Original Equipment Manufacturer (oem) Agreement

Original Equipment Manufacturer (OEM) Agreement



between



Befut Electric (Dalian) Co., Ltd.



and



Dalian Befut Wire & Cable Manufacturing Co., Ltd.



Dated February 16, 2009







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OEM Agreement



This OEM agreement ("Agreement") is made as of February 16, 2009 in Dalian by and between



Befut Electric (Dalian)Co., Ltd. as the assignor



Principal place of business:Lingang Industrial District of Changxing Island, Dalian



Legal representative: Hongbo Cao Hereinafter referred to as "Party A".



and



Dalian Befut Wire & Cable Manufacturing Co., Ltd. as the assignee



Principal place of business: 90-1 Hongji Street, Xigang District, Dalian



Legal representative: Hongbo Cao



Hereinafter referred to as "Party B".



Whereas:



1. Party A is a wholly foreign owned enterprise that is duly incorporated, validly existing and, among other things, engaged in the business of developing, manufacturing and selling cable wires;




2. Party B is a limited liability company that is duly incorporated and validly existing under the laws of the People's Republic of China and capable of and experienced in manufacture and sales of wires and cables; machining; wholesale and retail of mechanical and electrical equipment (automobiles excluded) and building materials; and import and export of goods and technologies;




3. For the purposes of its manufacture and operation, Party A desires to authorize Party B, and Party B agrees, to manufacture and supply OEM Products; and








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4. The boards of directors of both parties hereto have adopted resolutions approving the execution and performance of this Agreement;




NOW, THEREFORE, in consideration of the mutual agreements and undertakings set forth below, and for other good and valuable consideration, the parties agree as follows:



I. Definition



1.1 Unless otherwise specified herein, the following phrases shall bear the meanings as defined below in this Agreement:




(1) "OEM Products" means products listed in Annex I of this Agreement.




(2) "China" means the mainland of the People's Republic of China, excluding Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan.




(3) "Intellectual Property Rights" means, collectively, patents, trademarks, copyrights, designs and all other intellectual property rights related to all the OEM Products and their applications in the worldwide, whether registered or not.




(4) "OEM Fees" means the price charged as per Section 8 of this Agreement in consideration of the OEM services provided by Party B under this Agreement.




II. Contractual Arrangements and Services



2.1 Under this Agreement, Party B shall provide Party A with OEM services, i.e. manufacturing and processing OEM Products, on an exclusive basis. Such OEM services shall be provided in accordance with the terms and conditions contained in the orders submitted by Party A to Party B.




2.2 Party A shall, on a monthly basis, submit the orders for OEM Products to be supplied in the coming month, indicating the quantities and scheduled delivery dates, etc., and its detailed contents shall be mutually determined by the actual performance of the Agreement.




2.3 Party B shall not assign the OEM services under this Agreement, in whole or in part, to any third party without Party A's prior written consent.








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2.4 The OEM services under this Agreement shall be provided on an exclusive basis and without Party A's prior written consent, Party B shall not accept any orders for OEM services from any third party other than Party A, nor use Party A's production capacity of wires and cables for the manufacture of Party B's own products.




III. OEM Products



3.1 Party B shall, under this Agreement, manufacture OEM Products in accordance with Party A's specifications and requirements. Party B is not responsible for the design of the OEM Products.




3.2 Raw materials required for manufacturing OEM Products shall be provided by Party A and purchased, shipped and delivered to Party B at Party A's cost. Risk of loss or damage of the raw materials shall be passed to Party B upon delivery.




3.3 Party A shall provide Party B with the design drawings and samples of OEM Products, as well as other documents that Party B may reasonably require for manufacturing OEM Products, within 30 days after execution of this Agreement. Party B shall manufacture OEM Products in accordance with the above-mentioned design drawings and samples.




3.4 Party A shall give Party B advance notices in writing of any change or modification to the design drawings or samples of OEM Products.




IV. Delivery and Acceptance of OEM Products



4.1 Party B shall deliver, before the 5 th the day of each month, Party A's monthly order for OEM Products at such location(s) as Party A may designate.




4.2 Risk of loss or damage of OEM Products shall be passed to Party A upon delivery to Party A at such location(s) as Party A may designate.




4.3 Party A shall inspect and test OEM Products within 2 days after delivery thereof by Party B. Should any dispute arise between the parties hereto with respect to Party A's acceptance criteria on OEM Products, such dispute may be submitted to a competent quality supervision authority for investigation. The findings of such investigation shall be final.




V. Responsibilities and Obligations



5.1 Party A's Obligations




(1) Party A shall exercise its rights, fulfill its obligations and cooperate with Party B in good faith during the term of this Agreement;








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(2) Party A shall, upon Party B's request, provide Party B with the information (in writing or other forms) required for manufacturing OEM Products and necessary technical instruction and support as well; and




(3) Party A shall pay OEM Fees in a timely manner.




5.2 Party B's Obligations




During the term of this Agreement, Party B shall:



(1) manufacture OEM Products in accordance with the terms and conditions contained herein;




(2) deliver OEM Products to Party A in a timely manner in accordance with the terms and conditions contained herein;




(3) ship OEM Products to the location of delivery stipulated herein and assume any expenses and risk of loss or damage thus incurred;




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