EXHIBIT 10.37

 

Title Page

 

Firm-Fixed-Price Subcontract

 

Subcontract between

 

Subcontract No. 65096QDM5S

Northrop Grumman Space Technology

One Space Park

 

Sales No. 1E163

Redondo Beach, CA 90278

 

Prime Contract No. F04701-02-C-0502

And

 

Higher-Tier Subcontract No. N/A

Maxwell Technologies, Inc.

9244 Balboa Avenue

San Diego, CA 92133

 

Priority Rating DX-A2

   

Security Classification Unclassified

Subcontract Title

 

Discount Terms Net 30 days

Single Board Computer

 

x Resale Tax Permit # SR OHA 30-634362

   

¨ Not for Resale

   

Quality Document 1991 Q Clauses Q1, Q36A, Q49

Subcontract Administrator

 

Type of Inspection:

  

Buyer

  

Govt

   

M. Holguin

      

x       Source

  

¨        Source

   

Mail Station R10/2327C

      

x       Receipt

  

¨        Other

 

 

--------------------------------------------------------------------------------

 

This SUBCONTRACT is entered into as of 04 February 2005, between Northrop
Grumman Space & Mission Systems Corp., an Ohio corporation, by and through Space
Technology sector, with an office at One Space Park, Redondo Beach, California
90278 (hereinafter also called “the Buyer”) and Maxwell Technologies, Inc., a
Delaware corporation, with an office at 9244 Balboa Avenue, San Diego,
California 92133 (hereinafter also called “the Seller”, “the Contractor”, or
“the Subcontractor”).

 

In consideration of the mutual promises, covenants, and agreements herein set
forth, the parties agree that the Seller shall furnish and deliver to the Buyer
all the supplies and perform all the services set forth in this Subcontract, for
the consideration stated herein.

 

The rights and obligations of the parties to this Subcontract shall be subject
to, and governed by, the Schedule, the Subcontract clauses of Systems 3392, and
other documents or specifications attached hereto or referenced herein.

 

This Subcontract sets forth the entire agreement and supersedes any and all
prior agreements of the parties, whether written or oral, concerning the subject
matter hereof.

 

Note: Article XXV hereof contains information concerning seller’s obligations
with regard to prohibited materials in products to be delivered hereunder.

 

This Subcontract shall not be varied or changed in its terms or conditions by
any oral agreement or representation, or otherwise than by an instrument in
writing of even or subsequent date thereto, properly executed.

 

The subcontract title used hereinabove and the article titles used hereinbelow
are for convenience only and shall in no way be construed as an indication of
meaning for interpretive purposes.

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Schedule

 

Applicability

--------------------------------------------------------------------------------

   Article No.

--------------------------------------------------------------------------------

  

Article Title

--------------------------------------------------------------------------------

x

   I    Scope of Work

x

   II    Period of Performance

x

   III    Place of Performance, Inspection and Acceptance

x

   IV    Packaging, Packing, FOB Point, and Shipping

x

   V    Type of Subcontract

x

   VI    Key Personnel

x

   VII    Subcontract Reports

x

   VIII    Consideration and Payment

x

   IX    Funds Allocated to Subcontract

x

   X    Priority Rating

x

   XI    Notice of Delay

x

   XII    Termination for Convenience

x

   XIII    Buyer Itinerant or Resident Representatives and Government Visits

x

   XIV    Invoicing

x

   XV    Exercise of Options

x

   XVI    Subcontract Management

x

   XVII    Release of News Information

x

   XVIII    Representations, Certifications, and Other Statements

x

   XIX    Subcontract Cost Accounting Standards

¨

   XX    Reserved

x

   XXI    Submission of Notice, Consent, Demand, or Request

¨

   XXII    Reserved

x

   XXIII    Not-to-Exceed Agreement

¨

   XXIV    Reserved

x

   XXV    Prohibited Materials

x

   XXVI    Subcontract Content and Order of Precedence

 

Article I—Scope of Work

 

A. The Seller, as an independent contractor and not as an agent of the Buyer,
shall, in conformance with the terms and conditions more particularly set forth
herein, provide the necessary personnel, material, and facilities and do all
things necessary or incidental to accomplish the effort set forth in the
Statement of Work identified and made a part of this Subcontract under Article
No. XXVI hereof.

 

B. The Buyer was issued the prime contract or higher-tier subcontract identified
on the title page of this Subcontract (hereinbelow called the aforementioned
contract). The Seller’s supplies and services deliverable under this Subcontract
will be utilized by the Buyer as part of the basis on which the Buyer intends to
fulfill its obligations under the aforementioned contract.

 

The Buyer is relying on the Seller’s agreement as set forth in this Subcontract
and on the Seller’s performance of same by timely delivery or performance and
may be unable to fulfill its obligations under the aforementioned contract if
the Seller should fail to do so.

 

2

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Article II—Period of Performance

 

The Seller shall perform the work under this Subcontract during the period 04
February 2005 to 31 August 2007 and shall deliver the required supplies or any
services in accordance with the delivery schedule set forth in the Statement of
Work or elsewhere within this Subcontract. Time is of the essence in the
Seller’s performance of this Subcontract.

 

Article III—Place of Performance, Inspection, and Acceptance

 

A. The Seller shall perform the work under this Subcontract at 9244 Balboa
Avenue, San Diego California or at such other substitute or supplemental
locations as may be agreed to in writing by the parties.

 

B. Final inspection and the Buyer’s acceptance of all supplies and services and
other effort described herein as deliverable shall be made at Buyer’s facility
in Redondo Beach, California.

 

Article IV—Packaging, Packing, FOB Point, and Shipping

 

A. The supplies to be delivered hereunder are to be packaged and packed in
accordance with the Statement of Work.

 

B. The supplies to be delivered hereunder are to be shipped FOB Destination in
accordance with the following:

 

NGST, One Space Park, Redondo Beach, CA 90278

 

Article V—Type of Subcontract

 

The subcontract work is to be performed on a firm-fixed-price (FFP) (FAR 16.202)
basis (except to any extent that may be otherwise expressly provided for
herein).

 

Article VI—Key Personnel

 

The Seller’s employees identified below are key personnel, important to the
successful performance of the work under this Subcontract. The Seller agrees to
assign these employees to the performance of the work. Whenever, for any reason,
one or more of these employees becomes unavailable for assignment for work under
this Subcontract, the Seller shall replace each such employee with a person of
comparable ability as acceptable to the Buyer. The Seller shall inform the Buyer
in advance, in writing, whenever such an employee change becomes necessary.

 

Robert Hillman – Electrical Engineer

 

Mark Conrad – Software Engineer

 

Janet Patterson – Mechanical Engineer Manager

 

Article VII—Subcontract Reports

 

The Seller shall furnish reports, data, and other documentation as identified in
the Statement of Work.

 

Article VIII—Consideration and Payment

 

A. The Buyer shall, upon submission of proper invoices or vouchers and subject
to any funding limitation, withholding, set-off, or adjustment provisions
contained herein, pay the Seller a firm-fixed-price of Five Million Nine Hundred
Fourteen Thousand Seven Hundred Ninety-Four Dollars and no Cents ($5,914,729.00)
as full and complete consideration for the satisfactory performance of all the
requirements of this Subcontract designated as falling under that type of
subcontract. If this Subcontract provides separate line item prices and payments
shall be made following delivery of such lines items. In computing any discount
time, such time shall commerce upon the Buyer’s receipt of a proper invoice or
voucher and receipt of the items delivered.

 

2

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

SLIN 001- Basic (Flight 1 and 2)

 

Milestone
Item

--------------------------------------------------------------------------------

  

Description

--------------------------------------------------------------------------------

  

Quantity

--------------------------------------------------------------------------------

   Milestone
Payment

--------------------------------------------------------------------------------

   Funded

--------------------------------------------------------------------------------

  

Milestone

Date

--------------------------------------------------------------------------------

  

Completion Criteria

--------------------------------------------------------------------------------

01

   Initial Contract Review & Program Management Months February & March ‘05    1
   $ 600,000.00    $ 600,000.00    03/21/05    Completion of ICR & Buyer
approved Action Item Closure

02

   Program Management Months April & May ‘05    1    $ 100,000.00    $
100,000.00    05/16/05    PMR Report Submittal

03

   Breadboard Delivery, PDR, & Program Management Months June & July ‘05    2   
$ 600,000.00    $ 200,000.00    06/24/05    Delivery of Hardware & End Item Data
Package (EIDP), and Completion of PDR & Buyer approved Action Item Closure

04

  

Program Management

Months August & September ‘05

   1    $ 100,000.00           09/15/05    PMR Report Submittal

05

  

Program Management

Months October & November ‘05

   1    $ 100,000.00           11/15/05    PMR Report Submittal

06

  

Program Management

Months December ‘05 & January ‘06

   1    $ 100,000.00           01/16/06    PMR Report Submittal

07

  

Program Management

Months February & March ‘06

   1    $ 100,000.00           03/31/06    PMR Report Submittal

08

   Program Management Months April & May ‘06    1    $ 100,000.00          
05/15/06    PMR Report Submittal

 

3

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Milestone
Item

--------------------------------------------------------------------------------

  

Description

--------------------------------------------------------------------------------

   Quantity

--------------------------------------------------------------------------------

   Milestone
Payment

--------------------------------------------------------------------------------

   Funded

--------------------------------------------------------------------------------

  

Milestone

Date

--------------------------------------------------------------------------------

  

Completion Criteria

--------------------------------------------------------------------------------

09

   Engineering Qualification Model Program Management Months June & July ‘06   
1    $ 600,000.00         07/19/06    Delivery of Hardware & End Item Data
Package (EIDP)

10

   Engineering Model Delivery    6    $ 499,980.00         08/28/06    Delivery
of Hardware & End Item Data Package (EIDP)

11

   Critical Design Review & Manufacturing Readiness Review & Program Management
Months August & September ‘06    1    $ 600,000.00         09/15/06   
Completion of CDR/MRR & Buyer approved Action Item Closure

12

   Program Management Months October & November ‘06    1    $ 100,000.00        
11/15/06    PMR Report Submittal

13

   Program Management Months December ‘06 & January ‘07    1    $ 100,000.00   
     01/15/07    PMR Report Submittal

14

   Program Management Months February & March ‘07    1    $ 100,000.00        
03/15/07    PMR Report Submittal

15

   Flight I Units & Program Management Months April & May ‘07    7    $
999,990.00         04/02/07    Delivery of Hardware & End Item Data Package
(EIDP)

16

   Flight 2 Units and Spares & Program Management Months June & July ‘07    7   
$ 999,990.00         07/02/07    Delivery of Hardware & End Item Data Package
(EIDP)

17

   Subcontract Closeout – August ‘07    1    $ 114,769.00         08/31/07   
Delivery and Buyer approval of closeout documentation per SOW SDRL

 

4

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

SLIN 002 - Flight 3 Option

 

Option may be exercised on or before 01 December 2009

 

Line

Item

--------------------------------------------------------------------------------

 

Description

--------------------------------------------------------------------------------

 

Quantity

--------------------------------------------------------------------------------

 

Payment

--------------------------------------------------------------------------------

 

Delivery

Date

--------------------------------------------------------------------------------

 

Completion

Criteria

--------------------------------------------------------------------------------

 

Subcontract

Type

--------------------------------------------------------------------------------

17

  Flight 3 Units   8   $2,216,712.00   30 June 2011   Delivery of Hardware & End
Item Data Package (EIDP)   FFP

 

SLIN 003 - Flight 4 Option

 

Option may be exercised on or before 01 December 2010

 

Line

Item

--------------------------------------------------------------------------------

 

Description

--------------------------------------------------------------------------------

 

Quantity

--------------------------------------------------------------------------------

 

Payment

--------------------------------------------------------------------------------

 

Delivery

Date

--------------------------------------------------------------------------------

 

Completion

Criteria

--------------------------------------------------------------------------------

 

Subcontract

Type

--------------------------------------------------------------------------------

18

  Flight 4 Units   6   $1,684,440.00   30 June 2012   Delivery of Hardware & End
Item Data Package (EIDP)   FFP

 

SLIN 004 - Flight 5 Option

 

Option may be exercised on or before 01 December 2010

 

Line

Item

--------------------------------------------------------------------------------

 

Description

--------------------------------------------------------------------------------

 

Quantity

--------------------------------------------------------------------------------

 

Payment

--------------------------------------------------------------------------------

 

Delivery

Date

--------------------------------------------------------------------------------

 

Completion

Criteria

--------------------------------------------------------------------------------

 

Subcontract

Type

--------------------------------------------------------------------------------

19

  Flight 5 Units   6   $1,684,440.00   30 June 2012   Delivery of Hardware & End
Item Data Package (EIDP)   FFP

 

SLIN 005 - Flight 6 Option

 

Option may be exercised on or before 01 December 2011

 

Line

Item

--------------------------------------------------------------------------------

 

Description

--------------------------------------------------------------------------------

 

Quantity

--------------------------------------------------------------------------------

 

Payment

--------------------------------------------------------------------------------

 

Delivery

Date

--------------------------------------------------------------------------------

 

Completion

Criteria

--------------------------------------------------------------------------------

 

Subcontract

Type

--------------------------------------------------------------------------------

20

  Flight 6 Units   8   $2,275,536.00   30 June 2013   Delivery of Hardware & End
Item Data Package (EIDP)   FFP

 

Article IX—Funds Allocated to Subcontract

 

A. Pursuant to the Limitation of Government’s Obligation clause of Systems 3392,
hereby identified as applicable to all Line Item(s), of this Subcontract, the
total sum available for payment and allotted to this Subcontract is $900,000.00.
It is contemplated that such sum will cover the work to be performed through 24
June 2005.

 

5

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Article X—Priority Rating

 

This is a rated order certified for national defense use, and the Contractor
[Seller] shall follow all the requirements of the Defense Priorities and
Allocation System Regulation (15 CFR Part 700). See the title page hereof.

 

Article XI—Notice of Delay

 

In addition to its obligations under the Notice to the Government of Labor
Disputes clause hereof, whenever any other actual or potential event is delaying
or threatening to delay performance of the services under this Subcontract, the
Seller shall give the Buyer timely written notice thereof.

 

Article XII— Termination for Convenience

 

The performance of work under this order may be terminated in whole or in part
if, for the convenience of the Buyer. Under such condition, Buyer will give
written termination notice to Seller. Buyer shall pay Seller an amount computed
in accordance with FAR Clause 52.249-2.

 

Article XIII—Buyer Itinerant or Resident Representatives and Government Visits

 

A. The Buyer shall have the right to assign representatives on an itinerant or
resident basis at the Seller’s facilities, or those of lower-tier subcontractors
or vendors, for the purpose of maintaining surveillance activities, including
the right to witness any or all tests performed as part of the requirements of
this Subcontract. The Seller shall provide the Buyer’s representatives with
reasonable facilities and equipment, and reasonable access to all areas
essential to the proper conduct of the aforementioned activity, throughout all
phases of any engineering, manufacturing, testing, packaging, and shipping. In
addition, the Seller shall make available to the Buyer’s representatives
pertinent planning, status, and forecast information, and such other technical
and management reporting information as may be necessary for the Buyer’s
representatives to carry out their responsibilities.

 

B. The Seller agrees, upon request of the Buyer, to allow the U.S. Government
contracting officer under the prime contract or his/her authorized
representatives, to visit the Seller’s facilities to review progress and witness
testing pertaining to the requirements of this Subcontract. The Seller shall
furnish the contracting officer and his/her representatives all reasonable
facilities and assistance for the safe and convenient performance of the actions
described.

 

C. The Seller shall insert, and require its subcontractors and vendors to
insert, the substance of this article, including this paragraph, in each
lower-tier subcontract hereunder.

 

Article XIV—Invoicing

 

A. Invoices shall include the following information:

 

  •   Subcontract number

 

  •   Buyer name

 

  •   Subcontractor name

 

  •   Subcontractor remittance address

 

  •   Invoice number (designated by the subcontractor)

 

  •   Invoice date of issuance

 

  •   Total amount claimed for payment

 

  •   Subcontract line items against which payments is claimed along with the
claim amount by the line item

 

6

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

B. Original invoices (or vouchers) for payments hereunder shall be submitted in
either one of two ways:

 

1.    By Email      Via PDF Format to sas-ap-sub@ngc.com with a copy to
maria.holguin@ngc.com

 

2.    By Mail      Northrop Grumman Space Technology, Accounts Payable      P.O.
Box 922      El Segundo, CA 90245

 

C. Copy of invoices (or vouchers) shall be submitted either by mail (or fax), or
by e-mail to the following address:

 

     NGST      One Space Park      Redondo Beach, CA 90278      Attn: Maria
Holguin (R10/2327C)      maria.holguin@ngc.com

 

Article XV—Exercise of Options

 

The Seller shall perform and deliver to the Buyer the additional work specified
in Article I and identified as Options, if Buyer elects at its sole discretion
to exercise such option(s) by written notice to Seller on or before the option
date specified for each option. The Contract Price for such Work shall be as
specified in Article VIII, which amount shall be paid as provided in Article
VIII.

 

The Buyer reserves the right to exercise any option as a separate subcontract at
the time of exercise. In such case, the appropriate terms and conditions of this
subcontract will be included in the new subcontract. The Buyer intends to use
the terms and conditions as written in this Subcontract.

 

Article XVI—Subcontract Management

 

A. The Buyer’s subcontract manager for this Subcontract is designated on the
title page hereof. The Buyer may, by written notice to the Seller, change such
subcontract manager designation at any time.

 

B. No change notice, order, direction, authorization, notification, nor request
(hereinafter collectively called a “change request” for brevity) of the Buyer
shall (1) be binding upon either the Seller or the Buyer nor (2) serve as the
basis of any Seller claim for any Buyer change or waiver relating to the
Subcontract clauses, Statement of Work or specification(s), delivery schedule,
or any other provision of this Subcontract (hereinafter collectively called
“Subcontract terms and conditions” for brevity), unless such change request was
issued in writing or confirmed in writing by the Buyer’s subcontract manager.

 

C. The Seller shall immediately notify the Buyer’s subcontract manager in
writing whenever it is perceived that such a change request (1) has been
received by the Seller other than in writing by the Buyer’s subcontract manager
and (2) constitutes a change or waiver relating to certain Subcontract terms and
conditions, so that the Buyer’s subcontract manager may promptly respond in
writing to confirm, countermand, or deny such perceived change request.

 

D. The Buyer’s subcontract manager may designate authorized representatives and
specify the extent of their authority, by providing a written document to the
Seller. Individuals may be so designated as technical representatives, to
oversee technical aspects of the Subcontract work. No such authorized
representative, including any technical representative, shall be authorized to
issue any binding change request causing any Buyer change or waiver relating to
any Subcontract terms and conditions.

 

7

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

E. Any and each person identified below by name or by virtue of occupying a
position shown is hereby designated as an alternate Buyer’s subcontract manager
for this Subcontract, and is authorized to perform the same functions and with
the same extent of authority as the primary Buyer’s subcontract manager
identified hereinabove.

 

1. Paul Nakamoto – Subcontract Manager

 

Article XVII—Release of News Information

 

No news release, including photographs and films, public announcements, or
confirmation of same, on any part of the subject matter of this Subcontract or
any phase of any program hereunder, shall be made without the prior written
consent of the Buyer.

 

Article XVIII—Representations, Certifications, and Other Statements

 

All written representations, certifications, and other statements that the
Seller has submitted to the Buyer in connection with the award of this
Subcontract are hereby incorporated herein and made a part hereof by this
reference, and such have been relied upon by the Buyer in issuing this
Subcontract. The Seller agrees to advise the Buyer promptly in writing should
there be any change in the Seller’s status with respect thereto.

 

Article XIX—Subcontract Cost Accounting Standards

 

A. This Subcontract is ¨ is not x subject to the Cost Accounting Standards
clause hereof. If clause is indicated to be applicable, date thereof is ¨ Aug
1992 ¨ Sep 1987 ¨ Other             

 

B. This Subcontract is ¨ is not x subject to the Disclosure and Consistency of
Cost clause hereof. If clause is indicated to be applicable, date thereof is ¨
Nov 1993 ¨ Aug 1992 ¨ Sep 1987 ¨ Other             

 

C. If this Subcontract is indicated above to be subject to either the Cost
Accounting Standards clause or the Disclosure and Consistency of Cost Accounting
Practices clause:

 

  1. The corresponding Administration of Cost Accounting Standards clause hereof
also applies. If clause is indicated to be applicable, date thereof is ¨ Dec
1994 ¨ Aug 1992 ¨ Sep 1987 ¨ Other             

 

  2. The Seller shall comply with all applicable standards in effect on the date
of final agreement on the subcontract price as shown in the Seller’s signed
certificate of cost and pricing data or on the date of award of this
Subcontract, whichever is earlier, except where the Seller has been granted
written authorization for deviation.

 

  3. Award of this Subcontract does not constitute a determination that the
Seller’s disclosed and applied accounting practices used in pricing this
Subcontract are in compliance with the Cost Accounting Standards (CAS). The
Buyer retains the right to adjust the subcontract price per the CAS clauses, and
other applicable provisions of this Subcontract, if a subsequent final
determination of noncompliance is made by the contracting officer under the
prime contract from which this Subcontract stems.

 

 

Article XX—Reserved

 

Article XXI—Submission of Notice, Consent, Demand, or Request

 

Any notice, consent, demand, or request required or permitted by this
Subcontract shall be in writing and shall be deemed to have been sufficiently
given when personally delivered or deposited in the United States mail, postage
prepaid, addressed as follows:

 

If to Buyer   If to Seller Northrop Grumman Space & Mission Systems Corp.  
Maxwell Technologies, Inc.

One Space Park

Redondo Beach, CA 90278

 

9244 Balboa Avenue

San Diego, CA 92123

Attention:    M. Holguin (R10/2327C)   Attention    B. Eichler

 

8

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Article XXII—Reserved

 

Article XXIII—Not-To-Exceed Agreement

 

Prior to the issuance of a change notice under this Subcontract pursuant to the
Changes clause hereof, and upon any properly detailed written request by the
Buyer, the Seller shall provide the Buyer a written proposal as to the maximum
adjustment to be made in the Subcontract price, and in the delivery schedule (or
time of performance), by reason of the proposed change. The Buyer may also
solicit such proposal on limitations on the adjustments to any other provisions
of the Subcontract which may be subject to equitable adjustment by reason of the
proposed change. Any such written proposal that is agreed to by the Buyer shall
then be cited in the change notice and, upon issuance of the change notice,
shall be a binding part of this Subcontract. In no event shall the definitive
equitable adjustment exceed nor otherwise be inconsistent with any adjustment
limitations so established. Except with respect to such adjustment limitations,
nothing contained in this article shall affect the rights of the parties
regarding equitable adjustment by reason of such change notice.

 

Article XXIV—Reserved

 

Article XXV—Prohibited Materials

 

Seller acknowledges that Seller has read and understood the Prohibited Materials
Certification (SYSTEMS 8130). In addition to the certifications contained in the
Prohibited Materials Certification, Seller further covenants to take all steps
necessary to ensure that no products delivered hereunder will contain any
prohibited materials in accordance with the applicable Program Parts Material
and Processes Plan or Mission Assurance Requirement document or their equivalent
identified in the Statement of Work. Seller agrees that this covenant goes to
the essence of this contract and any breach of this covenant or the Prohibited
Materials Certification is grounds for termination for default. To the extent
that any products delivered by Seller hereunder contain any of the Prohibited
Materials, notwithstanding any other provision herein (or any attachment hereto)
to the contrary except the Prohibited Materials Certification itself, Seller
agrees to indemnify and hold harmless Buyer, Buyer’s customer and their
respective affiliates, employees, officers, directors and agents from any
internal and external cost, claim, damage, loss or other expense or liability
whatsoever (including without limitation all in-house and outside attorneys’
costs, fees and expenses) (collectively, “Costs”) resulting from Seller’s
delivery of products hereunder containing any of the Prohibited Materials.
Seller acknowledges that such Costs may include, without limitation, (i) any
penalties, loss of fee or additional costs that Buyer suffer as a result of (a)
the inclusion of Prohibited Materials in Seller’s products or (b) the delay
caused by Buyer remediating such Prohibited Materials, (ii) Buyer’s internal
costs incurred in testing components to determine if Prohibited Materials were
included in Seller’s products, in disassembling any component that includes
Seller’s product containing Prohibited Materials and in reassembling and
retesting the remediated component and (iii) any excess reprocurement costs to
replace Seller’s product that includes any Prohibited Material. To the extent
that any of Seller’s products delivered hereunder contains a Prohibited
Materials, Buyer may deem all of Seller’s products to be suspect and all costs
incurred in testing, disassembling, reassembling and retesting such products,
even if they are ultimately determined not to contain Prohibited Materials,
shall be deemed Costs and subject to reimbursement herein. Seller agrees that
Seller shall be fully responsible for all such Costs even if Seller is unaware
of the existence of any of the Prohibited Materials in its products. To the
extent that Buyer incurs any costs or expenses (including without limitation all
in-house and outside attorneys’ costs, fees and expenses) in obtaining
reimbursement of any of the Costs, such costs and expenses shall be considered
Costs and shall similarly be reimbursed by Seller.

 

9

--------------------------------------------------------------------------------

Subcontract No. 65096QDM5S

 

Seller Acknowledgment of Article XXV:                                        
                         

 

Seller agrees that, notwithstanding any provision herein (or in any attachment
hereto) to the contrary, the Costs for which Seller is responsible shall not be
limited by any limitation of liability or cap on damages. Further, Seller agrees
that any waiver of consequential, indirect, special, punitive, incidental or
similar damages contained elsewhere in this contract or any attachment hereto
shall not apply to Costs incurred pursuant to this Article XXV.

 

Article XXVI—Subcontract Content and Order of Precedence

 

This Subcontract consists of the physically incorporated documents identitied
below, and additionally such documents as have been incorporated into this
Subcontract by reference thereunder. Any inconsistency among such physically
incorporated documents, including the documents which they individually
incorporate by reference, shall be resolved by giving precedence per the
ordering thereof below (except that any Contract Security Classification
Specification [DD Form 254] shall be given precedence over all other such
documents).

 

1.    Title Page, consisting of one page. 2.    Schedule, consisting of 10
pages. 3.    Signature Page, consisting of one page. 4.    NPOESS Special and
Additional Clauses, dated 05 January 2005. 5.    Systems 3392, Subcontract
Clauses—Fixed-Price Subcontract for Supplies, Research and Development, and
Services, Rev. 02-03. 6.    Systems 1C, Patent and Data Rights
Clauses—Subcontracts and Purchase Orders, Rev. 02-03, the applicable clauses of
which are identified as follows (subject to any scoping provisions):

 

PR-01F   PR-02F   PR-12F   DR-13D   DR-13DI   DR-14D DR-16D   DR-19D   DR-25D  
DR-30D   DR-36D   DR-37D

 

a. In addition, 5352.227-9000, 5352.227.9002, and Maxwell’s Identification and
Assertion of Restrictions on the Government’s Use, Release, or Disclosure of
Computer Software and Technical Date are applicable.

 

7.    Systems 1992, Supplemental Clauses—Purchase Orders/Subcontracts, Rev.
02-03, the applicable clauses of which are identified as follows:

 

    106   109            

 

8.    Quality document 1991, Q Clauses, Procurement Quality Requirements, Rev.
02-04, the applicable clauses of which are identified on the title page of this
Subcontract. 9.    Statement of Work No. NP-EMD.04.K251.001 Rev. A, dated 27
January 2005. 10.    Single Board Computer EQ Specification No. EQ4-5956 as
modified by Attachment 1 “EQ-Spec No. EQ4-5956 Amendments”, dated 26 January
2005.

 

10

--------------------------------------------------------------------------------

Signature Page

 

IN WITNESS WHEREOF, the parties hereto have executed this Subcontract to be
effective as of the day and year first above written.

 

Seller

 

Buyer

   

Space Technology sector

Name

     

Northrop Grumman Space & Mission Systems

Corp.

By:

 

 

--------------------------------------------------------------------------------

 

By

 

 

--------------------------------------------------------------------------------

   

Richard D. Balanson

     

Maria Holguin                                                          Date

Title:

 

President and Chief Executive Officer

 

Title:

 

Sr. Subcontract Administrator

       

By

 

 

--------------------------------------------------------------------------------

           

Edward H. Mitchell                                                  Date

       

Title:

 

NPOESS Program Subcontract Manager