MANUFACTURING AGREEMENT THIS MANUFACTURING AGREEMENT (the "Agreement") is made effective as of the _______ day of _______________, ____ (the

"Effective Date") by and between __________________________Inc., a corporation organized under the laws of the State of ______________, located at _______________________________ (the "Customer") and _________________________, a corporation organized under the laws of the State of _________________, located at __________________________ (the "Manufacturer")(Each the "Party", collectively, the "Parties") W I T N E S S E T H: WHEREAS, Customer desires to have the Manufacturer manufacture and assemble certain Products (as hereinafter defined) pursuant to one or more Purchase Orders (as hereinafter defined) issued by Customer in accordance with this Agreement; and WHEREAS, Manufacturer desires to manufacture and assemble such Products for Customer hereunder; and WHEREAS, Manufacturer agreed to finance the purchase of certain machinery and equipment (the "Equipment"), to be owned by Customer, pursuant to an equipment lease in the form of Exhibit A hereto; and WHEREAS, Manufacturer has agreed to lease the Equipment to be located at Manufacturer's facility pursuant to an equipment lease in the form of Exhibit B hereto (the "Equipment Lease") and certain intellectual property, trade secrets and "know-how" (the "Technology") pursuant to a license agreement in the form of Exhibit C hereto (the "License Agreement") to Manufacturer for use in connection with the business contemplated by this Agreement. NOW, THEREFORE, Customer and Manufacturer, intending to be legally bound, hereby agree as follows: SECTION 1: DEFINITIONS Capitalized terms used in this Agreement and not otherwise defined herein shall have the meanings set forth in the attached Glossary. SECTION 2: SCOPE OF WORK 2.1 Products. Manufacturer shall manufacture and sell Products to Customer, and Customer shall order and purchase Products from Manufacturer, in accordance with the terms and conditions of this Agreement. All manufacture of Products by Manufacturer shall be solely for Customer and not for Manufacturer's own account or other purchasers. Manufacturer shall deliver to Customer's specified location only that quantity of Products specified in Customer's Purchase Orders, at prices and by the delivery date(s) set forth in such Purchase Orders.

2.2 Location. Unless otherwise agreed, all manufacture shall be conducted in ________ in Manufacturer's facilities or at a Sub-Manufacturer's (as defined in Exhibit D) facility, approved by Customer. 2.3 Sub-Manufacturer. Manufacturer shall be responsible for the quality of Products manufactured by the Sub-Manufacturer. Manufacturer will appoint a quality inspections officer on his behalf that will insure, on a regular basis, the quality of the manufacturing process, the proper use of Components and the strict guard of the Customer's Intellectual Property Rights by the Sub-Manufacturer. 2.4 Project Coordination. Each Party shall appoint a technical coordinator to maintain technical liaison with the other Party hereto in connection with the manufacture of the Products. Communication between the Parties regarding design or engineering of the Product shall be between the designated coordinators. 2.5 Specifications. Manufacturer agrees to perform the material planning, procurement, manufacturing, testing, assembly and packaging work with respect to the Product ("Work") in accordance with the Specifications and pursuant to Purchase Orders or changes thereto issued by Customer. Work shall mean to plan procurement orders, to procure components, materials and other supplies and to manufacture, test, and assemble the Products pursuant to detailed written specifications for each such Product, which are provided by Customer, and to deliver such Products to a Customer designated location, all in accordance with high industry practices and to Customer's full satisfaction. Manufacturers' rights hereunder shall not be exclusive, and Customer shall have no obligation to purchase from Manufacturer any Products or to purchase any minimum quantity or dollar amount. All Products supplied to Customer will be in conformity with the Specifications, which include, but are not limited to, PPAP standards. All Products must satisfy Customers test and quality standards, meet applicable industry quality and performance standards, comply with all applicable legal and regulatory requirements, and be merchantable and fit for the purpose intended by Customer. Manufacturer agrees to support Customers Six Sigma standards and adhere to Customer-required quality processes on an ongoing basis, with the objective of delivering zero (0) defects for all Products 2.6 Quality Assurance. Manufacturer will build and test the Products in accordance with the test procedures set forth in Exhibit E. Manufacturing test data will be maintained and will be available for inspection by Customer on an ongoing basis, and while production of the Product line is being carried out during normal business hours upon reasonable notice. Manufacturer will provide to Customer by the second (2nd) day of each month the quality data described in Exhibit F, for Products supplied during the prior thirty (30) days. The average of the total defects per unit (DPU) will be tracked continuously on a monthly basis for the term of this Agreement and for each Product. Additionally, Manufacturer will provide a monthly Pareto analysis of defects found with root causes identified and a corrective action plan. Customer may at its option reject lots that test above defect standards acceptable to Customer and require Manufacturer to immediately replace each Product contained in a rejected lot at Manufacturers expense in accordance with Section 9. Additionally, in the event that Manufacturers DPU or defect rates increase, Manufacturer will have a period of forty eight (48) hours from the date of notice by Customer to take containment action (Containment Action) and period of Five (5) days from

the date of notice by Customer to take permanent corrective action. If the quality reports during the corrective fifteen (15) day period indicate that the defect rates have not been reduced to acceptable levels, then, in addition to the other remedies provided in this Agreement, Customer may at its option reject shipments of the affected Product, and reschedule or cancel all open Orders for the affected Product without further liability. In the event Containment Action is triggered under this Section 2.6, Customer shall have the right at Manufacturers expense to have a third party inspect Manufacturers Products for nonconformance and/or defects. Manufacturer will cooperate with Customer, as requested, in the implementation by Manufacturer of a Quality Assurance/Reliability program reasonably satisfactory to Customer. Manufacturer will engage in continuous improved quality performance including but not limited to adherence to the following items: (i) Delivery of zero (0) Product defects; (ii) Improved corrective action response time; (iii) Implement industry appropriate statistical process control and statistical product control methods; (iv) including but not limited to, Statistical Process Control (SPC), Support Process Average Testing (PAT) and Statistical Yield Analysis (SYA); (v) New product safe-launch planning; (vi) Certification of TS-16949 Rev. 2002.10; and (vii) adopt ISO-9001(2000) as its quality systems standard. Manufacturer agrees to meet this standard and any additional certification requested by Customer, including TS-16949(2002) or TL9000. 2.7 Packaging. Packaging will be in accordance with Costumers' standards, unless otherwise mutually agreed in writing. Customer shall specify in each Statement of Work, or otherwise as agreed by the Parties, the trademarks and trade dress features to appear on the Products and the publications to be included in packaging. SECTION 3: SHIPPING/DELIVERY/TITLE 3.1 FOB Terms. All Products delivered pursuant to the terms of this Agreement shall be suitably packed for delivery in accordance with Customer's specifications set forth in Exhibit G hereto, marked for shipment to Customer's destination specified in the applicable Purchase Order and delivered to a carrier or forwarding agent. All products manufactured will be delivered FOB (Incoterms 2000), Customer's offices. Risk of loss and title will pass to Customer upon delivery. Products delivered to Customer in advance of a scheduled delivery date and without Customer's prior approval and any partial or incomplete deliveries may be returned to Manufacturer at Manufacturers' expense or held at Customer's facilities with deferred billing privileges. No delivery shall be deemed complete until all ordered units have been delivered and accepted. No payment or other obligations of Customer will accrue on partial or incomplete deliveries, and Customer shall be entitled to deduct penalties for late deliveries, as set forth in Exhibit H hereto. Unless agreed otherwise by Customer, the latest shipment date shall be __ days after receipt of Purchase Order. 3.2 Delivery in Installments. Manufacturer may fill a Purchase Order in installments, but only in mutually agreeable partial quantities and at mutually agreeable intervals. 3.3 Title. Customer Components shall be held by Manufacturer as on consignment from Customer and shall be accounted for by Manufacturer and cared for in accordance with Customer's standard Consignment Agreement (attached hereto as Attachment C). Title to Customer Components will remain with Customer. Title to any Manufacturer Components

included in the Products will pass to Customer upon the earlier of delivery to Customer or Manufacturer's receipt of payment for such items. To the extent not otherwise provided in this paragraph, title to Products will pass to Customer at point of shipment.

3.4 Late Delivery. Time is of the essence with respect to all deliveries and performance. If Manufacturer fails to timely perform or deliver according to the delivery requirements of any stand alone purchase order, Manufacturer shall be liable to Customer for the greater of (i) all of Customers costs incurred as a result of such delay, including penalties Customer must pay to its customers and all costs (including expediting costs) associated with Customers substitution of another vendors products to cover for Products not delivered by Manufacturer, or (ii) liquidated damages in the amount of one percent (1%) per day up to a cap of twenty percent (20%) of the purchase price of the delayed Products. Customer shall have the right to immediately cancel, without liability, all Orders or portions of Orders for delayed Products to the extent that Customer has elected to cover by sourcing products from other vendors. For delayed Products that Customer continues to require Manufacturer to provide, Manufacturer will use best efforts to expedite delayed Products and/or performance and will pay all expediting costs.

SECTION 4: PRICING AND PAYMENT TERMS 4.1 Pricing. The price for Products to be manufactured will be as set forth in Exhibit I hereto and as revised from time to time in accordance with the index and set-up prices also set forth in Exhibit J All prices quoted are inclusive of all taxes, fees, charges, duties, tariffs, transportation and insurance costs but are exclusive of VAT. 4.2 Price Changes. If the Parties agree to a Price change for any Product, the new Price is applicable to all Product units received on or after the effective date of the price change, including Products in transit to Customer, as of the effective date agreed by the Parties. Manufacturer will promptly refund to Customer any overpayment for Product units purchased by Customer on or after the new Price effective date. All Prices are stated in US dollars unless agreed and specifically noted otherwise in the applicable Product Schedule and Order. Upon request from Customer, Manufacturer will invoice and accept payment in other currencies at prevailing currency exchange rates. 4.3 Cost Reductions. Manufacturer agrees to seek ways to reduce the cost of the procurement of Inventory and the manufacturing and assembly of the Products by methods such as ordering in bulk and obtaining alternate sources of materials, excluding any cost improvements that are obtained as a result of an improvement in yield or any improvement realized pursuant to the implementation of Sections __ hereunder. Upon implementation of such ways, which have been initiated by Manufacturer, Manufacturer will keep the cost improvement and/or credit for any Product Orders received during three months period commencing as of the date of implementation of such ways, following which Customer shall receive one hundred percent (100%) of such cost reduction and/or credit. Customer will receive one hundred percent (100%) of the cost reduction immediately upon implementation of such ways initiated by Customer.

4.4 Most Favored Customer Status. Manufacturer agrees to treat Customer as a preferred customer for procurement, purchasing, allocations, production and delivery purposes, and it agrees to fulfill Customer's Purchase Orders before Manufacturer fulfills orders received from any other third party. Manufacturer hereby represents and warrants that the prices it charges Customer for the Work, raw materials and Inventory are the lowest currently offered for Work, raw materials and Inventory that are the same or substantially similar to the such Work, raw materials and Inventory ("Similar Services") offered to any third party, including any customer or partner. Manufacturer agrees to perform the Work and provide the raw materials and Inventory to Customer at discounted prices no less favorable than those offered by Manufacturer to such third party. In the event that Manufacturer agrees to provide the Similar Services to any third party on pricing and discount terms more favorable than those offered Customer during the term of this Agreement, the same pricing and discount terms shall thereafter apply to Customer. Manufacturer further agrees that if materials, supplies, components, or manufacturing and production resources used by Manufacturer to manufacture the Products are in such short supply ("Scarce Resources") that Manufacturer is unable to completely fulfill Customer's outstanding Purchase Orders, Manufacturer will allocate to Customer any available Scarce Resources in preference to any third party, including any other Manufacturer partner or customer. For the purpose of this Section, the Manufacturer shall be deemed to include its parent company, subsidiaries, if any, and any affiliate of the foregoing. 4.5 Suppliers' Discount. Manufacturer agrees that all price benefits or discounts rendered by suppliers in favor of the Customer shall be used for the sole of purchasing of Inventory and Components that shall be used solely for the manufacturing of the Product. 4.6 Payment. Payment is due net ninety (90) calendar days from the date of Customers acceptance of the Product pursuant to Section 5 hereinabove, or receipt of invoice, whichever occurs later, unless there is a dispute that is not resolved within that period, in which case payment will be due ten (10) calendar days after the dispute is resolved, and shall be made in lawful USD or the NIS equivalent thereof, calculated as of the date of invoice. 4.7 Invoicing. Manufacturer may invoice for Products upon completion and shipment of such Products pursuant to Purchase Orders. To the extent Manufacturer is entitled to do so under the Statement of Work, Manufacturer may invoice for Nonrecurring Charges, if any, as set forth in a Statement of Work, upon commencement of production or as otherwise set forth in the applicable Statement of Work. 4.8 Taxes. Customer shall be responsible for sales, use, or custom taxes or duties resulting from the sale or shipment of Products in accordance with its Purchase Orders. Customer shall provide tax exemption numbers, if applicable, for such purchases. 4.9 Open Books. Manufacturer undertakes that its record keeping with respect to or related to the Work, the Products and its obligations hereunder, including any and all costs documentation, pricing, credits, reductions and discounts received on Inventory, orders of raw materials, burdens and commissions shall be maintained on an open book policy, and that Customer shall be entitled at its sole discretion to examine all relevant Manufacturer books, records and accounts at any time.

4.10 Capital Equipment purchased by Manufacturer. Manufacturer undertakes to purchase and assemble the needed assembly lines and equipment that are needed in order to enable the volume production. Such assembly lines and equipment shall be solely used for the manufacturing of the Product. The type of equipment will be defined by the customer (including tool type and manufacturer). SECTION 5: PURCHASE ORDERS/FORECASTS 5.1 Forecast. Customer shall provide Manufacturer a non-binding rolling three (3) month Product forecast, updated at Customer's discretion ("Forecast"). As these Forecasts are estimated requirements only, they shall in no way be binding on Customer, and Manufacturer shall use such Forecast for internal planning requirements and for long-term procurement and price reduction planning. 5.2 Purchase Orders. Customer will issue written Purchase Orders which specify Work to be completed and Products to be delivered hereunder. It is clarified that Customer shall not have any obligation to order any minimum unit quantity or dollar amount per Purchase Order, and the quantities ordered shall be at Customer's sole discretion. Manufacturer shall notify Customer of acceptance of any Purchase Order and delivery date determined in the Purchase Order within two (2) working days of receipt of such order. Should written acceptance not be received by Customer for any Purchase Order within the time provided above, Manufacturer shall be deemed to have accepted such Purchase Order and, upon such acceptance, the quantities and delivery dates set forth in the Purchase Order shall be strictly adhered to. Customer may use its standard purchase order form to release items, quantities, prices, schedules, change notices, specifications, or other notice provided for hereunder. The Parties agree that the terms and conditions contained in this Agreement shall prevail over any terms and conditions of any purchase order, acknowledgment form or other instrument. 5.3 Inventory Procurement. Customer's accepted Purchase Orders will constitute authorization for Manufacturer to procure, using high industry Purchasing and Quality Assurance practices, the components, materials and supplies necessary for the manufacture of Products ("Inventory") covered by such Purchase Orders. In addition, Customer authorizes Manufacturer to purchase, and Manufacturer undertakes to purchase and maintain, in amounts beyond the amount necessary to fill accepted purchase orders, the Inventory: (i) with lead times greater than ninety (90) days at the time the order is placed ("Long Lead Time Components") plus thirty (30) days to account for the order, shipment, receipt and manufacturing time and, (ii) purchased in quantities above the required amount in order to achieve price targets ("Economic Order Inventory"), and (iii) purchased in excess of requirements because of minimum lot sizes available from manufacturers ("Minimum Order Quantity"). Together these are called "Special Inventory". Manufacturer may purchase Long Lead Time Components sufficient to meet all deliveries under the Purchase Orders and Forecast in effect at the time the order with the Manufacturer is placed, and may reasonably purchase Minimum Order Quantity even if greater than the amount necessary to meet Purchase Order and forecast. Economic Order Inventory shall be purchased by Manufacturer only with the prior approval of Customer. Manufacturer may, from time to time and after obtaining Customer's approval, hold Long Lead Time Components and finished goods in inventory to increase customer flexibility. The components and quantities

of all such inventory will be documented in separate letter and signed by both Manufacturer and Customer. Customer shall be entitled at any time and at its sole discretion, to designate the vendors, suppliers and/ or manufactures, from which Manufacturer shall procure Inventory at terms determined by Customer and to indicate manufacturer part numbers which Manufacturer is authorized to acquire. Any contract and/or purchase orders entered into with vendors, suppliers and/or manufacturers shall require customer's prior written approval. 5.4 Customer Supplied Inventory. With respect to any Purchase Order for items that are under Customer responsibility (for cases including but not limited to first time purchase orders ), the Customer shall be entitled, at its sole discretion, to purchase the Inventory necessary for the fulfillment of such Purchase Order on its own and to provide Manufacturer with such Inventory. Manufacturer shall purchase such Inventory from Customer at cost price and shall not be entitled to receive commissions and/or burdens for any Inventory so purchased and supplied by Customer. 5.5 Purchase of Inventory by Customer. The Customer shall be entitled to purchase Inventory from Manufacturer or via Manufacturer for use with respect to the Products or other Customer products, all at its sole discretion. Customer shall pay Manufacturer for Inventory purchased pursuant to this Section 5.5 as follows: (i) one hundred and three percent (103%) of Manufacturer ' direct purchasing cost for any raw materials purchased; (ii) the price determined by the Parties for any works in process according to the stage reached in the manufacturing process, which price shall at no time exceed ninety percent (90%) of the price of the finished product. 5.6 Inspection and Acceptance. The Products delivered by Manufacturer will be inspected and tested as required by Customer and/or by anyone of Customer's customers, within one hundred and twenty (120) business days of receipt for first article acceptance testing of a new Product or a modified Product and within forty-five (45) business days of receipt for all other Product deliveries (each an "Acceptance Period"). Manufacturer agrees to reserve for Customer test equipment and sufficient personnel necessary to perform acceptance testing of the Products at Manufacturer premises if so requested by Customer. If Products are found to be defective in material or workmanship or if such Product fails to conform to the Specifications or to other testing and acceptance criteria, all to Customer's satisfaction, Customer has the right to reject such Products during said Acceptance Period. Customer may notify Manufacturer in writing of such rejection, detailing the nature of the failure, and the Parties will promptly discuss means to resolve any such failure; Manufacturer will then deliver to Customer, at Manufacturers' expense and. pursuant to an agreed upon schedule, non-defective Products that meet the Specifications or mutually acceptable testing and acceptance criteria. Upon re-delivery, Customer shall have an additional twenty five (25) business days to acceptance test the re-delivered Product and provide either written acceptance of the Product or a written statement detailing the Product's failure. Customer may elect to continue the process of modification and acceptances testing, terminate the applicable Purchase Order, or terminate this Agreement without further cure period. Products not rejected during the Acceptance Period will be deemed accepted. Products to be returned to Manufacturer may be returned by Customer or Customer's customers, freight collect, after obtaining a Return Material Authorization number from Manufacturer to be displayed on the shipping container. The Parties agree that Customer shall have no obligation to pay for any Product until such Product has been accepted by Customer in accordance with this Section.

SECTION 6: PURCHASE ORDER RESCHEDULING/CANCELLATIONS 6.1 Rescheduling. Manufacturer agrees to use its best efforts to accommodate requests for rescheduling (acceleration and delay) and, before accepting such rescheduling requests, may quote applicable charges resulting from changes in costs associated with such rescheduling. If the Parties are unable to agree on such changes, then Manufacturer shall deliver as initially agreed, subject to Customer's right to cancel Purchase Orders as provided herein. Customer shall be entitled, without additional charge or payment of associated costs, to change quantities (increase or decrease) or reschedule delivery (acceleration or delay) of Products that are scheduled for delivery. 6.2 Product Modifications. Customer may request, in writing, that Manufacturer incorporate engineering changes into the Product. Such request will include a description of the proposed engineering change sufficient to permit Manufacturer to begin implementation of the engineering changes as of the release date indicated on the engineering change request. Concurrently, Manufacturer shall evaluate the implication of the changes and shall issue an evaluation in writing within three (3) business days stating the costs of implementing the engineering changes and the impact on the delivery schedule and pricing of the Product. Based on the open books policy, the Parties shall negotiate in good faith regarding the changes to the Product's Specifications, delivery schedule and pricing and upon the implementation costs to be borne including the cost of Inventory and Special Inventory on-hand and on-order that becomes obsolete, if any. 6.3 Discontinued Product. If Manufacturer intends to stop offering any Product for sale to Customer for any reason (Discontinued Product), unless a longer period is specified in the applicable Product Schedule, Manufacturer will give Customer a minimum of six (6) months prior written notice, or if Manufacturer is the only Customer-qualified source of the Discontinued Product, a minimum of nine (9) months prior written notice (End of Life Period). During the End of Life Period, Customer will a) provide Manufacturer with a forecast of anticipated demand for the Discontinued Product during the End of Life Period and a final lifetime buy volume forecast; b) may continue to place orders for Discontinued Product, with delivery not to exceed twelve (12) months from the date of the Order. Additionally, at Customers request, Manufacturer will deliver to Customer or its designated third-party manufacturer all materials necessary for manufacture and supply to Customer of the Discontinued Product, and Manufacturer will assist Customer in making alternative supply arrangements for the manufacture and supply of Discontinued Product, including granting to Customer and a mutually agreed third-party manufacturer, a perpetual, irrevocable, worldwide, non-exclusive, royalty-free, fully paid up, transferable license under Manufacturers Intellectual Property Rights to such materials and all relevant technology, to use, reproduce, modify, display, perform, distribute copies of and sublicense such materials and technology, and to make or have made, sell, offer to sell, import, otherwise dispose of, sublicense and distribute Discontinued Product and/or other parts and products derived there from. For purposes of this Section, Manufacturers Intellectual Property Rights include any rights Manufacturer has obtained to the Intellectual Property of third parties, to the extent that such rights are necessary for the sale, use

or other distribution of the Products supplied to Customer under this Agreement. If Manufacturer is unable to transfer or sublicense those rights to third party Intellectual Property, then Manufacturer will at Customers request, assist at its own cost, Customer in obtaining the necessary rights from the third party. Manufacturer agrees that Customer would be irreparably harmed by Manufacturers failure to fulfill its obligations under this section, that money damages would not adequately compensate Customer for such harm, and that Customer is entitled to injunctive relief to prevent any threatened or continued breach of this section and to specifically enforce this section, in addition to all other remedies to which Customer may be entitled to at law or in equity. Manufacturer hereby waives any right to contend that Customer would not be irreparably harmed, would have an adequate remedy at law, is not entitled to specific performance of this section, and that a bond is necessary. 6.4 Cancellation. Customer may, by written notice, cancel shipments of Products that are scheduled for delivery. Upon receipt of notice of cancellation, Manufacturer shall stop work on the canceled portion of existing Purchase Orders immediately. Manufacturer agrees to use its reasonable efforts to return, reuse, or sell any Manufacturer Components covered by the canceled portion of the applicable Purchase Order. Manufacturer will make good faith efforts to effectively minimize costs associated with such cancellation. 6.7 Failure to deliver by Sub-Manufacturer. Manufacturer shall have the ability to replace within seven (7) days any Purchase Order failed to be made by the Sub-Manufacturer. SECTION 7: COMPONENTS 7.1 Customer Components. Customer may identify to Manufacturer certain Components that must be used in the manufacturing of the Product. Either these Components may be consigned by Customer or Manufacturer may be directed by Customer to purchase such components from Customer's approved vendor list (AVL). If Manufacturer offers alternative to Customer's AVL, the alternative must be approved in writing by Customer prior to the procurement of the Components to be used in production of Products. 7.2 Programs. If computer programming is incorporated in the Products, procurement of such programming shall be the responsibility of Manufacturer or Customer as set forth in the applicable Statement of Work or Bill of Materials. Any restrictions or payment obligations imposed by the original source on Manufacturer's or Customer's use or handling of such programming shall be set forth in a separate signed writing. There shall be no payment or reimbursement obligation on Customer's part for programming obtained or provided by Manufacturer unless such payments or reimbursements are set forth in a Bill of Materials that indicates that Customer has accepted such obligation.

SECTION 8: MONTHLY PERFORMANCE REVIEWS

Customer and Manufacturer agree to review monthly the business performance to date of each Party to include such items as quality, delivery, communications, responsiveness, and cost fluctuations. SECTION 9: WARRANTY 9.1 Manufacturer's Warranty. Manufacturer represents and warrants that each Product is free of any defect that would pose a potential safety hazard. Further, unless specified otherwise in the applicable Product Schedule, for a period of thirty (30) months from the date of Product delivery or for the period of Manufacturers standard warranty, whichever is longer, Manufacturer expressly warrants that all Products are free from defects in design, materials and workmanship, are appropriately labeled and packaged, meet the Quality requirements set forth in Section 2.5, and conform to the Product Specifications. All warranties run to Customer, and through Customer, to its customers. All warranties survive any inspection, acceptance, payment, or resale by Customer. Manufacturer agrees that its representations and warranties are reaffirmed with each shipment or delivery of Products. If Manufacturer delivers Products that are defective, non-conforming, or otherwise fail to comply with the warranties in this Agreement, or which experience an Epidemic Failure as defined in Section 9.2, below (affected Products), whether or not apparent upon inspection, Manufacturer shall promptly and at its sole expense: (i) at Customers option, re-perform, repair, or replace the affected Products, or provide a refund for the affected Products; (ii) expedite late deliveries and performance; and (iii) pay for any additional related costs, including inspection by Customer or Customer designated third parties, sorting inventories to isolate affected Products, reworking, retesting, storage, shipping, repackaging, reinstallation, expediting, and replacing the affected Products; (iv) pay to Customer all costs of investigating, recovering, recalling, repairing or replacing Customer products that incorporate or are otherwise potentially impacted by the affected Products; and (v) pay all other costs, charges, fines, penalties, or damages incurred by Customer or its customers related to the affected Products. Manufacturer agrees that the foregoing remedies are in addition to any other remedies provided elsewhere in this Agreement and remedies available under law or equity. In addition to the other rights and remedies provided in this Agreement, if at any time one or more of the Products experiences an Epidemic Failure, then: (i) Customer, at its option, may reschedule or cancel all Orders and Forecasts for the affected Product without liability of any kind, including but not limited to liability for raw materials, work-in-process, or finished goods Manufacturer may have on-hand for the Order or the Forecast; (ii) Manufacturer, at its sole expense, will take immediate remedial action for impacted and potentially impacted Products, according to a corrective action plan approved by Customer; and (iii) Manufacturer shall be liable for all customer charges or penalties Customer incurs in connection with the affected Products. 9.2 Customer Warranty. Customer warrants it has the right (1) to consign Customer Components to Manufacturer for incorporation in the Products in accordance with the Manufacturing and Design Documentation and (2) to authorize Manufacturer to use, for purposes of manufacturing and assembling the Products hereunder, any information provided by Customer and contained in the Manufacturing and Design Documentation.

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9.3 Epidemic Failure. Without limiting any other remedy for the Customer under this Agreement or at law, and without affecting any other obligation Manufacturer may have under this Agreement, in the event of an Epidemic Failure, Manufacturers' obligations shall be, within three (3) business days, to propose an action plan to fix the failure of any affected Products and to implement immediately such action plan (Corrective Action) upon Customer's acceptance thereof. If the action plan is not acceptable to Customer, Customer may require Manufacturer to repair or replace the affected Products, regardless of whether the applicable warranty period has expired. The repair or replacement shall be done at mutually agreed upon location(s); provided, however, that cost of repair or replacement together with the shipping, transportation and other costs of gathering and redistributing the Products shall be borne by Manufacturer. In addition to bearing the costs associated therewith, if requested by Customer, Manufacturer shall support and provide at Manufacturer ' expense a sufficient number of Products to permit the immediate field exchange or "hot swap" of Products at customer sites. The Parties agree to make all reasonable efforts to complete the repair or replacement of all of the affected Products within ten (10) business days after written notice of Epidemic Failure by Customer to Manufacturer. Manufacturer also agrees that Customer will be supported with accelerated shipments of replacement Products to cover Customer's supply requirements.

9.4 Dead on Arrival. In the event that any Product is found to be Dead-on-Arrival, Manufacturer shall deliver, at Manufacturer ' sole expense, a replacement Product within seven (7) days following receipt of notice from Customer. Any Dead-on-Arrival Product will be returned to Manufacturer at Manufacturer' sole expense.

9.5 Conforming Products. For Products that are returned to Manufacturer by Customer for warranty repair or replacement and are found by Manufacturer to conform to the product Specifications and such conformity is verified by Customer, Customer shall pay Manufacturer shipping charges and duties.

9.6 DISCLAIMER. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, MANUFACTURER SHALL HAVE NO LIABILITY FOR THE PRODUCTS OR ANY COMPONENTS THEREIN, INCLUDING ANY LIABILITY FOR NEGLIGENCE, MANUFACTURER MAKES AND CUSTOMER RECEIVES NO WARRANTIES, EXPRESS, IMPLIED, STATUTORY, OR IN ANY OTHER PROVISION OF THIS AGREEMENT OR ANY OTHER COMMUNICATION, AND MANUFACTURER SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. SECTION 10: INDEMNIFICATION / INSURANCE

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10.1 Indemnification. Manufacturer will indemnify and hold harmless Customer, its officers, directors, employees, contractors , and agents from any and all claims, damages, expenses (including ,without limitation, court costs and attorneys fees), suits, losses, or liabilities by a third party (Claims) for any death, injury, or property damage caused by acts or omissions of the indemnifying Party, its officers, directors, employees, contractors, or agents arising from or connected with the performance of this Agreement. To receive the foregoing indemnities, the Customer must promptly notify the other in writing of a Claim and provide reasonable cooperation and full authority to defend or settle the Claim. Manufacturer will fully defend, indemnify, and hold harmless Customer and all of its past, present, and future affiliates, customers, distributors, officers, directors, employees, contractors, successors, assigns, agents, attorneys and insurers (the Customer Indemnitees) against all Claims brought by a third party under any theory of liability or recovery, arising from, or connected with, Manufacturers acts or omissions under this Agreement, or the acts or omissions of Manufacturers past, present, or future officers, directors, employees, contractors, representatives, or agents under this Agreement, including without limitation the delivery of Products that are defective, nonconforming, or that otherwise fail to comply with Manufacturers warranties as set forth in this Agreement. Manufacturer will reimburse the Customer Indemnitees for all losses, costs, and expenses the Customer Indemnitees incur as a result of such Claims, including court costs and attorneys fees. Manufacturer agrees to indemnify and hold harmless the Customer Indemnitees, from any and all Claims arising from or by reason of any actual or claimed infringement or misappropriation of any patents, trade secrets, trademarks, maskworks, copyrights or other intellectual property rights, and to defend any suits based thereon with respect to the use, license, distribution, importation, or sale, of Products or a Customer product by virtue of incorporation of a Product or Products, either alone or in combination with other products provided that: (i) Customer gives Manufacturer prompt notice in writing of any such claim or suit and permits Manufacturer, through counsel of its choice, to answer the charge of infringement and defend the claim or suit; (ii) Customer provides Manufacturer information, assistance and authority, at Manufacturers expense, to enable Manufacturer to defend the claim or suit; and (iii) Customer gives Manufacturer full control of any settlement negotiations. If the use of any portion of the Products provided hereunder is enjoined as a result of such suit, then Manufacturer, at no expense to Customer and its customers, will either procure the right for Customer and its customers to continue using the Products or replace or modify the Products so that they become non-infringing and are of equivalent or superior functionality. If neither of the foregoing alternatives is available on terms which are acceptable to Customer, Customer may return all or any part of the Products, at Customers sole option, for a full refund of the total amounts paid for the affected Products. Manufacturer agrees that its obligations to indemnify, as set forth in this Section 10, will survive the termination or expiration of this Agreement. Manufacturer will not enter into any settlement agreement that affects any Customer Indemnitee without Customers prior written consent. Customer may, at its sole expense, actively participate in any suit or proceeding, through its own counsel. 10.2 Insurance. Manufacturer will (i) maintain statutory Workers Compensation, Employers Liability, Broad Form Commercial General Liability, and Business Automobile Liability Insurance on behalf of Manufacturer and its subcontractors, and Contractual Liability Insurance for liability under this Agreement, in each instance of at least $1,000,000 (U.S.) combined single limit; (ii) maintain insurance covering its assets and operations in an amount sufficient to fund

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the costs of compliance with the Business Interruption and Recovery Plan required by this Agreement; (iii) maintain Umbrella / Excess Liability Insurance of $5,000,000 (U.S.) per occurrence; (iv) name Customer as an additional insured and, under the Commercial General Liability policy, include a cross-liability endorsement; (v) provide a waiver of subrogation in favor of Customer under the Workers Compensation and Employers Liability policies; (vi) cause its insurance to be designated as primary and provide for thirty days minimum prior notice of cancellation to Customer; (vii) at Customer's request, furnish evidence of insurance from a locally licensed insurance provider reasonably acceptable to Customer; and (viii) require its supply chain to maintain, at a minimum, the same coverage and limits required of Manufacturer. Nothing contained within these insurance requirements will be deemed to limit or expand the scope, application and/or limits of the coverage afforded, which coverage will apply to each insured to the full extent provided by the terms and conditions of the policies. Nothing contained within this provision will affect and/or alter the application of any other provision contained with this Agreement. Deductibles or self-insured retentions must not exceed $50,000 unless declared to and approved by Customer prior to the date of this Agreement. The deductible and/or self-insured retention of the policies will not limit or apply to the Manufacturers liability to Customer and will be the sole responsibility of the Manufacturer. SECTION 11: INTELLECTUAL PROPERTY RIGHTS 11.1 IP Protection. Manufacturer, at its own expense, shall protect, defend, hold harmless, and indemnify Customer and any subsequent owner of the Products, and shall pay any damages, agreed upon settlement amounts, or necessary costs (including attorney fees and fines) finally awarded with respect to all proceedings or claims against it or them for the infringement of any Intellectual Property Rights resulting from Manufacturer's manufacture and assembly processes or the use of Manufacturer Components where such use necessarily and solely causes the infringement. Manufacturer shall not have any liability hereunder based on (1) required compliance by Manufacturer with Manufacturing and Design Documentation originating with and furnished by Customer (or the combination of the Products with other apparatus not included in the deliveries to Customer), if such compliance (or combination) necessarily and solely gives rise to such proceedings or claims; (2) infringement or alleged infringement caused solely by Customer Components; (3) Customer's failure to provide prompt notice to Manufacturer of any such proceeding or claim and copies of all communications, notices, and/or other actions relating to such claim; or (4) infringements resulting from modifications or alterations made after shipment by Manufacturer. Customer shall not agree to settle any such proceeding or claim without the written consent of Manufacturer, which consent shall not be unreasonably withheld. Manufacturer, for itself, its subsidiaries, and its affiliates, hereby grants Customer, its subsidiaries, affiliates, dealers, and customers, royalty-free immunity from and against any claim of infringement of any Intellectual Property Rights associated with the design, manufacture, sale, or use, of the Products to the extent of any Intellectual Property Rights that Manufacturer may own or have the right to license, as they apply to Products made and distributed under this Agreement and any subsequent sale, use, or repair of such Products, including any reconstruction of returned units. 11.2 No Other Rights. Except for any licenses and immunities that are expressly granted by this Agreement, nothing in this Agreement or any course of dealing between the Parties will be

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deemed to create a license from either Party to the other of any Intellectual Property Right, whether by estoppel, implication, or otherwise. 11.3 Manufacturing and Design Documentation. Manufacturer shall segregate all Manufacturing and Design Documentation and provide Customer with a set of copies thereof as requested by Customer from time to time. Except for copies needed to be retained for Manufacturer to complete its obligations under this Agreement and one copy which may be retained in a segregated manner solely for nonproductive archival purposes for reference concerning Manufacturer's obligation hereunder, Manufacturer shall turn over such materials to Customer upon termination of this Agreement. 11.4 Confidential Exchanges. The Parties have executed a Mutual Confidentiality Agreement, dated __________, relating to the exchange of certain confidential information. Such Agreement is hereby incorporated in this Agreement by reference. 11.5 Ownership of Intellectual Property Rights in Products. Manufacturer acknowledges that, subject for the explicit license granted herein, Customer retains and shall exclusively own and all rights and title to the Technology and the Products including to any intellectual property rights and interest in or with respect to the Products and the Technology Manufacturer hereby irrevocably waives and renounces any and all rights with respect thereto and waives any and all rights to make claims with respect thereto in the future. 11.6 License. Manufacturer is hereby granted by Customer a non-exclusive, non-transferable license during the term of this Agreement to the Technology to be used for the sole purpose of performing the Work with respect to the Products and only to the extent required to perform Manufacturer' obligations under this Agreement. 11.7 Execution of Documents. Manufacturer shall from time to time and at Customer's sole expense take any further action and execute and deliver any further instrument, including documents of assignment or acknowledgment, that Customer may reasonably request in order to establish and perfect its exclusive ownership rights in such Products and Technology, including any associated intellectual property rights.

SECTION 12: TERM AND TERMINATION 12.1 Term and Renewal. This Agreement will have an initial term of five (5) years, starting on the Effective Date. After the initial term, the Agreement will automatically renew for additional successive one-year period(s) unless either Party provides the other with at least one hundred twenty (120) days written notice of its intention not to renew the Agreement prior to the expiration of the initial term or any one-year renewal period. 12.2. Termination. Either Party may terminate this Agreement if the other Party breaches a material obligation under this Agreement, and that breach continues uncured for a period of thirty (30) days after receiving written notice of the breach. Either Party may immediately

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terminate this Agreement in the event the other Party files a bankruptcy petition of any type or has a bankruptcy petition of any type filed against it, ceases to conduct business in the normal course, becomes insolvent, enters into suspension of payments, moratorium, reorganization, makes a general assignment for the benefit of creditors, admits in writing its inability to pay debts as they mature, goes into receivership, or avails itself of or becomes subject to any other judicial or administrative proceeding that relates to insolvency or protection of creditors rights. Customer may terminate this Agreement, or any applicable open order(s), Product Schedule(s)and related Forecast(s), upon providing Manufacturer with prior written notice and not less than a thirty (30) day opportunity to cure in the event that either (i) the quality performance of Products is not competitive with the quality performance of similar products from other Parties, or (ii) the prices at which Manufacturer is offering Products are not competitive with the prices Customer can obtain from other suppliers of similar products. Customer may terminate for convenience upon ninety (90) days prior written notice to Manufacturer. 12.3 Effect of Termination. Upon the expiration or termination of this Agreement for any reason: (i) Each Party will immediately stop using, and destroy or return to the other Party, all items that contain any Confidential Information belonging to the other Party (including without limitation all Customer-consigned inventory and all types of Customer Property as defined in Section 7 of this Agreement), except Customer may retain one copy of any Confidential Information, Software, and Documentation necessary for the purpose of supporting Products sold to then-existing customers; (ii) Customer may continue to use and sell, in the ordinary course of business, any of its then existing inventory of Products. Customer and its customers will continue to have all license grants described in Section 11 to continue using and selling the Products and providing support to Customer's customers; (iii) unless specified otherwise in the applicable Product Schedule, Manufacturer will continue to make spare parts and repair services for Products available for purchase by Customer on the terms and conditions of this Agreement for seven (7) years after the date of expiration or termination of this Agreement. However, if Manufacturer gives notice of Product discontinuance pursuant to Section 6.3, then the terms of Section 6.3 (instead of this Section) will apply but only to the specific Product for which such notice has been given.

SECTION 13: GENERAL TERMS 13.1 Independent Contractor Status. Each of the Parties hereto shall conduct the work to be performed hereunder as an independent contractor and not as an agent or employee of the other Party. Subject to the terms and conditions of this Agreement, each Party shall choose the means to be employed and the manner of carrying out its obligations hereunder. Each Party shall have sole responsibility for the supervision and payment of its personnel and, except as agreed in writing, all other costs and expenses required to perform its obligations hereunder. Manufacturer shall be responsible for the terms of engagements with and the fee rendered to the SubManufacturer for the manufacturing made by it.

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13.2 Freedom of Action; Non Compete. Except as restricted by Intellectual Property Rights of a Party hereto or of third parties, nothing in this Agreement shall limit the right of Customer to develop, have developed, procure, and/or market products or services now or in the future, including any that may be competitive with those that are subject of this Agreement. Neither Party shall be required to disclose planning information to the other except for the forecast described in Section 5.1. Commencing with the Effective Date and continuing thereafter for a period of three (3) years after the effective date of termination of this Agreement (the Restriction Term), Manufacturer agrees and covenants that it will not, at any time, directly or indirectly, through its employees, agents, suppliers, consultants, and affiliates or otherwise, as an investor, owner, proprietor, principal, founder, partner, licensor, licensee, promoter, stockholder, or otherwise, engage in manufacturing, supplying, inventing, researching, as a FAB, as such term is used in the chip industry or otherwise, of glass waveguide chip, or any other products manufactured by or for Customer (FAB), or have an interest in a commercial enterprise (other than the ownership of less than one percent of the common stock of a publicly traded company) in any corporation, firm, business or related entity or enterprise involved in FAB within the entire world (collectively, the Territory). Manufacturer expressly agrees and understands that the remedy at law for any breach of any provision of this Section will be inadequate and that the damages flowing from such breach are not readily susceptible to being measured in monetary terms. Accordingly, Manufacturer agrees that upon adequate proof of a violation of this Section, Customer will be entitled, among other remedies, to immediate injunctive relief and may obtain a temporary restraining order restraining any threatened or further breach. Nothing in this Section will be deemed to limit Customer's remedies at law or in equity for any breach by Manufacturer of any of the provisions of this Agreement which may be pursued or availed of by Manufacturer. In the event any court of competent jurisdiction (or arbitrator) determines that the specified time period or geographical areas set forth in this Section is unreasonable, arbitrary or against public policy, then a lesser time period or geographical area that is determined by the court to be reasonable, non-arbitrary and not against public policy will be enforced. During the Restriction Term, Manufacturer shall not directly or indirectly solicit, recruit, induce, encourage or attempt to induce or encourage any employee of the Customer or any of its independent contractor, or in development or commercialization activities to terminate his or her employment with the Customer and become employed by or consult for Customer whether or not such employee is a fulltime employee of Customer, whether or not such employment is pursuant to a written agreement or is at will. In the event Manufacturer violates any legally enforceable provision of this Section as to which there is a specific time period during which such Manufacturer is prohibited from taking certain actions or engaging in certain activities, then, in such event the violation will toll the running of the time period from the date of the violation until the violation ceases. 13.3 Business Interruption and Recovery Plan. Within thirty (30) days of a request by Customer, Manufacturer will provide Customer with a detailed, appropriate, written business interruption and recovery plan, including business impact and risk assessment, crisis management, information technology disaster recovery, and business continuity. Manufacturer will update the plan annually. Manufacturer will notify Customer in writing within twenty-four (24) hours of any activation of the plan.

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13.4 Trademarks and Trade Names. Neither this Agreement nor the sale of Products hereunder shall be deemed to give either Party any right to use any of the other Party's trademarks or trade names without such other Party's specific, written consent. 13.5 Compliance with Governmental Legal Requirements. Manufacturer shall comply with the provisions of all applicable federal, state, and local laws, regulations, rules, and ordinances applicable to the transactions governed by this Agreement. Should the Products fail to meet the applicable approvals, standards, or regulations, other than as a result of pending applications or actions with respect to the issuance thereof, Manufacturer may cease production until Customer and Manufacturer agree to required changes and applicable qualifications are met without causing breach of this Agreement. 13.6 Export Controls. Each Party agrees that it will not knowingly (1) export or re-export, directly or indirectly, any technical data (as defined by the U.S. Export Administration Regulations), including software received from the other under this Agreement to; (2) disclose such technical data for use in; or (3) export or re-export directly or indirectly, any direct product of such technical data, including software to, a destination to which such export or re-export is restricted or prohibited by U.S. or non-U.S. law without obtaining prior authorization from U.S. Department of Commerce and other competent government authorities to the extent required by those laws. This clause shall survive termination or cancellation of this Agreement. 13.7 Force Majeure. Neither Customer nor Manufacturer shall be considered in default or liable for any delay or failure to perform any provision of this Agreement if such delay or failure arises directly or indirectly out of an act of nature, acts of the public enemy, freight embargoes, strikes, quarantine restrictions, unusually severe weather conditions, insurrection, riot, and other such causes beyond the control of the Party responsible for the delay or failure to perform. 13.8 Engineering Changes. Customer shall retain engineering control over the entire Product, including Components, subassemblies and all other data and material. All engineering changes and sourcing changes must be approved by Customer before implementation by Manufacturer. The cost increases or decreases incurred as a result of engineering and sourcing changes will be reviewed and an equitable adjustment shall be made in the price or shipping schedule or both, including costs to Manufacturer for any material that is rendered excess due to the change. Such changes will be implemented only upon receipt by Manufacturer of Customer's written request to proceed with the change. 13.9 Notice. Unless otherwise specified in this Agreement, all notices and other communications permitted or required hereunder shall be in writing and shall be mailed, telecopied, telegraphed, telexed or delivered to the other Party at the address set forth in the following (or at such other address as either Party shall designate in writing to the other Party during the term of this Agreement) and shall be effective at the earlier of the time received of five days after dispatch in accordance with the terms of this Section. Each notice to Customer or Manufacturer shall be addressed, until notice of change thereof, as follows:

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If intended for Customer, to:

_________________________ _________________________ Attn: __________________

If intended for Manufacturer, to:

_________________________ _________________________ Attn: __________________

13.10 Assignment. This Agreement may not be assigned by either Party without the prior written consent of the other Party, except that Customer may assign this Agreement, in whole or in part, to any successor to all or substantially all of its business and assets relating to the subject matter of this Agreement, or to any subsidiary or affiliate (defined to mean any entity at least 30 percent of whose voting or profits interests are owned or controlled, directly or indirectly, by Customer). Manufacturer will not subcontract any of its obligations under this Agreement without Customer's prior written consent. Any attempted assignment or transfer of any of the rights, duties, or obligations herein shall be void if not in compliance with this subsection. 13.11 Governing Law. This Agreement shall be governed by the laws of the State of __________, without reference to its conflict of laws provisions. The Parties consent to the
exclusive jurisdiction of the competent courts in ______________

13.12 Waiver. No failure or delay on the part of either Party hereto in exercising any right or remedy under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any such right or remedy. No provision of this Agreement may be waived except in writing signed by the Party granting such waiver. 13.13 Severability. If any provision of this Agreement is held to be invalid, the other provisions will not be affected.

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13.14 Complete Agreement. This Agreement (including the attachments hereto, Statements of Works, Acknowledgments, Invoices, and Purchase Orders issued hereunder) constitutes the complete and exclusive final written expression of all the terms of agreement between Parties. It supersedes all prior agreements, understandings, and negotiations concerning the matters specified herein. Any representations, promises, warranties or statements made by either Party that differ in any way from the terms of this Agreement shall not be binding on either Party unless made in writing and signed by a duly authorized representative of each Party.

Agreed to: Customer

Agreed to: Manufacturer

By:___________________________ By:___________________________ ___________________________ Name (Print or Type) ___________________________ Name (Print or Type)

Title:________________________ Title:________________________ Date:_________________________ Date:_________________________

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Glossary

Capitalized terms shall mean as follows: "Bill of Materials" shall mean a listing or reference for the Components and Programs included in or required for the manufacture or assembly of the Products based on their Specifications. Generic or staple Components may be provided for in general terms sufficient to give Customer an estimate of approximate cost. Unless otherwise indicated, Manufacturer reserves the right to require substitution of functionally equivalent Components or to make additions or deletions to the configuration of a Product, if feasible and if resulting changes in the manufacturing costs are provided for by the Parties. "Components" shall mean parts, materials, and supplies included in or required for each Product, as provided in the Bill of Materials for such Product. The Components will include all equipment, Programs, or Intellectual Property Rights included in or required for each Product. Components may be manufactured by or for Manufacturer (Manufacturer Components) or obtained from or through Customer (Customer Components), if so indicated in the Bill of Materials for the Products. "Dead on Arrival" shall mean any Product that is discovered to contain a Product Defect within one hundred and eighty (180) calendar days from the date of acceptance of the Product. "Epidemic Failure" shall mean the occurrence of the same Product Defect experienced in test or in the field, in greater than two percent (2%) of all Products purchased by Customer over any rolling sixty (60) day period, when such Product Defect manifests itself within three (3) years following the acceptance of such Products by Customer. "Intellectual Property Rights" shall mean any rights under patent, semiconductor chip protection, copyright, trade secret, trademark, or similar laws which would restrict the manufacture, assembly, or distribution of the Products or the subsequent use, sale, or repair of the Products as purchased by Customer from Manufacturer hereunder. "Manufacturing and Design Documentation" shall mean materials and media provided to Manufacturer by Customer or third-party contractors, suppliers, or licensors acting at Customer's request or created by Manufacturer or third-party contractors, suppliers, or licensors acting at Manufacturer's request, in each case specifically for use in the manufacture and assembly of Products hereunder, including drawings, routings, Bills of Materials, schematics, circuit diagrams, Specifications, and test documents. "Products" shall mean the [Manufacturer part number or assembly identification name] specified in each Purchase Order issued under this Agreement, and as described in the Specifications, which comprises the integrated unit described in each Statement of Work. There can be multiple versions of a Product, based on differences provided for under Bills of Materials and Statements of Work.

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"Product Defect" shall mean (i) any reported malfunction, error or other defect in a Product that constitutes a material nonconformity with the Specifications for such Product under conditions of normal and proper use; (ii) any reported malfunction, error or other defect in the Products that is a result of the Work; or (iii) non-compliance with any industry standards. "Purchase Order" shall mean an order to purchase a specific quantity of a Product submitted by Customer and accepted by Manufacturer in accordance with this Agreement, which refers to the version and volume of Products to be manufactured and purchased; price terms; scheduled delivery dates (unless submitted on open delivery terms); and "sold to," "invoice to," and "ship to" addresses. The terms of this Agreement control over any printed terms on a purchase order, acknowledgment, confirmation, or invoice. "Specifications" shall mean, for each Product or revision thereof, written specifications, which shall include, at the Customer's sole discretion and without limitation, bill of materials, schematics, assembly drawings, test specifications, current revision number, list of approved vendors, suppliers and/or manufacturers, approved manufacturer part numbers, quantities and delivery times. "Statement of Work" shall mean a document relating to a particular Product, documented and agreed on by Manufacturer and Customer, which refers to the Specifications for the Product that Manufacturer agrees to manufacture or assemble pursuant to Purchase Orders Customer may submit hereunder. If multiple versions of a Product are contemplated, an initial Statement of Work may give a generalized description or provide sample specifications and leave the detailed specifications of each version to the terms of further Bills of Materials, Statements of Work, or ordering procedures. Price terms, packaging, and applicable testing procedures for each Product will be set forth in a Statement of Work. A Statement of Work may include minimum volume purchase commitments to be satisfied through future Purchase Orders. A Statement of Work may be implemented by reference to a new or changed Bill of Materials. A Statement of Work may provide for special packaging or logo requirements.

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