<PAGE>
Exhibit 10.3
* Certain confidential information contained
in this document, marked by brackets, has
been omitted and filed separately with the
Securities and Exchange Commission pursuant
to Rule 406 of the Securities Act of 1933,
as amended.
MANUFACTURERS REPRESENTATIVE/DISTRIBUTOR CONTRACT
This contract, made this 26th day of January, 1998, is by and between Oplink
Communications Inc. under the laws of the state of California USA, having its
corporate offices at 721 Charcot Drive, San Jose, CA 95131, USA, hereinafter
referred to as the "Principal" and DBX Communications Inc., having its
corporate office at 454 Morris Avenue, Springfield, NJ 07081, USA,
hereinafter referred to as the "Distributor".
The Principal and Distributor hereby Agree To:
1.0 GENERAL PROVISIONS - APPLYING TO DISTRIBUTOR ACTING AS EITHER A
DISTRIBUTOR OR SALES REPRESENTATIVE
(a) The Principal hereby appoints the Distributor, and the Distributor
hereby agrees to act for the Principal as its exclusive selling agent
for the Principal's products designated in Exhibit A.
(b) It is understood that the Principal shall not exercise any control over
the activities and the operations of the Distributor, each being
recognized hereunder as an independent contractor.
(c) It is also understood that the Principal shall not place any
restrictions upon the number of other Principals which the Distributor
may represent. However, the Distributor agrees that it will not
represent other Principals whose products or services are considered by
the Principal as competitive with the products or services of the
Principal herein designated in Exhibit A (except by mutual agreement in
writing).
(d) The Distributor agrees to use its best efforts to promote and sell the
Principal's products or services in the territory hereinafter
designated in Exhibit C.
(e) The Distributor and Principal agree that the Distributor may be
referred to as an Authorized Distributor and Representative in
advertising, signs, trade listings, directories, and similar sales
instruments until this agreement is terminated.
(f) The Distributor shall preserve in strict confidence any information it
obtains concerning the business of the Principal including, without
limitation, trade secrets, information concerning the design or
manufacture of the products or services, customer list, financial
information, and shall not disclose such information to any person or
entity.
(g) The Distributor shall continue to represent the principal as herein
provided until either party elects to terminate the relationship by
giving the other party not less than thirty (30) days advanced written
notice during the first year, sixty (60) days during the second year,
and ninety (90) days during the third year and so on (non cumulative).
(h) The Principal shall be responsible for supplying all catalogs,
specification sheets, product photographs and other sales material that
are reasonable for promoting the sale of the Principal's products by
Distributor.
(i) Principal will from time to time make price adjustments and will
promptly notify Distributor of such changes.
1.
<PAGE>
(j) At the Principal's discretion, this contract shall include any new
products or services developed or added by the Principal during the
life of this Contract, so long as they are not competitive with the
products or services of other Principals then represented by the
Distributor. The Distributor may, however, decline to sell any new
products developed by the Principal, by providing written notice within
20 days of product announcement to Distributor. In such a case,
Principal shall have the right to secure another Distributor to sell
the products declined by Distributor.
(k) Principal agrees to refrain from hiring any Personnel from Distributor
for twelve months after termination of this agreement.
(l) Confirming order notices and shipping schedules will be supplied to
Distributor, by Principal, within 7 days after receipt of Distributor's
purchase orders, or purchase orders received directly from customers.
(m) The Principal agrees to hold the Distributor harmless from all
liability for infringement of any patent rights or other rights of
third parties which may result from the Distributor's sale and
distribution of the Principal's products.
2.0 GENERAL PROVISIONS FOR "DISTRIBUTOR" ACTING AS A SALES REPRESENTATIVE
(a) The Distributor shall sometimes act as a representative on large orders
to one customer, where it is mutually agreed that it would be
impractical for Distributor to purchase products from Principal and
resell them to the customer. In such circumstances, and where it is
agreed by Distributor and Principal, Principal shall ship directly to
the customer and pay Distributor a commission as described herein.
(b) The Principal grants the Distributor the exclusive right to sell its
products and services to any customer, with the exception of those
house accounts designated in Exhibit B.
(c) The Distributor shall not have the authority on behalf of the Principal
to accept the return of, or to make any allowances with respect to, any
of the products or services without the prior written approval of the
Principal.
(d) The Principal shall establish and have exclusive control over all
prices, discounts, specifications, and terms governing the sale and
shipments of products directly to the customer. The Distributor shall
not accept orders in the Principal's name or make price quotations or
delivery promises without the Principal's prior approval.
(e) All orders are subject to the acceptance of, or rejection by, an
authorized officer of the Principal. The customer shall be notified in
writing by the Principal of its acceptance of or rejection of the order
and a copy of such writing shall be transmitted to the Distributor.
(f) The Distributor shall pay all of its sales expenses, including any
expense of its sub-agents, incurred in connection with the
representation as herein contemplated.
(g) It is understood that the full responsibility of all collections rests
with the Principal which exercise complete control over the approval of
customers, credits, orders and contracts.
(h) The Distributor is not authorized to vary, alter, enlarge, or limit
orders for the Principal's products or services or make representations
or guarantees without Principal's prior written approval.
(i) The Principal shall be solely responsible for the design, development,
supply, production and performance of its products hereunder and the
protection of its trade name or names.
(j) At the Principal's discretion, this contract shall include any new
products or services developed or added by the Principal during the
life of this contract, so long as they are not competitive with the
products or services of other Principals than represented by the
Distributor.
2.
<PAGE>
(k) Terms for all shipments directly to a customer in Territory by
Principal, shall be as follows:
1. FOB San Jose, California, USA
2. Irrevocable letter of credit
2.1 COMMISSIONS:
(a) The Principal shall pay the Distributor a commission of [ * ]% based on
the total of the "net invoice price" of all commissionable orders
received from the territory.
(b) The term "net invoice price" shall mean the price at which the products
or services are actually sold to the customer after excluding all
shipping costs and any other allowances expressly granted to the
customer by the Principal including, but not limited to taxes,
discounts, and insurance.
(c) Occasionally, price is not the sole factor determining the placement of
an order. In such cases, a lesser commission rate will be accepted by
the Distributor if it appears to be in the best interest of both
parties and if the amount of such lesser commission is mutually agreed
upon in writing before a quotation is sent to the customer.
(d) The parties recognize that sometimes the engineering jurisdiction and
the ship to location are in different territories. In such cases, a
50/50 split commission will apply. In any territory where there is no
Distributor under contract, the Principal shall be considered to be
such agent with respect to commissions.
(e) Commissions are due and payable on or before the Fifteenth day of the
month following the month in which the Principal received payment from
the customer.
(f) The Principal shall supply the Distributor with copies of all
commissionable orders received directly by the Principal and copies of
all order confirmations, shipping notices or invoices originated at the
time of shipment. The aforesaid copies are to be furnished to the
Distributor no less frequently than at monthly intervals.
3.0 GENERAL PROVISIONS FOR "DISTRIBUTOR" ACTING AS DISTRIBUTOR
(a) Distributor shall purchase products form Principal at International
List Price, less [ * ]%, and resell them to customers in the territory.
Such sales shall be referred to as "Distributor sales orders" here
under.
(b) Acceptance of "distributor sales orders" shall be at the sole judgment
of Distributor.
(c) Terms on all Distributor orders shall be as follows:
(i) FOB San Jose, California, USA
(ii) Payment Net 45 days, after approval of
credit.
4.0 ADDITIONAL PROVISIONS
(a) This instrument contains the entire contract between the parties
pertaining to the subject matter hereof and supersedes any prior or
contemporaneous agreements, representations, negotiations or
understandings between the parties not herein expressly set forth. No
supplement, modification, promise, addition or amendment of this
contract shall be effective or binding unless executed in writing by
both parties. The mere acknowledgement or acceptance of any order
inconsistent with the terms of the contract, or the making of
deliveries pursuant thereto, shall not be deemed acceptance or approval
of such inconsistent provisions. No waiver of any of the provisions of
this contract shall
-------------------
* CONFIDENTIAL TREATMENT REQUESTED
3.
<PAGE>
be deemed to constitute a waiver of any other provision, whether or
not similar, nor shall any one waiver constitute a continuing waiver.
(b) Neither the Principal nor the Distributor shall by reason of the
termination of the contract be liable to the other for compensation,
reimbursement, or damage either on account of present or prospective
profits on sales, or on account of expenditures, investments or
commitments made in connection with the establishment, development or
maintenance of the business of goodwill of the Principal or the
Distributor or on account of any cause or thing whatsoever, provided,
however, that such termination shall not effect the rights or
liabilities of the parties with respect to any indebtedness then owing
by either party to the other. Termination activities shall immediately
halt credit extension to the Distributor.
5.0 DISPUTES
(a) This contract shall be construed in accordance with, and shall be
governed by, the laws of the State of California, USA.
(b) All disputes in connection with this contract shall be finally settled
under the Rules of Conciliation and Arbitration of the International
Chamber of Commerce by one arbitrator appointed in accordance with said
rules.
(c) In the event of any litigation or arbitration between the parties
hereto respecting or arising out of this contract, the prevailing
party, whether or not such litigation proceeds to final judgment or
determination, shall be entitled to recover all of the attorneys' fees,
costs, in each and every such action, suit or other proceeding,
including any and all appeals or petitions therefrom.
6.0 ASSIGNMENT
(a) This contract is not transferable to others. Any change of ownership or
primary control of the Distributor's company shall require a new
Representation/Distribution contract.
(b) Neither this contract nor any right or interest in it may be assigned
by either party to any other person or corporation without the express
written consent of the other party to this contract.
7.0 MISCELLANEOUS
(a) The parties shall each execute any and all other documents and take any
and all further steps which may be necessary or appropriate to
implement the terms of this contract.
(b) This contract shall be binding upon, and shall inure to the benefit of,
each of the parties and their respective heirs, legal distributors,
predecessors, successors, assignees, employees, partners, lawyers and
all other persons and entities now, heretofore or hereafter having
interest whatsoever with respect to the subject matter hereof.
(c) Each of the parties hereto represents and warrants, as an inducement to
the other to enter into this contract, that this contract is entered
into freely and voluntarily by each of them, free of duress, fraud or
undue influence of any kind, including contentions, and circumstances
likely to influence judgment herein, and that each has read and fully
4.
<PAGE>
understands and consents to all the terms and provisions of this
contract. The parties each further acknowledge that they each have
either consulted with legal and tax counsel or have been given more
than adequate opportunity to do so and elected not to seek counsel,
that they have each actively participated in the negotiation and in the
preparation hereof, and that they each understand the substance,
meaning, content and legal effect of this contract.
(d) The parties agree and acknowledge that if any portion of this contract
is declared invalid, or unenforceable, such determination shall not
effect the balance of this contract, but shall remain in full force and
affect, as such invalid portion shall be deemed severable.
IN WITNESS OF, the parties hereto have executed this contract on the date and
year first shown herein.
DISTRIBUTOR PRINCIPAL
By: /s/ Alex Hsu By: /s/ illegible
---------------------------- --------------------------
Title: President Title: CTO
-------------------------- ------------------------
5.
<PAGE>
[OPLINK LOGO]
FAX: (408) 433-0608 PHONE: (408) 433-0606
TO: Dean Brosie FROM: QIN ZHANG
COMPANY: DBX Page 1
CC: DATE: 7/28/1999
Regards Commission Schedule Fax #: 1-973-379-4939
Dear Dean,
[ * ] Hence, after reviewing your commission schedule, we will reduce the
commission with DBX for the [ * ] products to [ * ]% and for [ * ] products
to [ * ]%, effective October 1, 1999.
[ * ] and your understanding shall be greatly appreciated. In general, Dean,
we would expect your commission on new business to remain [ * ]% but be
reduced to approx. [ * ]% when significant volume production begins. [ * ]
Should you have any questions, please feel free to contact us.
Best regards,
Qin Zhang
/s/ Qin Zhang
-----------------------
* CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
[OPLINK LOGO]
FAX: (408) 433-0608 PHONE: (408) 433-0606
TO: Dean Brosie FROM: QIN ZHANG
COMPANY: DXB Page 1
CC: DATE: 3/15/1999
Regards Representation Fax #: 1-973-379-4939
Dear Dean,
For the last two years, DXB has performed superbly in servicing the Lucent and
ADC accounts. Oplink is committed to supporting you, Lucent and ADC. However,
due to increasing market pressure on price, we are forced to cut our profit in
order to stay competitive. Under current high pressure from both customers and
competitors, it is inevitable that we need to, from time to time, review our
representatives' commission schedule. This letter is to inform you that the
commision schedule for DBX will be changed, effective July 1, 1999.
The revised commission will be [ * ] % on [ * ] products, [ * ] and [ * ]
components. For accounts and products not mentioned above, your commision will
be revised to [ * ]%.
Should you have any questions, please feel free to contact us. We are looking
forward to your reply.
Thank you very much,
Best regards,
Qin Zhang
--------------------------
*CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
[OPLINK LOGO]
FAX: (408) 433-0608 PHONE: (408) 433-0606
TO: Dean Brosie FROM: QIN ZHANG
COMPANY: DBX Page 1
CC: Alex Hsu DATE: 1/11/2000
Regards Commission and stock option (revised) Fax #: 1-973-379-4939
Dear Dean,
As Oplink's most valued business partner, we appreciate what you have
contributed to Oplink for the last three year. The following is summary of our
phone conversation on January 6, 2000.
1. Oplink will grant Mr. Dean Brosie with 100,000 share of common stock at
$1.50. The vesting schedule is 75,000 share immediately vested. The
remaining 25,000 shares will be vested on January 1, 2001.
2. Mr. Dean Brosie will accept commission rescheduling based on the
following table, effective April 1, 2000.
- New product order [ * ]%
- Existing product order [ * ]%
- [ * ] order [ * ]%
- New product order is defined as 6-month period starting from
the date when customer first places order onward.
3. Both Oplink and Mr. Dean Brosie mutually agree to extend the advance
notification requirement for termination of agreement from 3-month to
12-month if one party decides to terminate the relationship.
Please feel free to contact me if you have any questions.
Best regards,
Qin Zhang
Accepted by: Date:
---------------------- ---------------------------
------------------------
*CONFIDENTIAL TREATMENT REQURESTED
