Both parties further agree it will not, during the term of the Agreement or thereafter, directly or indirectly, copy or make any commercial or other use whatsoever of any Confidential Information, except as may be necessary to perform its obligations under this Agreement.

　　12.2.Return, Employees. 保密资料的返还与对其雇员的责任

　　Disclosing party shall deliver all copies of the Confidential Information to receiving party on receiving party’s request, or, at disclosing party’s option, receiving party shall destroy such copies and certify to disclosing party in writing that such copies have been destroyed. Receiving party shall inform all its employees and subcontractors who receive Confidential Information of the confidential nature of such Confidential Information and of their obligation to keep same confidential and not to use it other than as permitted hereunder. Receiving party shall be responsible for any acts of its employees and subcontractors in conflict with this Section 14.

　　12.3.Exceptions. 除外情况

　　The obligations of confidentiality imposed by Section 14.1 shall not apply, or shall cease to apply, to any Confidential Information that (a) was already known to receiving party prior to its dealings with disclosing party, as evidenced by documentation bearing a date prior to the commencement of the parties' dealings, (b) is publicly available or becomes so without breach of the Agreement by receiving party, (c) is approved for release to the public by disclosing party, or (d) is received by receiving party from a third party without receiving party’s breach of the Agreement and without the third party's breach of any obligation of confidentiality.

　　12.4. Time. 保密期限

　　Confidential Information, disclosed in furtherance of this Agreement, shall be kept confidential for five (2) years from the date of its original disclosure.

　　12.5. Injunctive Relief. 寻求法院的禁令救济

　　Receiving party acknowledges that the Confidential Information is special and unique to disclosing party, and that any breach of the terms and covenants of this Section 14 will result in irreparable and continuing harm to disclosing party. Receiving party therefore agrees that in the event it breaches any of its obligations under this Section 14, Disclosing party shall be entitled to immediate issuance of a court order enforcing the Agreement, without the necessity of proof of actual damages and without posting bond for such relief, in addition to any and all other remedies provided by applicable law.

　　13. General Provisions. 一般性规定

　　13.1. Entire Agreement. 协议的完整性

　　This Agreement, together with its Schedules and Exhibits, constitutes the complete agreement of the parties and supersedes any other agreements, written or oral concerning the subject matter hereof.

　　13.2. Conflict. 订单与本协议不一致的处理

　　In the event of any conflict between any term or provision of this Agreement and any term or provision of any purchase order, order confirmation or the like, the terms of this Agreement shall be controlling.

　　13.3.Succession and Assignment. 权利义务的承继与转让

　　Neither party may assign this Agreement or delegate its duties hereunder without the written consent of the other party.

　　13.4. Right to Setoff. 款项抵扣权

　　PARTY B may deduct from PARTY A's invoices any amounts equal to an amount owed by PARTY A to PARTY B upon prior notification to PARTY A.

　　13.5. Notices. 通知

　　All notices required or permitted under this Agreement shall be in writing and effective as of (a) the date of transmission if sent by fax, provided the sender has confirmation the transmission was completed, (b) the date of delivery, if by hand delivery, (c) the day following the date of forwarding, if sent by overnight delivery, or (d) the date of actual receipt, if sent by mail, and shall be addressed as follows:

　　PARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY APARTY B

　　13.6. Designated Coordinators. 指定合作商

　　The designated business and technical coordinators for each of PARTY B and PARTY A under this Agreement are set out on Exhibit A. Each party may change its designated coordinators any time by a written notification to the relevant coordinator.

　　13.7. Further Assurances. 其他保证

　　The parties shall each perform such acts, execute and deliver such instruments and documents, and do all such other things as may be reasonably necessary to accomplish the transactions contemplated by the Agreement, including any papers needed to apply for or pursue any patent, copyright or other intellectual property rights registration. PARTY A agrees that PARTY B is its attorney-in-fact for that purpose and can sign papers as its agent and take other actions necessary to pursue these registrations.

　　13.8.No Waiver. 不放弃权利

　　No delay or omission by either party hereto to exercise any right or power occurring upon any noncompliance or default by the other party with respect to any of the terms of this Agreement shall impair any such right or power or be construed to be a waiver thereof. A waiver by either of the parties hereto of any of the covenants, conditions, or agreements to be performed by the other shall not be construed to be a waiver of any succeeding breach thereof or of any covenant, condition or agreement herein contained. Unless stated otherwise, all remedies provided for in this Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to either party at law, in equity, or otherwise.

　　13.9.Interpretation, Amendment in Writing. 解释、书面变更

　　This Agreement, having been reviewed and negotiated by both parties, shall not be construed against any one party as the drafting party. Any amendment to this Agreement or any Schedule or Exhibit hereto shall be in writing and signed by authorized representatives of each party. In furtherance thereof, PARTY B authorizes the following people to sign any subsequent amendments of Exhibit A, but only such Exhibits, provided that any such amendment is signed by any one of the individuals listed in Group A below, together with one of the individuals listed in Group B below.

　　Group A

　　Group B

　　PARTY B may, by notice to PARTY A, modify the above list at its sole discretion.

　　13.10. Governing Law; Venue. 管辖法律与司法属地

　　The laws of the Republic of China (Taiwan) will govern this Agreement without reference to principles of conflicts of laws. The application of the United Nations Convention for Contracts for the International Sale of Goods and/or any local implementing legislation is expressly excluded. Any suit hereunder shall be brought in courts in the districts, and PARTY A hereby agrees and submits to the personal jurisdiction and venue thereof.

　　13.11.No Agency. 非相互代理关系

　　Neither party is to be construed as the agent or to be acting as the agent of the other party hereunder in any respect.

　　13.12. Multiple Counterparts. 副本

　　This Agreement may be executed in several counterparts, all of which taken together shall constitute one single agreement.

　　13.13. Severability. 条款的可分割性

　　If any one or more of the provisions of this Agreement shall be held to be invalid, illegal, or unenforceable, the validity, legality, or enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby.

　　13.14. Force Majeure. 不可抗力

　　With the exception of the obligation to pay moneys due and owing, neither party shall be in default or grounds for termination of the Agreement on any obligations under this Agreement if such default results from governmental acts or directives (official or unofficial), strikes (legal or illegal), act of God, war (declared or undeclared), insurrection, riot or civil commotion, fires, flooding, explosions, embargoes or delays in PARTY A’s furnishing Parts, or other event of force majeure not within the reasonable control of the party affected.

　　IN WITNESS WHEREOF, the authorized representatives of the parties hereto have executed this Agreement as of the date and year first set forth above.

　　SCHEDULE A： TERMS AND CONDITIONS OF SALE

　　This Schedule outlines the terms and conditions of sale of Parts

　　It incorporates by reference the attached Exhibit A, as such Exhibit may be amended from time to time by mutual agreement of the parties.

　　1. PARTY B PURCHASE ORDER TERMS & CONDITIONS See attachment (1).

　　乙方订单的条款与条件

　　2. PURCHASE ORDERS AND FORECASTS 购买订单与预计

　　PARTY B may purchase the Parts by placing written, faxed or electronic orders with PARTY A. Such orders will state the PARTY B Part No., part description, specific quantities, and delivery dates. Orders not acknowledged by PARTY A within three (3) working days of receipt of such order shall be deemed accepted. PARTY A shall accept without making any unilateral changes all orders in compliance with this Agreement. Purchase orders shall be invalid unless placed by PARTY B's designated purchasing agent. Changes to the quantity, or delivery date or other items on purchase orders may be made in writing, by fax or electronically by PARTY B. PARTY B makes no representation or guarantee as to the quantity of Parts that it will purchase under this Agreement, if any.

　　PARTY B’s designated purchasing agent shall issue PARTY A a non-binding six (6) month rolling forecast (the Forecast) for expected orders that shall be updated monthly.

　　3. PRICE, PAYMENT, AND TAXES 价格、支付与税收

　　PARTY A shall sell the Parts at the prices set forth in Exhibit A. Such prices represent are quoted based on FOB Kuala Lumpur. PARTY A warrants that the Prices do not include sales, use or similar taxes applied against the finished Part sold to PARTY B.

　　On a quarterly basis, PARTY A and PARTY B shall meet to review and agree upon reasonable price adjustments. PARTY A 's maximum price in US Dollars to PARTY B during the term or any renewal period for this Agreement shall be the price first set forth in Exhibit A on the date of execution of this Agreement. PARTY B shall pay PARTY A Net 30 days from the invoice. Payment shall be in United States Dollars.

　　4. SAFETY STOCK 安全存货

　　PARTY A agree to build up safety stock for PARTY B. Quantity(Q) will be approximately equal to one month order based on forecast. First shipment in two(2) weeks with partial for Q < Safety stock.

　　5. SHIPPING AND DELIVERY 装运与交付

　　All Parts shall be properly packaged for shipment according to PARTY A’s specifications and requirements and delivered to PARTY B (and/or its Affiliates) with all documents that PARTY B (and/or its Affiliates) need to receive possession of the Parts and to ship, import, and export them. At PARTY B’s request, all Parts shall ship on a FOB Kuala Lumpur basis as provided in the relevant purchase order, as these terms are defined in Incoterms 2000. Risk of loss will pass in accordance with the applicable Incoterm. Title to the Parts will pass when PARTY A makes delivery in accordance with the applicable Incoterm.

　　PARTY B will place PO to PARTY A per PARTY A’s request so that the delivery lead times for Parts shall be not more than the following from the date of issuance of the applicable purchase order by PARTY B to PARTY A under below condition :

　　Incoterm and Delivery Point Delivery Lead-Time Remark

　　FOB Kuala Lumpur 6 weeks with material authorization.

　　16 weeks without material authorization.

　　Parts specified in a purchase order for delivery with the applicable lead-time will be delivered on time. PARTY A will use reasonable efforts when PARTY B requests delivery with a shorter lead-time.

　　PARTY A shall promptly notify PARTY B of any possible delays and revised delivery dates and PARTY B may (i) elect to terminate any delayed orders without liability or (ii) require PARTY A to deliver Parts using expedited delivery at PARTY A’s cost to the location identified by PARTY B. Parts received without PARTY B’s prior written permission more than ten (10) days prior to the scheduled delivery date may be returned, canceled, or rescheduled by PARTY B at PARTY A 's risk and expense.

　　6. CANCELLATION AND RESCHEDULING 订单的撤销与另外安排

　　PARTY B may without penalty reschedule or cancel delivery of the following percentages of Parts for which purchase orders have been issued:

　　Upon cancellation of any purchase order, PARTY A will promptly provide an excess stock report to PARTY B.

　　PARTY B’s exclusive liability for any cancellations outside of the percentages set forth above shall be limited to the long lead-time materials approved by PARTY B in Section 3 of this Schedule A that have been purchased by PARTY A to meet PARTY B’s lead-time requirements and which cannot readily be resold, returned, or consumed in PARTY A's other products. In no event shall those costs exceed the price for the Parts canceled.

　　7. PRICE ADJUSTMENTS 价格调整

　　On a quantity basis, PARTY A shall reduce the sales price. In the event that PARTY A cannot meet this price reduction plan, then PARTY A must represent to PARTY B in writing, the reason for its inability to reduce costs. PARTY B and PARTY A shall then agree, in writing, on a reasonable cost reduction for the upcoming quarterly period.

　　To achieve this price reduction plan, PARTY B will review the market situation and renegotiate a more competitive price with PARTY A accordingly. If PARTY B and PARTY A are unable to agree upon the timing and rate of Part price adjustments, then PARTY B may terminate the Agreement with cause upon sixty (60) days written notice.

　　8. VALUED CUSTOMER STATUS 重要客户待遇

　　PARTY A shall sell Parts to PARTY B for prices not to exceed the prices PARTY A offers to others for parts similar to the Parts and on terms no less favorable than the best terms PARTY A offers to others for parts similar to the Parts. In addition to price, other most favorable terms include, but are not being limited to, delivery terms, inventory protection, and lead-times.