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EXHIBIT 10.8
CONTRACT
Made and Executed this ___ Day of January 1988.
Between: Camtek Ltd.
(hereinafter: "Camtek")
OF THE FIRST PART
AND: P.C.B. Ltd.
(hereinafter: "P.C.B.")
OF THE SECOND PART
Whereas Camtek is engaged in the research and development of a
computerized system for visually checking printed circuits
(hereinafter: the "System"); and
Whereas Camtek has already invested funds and know-how in, and
wishes to continue, the research and development of the
System (hereinafter: the "Further Development") and is, for
such purpose in need of additional financing, and
Whereas Camtek has proposed that P.C.B. participate in the Further
Development of the System; and
Whereas P.C.B. has agreed to participate in the research and Further
Development of the System, subject to the provisions herein
contained.
Now, therefore, it is declared, agreed and stipulated between the parties as
follows:
1. The preamble to this Contract constitutes an integral part thereof.
2. Camtek hereby declares, confirms and warrants that:
a. It has already carried out research and development of the
System by investing monies and efforts and that there is a
reasonable prospect of the development of the System being
completed and being brought to a stage of productions.
b. Camtek has files an application with the Industrial Research
and Development Administration for approval of the program of
research and development which has already been and continues
to be carried out by it.
c. Camtek undertakes to complete the Further Development until
the know-how and technology required to produce the System are
obtained.
3. P.C.B. undertakes to participate and invest in the Further Development
a sum of up to NIS 1 million (one million New Israel Shekels)
(hereinafter the "Financing") which will be paid to Camtek pursuant to
the needs of Camtek, with the sum of 500,000 of the Financing to be
paid in 1988 and the sum of up to NIS 500,000 to be paid in 1989.
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4. a. Camtek undertakes to submit the program/s for implementation
of the Further Development for the approval of the competent
authorities.
b. The grant of the Financing by P.C.B. is subject and
conditional to the obtainment of an approval for the program/s
for implementation of the Further Development, as required
according to Section 20A of the Income Tax Ordinance.
c. If P.C.B. remits to Camtek any payment on account of the
Financing and the program/s for the Further Development will
not have been approved as mentions above, Camtek will repay to
P.C.B. the amount transferred to it, linked to the Consumer
Price Index published by the Central Bureau of Statistics
(including fruit and vegetables).
5. Camtek undertakes to complete and execute the Further Development
according to the program/s that will be approved and to execute them
solely at its own expense and responsibility.
6. In consideration of the Financing P.C.B. will be entitled to receive
royalties as set out in Schedule A attached hereto as an integral part
hereof.
7. Camtek undertakes to purchase the design of the printed circuits form
P.C.B. and also the printed circuits required by it to execute the
Further Development and production of the System, provided that the
price and conditions of P.C.B.will be no less favourable than the best
offer (from Camtek's point of view) that Camtek will receive from
another manufacturer of printed circuits.
8. P.C.B. will be granted first preference in purchasing the system for
its own needs in all matters relating to the supply dates, and the
System will be supplied to it at the price and on the payment
conditions of a "preferred customer" of Camtek.
9. Camtek will, upon P.C.B.'s demand, submit to it at the end of each
quarter a statement setting out the operations and expenses expended by
Camtek during the quarter. P.C.B. will be entitled to receive
additional statement upon demand, including a copy of the statements
filed by Camtek with the Chief Scientist in accordance with the Letter
of Approval.
P.C.B. will be entitled to inspect Camtek's books of account at any
time in connection with all matters concerned with the execution and
financing of the Further Development.
10. In order to protect P.C.B.'s rights under this Contract and to enable
it to supervise and review the execution of the Further Development and
payment of the expenses, a representative on behalf of P.C.B. will be
appointed as a director of Camtek, with the right to be a co-signor
with an additional director.
11. For the avoidance of any doubt, it is hereby expressly agreed and
declared that the participation by P.C.B. in the Further Development
according to the provisions of this
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Contract is not to be regarded as creating any partnership between
Camtek and P.C.B., as Camtek will execute the Further Development at
its sole expense and responsibility.
12. No variation to this Contract will be effective unless made in writing
with the consent of both parties.
13. Neither of the parties will be entitled to assign or transfer its
rights under this Contract without obtaining the prior written consent
of the other party.
In witness whereof the parties have set their hands:
(signed) (signed)
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P.C.B. Ltd. Camtek Ltd.
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SCHEDULE A
1. P.C.B. will be entitled to royalties based on these principles pursuant
to a percentage of the cumulative value of the sales of the System
(including retained models) as follows:
TURNOVER PERCENTAGE
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In millions of US$
Up to 5 5.0%
Above 5 and up to 7.5 4.5%
Above 7.5 and up to 10 4.0%
Above 10 and up to 12.5 3.5%
Above 12.5 and up to 15 3.0%
Above 15 and up to 20 2.5%
Above 20 0.5%
2. "Value of sales" means the aggregate actual revenues that will be
received by Camtek from sales of the System, less V.A.T. and other
taxes (apart from income tax) and under deduction of the cashflow and
commissions.
Revenues that will be received in NIS will be calculated according to
the representative rate of exchange of the U.S. dollar as existing on
the date of receipt of the revenue.
3. For the avoidance of doubt it is hereby stated that the calculation of
the turnover will be made on an accrued basis.
4. Camtek will pay P.C.B. the royalties at the end of each 3-month period
in respect of the revenues actually received by it during such period.
5. The royalties will be paid to P.C.B plus V.A.T. as shall apply at the
time of payment against a V.A.T. invoice of P.C.B.
(signed) (signed)
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