Document:

exhibit10-9.htm

         Portions of this exhibit were omitted and filed separately with the
Secretary of the 
Securities and Exchange Commission pursuant to an
application for confidential treatment 
filed with the Securities and
Exchange Commission pursuant to Rule 24b-2 under the 
Securities Exchange Act
of 1934. Such portions are marked by [***]. 

     

    SUPPLY AGREEMENT 

     

    by and between

     

    Vishay Measurements
Group, Inc., 
a Delaware corporation, 

     

    as Supplier

     

     

     

    and 

     

    Vishay S.A., a

French company, 

     

    as Buyer 

     

     

     

     

     

    Dated as of July 6,
2010 

     

    

    
    

         This SUPPLY AGREEMENT (this “Agreement”) is made as of July 6, 2010 by and between
Vishay Measurements Group, Inc., a Delaware corporation (“Supplier”), and Vishay S.A., a French company
(“Buyer”). Supplier and Buyer each may be referred to
herein as a “Party” and collectively, as the “Parties”. 

     

         WHEREAS, subject to the terms, conditions, commitments and undertakings
herein provided, Supplier is willing to manufacture and sell those products as
set forth on Exhibit A hereto (as the same may be modified from time
to time pursuant to the provisions hereof, the “Products”) to Buyer, and Buyer desires to purchase the
Products from Supplier, in such quantities as Buyer shall request , as provided
in this Agreement; 

     

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, agree as follows: 

     

    ARTICLE I

DEFINITIONS 

     

         For purposes of this Agreement, the following terms shall have the
meanings specified in this Article I: 

     

         “Affiliate” means, as applied to any Person, any other
Person that, directly or indirectly, controls, is controlled by, or is under
common control with that Person as of the date on which or at any time during
the period for when such determination is being made. For purposes of this
definition, “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

     

         “Applicable Law” means any applicable law, statute, rule or
regulation of any Governmental
Authority, or any outstanding order, judgment, injunction, ruling or decree by
any Governmental Authority. 

     

         “Buyer” has the meaning set forth in the preamble of
this Agreement. 

     

         “Confidential Information” means all proprietary, design or operational
information, data or material including, without limitation: (a) specifications,
ideas and concepts for goods and services; (b) manufacturing specifications and
procedures; (c) design drawings and models; (d) materials and material
specifications; (e) quality assurance policies, procedures and specifications;
(f) customer, client, manufacturer and supplier information; (g) computer
software and derivatives thereof relating to design development or manufacture
of goods; (h) training materials and information; (i) inventions, devices, new
developments, methods and processes, whether patentable or unpatentable and
whether or not reduced to practice; (j) all other know-how, methodology,
procedures, techniques and Trade Secrets; (k) proprietary earnings reports and
forecasts; (l) proprietary macro-economic reports and forecasts; (m) proprietary
marketing, advertising and business plans, objectives and strategies; (n)
proprietary general market evaluations and surveys; (o) proprietary financing
and credit-

     

    2 

     

    

    
    

    related information; (p)
other copyrightable or patented works; (q) the terms of this Agreement; and (r)
all similar and related information in whatever form; in each case, of one party
which has been disclosed by Supplier or members of its Group on the one hand, or
Buyer or members of its Group, on the other hand, in written, oral (including by
recording), electronic, or visual form to, or otherwise has come into the
possession of, the other Group. 

     

         “Firm Order” means Buyer’s non-cancelable purchase order
for Products to be purchased by Buyer from Supplier pursuant to this Agreement
for delivery. 

     

         “FOB” has the meaning and usage assigned to such
words in the incoterms rules published by the International Chamber of Commerce.

     

         “Forecast” means, with respect to any relevant period,
a good faith non-binding forecast, based on information available to Buyer at
the time of such forecast (which information, if reduced to writing, shall be
made available to Supplier upon reasonable request), of the Firm Order for each
Product that Buyer expects to deliver to Supplier for each calendar month during
such period. 

     

         “Governmental Authority” means any U.S. or non-U.S. federal, state,
local, foreign or international court, arbitration or mediation tribunal,
government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority. 

     

         “Group” means, with respect to any Person, each
Subsidiary of such Person and each other Person that is controlled directly or
indirectly by such Person. 

     

         “Intellectual Property” means all domestic and foreign patents and
patent applications, together with any continuations, continuations-in-part or
divisional applications thereof, and all patents issuing thereon (including
reissues, renewals and re-examinations of the foregoing); design patents;
invention disclosures; mask works; all domestic and foreign copyrights, whether
or not registered, together with all copyright applications and registrations
therefor; all domain names, together with any registrations therefor and any
goodwill relating thereto; all domestic and foreign trademarks, service marks,
trade names, and trade dress, in each case together with any applications and
registrations therefor and all goodwill relating thereto; all Trade Secrets,
commercial and technical information, know-how, proprietary or Confidential
Information, including engineering, production and other designs, notebooks,
processes, drawings, specifications, formulae, and technology; computer and
electronic data processing programs and software (object and source code), data
bases and documentation thereof; all inventions (whether or not patented); all
utility models; all registered designs, certificates of invention and all other
intellectual property under the laws of any country throughout the world.

     

         “Last-Time Buy Order” has the meaning set forth in Section 4.5.

     

         “Liability” means, with respect to any Person, any and
all losses, claims, charges, debts, demands, Actions, causes of action, suits,
damages, obligations, payments, costs and expenses, sums of money, accounts,
reckonings, bonds, specialties, indemnities and similar obligations, exoneration
covenants, obligations under contracts, guarantees, make whole agreements and
similar obligations, and other liabilities and requirements, including all
contractual obligations, whether absolute or contingent, matured or unmatured,
liquidated or unliquidated, accrued or 

     

    -3- 

     

    

    
    

    unaccrued, known or
unknown, joint or several, whenever arising, and including those arising under
any Applicable Law, action, threatened or contemplated action (including the
costs and expenses of demands, assessments, judgments, settlements and
compromises relating thereto and attorneys’ fees and any and all costs and
expenses, whatsoever reasonably incurred in investigating, preparing or
defending against any such actions or threatened or contemplated actions) or
order of any Governmental Authority or any award of any arbitrator or mediator
of any kind, and those arising under any contract, in each case, whether or not
recorded or reflected or otherwise disclosed or required to be recorded or
reflected or otherwise disclosed, on the books and records or financial
statements of any Person, including any Liability for taxes. 

     

         “Person” (whether or not initially capitalized) means
any corporation, limited liability company, partnership, firm, joint venture,
entity, natural person, trust, estate, unincorporated organization, association,
enterprise, government or political subdivision thereof, or Governmental
Authority. 

     

         “Product” has the meaning set forth in the preamble of
this Agreement. 

     

         “Product Warranty” has the meaning set forth in Section 6.1(a). 

     

         “Raw Materials Cost” means the direct cost of material used in a
finished Product, including the normal quantity of material wasted in the
production process, purchasing costs, inbound freight charges and any applicable
subcontractor charges. 

     

         “Six-Month Forecast” means a forward-looking Forecast for a
period of six consecutive calendar months, beginning on July 1 and January 1 of
each calendar year, or, if earlier with respect to any Product, the last day of
the Term for such Product.

     

         “Subsidiary” of any Person means a corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries;
provided, however, that no Person that is not directly or
indirectly wholly-owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person.

     

         “Supplier” has the meaning set forth in the preamble of
this Agreement.

     

         “Supplier’s Other Manufacturing
Obligations” means the
manufacturing obligations and commitments of Supplier to Persons other than
Buyer, including Supplier’s Affiliates. 

     

         “Specifications” means, with respect to any Product, the
design, composition, dimensions, other physical characteristics, chemical
characteristics, packaging, unit count and trade dress of such Product.

     

         “Term” has the meaning set forth in Section 7.1.

     

    -4- 

     

    

    
    

         “Trade Secrets” means information, including a formula,
program, device, method, technique, process or other Confidential Information
that derives independent economic value, actual or potential, from not being
generally known to the public or to other Persons who can obtain economic value
from its disclosure or use and is the subject of efforts that are reasonable,
under the circumstances, to maintain its secrecy. 

     

         “Wholly-Owned Subsidiary” of a Person means a Subsidiary of that
Person substantially all of whose voting securities and outstanding equity
interest are owned either directly or indirectly by such Person or one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries.

     

         The terms “herein”, “hereof”, “hereunder” and like terms, unless otherwise specified,
shall be deemed to refer to this Agreement in its entirety and shall not be
limited to any particular section or provision hereof. The term “including” as used herein shall be deemed to mean
“including, but not limited to.” The term “days” shall refer to calendar days unless
specified otherwise. References herein to “Articles”, “Sections” and “Exhibits” shall be deemed to mean Articles, Sections
of and Exhibits to this Agreement unless otherwise specified.

     

    ARTICLE II

PURCHASE AND SALE OF
PRODUCTS 

     

         SECTION 2.1 Agreement to Purchase and Sell
Products. (a) During the
Term, Supplier hereby agrees to manufacture and sell to Buyer, and Buyer hereby
agrees to purchase and accept from Supplier, such amounts of Products, as from
time to time shall be ordered by Buyer. 

     

         (b) All Products to be sold to Buyer pursuant to
this Agreement shall be manufactured by Supplier or an Affiliate of Supplier;
provided, however, that Supplier may subcontract the
manufacture of any Product to a manufacturer that is not an Affiliate of
Supplier with Buyer’s prior written consent, which consent shall not be
unreasonably withheld, provided that any such subcontracting shall not
relieve Supplier of its obligations hereunder. 

     

         SECTION 2.2 Product Specifications. (a) Supplier shall manufacture all Products
according to the Specifications in effect as of the date of this Agreement, with
such changes or additions to the Specifications of the Products related thereto
as shall be requested by Buyer in accordance with this Section or as otherwise
agreed in writing by the Parties. All other Products shall be manufactured with
such Specifications as the Parties shall agree in writing. 

     

         (b) Buyer may request changed or additional
Specifications for any Product by delivering written notice thereof to Supplier
not less than one hundred twenty (120) days in advance of the first Firm Order
for such Product to be supplied with such changed or additional Specifications.
Notwithstanding the foregoing, if additional advance time would reasonably be
required in order to implement the manufacturing processes for production of a
Product with any changed or additional Specifications, and to commence
manufacture and delivery thereof, Supplier shall so notify Buyer, and Supplier
shall not be required to commence delivery of such Product until the passage of
such additional time. 

     

         (c) Supplier shall be required to accommodate any
change of, or additions to, the Specifications for any Product, if and only if (i) in Supplier’s good faith judgment, such
changed 

     

    -5- 

     

    

    
    

    or additional
Specifications would not require Supplier to violate good manufacturing
practice, (ii) the representation and warranty of Buyer deemed made pursuant to
Subsection (e) below is true and correct, and (iii) Buyer agrees to reimburse
Supplier for the incremental costs and expenses incurred by Supplier in
accommodating the changed or additional Specifications, including the costs of
acquiring any new machinery and tooling. For the avoidance of doubt, such costs
and expenses shall be payable by Buyer separately from the cost of Products at
such time or times as Supplier shall request. 

     

         (d) Supplier shall notify Buyer in writing within
thirty (30) days of its receipt of any request for changed or additional
Specifications (i) whether Supplier will honor such changed or additional
Specifications, (ii) if Supplier declines to honor such changed or additional
Specifications, the basis therefor and (iii) if applicable, the estimated costs
and expenses that Buyer will be required to reimburse Supplier in respect of the
requested changes or additions, as provided in Subsection (c) above. Buyer shall
notify Supplier in writing within fifteen (15) days after receiving notice of
any required reimbursement whether Buyer agrees to assume such reimbursement
obligation. 

     

         (e) By its request for any changed or additional
Specifications for any Product, Buyer shall be deemed to represent and warrant
to Supplier that the manufacture and sale of the Product incorporating Buyer’s
changed or additional Specifications, as a result of such incorporation, will
not and could not reasonably be expected to (i) violate or conflict with any
contract, agreement, arrangement or understanding to which Buyer and/or any of
its Affiliates is a party, including this Agreement and any other contract,
agreement, arrangement or understanding with Supplier and/or its Affiliates,
(ii) infringe on any trademark, service mark, copyright, patent, trade secret or
other intellectual property rights of any Person, or (iii) violate any
Applicable Law. Buyer shall indemnify and hold Supplier and its Affiliates
harmless (including with respect to reasonable attorneys’ fees and
disbursements) from any breach of this representation and warranty.

     

         SECTION 2.3 New Products. If Buyer shall request in writing that
Supplier manufacture and sell to Buyer an item that is not at the time a
Product, Supplier shall consider such request in good faith, giving due
consideration to Supplier’s available manufacturing capacity, Supplier’s Other
Manufacturing Obligations, existing know-how, technical feasibility, cost,
profitability and other relevant factors. Supplier shall inform Buyer within a
reasonable time of Supplier’s determination in principle whether to manufacture
such Product, and if Supplier has determined not to manufacture such Product,
the reasons therefor. If Supplier shall inform Buyer that it is willing in
principle to manufacture and sell such Product, Buyer and Supplier shall
negotiate in good faith with respect to the terms of such manufacture and sale,
including pricing and the Exhibits to this Agreement shall be modified
accordingly; provided, however, that neither Party shall be bound with
respect to the manufacture and sale of any such Product unless the Parties shall
have so agreed in writing.

     

         SECTION 2.4 Supplier’s Supply
Obligations. Supplier
shall be obligated to manufacture and sell Products to Buyer, in accordance with
Buyer’s Firm Orders, to the extent of Supplier’s then existing manufacturing
capacity, taking into account Supplier’s Other Manufacturing Obligations;
provided, however, the Supplier shall give equal priority to
the orders of Buyer, on the one hand, and Supplier’s Other Manufacturing
Obligations, on the other. 

     

    -6- 

     

    

    
    

         SECTION 2.5 Product Changes. Supplier shall communicate any change in the
Specifications for any Product or its manufacture in accordance with Supplier’s
product change notification process. Buyer shall be deemed to have accepted such
change unless, within thirty (30) days after receipt of notice from Supplier,
Buyer informs Supplier that such change is not acceptable. If Buyer informs
Supplier that such change is not acceptable, Supplier may by notice to Buyer
either (x) continue to supply the Product in accordance with the original
Specifications and manufacturing procedures or (y) terminate this Agreement with
respect to such Product on a date specified by Supplier in a notice of
termination, which date shall not be earlier than the earlier of (I) one (1)
year from the date of Buyer’s information that it does not accept the change
proposed by Supplier and (II) if such notice of termination is delivered more
than ninety (90) days before the end of the then current Term, the end of such
Term; subject to the right of the Buyer to submit a Last-Time Buy Order in
accordance with Section 4.5.

     

         SECTION 2.6 Product Discontinuation. At any time Supplier may notify Buyer that
Supplier is discontinuing the manufacture and sale of a Product. Such
discontinuation shall take effect on a date specified by Supplier in a notice of
discontinuation, which date shall not be earlier than one (1) year from the date
of the notice of discontinuation; subject to the right of the Buyer to submit a
Last-Time Buy Order in accordance with Section 4.5. 

     

         SECTION 2.7 Consultation and Support. At either Party’s reasonable request, the
Parties shall meet and discuss the nature, quality and level of supply services
contemplated by this Agreement. In addition, Supplier will make available on a
commercially reasonable basis and at commercially reasonable times qualified
personnel to provide knowledgeable support service with respect to the Products.
The Parties shall negotiate in good faith with respect to any fees and other
charges incurred by Supplier in providing other than routine product support.

     

    ARTICLE III

FORECASTS 

     

         SECTION 3.1 Forecasts. (a) As soon as possible, but in no event
later than thirty (30) days following the distribution of shares of common stock
of Vishay Precision Group, Inc. (“VPG”) to the shareholders of Vishay
Intertechnology, Inc. (“Vishay Intertechnology”) under that certain Master
Separation and Distribution Agreement between Vishay Intertechnology and VPG
(the “Master Separation Agreement”), Buyer shall provide to Supplier an initial
Forecast for the period ending on December 31, 2010. Beginning on December 1,
2010, and thereafter, on May 31 and December 1 of each calendar year, Buyer
shall provide to Supplier a Six-Month Forecast for the 6-month period beginning
on the immediately following July 1 and January 1, respectively.

     

         (b) If it is commercially impracticable for Buyer
to deliver a Six-Month Forecast for a particular Product, Buyer shall deliver
Forecasts to Supplier at such intervals and for such periods as reasonable under
the circumstances, and Supplier shall in good faith consider such Forecasts
delivered by Buyer.

     

         (c) Supplier shall use all Forecasts delivered by
Buyer under this Agreement for capacity and raw material planning purposes only,
and such Forecasts will not constitute a commitment of any type by Buyer to
purchase any Product. 

     

    -7- 

     

    

    
    

         SECTION 3.2 Forecasts in Excess of
Capacity. Upon receipt of
each Forecast, Supplier shall determine whether it will have the capacity to
manufacture and sell to Buyer the Products in the forecasted amounts. If
Supplier determines that it will not have the capacity to manufacture and
deliver any Product to Buyer as forecasted, Supplier shall so notify Buyer as
promptly as practicable. Supplier and Buyer shall thereafter negotiate in good
faith in order to match Supplier’s manufacturing capacity with Buyer’s
requirements for the specified Product, such as by advancing or deferring the
delivery of the Product to other periods. In the event that Supplier and Buyer
shall agree to accommodate Buyer’s forecasted requirements in a manner that will
require the expenditure by Supplier of unbudgeted costs and expenses in addition
to the costs and expenses that Supplier would otherwise be required to expend in
order to fulfill its obligations under this Agreement, Buyer shall be obligated
to reimburse Supplier for such costs and expenses as have actually been expended
by Supplier, notwithstanding that the manufacture and sale of Products in
accordance with the Firm Orders subsequently delivered by Buyer for the relevant
periods do not require such expenditure. 

     

         SECTION 3.3 Firm Orders in Excess of
Forecasts. In the event
that the Firm Order for any Product shall exceed the Forecast contained in the
most recent prior Forecast for such Product (as such Forecast may have been
modified by agreement of the Parties in the manner contemplated in Section 3.2; such excess being referred to as the
“Excess Order”), Supplier shall notify Buyer, as promptly
as reasonably practicable after receipt of such Firm Order, whether Supplier has
sufficient available capacity to accommodate the Excess Order, taking into
consideration Supplier’s manufacturing capacity for such Product and Supplier’s
Other Manufacturing Obligations. If Supplier shall not have sufficient available
capacity to accommodate the Excess Order, Supplier and Buyer shall negotiate in
good faith in order to match Supplier’s available manufacturing capacity with
Buyer’s requirements for the specified Product, such as by advancing or
deferring the delivery of the Product to other periods.

     

    ARTICLE IV

ORDERS AND PAYMENT 

     

         SECTION 4.1 Purchase Orders. (a) Buyer may place a Firm Order for the
Products with Supplier at any time and from time to time.

     

         (b) Each Firm Order shall specify (i) number of
units of the Product to be purchased and (ii) the requested delivery date,
provided that Buyer shall request a delivery date with a lead delivery time that
is customary for the particular Product, unless otherwise agreed upon by the
Parties. Supplier agrees to provide Buyer prompt notice if it knows it cannot
meet a requested delivery date. 

     

         (c) If Buyer requires a Product on an emergency
basis and so informs Supplier, and Supplier has the Product available in its
uncommitted inventory, Supplier agrees to use reasonable commercial efforts to
fill the emergency order as promptly as practicable. Buyer agrees to pay
reasonable incremental expenses related to any emergency order. 

     

         SECTION 4.2 Shipment.

     

         (a) Products will be shipped by Supplier to Buyer FOB shipping point.

     

    -8- 

     

    

    
    

         (b) Supplier shall package all Products so as to
protect them from loss or damage during shipment, in conformity with good
commercial practice, the Specifications and Applicable Law. Buyer shall be
responsible, at its own cost and expense, for the shipment (including, among
other fees, costs and expenses, transit and casualty insurance and third party
fees) of all processed materials by Buyer. Supplier shall cooperate with Buyer
in assembling and coordinating shipments, as reasonably requested by Buyer.

     

         (c) For the avoidance of doubt, title to and risk
of loss or damage will pass to Buyer upon Buyer’s pick up for transfer of the
Products ordered.

     

         SECTION 4.3 Prices. Pricing for the Products shall be as set
forth on Exhibit A, as such Exhibit may be modified from time to
time by agreement of the Parties. At least thirty (30) days prior to the
beginning of each calendar year, the parties shall negotiate in good faith
changes to the pricing of the Products to be applicable in the ensuing year.
Such pricing shall take into account changes in the cost of manufacturing the
Products, including labor, manufacturing, utility and other direct costs, and
other ascertainable market inputs. If the Parties cannot in good faith agree on
pricing for the Products, until such time as the Parties do so agree, Supplier
shall have no obligation to honor any Firm Orders submitted by Buyer to the
extent that such Firm Orders are placed following expiration of the then current
calendar year. 

     

         SECTION 4.4 Payment Terms. Unless otherwise agreed to by the Parties in
writing, Buyer shall make payment separately for each Firm Order. Buyer shall
pay the net amount of all invoice amounts within sixty (60) days of the date of
Supplier’s invoice unless the terms of Supplier’s invoice permits later payment
or allows for prepayment with a discount. Invoices shall not be sent earlier
than the date on which the Products related thereto are delivered to Buyer.

     

         SECTION 4.5 Last-Time Buy Order.

     

         (a) Buyer shall have a right to place a written
last-time Firm Order for a Product (a “Last-Time Buy Order”) if (i) Supplier delivers to Buyer notice of
its intention not to renew the Term pursuant to Section 7.2; (ii) Supplier terminates this Agreement in
respect of such Product in connection with Buyer’s choice not to accept a change
in such Product under Section 2.5; (iii) Supplier delivers to Buyer a notice of
discontinuation of such Product; or (iv) Buyer terminates this Agreement in
connection with a material breach by Supplier pursuant to Section 7.3. The right of the Buyer to submit a Last-Time
Buy Order shall entitle Buyer to purchase the Products at the price in effect
for the products as of the time of Buyer’s exercise of such right.

     

         (b) A Last-Time Buy Order shall specify (i) number
of units of the Product to be purchased and (ii) the requested delivery date or
dates for such units. If Supplier informs Buyer that it cannot honor the
requested delivery dates because of capacity restraints or otherwise, the
Parties shall negotiate in good faith with respect to delivery dates mutually
acceptable to Supplier and Buyer.

     

         (c) The Parties hereby agree to use commercially
reasonable efforts to coordinate forecasting and ordering during the period
between the date the Last-Time Buy Order is 

     

    -9- 

     

    

    
    

    delivered to Supplier
and the final delivery date to allow for regular supply of Products during such
period.

     

    ARTICLE V

CONFIDENTIALITY 

     

         SECTION 5.1 Supplier and Buyer shall hold and shall cause each of their
respective affiliates, directors, officers, employees, agents, consultants,
advisors and other representatives to hold, in strict confidence and not to
disclose or release without the prior written consent of the other party, any
and all proprietary or confidential information, material or data of the other
party that comes into its possession in connection with the performance by the
parties of their rights and obligations under this Agreement. The provisions of
Section 4.5 of the Master Separation Agreement shall govern, mutatis mutandis,
the confidentiality obligations of the parties under this Section. 

     

    ARTICLE VI

PRODUCT WARRANTY; LIMITATION OF
LIABILITY 

     

         SECTION 6.1 Product Warranty; Merchantability
Warranty. (a) Supplier
warrants to Buyer that the Products shall, at the time of delivery to Buyer in
accordance with Section 4.2: (i) conform to the Specifications therefor,
as provided in Section 2.2; (ii) be free from material defects; and
(iii) be manufactured in accordance with good manufacturing practice and
Applicable Law (such warranty being referred to as the “Product Warranty”). 

     

         (b) EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, NO WARRANTIES,
OTHER THAN THE PRODUCT WARRANTY, ARE EXPRESSED OR IMPLIED IN RESPECT OF THE
PRODUCTS, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. 

     

         SECTION 6.2 Defective or Non-Conforming
Products. (a) Claims by
Buyer relating to the quantity of or damage to any Product or the failure of any
Product to conform to its Specifications must be made within one (1) year of
receipt of such Product and must be in writing, specifying in reasonable detail
the nature and basis of the claim and citing relevant control or lot numbers or
other information to enable identification of the Product in question.
Supplier’s Liability to Buyer for damages for any such claim shall be limited to
a refund for the price of the defective Product plus shipping costs or, at
Buyer’s option, prompt replacement thereof with a Product that complies with the
Product Warranty. Such refund and shipping costs or a replacement shall
constitute Supplier’s sole and exclusive Liability for such claims. For the
avoidance of doubt, nothing shall limit the obligations of Supplier to Buyer in
respect of third party claims against Buyer arising from the failure of any
Product to conform to its Specifications. 

     

         (b) Any notifications to either Party pursuant to
this Section 6.2 shall be subject to the confidentiality
provisions of Article V above. 

     

         SECTION 6.3 Indemnification. (a) Subject to Section 6.4, Supplier shall indemnify and hold Buyer
harmless from and against any Liability, including reasonable attorney’s fees
and disbursements, arising out of any third party claim for death, injury or
damage to property 

     

    -10- 

     

    

    
    

    resulting from (i)
Supplier’s breach of this Agreement; or (ii) any claim that a Product purchased
from Supplier infringes any intellectual property right of a third
party.

     

         (b) Buyer shall indemnify and hold harmless
Supplier from and against any Liability, including reasonable attorneys’ fees
and disbursements, arising out of any third party claim for death, injury or
damage to property resulting from use of any of the Products based upon (i)
Buyer’s breach of this Agreement; or (ii) any change in condition of the
Products caused by Buyer other than any change in Specifications requested by
Supplier and deemed accepted by Buyer under Section 2.5. 

     

         (c) Any Party seeking indemnification pursuant to
this Section 6.3 shall promptly notify the other Party of the
claim as to which indemnification is sought, shall afford the other Party, at
the other Party’s sole expense, the opportunity to defend or settle the claim
(in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified Party with respect such claim) and shall
cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim; provided, however, that any settlement of any such claim that
would adversely affect the rights of the indemnified Party shall require the
written approval of such indemnified Party; and provided further that an indemnified Party shall not settle
any such claim without the written approval of the indemnifying Party.

     

         (d) The foregoing indemnification obligations
shall survive any termination or expiration of this Agreement, in whole or in
part, or the expiration or termination of the Term. 

     

         SECTION 6.4 Limitation of Liability. In no event shall any Party be liable for
any special, consequential, indirect, collateral, incidental or punitive damages
or lost profits or failure to realize expected savings or other commercial or
economic loss of any kind, arising out of any breach of this Agreement,
including breach of the Product Warranty, or any other obligations of any Party
hereunder, or any use of the Products, and each Party hereby knowingly and
expressly waives any claims or rights with respect thereto; provided, however, that in the event a Party is required to pay
to a third-party claimant any special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss on any claim with respect to which
such Party is indemnified by the other Party pursuant to this Agreement, such
Party shall be entitled to indemnification from the other Party with respect to
such third-party special, consequential, indirect, collateral, incidental or
punitive damages or lost profits or failure to realize expected savings or other
commercial or economic loss to the extent resulting from the indemnifiable acts
or omissions of the other Party. 

     

         SECTION 6.5 Insurance. Each of the Parties shall maintain general
liability insurance covering their activities under this Agreement in accordance
with prudent and customary commercial practices, in such amounts as shall be
agreed upon from time to time by the Parties. 

     

    ARTICLE VII

TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION 

     

         SECTION 7.1 Term of Agreement. Unless earlier terminated pursuant to
Section 7.3, the term of this Agreement shall be
perpetual. 

     

    -11- 

     

    

    
    

         SECTION 7.2 Termination. Either Party may terminate this Agreement at
any time upon prior written notice to the other at least one (1) year prior to
the requested date of termination. 

     

         SECTION 7.3 Rights Upon Termination. Following a termination of this Agreement,
all further rights and obligations of the Parties under this Agreement shall
terminate. Notwithstanding the
foregoing, the termination of this Agreement shall not affect the rights and
obligations of the Parties arising prior to such expiration or termination; and
provided further that the Parties shall not be relieved of (i)
their respective obligations to pay monies due or which become due as of or
subsequent to the date of expiration or termination, and (ii) any other
respective obligations under this Agreement which specifically survive or are to
be performed after the date of such expiration or termination, including the
provisions of Article V and 6.3. Any Firm Order, including a Last-Time Buy
Order, submitted prior to the expiration or termination of this Agreement shall
be filled by Supplier pursuant to the terms hereof even if the delivery date is
after expiration or termination. 

     

    ARTICLE VIII

DISPUTE RESOLUTION 

     

         SECTION 8.1 The terms and provisions of Article VIII of the Master
Separation Agreement relating to the procedures for resolution of any disputes
between the parties, shall apply to all disputes, controversies or claims
(whether sounding in contract, tort or otherwise) that may arise out of or
relate to or arise under or in connection with this Agreement, or the
transactions contemplated hereby, mutatis mutandis.

     

    ARTICLE IX

MISCELLANEOUS 

     

         SECTION 9.1 Assignment. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Supplier without the consent of Buyer, to a Wholly-Owned
Subsidiary of Supplier that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Supplier, to a Wholly-Owned Subsidiary of Buyer; or (iii) by either
Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only with
the prior written consent of the other Party; provided, however, that no such assignment shall relieve the
assigning Party of Liability for its obligations hereunder. The following
actions shall not be deemed an assignment of this Agreement: (1) assignment or
transfer of the stock of a Party, including by way of a merger, consolidation,
or other form of reorganization in which outstanding shares of a Party are
exchanged for securities, or (2) any transaction effected primarily for the
purpose of (A) changing a Party’s state of incorporation or (B) reorganizing a
Party into a holding company structure such that, as a result of any such
transaction, such Party becomes a Wholly-Owned Subsidiary of a holding company
owned by the holders of such Party’s securities immediately prior to such
transaction. Any attempted assignment other than as provided herein shall be
void. The provisions of this Agreement shall be binding upon, and shall inure to
the benefit of, the successors and permitted assigns of the
Parties.

     

    -12- 

     

    

    
    

         SECTION 9.2 Force Majeure. The Parties shall not be liable for the
failure or delay in performing any obligation under this Agreement (except
pursuant to Section 7.4) if and to the extent such failure or delay
is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war, invasion,
riot or other civil unrest; (iv) governmental laws, orders, restrictions,
actions, embargoes or blockages; (v) action by any regulatory authority which
prohibits the manufacture, sale or distribution of the Products, except to the
extent due to Supplier’s breach of its obligations hereunder; (vi) regional,
national or foreign emergency; (vii) injunction, strikes, lockouts, labor
trouble or other industrial disturbances; (viii) shortage of adequate fuel,
power, materials, or transportation facilities; or (ix) any other event which is
beyond the reasonable control of the affected Party; provided, however, that the Party affected shall promptly
notify the other Party of the force majeure condition and shall exert its
reasonable commercial efforts to eliminate, cure or overcome any such causes and
to resume performance of its obligations as soon as possible. 

     

         SECTION 9.3 Intellectual Property. All Intellectual Property owned or created
by a Party shall remain its sole and exclusive property, and the other Party
shall not acquire any rights therein by reason of this Agreement. 

     

         SECTION 9.4 Entire Agreement. This Agreement and the Exhibits hereto
constitute the entire agreement between the Parties with respect to the subject
matter hereof and thereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations between the
parties with respect to such subject matter. No agreements or understandings
exist between the parties other than those set forth or referred to herein or
therein. If any provision of this Agreement or the application thereof to any
Party or circumstance shall be declared void, illegal or unenforceable, the
remainder of this Agreement shall be valid and enforceable to the extent
permitted by Applicable Law. In such event, the Parties shall use their best
efforts to replace the invalid or unenforceable provision with a provision that,
to the extent permitted by Applicable Law, achieves the purposes intended under
the invalid or unenforceable provision. 

     

         SECTION 9.5 Governing Law. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction. 

     

         SECTION 9.6 Consent to Jurisdiction. Subject to the provisions of Article VIII, each of the Parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to Section 9.16. Each of the parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in Section 9.10 shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this Section 9.6. Each of the parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby for which it has submitted to jurisdiction pursuant to this 

     

    -13- 

     

    

    
    

    Section 9.6, and waives any claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum. 

     

         SECTION 9.7 Independent Contractor. Nothing contained in this Agreement shall
constitute a Party as a partner, employee or agent of the other Party, nor shall
any Party hold itself out as such. Neither Party shall have the right or
authority to incur, assume or create, in writing or otherwise, any warranty,
Liability or other obligation of any kind, express or implied, in the name or on
behalf of the other Party, and each Party is and shall remain an independent
contractor, responsible for its own actions. Except as otherwise explicitly
provided herein, each Party shall be responsible for its own expenses incidental
to its performance of this Agreement. 

     

         SECTION 9.8 Set-Off. The obligation of Buyer to pay the purchase
price for Products shall be unconditional, except as provided in this Agreement,
and shall not be subject to any defense, setoff, counterclaim or similar right
against Supplier or any of its Affiliates that could be asserted by Buyer or any
of its Affiliates under any other contract, agreement, arrangement or
understanding or otherwise under Applicable Law. 

     

         SECTION 9.9 Waivers. No claim or right arising out of or relating
to a breach of any provision of this Agreement can be discharged in whole or in
part by a waiver or renunciation of the claim or right unless the waiver or
renunciation is supported by consideration and is in writing signed by the
aggrieved Party. Any failure by any Party to enforce at any time any provision
under this Agreement shall not be considered a waiver of that Party’s right
thereafter to enforce each and every provision of this Agreement. 

     

         SECTION 9.10 Notices. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision): 

     

         If to Supplier, to: 

     

         Vishay Measurements Group
Inc. 
     c/o Vishay
Precision Group, Inc. 
     3 Great Valley
Parkway 
     Malvern, PA
19355-1307 
     Attention: William M. Clancy 
     Telephone:
484-321-5300 
     Facsimile: 484-321-5300

     

         with a copy to: 

     

         Pepper Hamilton LLP 
     3000 Two Logan Square 
     Eighteenth and Arch Streets

     

    -14- 

     

    

    
    

     

    
      	
                   Philadelphia, Pennsylvania
      19103-2799 
     Attention: Barry Abelson,
      Esq. 
     Telephone:
      215-981-4000 
     Facsimile:
      215-981-4750

     If to Buyer,
      to: 

     Vishay S.A. 
     c/o Vishay Intertechnology,
      Inc. 
     63
      Lancaster Avenue 
     Malvern, PA
      19355-2120 
     Attention: Dr. Lior E.
      Yahalomi 
     Telephone:
      610-644-1300 
     Facsimile:
      610-889-2161 

     with a copy
      to: 

     Kramer Levin Naftalis &
      Frankel LLP 
     1177 Avenue of the
      Americas 
     New
      York, NY 10036 
     Attention: Ernest S. Wechsler,
      Esq. 
     Telephone:
      212-715-9100 
     Facsimile:
      212-715-8000
      

               

            

    

    Any notice, demand or other
communication hereunder shall be deemed given upon the first to occur of: (i)
the fifth (5th) day after deposit thereof, postage prepaid
and addressed correctly, in a receptacle under the control of the United States
Postal Service; (ii) transmittal by facsimile transmission to a receiver or
other device under the control of the party to whom notice is being given; (iii)
actual delivery to or receipt by the party to whom notice is being given or an
employee or agent thereof; or (iv) one (1) day after delivery to an overnight
carrier.

     

         SECTION 9.11 Headings. The headings contained herein are included
for convenience of reference only and do not constitute a part of this
Agreement.

     

         SECTION 9.12 Counterparts. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered or transmitted
by facsimile, e-mail or other electronic means, shall be deemed to be an
original and all of which taken together shall constitute but one and the same
instrument. A facsimile or electronic signature is deemed an original signature
for all purposes under this Agreement. 

     

         SECTION 9.13 Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such 

     

    -15- 

     

    

    
    

    determination, the
Parties shall negotiate in good faith in an effort to agree upon such a suitable
and equitable provision to effect the original intent of the Parties.

     

         SECTION 9.14 Waiver of Default. (a) Any term or provision of this Agreement
may be waived, or the time for its performance may be extended, by the party or
the parties entitled to the benefit thereof. Any such waiver shall be validly
and sufficiently given for the purposes of this Agreement if, as to any party,
it is in writing signed by an authorized representative of such party.

     

         (b) Waiver by any party of any default by the
other party of any provision of this Agreement shall not be construed to be a
waiver by the waiving party of any subsequent or other default, nor shall it in
any way affect the validity of this Agreement or any party hereof or prejudice
the rights of the other party thereafter to enforce each and ever such
provision. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. 

     

         SECTION 9.15 Amendments. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification. 

     

         SECTION 9.16 Specific Performance. The Parties agree that the remedy at law for
any breach of this Agreement may be inadequate, and that, as between Supplier
and Buyer, any Party by whom this Agreement is enforceable shall be entitled to
seek temporary, preliminary or permanent injunctive or other equitable relief
with respect to the specific enforcement or performance of this Agreement. Such
Party may, in its sole discretion, apply to a court of competent jurisdiction
for such injunctive or other equitable relief as such court may deem just and
proper in order to enforce this Agreement as between Supplier and Buyer, or the
members of their respective Groups, or prevent any violation hereof, and, to the
extent permitted by Applicable Law, as between Supplier and Buyer, each Party
waives any objection to the imposition of such relief. 

     

         SECTION 9.17 Waiver of jury trial. Subject to Article VIII, each of the Parties
hereby waives to the fullest extent permitted by Applicable Law any right it may
have to a trial by jury with respect to any court proceeding directly or
indirectly arising out of and permitted under or in connection with this
Agreement or the transactions contemplated hereby. Each of the Parties hereby
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it has been induced to enter into this agreement and the transactions
contemplated by this agreement, as applicable, by, among other things, the
mutual waivers and certifications in this Section 9.17. 

     

    [SIGNATURE PAGE FOLLOWS] 

     

    -16- 

     

    

    
    

         IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first written
above. 

     

    
      	
            	SUPPLIER:
	
            	VISHAY MEASUREMENTS GROUP,
  INC.
	
            	
            	 
	
            	By:   	/s/ William M. Clancy	 
	
            	
            	Name: William M. Clancy	 
	
            	
            	Title: Secretary
	
            	
            	 
	
            	
            	 
	 	
            	 
	
            	BUYER:
	
            	VISHAY S.A.
	
            	
            	 
	
            	By:  	/s/ Denis Maugest	 
	
            	
            	Name: Denis Maugest
	
            	
            	Title: Directeur
General

    

    -17- 

     

    

    
    

    EXHIBIT A

     

    
    

     

    
      	
            	
            	
            	MINIMUM
	 	 	PRICE(c)	ORDER
	Product	DESCRIPTION	(USD)	QUANTITY
	[***]	[***]	[***]	[***]
	[***]	
            	
            	
            

    

     

         Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange 
Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission 
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934. Such portions are marked by [***].twelve.htm

    Portions of this exhibit were omitted and
filed separately with the Secretary of the 
Securities and Exchange
Commission pursuant to an application for confidential treatment
filed with
the Securities and Exchange Commission pursuant to Rule 24b-2 under the

Securities Exchange Act of 1934. Such portions are marked by
[***]. 

     

     

     

     

     

     

     

     

     

     

     

    MANUFACTURING AGREEMENT 

     

    by and between

     

    Vishay S.A., a

French company, 

     

    as Manufacturer

     

     

     

    and 

     

    Vishay Precision Foil
VPG GmbH, 
a German company, 

     

    as Buyer 

     

    Dated as of July 6,
2010 

     

    

    
    

              This MANUFACTURING AGREEMENT (this
“Agreement”) is made as of July 6, 2010 by and between
Vishay S.A., a French company (“Manufacturer”), and Vishay Precision Foil VPG GmbH, a
German company (“Buyer”). Manufacturer and Buyer each may be
referred to herein as a “Party” and collectively, as the “Parties”. 

     

              WHEREAS, subject to the terms, conditions,
commitments and undertakings herein provided, Manufacturer is willing to
manufacture those products as set forth on Exhibit A hereto (as the same may be modified from time
to time pursuant to the provisions hereof, the “Products”) on a contract basis on behalf of Buyer in
such quantities as Buyer shall request , as provided in this Agreement;

     

              NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties, intending to be legally bound, agree as follows: 

     

    ARTICLE I

DEFINITIONS 

     

              For purposes of this Agreement, the following
terms shall have the meanings specified in this Article I: 

     

              “Affiliate” means, as applied to any Person, any other
Person that, directly or indirectly, controls, is controlled by, or is under
common control with that Person as of the date on which or at any time during
the period for when such determination is being made. For purposes of this
definition, “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
other interests, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

     

              “Applicable Law” means any applicable law, statute, rule or
regulation of any Governmental Authority, or any outstanding order, judgment,
injunction, ruling or decree by any Governmental Authority. 

     

              “Buyer” has the meaning set forth in the preamble of
this Agreement. 

     

              “Confidential Information” means all proprietary, design or operational
information, data or material including, without limitation: (a) specifications,
ideas and concepts for goods and services; (b) manufacturing specifications and
procedures; (c) design drawings and models; (d) materials and material
specifications; (e) quality assurance policies, procedures and specifications;
(f) customer, client, manufacturer and supplier information; (g) computer
software and derivatives thereof relating to design development or manufacture
of goods; (h) training materials and information; (i) inventions, devices, new
developments, methods and processes, whether patentable or unpatentable and
whether or not reduced to practice; (j) all other know-how, methodology,
procedures, techniques and Trade Secrets; (k) proprietary earnings reports and
forecasts; (l) proprietary macro-economic reports and forecasts; (m) proprietary
marketing, advertising and business plans, objectives and strategies; (n)
proprietary general market evaluations and surveys; (o) proprietary financing
and credit-related information; (p) other copyrightable or patented works; (q)
the terms of this Agreement; 

     

    

    
    

    and (r) all similar and
related information in whatever form; in each case, of one party which has been
disclosed by Manufacturer or members of its Group on the one hand, or Buyer or
members of its Group, on the other hand, in written, oral (including by
recording), electronic, or visual form to, or otherwise has come into the
possession of, the other Group. 

     

              “DDU” has the meaning and usage assigned to such
words in the Incoterms rules published by the International Chamber of Commerce.

     

              “Ex Works” has the meaning and usage assigned to such
words in the Incoterms rules published by the International Chamber of Commerce.

     

              “Firm Order” means Buyer’s non-cancelable purchase order
for Products to be purchased by Buyer from Manufacturer pursuant to this
Agreement for delivery. 

     

              “Forecast” means, with respect to any relevant period,
a good faith non-binding forecast, based on information available to Buyer at
the time of such forecast (which information, if reduced to writing, shall be
made available to Manufacturer upon reasonable request), of the Firm Order for
each Product that Buyer expects to deliver to Manufacturer for each calendar
month during such period. 

     

              “Governmental Authority” means any U.S. or non-U.S. federal, state,
local, foreign or international court, arbitration or mediation tribunal,
government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority. 

     

              “Group” means, with respect to any Person, each
Subsidiary of such Person and each other Person that is controlled directly or
indirectly by such Person. 

     

              “Intellectual Property” means all domestic and foreign patents and
patent applications, together with any continuations, continuations-in-part or
divisional applications thereof, and all patents issuing thereon (including
reissues, renewals and re-examinations of the foregoing); design patents;
invention disclosures; mask works; all domestic and foreign copyrights, whether
or not registered, together with all copyright applications and registrations
therefor; all domain names, together with any registrations therefor and any
goodwill relating thereto; all domestic and foreign trademarks, service marks,
trade names, and trade dress, in each case together with any applications and
registrations therefor and all goodwill relating thereto; all Trade Secrets,
commercial and technical information, know-how, proprietary or Confidential
Information, including engineering, production and other designs, notebooks,
processes, drawings, specifications, formulae, and technology; computer and
electronic data processing programs and software (object and source code), data
bases and documentation thereof; all inventions (whether or not patented); all
utility models; all registered designs, certificates of invention and all other
intellectual property under the laws of any country throughout the world.

     

              “Last-Time Buy Order” has the meaning set forth in Section 4.6. 

     

              “Liability” means, with respect to any Person, any and
all losses, claims, charges, debts, demands, Actions, causes of action, suits,
damages, obligations, payments, costs and expenses, sums of money, accounts,
reckonings, bonds, specialties, indemnities and similar 

     

    -2- 

     

    

    
    

    obligations, exoneration
covenants, obligations under contracts, guarantees, make whole agreements and
similar obligations, and other liabilities and requirements, including all
contractual obligations, whether absolute or contingent, matured or unmatured,
liquidated or unliquidated, accrued or unaccrued, known or unknown, joint or
several, whenever arising, and including those arising under any Applicable Law,
action, threatened or contemplated action (including the costs and expenses of
demands, assessments, judgments, settlements and compromises relating thereto
and attorneys’ fees and any and all costs and expenses, whatsoever reasonably
incurred in investigating, preparing or defending against any such actions or
threatened or contemplated actions) or order of any Governmental Authority or
any award of any arbitrator or mediator of any kind, and those arising under any
contract, in each case, whether or not recorded or reflected or otherwise
disclosed or required to be recorded or reflected or otherwise disclosed, on the
books and records or financial statements of any Person, including any Liability
for taxes. 

     

              “Manufacturer” has the meaning set forth in the preamble of
this Agreement. 

     

              “Manufacturer’s Other Manufacturing
Obligations” means the
manufacturing obligations and commitments of Manufacturer to Persons other than
Buyer, including Manufacturer’s Affiliates. 

     

              “Person” (whether or not initially capitalized) means
any corporation, limited liability company, partnership, firm, joint venture,
entity, natural person, trust, estate, unincorporated organization, association,
enterprise, government or political subdivision thereof, or Governmental
Authority. 

     

              “Product” has the meaning set forth in the preamble of
this Agreement. 

     

              “Product Warranty” has the meaning set forth in Section 6.1(a). 

     

              “Raw Materials Cost” means the direct cost of material used in a
finished Product, including the normal quantity of material wasted in the
production process, purchasing costs, inbound freight charges and any applicable
subcontractor charges. 

     

              “Subsidiary” of any Person means a corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries;
provided, however, that no Person that is not directly or
indirectly wholly-owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person. 

     

              “Specifications” means, with respect to any Product, the
design, composition, dimensions, other physical characteristics, chemical
characteristics, packaging, unit count and trade dress of such Product.

     

              “Term” has the meaning set forth in Section 7.1. 

     

    -3- 

     

    

    
    

              “Trade Secrets” means information, including a formula,
program, device, method, technique, process or other Confidential Information
that derives independent economic value, actual or potential, from not being
generally known to the public or to other Persons who can obtain economic value
from its disclosure or use and is the subject of efforts that are reasonable,
under the circumstances, to maintain its secrecy. 

     

              “Wholly-Owned Subsidiary” of a Person means a Subsidiary of that
Person substantially all of whose voting securities and outstanding equity
interest are owned either directly or indirectly by such Person or one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries.

     

              The terms “herein”, “hereof”, “hereunder” and like terms, unless otherwise specified,
shall be deemed to refer to this Agreement in its entirety and shall not be
limited to any particular section or provision hereof. The term “including” as used herein shall be deemed to mean
“including, but not limited to.” The term “days” shall refer to calendar days unless
specified otherwise. References herein to “Articles”, “Sections” and “Exhibits” shall be deemed to mean Articles, Sections
of and Exhibits to this Agreement unless otherwise specified. 

     

    ARTICLE II

PURCHASE AND SALE OF
PRODUCTS 

     

         SECTION 2.1. Agreement to Purchase and Sell
Products. 

     

              (a) During the Term, Manufacturer hereby agrees to manufacture and supply on
behalf of Buyer, and Buyer hereby agrees to purchase and accept from
Manufacturer, such amounts of Products, as from time to time shall be ordered by
Buyer. 

     

              (b) All Products to be sold to Buyer pursuant to this Agreement shall be
manufactured by Manufacturer or an Affiliate of Manufacturer. 

     

         SECTION 2.2. Raw Materials. Manufacturer shall be responsible for the
procurement of raw materials and container and packaging materials, in each case
consistent with the Manufacturer’s customary practices and necessary to
manufacture and package the Products, except that Buyer acknowledges that Vishay
Advanced Technologies, Ltd. (“VAT”), or an Affiliate of Buyer, shall supply
foil resistor chips on the terms described in the Supply Agreement between the
Manufacturer, as buyer, and VAT, as supplier, as may be amended or supplemented
from time to time (the “Supply Agreement”). 

     

         SECTION 2.3. Product Specifications. 

     

              (a) Manufacturer shall manufacture all Products according to the Specifications in effect as of the date of
this Agreement, with such changes or additions to the Specifications of the
Products related thereto as shall be requested by Buyer in accordance with this
Section or as otherwise agreed in writing by the Parties, so long as and only to
the extent that if such requested change or addition requires a change or
addition in the Specifications applicable to the foil resistor chips to be
supplied by VAT under the Supply Agreement, VAT can supply the foil resistor
chips with such change or addition or Buyer is able to identify an appropriate
alternative source of foil resistor chips in the event that VAT is unable to
provide 

     

    -4- 

     

    

    
    

    such chips. All other
Products shall be manufactured with such Specifications as the Parties shall
agree in writing. 

     

              (b) Buyer may request changed or additional Specifications for any Product by
delivering written notice thereof to Manufacturer not less than one hundred
twenty (120) days in advance of the first Firm Order for such Product to be
supplied with such changed or additional Specifications. Notwithstanding the
foregoing, if additional advance time would reasonably be required in order to
implement the manufacturing processes for production of a Product with any
changed or additional Specifications, and to commence manufacture and delivery
thereof, Manufacturer shall so notify Buyer, and Manufacturer shall not be
required to commence delivery of such Product until the passage of such
additional time. 

     

              (c) Manufacturer shall be required to accommodate any change of, or additions
to, the Specifications for any Product, if and only if (i) in Manufacturer’s good faith judgment,
such changed or additional Specifications would not require Manufacturer to
violate good manufacturing practice, (ii) the representation and warranty of
Buyer deemed made pursuant to Subsection (e) below is true and correct, (iii)
Buyer agrees to reimburse Manufacturer for the incremental costs and expenses
incurred by Manufacturer in accommodating the changed or additional
Specifications, including the costs of acquiring any new machinery and tooling,
and (iv) to the extent applicable, a corresponding change of, or addition to,
the Specifications applicable to the materials supplied to the Manufacturer
under the Supply Agreement has been made. For the avoidance of doubt, such costs
and expenses shall be payable by Buyer separately from the cost of Products at
such time or times as Manufacturer shall request. 

     

              (d) Manufacturer shall notify Buyer in writing within thirty (30) days of its
receipt of any request for changed or additional Specifications (i) whether
Manufacturer will honor such changed or additional Specifications, (ii) if
Manufacturer declines to honor such changed or additional Specifications, the
basis therefor and (iii) if applicable, the estimated costs and expenses that
Buyer will be required to reimburse Manufacturer in respect of the requested
changes or additions, as provided in Subsection (c) above. Buyer shall notify
Manufacturer in writing within fifteen (15) days after receiving notice of any
required reimbursement whether Buyer agrees to assume such reimbursement
obligation. 

     

              (e) By its request for any changed or additional Specifications for any
Product, Buyer shall be deemed to represent and warrant to Manufacturer that the
manufacture and sale of the Product incorporating Buyer’s changed or additional
Specifications, as a result of such incorporation, will not and could not
reasonably be expected to (i) violate or conflict with any contract, agreement,
arrangement or understanding to which Buyer and/or any of its Affiliates is a
party, including this Agreement and any other contract, agreement, arrangement
or understanding with Manufacturer and/or its Affiliates, (ii) infringe on any
trademark, service mark, copyright, patent, trade secret or other intellectual
property rights of any Person, or (iii) violate any Applicable Law. Buyer shall
indemnify and hold Manufacturer and its Affiliates harmless (including with
respect to reasonable attorneys’ fees and disbursements) from any breach of this
representation and warranty. 

     

    -5- 

     

    

    
    

         SECTION 2.4. Manufacturer’s Supply
Obligations. Manufacturer
shall be obligated to manufacture and sell Products to Buyer, in accordance with
Buyer’s Firm Orders, to the extent of Manufacturer’s then existing manufacturing
capacity, taking into account Manufacturer’s Other Manufacturing Obligations;
provided, however, the Manufacturer shall give equal priority
to the orders of Buyer, on the one hand, and Manufacturer’s Other Manufacturing
Obligations, on the other. 

     

         SECTION 2.5. Product Changes. Manufacturer shall communicate any change in
the Specifications for any Product or its manufacture in accordance with
Manufacturer’s product change notification process. Buyer shall be deemed to
have accepted such change unless, within thirty (30) days after receipt of
notice from Manufacturer, Buyer informs Manufacturer that such change is not
acceptable. If Buyer informs Manufacturer that such change is not acceptable,
Manufacturer may by notice to Buyer either (x) continue to supply the Product in
accordance with the original Specifications and manufacturing procedures or (y)
terminate this Agreement with respect to such Product on a date specified by
Manufacturer in a notice of termination, which date shall not be earlier than
the earlier of one (1) year from the date of Buyer’s information that it does
not accept the change proposed by Manufacturer, subject to the right of the
Buyer to submit a Last-Time Buy Order in accordance with Section 4.5. 

     

         SECTION 2.6. Product Discontinuation. 

     

              (a) Discontinuation of Products. At any time, Manufacturer may notify Buyer
that Manufacturer is discontinuing the manufacture and sale of a Product. Such
discontinuation shall take effect on a date specified by Manufacturer in a
notice of discontinuation, which date shall not be earlier than one (1) year
from the date of the notice of discontinuation; subject to the right of the
Buyer to submit a Last-Time Buy Order in accordance with Section 4.5. 

     

              (b) Discontinuation of Foil Chips Under Supply
Agreement. To the extent
that a discontinuation by VAT under Section 2.5 of the Supply Agreement causes
Manufacturer to be unable to satisfy its obligations under this Agreement,
Manufacturer shall be released from any claims of breach of this Agreement or
the Supply Agreement; provided, that Manufacturer will give Buyer a
reasonable opportunity to find alternative sources of foil resistor chips.

     

         SECTION 2.7. Consultation and Support. At either Party’s reasonable request, the
Parties shall meet and discuss the nature, quality and level of supply services
contemplated by this Agreement. In addition, Manufacturer will make available on
a commercially reasonable basis and at commercially reasonable times qualified
personnel to provide knowledgeable support service with respect to the Products.
The Parties shall negotiate in good faith with respect to any fees and other
charges incurred by Manufacturer in providing other than routine product
support. 

     

    ARTICLE III

FORECASTS 

     

         SECTION 3.1. Forecasts. As and where warranted, Buyer shall provide
to Manufacturer a Forecast of the Firm Orders Buyer expects in good faith to
deliver to Manufacturer for such period of time specified in such Forecast.
Manufacturer shall use such Forecasts for capacity and 

     

    -6- 

     

    

    
    

    raw material planning
purposes only and such Forecasts shall not constitute a commitment of any type
by Buyer to purchase the Products. 

     

    ARTICLE IV

ORDERS AND PAYMENT 

     

         SECTION 4.1. Purchase Orders. 

     

              (a) Buyer may place a Firm Order for the Products with Manufacturer at any
time and from time to time. 

     

              (b) Each Firm Order shall specify (i) number of units of the Product to be
purchased and (ii) the requested delivery date, provided that Buyer shall
request a delivery date with a lead delivery time that is customary for the
particular Product, unless otherwise agreed upon by the Parties. Manufacturer
agrees to provide Buyer prompt notice if it knows it cannot meet a requested
delivery date. 

     

              (c) If Buyer requires a Product on an emergency basis and so informs
Manufacturer, and Manufacturer has the Product available in its uncommitted
inventory, Manufacturer agrees to use reasonable commercial efforts to fill the
emergency order as promptly as practicable. Buyer agrees to pay reasonable
incremental expenses related to any emergency order. 

     

         SECTION 4.2. Shipment. 

     

              (a) Products intended for customers within Europe will be shipped DDU
destination Manufacturer’s customers. Products intended for customers outside of
Europe will be shipped Ex Works Manufacturer’s factory. 

     

              (b) Manufacturer shall package all Products so as to protect them from loss
or damage during shipment, in conformity with good commercial practice, the
Specifications and Applicable Law. Buyer shall be responsible, at its own cost
and expense, for the shipment (including, among other fees, costs and expenses,
transit and casualty insurance and third party fees) of all processed materials
by Buyer. Manufacturer shall cooperate with Buyer in assembling and coordinating
shipments, as reasonably requested by Buyer. 

     

              (c) For the avoidance of doubt, title to and risk of loss or damage will pass
to Buyer upon Buyer’s pick up for transfer of the Products ordered.

     

         SECTION 4.3. Prices. Pricing for the Products shall be as set
forth on Exhibit A, as such Exhibit may be modified from time to
time by agreement of the Parties, which shall at all times equal the prices
charged by Buyer to its customers for its Products, less a 5% discount. If Buyer
proposes to change the prices for Products charged to its customers for any
calendar year, the parties will discuss the consequences of such change for the
pricing of the Products under this Agreement, including the annual adjustment,
and shall agree in good faith to make such change as shall preserve the intended
economic benefits of this Agreement to each of the Parties. 

     

    -7- 

     

    

    
    

         SECTION 4.4. Payment Terms. 

     

              (a) Unless otherwise agreed to by the Parties in writing, Buyer shall make
payment separately for each Firm Order. Buyer shall pay the net amount of all
invoice amounts within sixty (60) days of the date of Manufacturer’s invoice
unless the terms of Manufacturer’s invoice permits later payment or allows for
prepayment with a discount. Invoices shall not be sent earlier than the date on
which the Products related thereto are delivered to Buyer. 

     

              (b) The Parties hereby agree that Manufacturer shall be entitled to realize a
Gross Profit (as defined below) with respect to the Products invoiced during
each calendar year equal to 25% of the aggregate Operational Cost of such
Products during such calendar year (the “25% Markup”). If the actual aggregate Gross Profit for
the Products invoiced during any calendar year is less than 25% of the aggregate
Operational Cost for such Products, Buyer will pay to Manufacturer an amount
equal to the difference between (x) the aggregate Operational Cost for such
Products multiplied by 25% and (y) the actual aggregate Gross Profit realized on
such Products. If the actual aggregate Gross Profit for the Products invoiced
during each calendar year is greater than 25% of the aggregate Operational Cost
for such Products, Manufacturer will pay to Buyer an amount equal to the
difference between (x) the actual aggregate Gross Profit realized on such
Products and (y) the aggregate Operational Cost for such Products multiplied by
25%. 

     

              (c) Within thirty (30) calendar days of the end of each calendar year,
Manufacturer shall furnish Buyer with a calculation, on an aggregate basis, of
the Gross Profit and Operating Cost for the Products invoiced during such
calendar year, together with back-up for such calculation in reasonable detail,
and a statement of the amount due to, or payable by, Manufacturer in accordance
with the provisions of subsection (a) above (the “Gross Profit Statement”). Thereafter, Manufacturer will provide
Buyer and its accountants with access to the records and employees of Buyer, to
the extent reasonably related to Buyer’s evaluation of the Gross Profit
Statement, the calculation of the Gross Profit or the resolution of any dispute
with respect thereto. Within fifteen (15) calendar days after Buyer’s receipt of
the Gross Profit Statement, Buyer shall notify Manufacturer in writing as to
whether Buyer agrees or disagrees with the Gross Profit Statement, which notice,
in the case of a disagreement, shall set forth in reasonable detail the
particulars of such disagreement. In the event that Buyer does not provide a
notice of disagreement within such fifteen (15) calendar day period, then Buyer
shall be deemed to have accepted the calculations and the amounts set forth in
the Gross Profit Statement delivered by Manufacturer, which shall be final,
binding and conclusive for all purposes hereunder. If any notice of disagreement
is timely provided in accordance with this Section 4.4(c), Buyer and Manufacturer shall each use
commercially reasonable efforts for a period of fifteen (15) calendar days
thereafter (or such longer period as they may mutually agree) to resolve any
disagreements with respect to the calculations in the Gross Profit Statement.
If, at the end of such period, Buyer and Manufacturer are unable to resolve any
disagreements as to items in the Gross Profit Statement, then the Parties shall
engage KPMG LLP (the “Auditor”) to resolve any remaining disagreements. The
Auditor shall be charged with determining as promptly as practicable, but in any
event within thirty (30) calendar days after the date on which such dispute is
referred to the Auditor, whether the actual Gross Profit as set forth in the
Gross Profit Statement was prepared in accordance with this Agreement whether
and to what extent the actual Gross Profit requires adjustment. The fees and
expenses of the Auditor shall be shared by 

     

    -8- 

     

    

    
    
     

    Buyer and Manufacturer
in inverse proportion to the relative amounts of the disputed amounts determined
in favor Buyer and Manufacturer, respectively. The determination of the Auditor
shall be final, binding and conclusive for all purposes hereunder. The date on
which the actual Gross Profit is finally determined in accordance with this
Section 4.4(c) is referred to as the “Determination Date.” 

     

              (d) Non-recurring Costs shall be charged by Manufacturer to Buyer as
incurred, and shall be paid by Buyer to Manufacturer within sixty (60) days of
receipt of the invoice therefore. Manufacturer shall provide such back-up and
detail with respect to any invoice for Non-recurring Costs as Manufacturer
reasonably requests. 

     

              (e) As used in this section— 

     

                   i. “Gross Profit” means net sales minus Operational Costs. 

     

                   ii. “Operational Costs” means the sum of direct labor costs, raw material
costs and other variable costs, indirect expenses (including without limitation
indirect supervisory costs and allocated use of utilities, space and similar
items), and fixed costs (including without limitation costs of periodic
requalification with the European Space Agency or any other Governmental
Authority and depreciation costs of new tools and equipment), but excluding
Non-recurring Costs. For the avoidance of doubt, costs and expenses of shipping,
insurance and other costs and expenses incurred in connection with the shipment
of the Products, shall constitute Operational Costs (as defined below) subject
to the 25% Markup. 

     

                   iii. “Non-recurring Costs” means costs incurred in connection with the
manufacture of Products on a one-time or one-off basis and shall include,
without limitation, costs of Product requalification with the European Space
Agency (other than periodic requalification costs as set forth in Section 4.5),
costs of complying with any change in specifications by the European Space
Agency, and costs of non-routine equipment maintenance (for example, other than
routine maintenance, including preventative maintenance, and calibration).

     

         SECTION 4.5. Last-Time Buy Order. 

     

              (a) Buyer shall have a right to place a written last-time Firm Order for a
Product (a “Last-Time Buy Order”) if Manufacturer delivers to Buyer notice of
its intention to terminate this Agreement pursuant to Section 7.2. The right of the Buyer to submit a Last-Time
Buy Order shall entitle Buyer to purchase the Products at the price in effect
for the products as of the time of Buyer’s exercise of such right. 

     

              (b) A Last-Time Buy Order shall specify (i) number of units of the Product to
be purchased and (ii) the requested delivery date or dates for such units. If
Manufacturer informs Buyer that it cannot honor the requested delivery dates
because of capacity restraints or otherwise, the Parties shall negotiate in good
faith with respect to delivery dates mutually acceptable to Manufacturer and
Buyer. 

     

              (c) The Parties hereby agree to use commercially reasonable efforts to
coordinate forecasting and ordering during the period between the date the
Last-Time Buy Order 

     

    -9- 

     

    

    
    

    is delivered to
Manufacturer and the final delivery date to allow for regular supply of Products
during such period. 

     

    ARTICLE V

CONFIDENTIALITY 

     

         SECTION 5.1. Manufacturer
and Buyer shall hold and shall cause each of their respective affiliates,
directors, officers, employees, agents, consultants, advisors and other
representatives to hold, in strict confidence and not to disclose or release
without the prior written consent of the other party, any and all proprietary or
confidential information, material or data of the other party that comes into
its possession in connection with the performance by the parties of their rights
and obligations under this Agreement. The provisions of Section 4.5 of the
Master Separation and Distribution Agreement between Vishay Intertechnology,
Inc. and Vishay Precision Group, Inc. (the “Master Separation Agreement”) shall govern, mutatis mutandis,
the confidentiality obligations of the parties under this Section. 

     

    ARTICLE VI

QUALITY CONTROL; PRODUCT WARRANTY; LIMITATION
OF LIABILITY 

     

         SECTION 6.1. Quality Control. Manufacturer shall establish and maintain
such quality control and testing systems for the manufacture of Products for
sale by Buyer to the European Space Agency (“ESA”) as shall be required by that customer,
consistent with past practice. Manufacturer shall also designate a technically
competent employee who shall be responsible for the Manufacturer’s quality
control and testing systems and who shall be available to ESA and the other
customers of Buyer for Products to respond to technical inquiries concerning the
Products, inquiries and claims concerning the compliance or non-compliance of
Products with specifications and customer standards and inquiries and claims
concerning quality control and testing issues, including product failure, with
respect to the Products. Manufacturer shall notify Buyer as promptly as
practicable, to the extent reasonable in the circumstances, of inquiries and
claims received from customers of the Buyer as aforesaid. 

     

         SECTION 6.2. Product Warranty; Merchantability
Warranty. 

     

              (a) Manufacturer warrants to Buyer that the Products shall, at the time of
delivery to Buyer in accordance with Section 4.2: (i) conform to the Specifications therefor,
as provided in Section 2.2; (ii) be free from material defects; and
(iii) be manufactured in accordance with good manufacturing practice and
Applicable Law (such warranty being referred to as the “Product Warranty”), in each case, except to the extent any
such material defect or failure arises from an act or omission of VAT in
manufacturing for, or supplying foil resistor chips to, Buyer. 

     

              (b) EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, NO WARRANTIES, OTHER
THAN THE PRODUCT WARRANTY, ARE EXPRESSED OR IMPLIED IN RESPECT OF THE PRODUCTS,
INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE. 

     

    -10- 

     

    

    
    

         SECTION 6.3. Defective or Non-Conforming Products;
Recalls. 

     

              (a) Claims by Buyer relating to the quantity of or damage to any Product or
the failure of any Product to conform to its Specifications must be made within
one (1) year of receipt of such Product and must be in writing, specifying in
reasonable detail the nature and basis of the claim and citing relevant control
or lot numbers or other information to enable identification of the Product in
question. Manufacturer’s liability to Buyer for damages for any such claim shall
be limited to a refund for the price of the defective Product plus shipping
costs or, at Buyer’s option, prompt replacement thereof with a Product that
complies with the Product Warranty. Such refund and shipping costs or a
replacement shall constitute Manufacturer’s sole and exclusive liability for
such claims. For the avoidance of doubt, nothing shall limit the obligations of
Manufacturer to Buyer in respect of third party claims against Buyer arising
from the failure of any Product to conform to its Specifications. 

     

              (b) Any notifications to either Party pursuant to Section 6.3(a) shall be subject to the confidentiality
provisions of Article V above. 

     

              (c) In the event of a recall of a Product resulting from a breach of this
Agreement by Manufacturer of this Agreement or the gross negligence of
Manufacturer, Manufacturer shall be responsible for all costs associated with
such recall. Except as otherwise provided in the immediately preceding sentence,
Buyer shall be responsible for all costs associated with the recall of a
Product. 

     

         SECTION 6.4. Indemnification. 

     

              (a) Subject to Section 6.5, Manufacturer shall indemnify and hold Buyer
harmless from and against any Liability, including reasonable attorney’s fees
and disbursements, arising out of any third party claim for death, injury or
damage to property resulting from (i) Manufacturer’s breach of this Agreement;
or (ii) any claim that a Product purchased from Manufacturer infringes any
intellectual property right of a third party, except to the extent such claim
relates to intellectual property transferred to Vishay Precision Group, Inc. or
any of its subsidiaries prior to the Distribution Date (as such term is defined
in the Master Separation Agreement). 

     

              (b) Buyer shall indemnify and hold harmless Manufacturer from and against any
Liability, including reasonable attorneys’ fees and disbursements, arising out
of any third party claim for death, injury or damage to property resulting from
use of any of the Products based upon Buyer’s breach of this Agreement.

     

              (c) Any Party seeking indemnification pursuant to this Section 6.4 shall promptly notify the other Party of the
claim as to which indemnification is sought, shall afford the other Party, at
the other Party’s sole expense, the opportunity to defend or settle the claim
(in which case the indemnifying Party shall not be responsible for the
attorneys’ fees of the indemnified Party with respect such claim) and shall
cooperate to the extent reasonably requested by the other Party in the
investigation and defense of such claim; provided, however, that any settlement of any such claim that
would adversely affect the rights of the indemnified Party shall require the
written approval of such indemnified Party; and provided further that an 

     

    -11- 

     

    

    
    

    indemnified Party shall
not settle any such claim without the written approval of the indemnifying
Party. 

     

              (d) The foregoing indemnification obligations shall survive any termination
or expiration of this Agreement, in whole or in part, or the expiration or
termination of the Term. 

     

         SECTION 6.5. Limitation of Liability. In no event shall any Party be liable for
any special, consequential, indirect, collateral, incidental or punitive damages
or lost profits or failure to realize expected savings or other commercial or
economic loss of any kind, arising out of any breach of this Agreement,
including breach of the Product Warranty, or any other obligations of any Party
hereunder, or any use of the Products, and each Party hereby knowingly and
expressly waives any claims or rights with respect thereto; provided, however, that in the event a Party is required to pay
to a third-party claimant any special, consequential, indirect, collateral,
incidental or punitive damages or lost profits or failure to realize expected
savings or other commercial or economic loss on any claim with respect to which
such Party is indemnified by the other Party pursuant to this Agreement, such
Party shall be entitled to indemnification from the other Party with respect to
such third-party special, consequential, indirect, collateral, incidental or
punitive damages or lost profits or failure to realize expected savings or other
commercial or economic loss to the extent resulting from the indemnifiable acts
or omissions of the other Party. 

     

         SECTION 6.6. Insurance. Each of the Parties shall maintain general
liability insurance covering their activities under this Agreement in accordance
with prudent and customary commercial practices, in such amounts as shall be
agreed upon from time to time by the Parties. 

     

    ARTICLE VII

TERM OF AGREEMENT; RENEWAL TERM;
TERMINATION 

     

         SECTION 7.1. Term of Agreement. Unless earlier terminated pursuant to
Section 7.2, the term of this Agreement shall be
perpetual. 

     

         SECTION 7.2. Termination. Either Party may terminate this Agreement at
any time upon prior written notice to the other at least one (1) year prior to
the requested date of termination. 

     

         SECTION 7.3. Rights Upon Termination. Following a termination of this Agreement,
(a) all further rights and obligations of the Parties under this Agreement shall
terminate, and (b) Buyer shall pay Manufacturer an amount equal to the remaining
book value (determined in accordance with accounting principles generally
accepted in the United States) of any equipment and tools purchased by
Manufacturer after the Distribution Date for the purpose of complying with this
Agreement. Notwithstanding the foregoing, the termination of this Agreement
shall not affect the rights and obligations of the Parties arising prior to such
expiration or termination; and provided further that the Parties shall not be relieved of (i)
their respective obligations to pay monies due or which become due as of or
subsequent to the date of expiration or termination, and (ii) any other
respective obligations under this Agreement which specifically survive or are to
be performed after the date of such expiration or termination, including the
provisions of Article V and Section 6.3. Any Firm Order, including a Last-Time Buy
Order, submitted prior to 

     

    -12- 

     

    

    
    

    the expiration or
termination of this Agreement shall be filled by Manufacturer pursuant to the
terms hereof even if the delivery date is after expiration or termination

     

    ARTICLE VIII

DISPUTE RESOLUTION 

     

         SECTION 8.1. The terms and
provisions of Article VIII of the Master Separation Agreement, relating to the
procedures for resolution of any disputes between the parties, shall apply to
all disputes, controversies or claims (whether sounding in contract, tort or
otherwise) that may arise out of or relate to or arise under or in connection
with this Agreement, or the transactions contemplated hereby, mutatis mutandis.

     

    ARTICLE IX

MISCELLANEOUS 

     

         SECTION 9.1. Assignment. This Agreement and the rights and
obligations of a Party hereunder shall be assignable or delegable, in whole or
in part, (i) by Manufacturer without the consent of Buyer, to a Wholly-Owned
Subsidiary of Manufacturer that succeeds to the conduct of the foil resistor
business responsible for supplying the Products; (ii) by Buyer without the
consent of Manufacturer, to a Wholly-Owned Subsidiary of Buyer; or (iii) by
either Party, to any Person who is not a Wholly-Owned Subsidiary of a Party only
with the prior written consent of the other Party; provided, however, that no such assignment shall relieve the
assigning Party of liability for its obligations hereunder. The following
actions shall not be deemed an assignment of this Agreement: (1) assignment or
transfer of the stock of a Party, including by way of a merger, consolidation,
or other form of reorganization in which outstanding shares of a Party are
exchanged for securities, or (2) any transaction effected primarily for the
purpose of (A) changing a Party’s state of incorporation or (B) reorganizing a
Party into a holding company structure such that, as a result of any such
transaction, such Party becomes a Wholly-Owned Subsidiary of a holding company
owned by the holders of such Party’s securities immediately prior to such
transaction. Any attempted assignment other than as provided herein shall be
void. The provisions of this Agreement shall be binding upon, and shall inure to
the benefit of, the successors and permitted assigns of the Parties.

     

         SECTION 9.2. Force Majeure. The Parties shall not be liable for the
failure or delay in performing any obligation under this Agreement (except
pursuant to Section 6.4) if and to the extent such failure or delay
is due to (i) acts of God; (ii) weather, fire or explosion; (iii) war, invasion,
riot or other civil unrest; (iv) governmental laws, orders, restrictions,
actions, embargoes or blockages; (v) action by any regulatory authority which
prohibits the manufacture, sale or distribution of the Products, except to the
extent due to Manufacturer’s breach of its obligations hereunder; (vi) regional,
national or foreign emergency; (vii) injunction, strikes, lockouts, labor
trouble or other industrial disturbances; (viii) shortage of adequate fuel,
power, materials, or transportation facilities; or (ix) any other event which is
beyond the reasonable control of the affected Party; provided, however, that the Party affected shall promptly
notify the other Party of the force majeure condition and shall exert its
reasonable commercial efforts to eliminate, cure or overcome any such causes and
to resume performance of its obligations as soon as possible. 

     

    -13- 

     

    

    
    

         SECTION 9.3. Intellectual Property. All Intellectual Property owned or created
by a Party shall remain its sole and exclusive property, and the other Party
shall not acquire any rights therein by reason of this Agreement. 

     

         SECTION 9.4. Entire Agreement. This Agreement and the Exhibits hereto
constitute the entire agreement between the Parties with respect to the subject
matter hereof and thereof and supersede all previous agreements, negotiations,
discussions, understandings, writings, commitments and conversations between the
parties with respect to such subject matter. No agreements or understandings
exist between the parties other than those set forth or referred to herein or
therein. If any provision of this Agreement or the application thereof to any
Party or circumstance shall be declared void, illegal or unenforceable, the
remainder of this Agreement shall be valid and enforceable to the extent
permitted by Applicable Law. In such event, the Parties shall use their best
efforts to replace the invalid or unenforceable provision with a provision that,
to the extent permitted by Applicable Law, achieves the purposes intended under
the invalid or unenforceable provision. 

     

         SECTION 9.5. Governing Law. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof to the extent such rules would require the application of the law of
another jurisdiction. 

     

         SECTION 9.6. Consent to Jurisdiction. Subject to the provisions of Article VIII, each of the Parties irrevocably submits to
the jurisdiction of the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan for the purposes of
any suit, action or other proceeding to compel arbitration, for the enforcement
of any arbitration award or for specific performance or other equitable relief
pursuant to Section 9.16. Each of the parties further agrees that
service of process, summons or other document by U.S. registered mail to such
parties address as provided in Section 9.10 shall be effective service of process for any
action, suit or other proceeding with respect to any matters for which it has
submitted to jurisdiction pursuant to this Section 9.6. Each of the parties irrevocably waives any
objection to venue in the federal and state courts located in Philadelphia,
Pennsylvania and the City of New York, Borough of Manhattan of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby for which it has submitted to jurisdiction pursuant to this Section 9.6, and waives any claim that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum. 

     

         SECTION 9.7. Independent Contractor. Nothing contained in this Agreement shall
constitute a Party as a partner, employee or agent of the other Party, nor shall
any Party hold itself out as such. Neither Party shall have the right or
authority to incur, assume or create, in writing or otherwise, any warranty,
Liability or other obligation of any kind, express or implied, in the name or on
behalf of the other Party, and each Party is and shall remain an independent
contractor, responsible for its own actions. Except as otherwise explicitly
provided herein, each Party shall be responsible for its own expenses incidental
to its performance of this Agreement. 

     

         SECTION 9.8. Set-Off. The obligation of Buyer to pay the purchase
price for Products shall be unconditional, except as provided in this Agreement,
and shall not be subject to any defense, setoff, counterclaim or similar right
against Manufacturer or any of its Affiliates that 

     

    -14- 

     

    

    
    

    could be asserted by
Buyer or any of its Affiliates under any other contract, agreement, arrangement
or understanding or otherwise under Applicable Law. 

     

         SECTION 9.9. Waivers. No claim or right arising out of or relating
to a breach of any provision of this Agreement can be discharged in whole or in
part by a waiver or renunciation of the claim or right unless the waiver or
renunciation is supported by consideration and is in writing signed by the
aggrieved Party. Any failure by any Party to enforce at any time any provision
under this Agreement shall not be considered a waiver of that Party’s right
thereafter to enforce each and every provision of this Agreement. 

     

         SECTION 9.10. Notices. All notices, demands and other
communications required to be given to a Party hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by a
nationally recognized overnight courier, transmitted by facsimile, or mailed by
registered or certified mail (postage prepaid, return receipt requested) to such
Party at the relevant street address or facsimile number set forth below (or at
such other street address or facsimile number as such Party may designate from
time to time by written notice in accordance with this provision): 

     

              If to
Manufacturer, to: 

     

                   Vishay
S.A. 
               c/o
Vishay Intertechnology, Inc. 
               63
Lancaster Avenue 
               Malvern,
PA 19355-2120 

    
      	               	Attention: 	Dr. Lior E. Yahalomi 
	
            	Telephone:  	610-644-1300  
	
            	Facsimile: 	610-889-2161 

    

     

              with a
copy to: 

     

                   Kramer
Levin Naftalis & Frankel LLP 
               1177
Avenue of the Americas 
               New
York, NY 10036 

    
      	               	Attention: 	Ernest S. Wechsler, Esq. 
	
            	Telephone:  	212-715-9100  
	
            	Facsimile: 	212-715-8000 

    

     

              If to
Buyer, to: 

     

                   Vishay
Precision Foil VPG GmbH 
               c/o
Vishay Precision Group, Inc. 
               3
Great Valley Parkway 
               Malvern,
PA 19355-1307 

    
      	               	Attention: 	William M. Clancy  
	
            	Telephone:  	(484)-321-5300  
	
            	Facsimile: 	(484)-321-5301 

    

     

    -15- 

     

    

    
    

              with a
copy to: 

     

                   Pepper
Hamilton LLP 
               3000
Two Logan Square 
               Eighteenth
and Arch Streets 
               Philadelphia, Pennsylvania
19103-2799

    
      	               	Attention: 	Barry Abelson, Esq. 
	
            	Telephone:  	215-981-4000 
	
            	Facsimile: 	215-981-4750 

 
          Any notice, demand or other communication
hereunder shall be deemed given upon the first to occur of: (i) the fifth
(5th) day after deposit thereof, postage prepaid
and addressed correctly, in a receptacle under the control of the United States
Postal Service; (ii) transmittal by facsimile transmission to a receiver or
other device under the control of the party to whom notice is being given; (iii)
actual delivery to or receipt by the party to whom notice is being given or an
employee or agent thereof; or (iv) one (1) day after delivery to an overnight
carrier. 

     

         SECTION 9.11. Headings. The headings contained herein are included
for convenience of reference only and do not constitute a part of this
Agreement. 

     

         SECTION 9.12. Counterparts. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered or transmitted
by facsimile, e-mail or other electronic means, shall be deemed to be an
original and all of which taken together shall constitute but one and the same
instrument. A facsimile or electronic signature is deemed an original signature
for all purposes under this Agreement. 

     

         SECTION 9.13. Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon such a suitable and equitable
provision to effect the original intent of the Parties. 

     

         SECTION 9.14. Waiver of Default. 

     

              (a) Any term or provision of this Agreement may be waived, or the time for
its performance may be extended, by the party or the parties entitled to the
benefit thereof. Any such waiver shall be validly and sufficiently given for the
purposes of this Agreement if, as to any party, it is in writing signed by an
authorized representative of such party. 

     

              (b) Waiver by any party of any default by the other party of any provision of
this Agreement shall not be construed to be a waiver by the waiving party of any
subsequent or other default, nor shall it in any way affect the validity of this
Agreement or any party hereof or prejudice the rights of the other party
thereafter to enforce each and ever such provision. No 

     

    -16- 

     

    

    
    

    failure or delay by any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. 

     

         SECTION 9.15. Amendments. No provisions of this Agreement shall be
deemed amended, modified or supplemented by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom it is sought to enforce such amendment,
supplement or modification. 

     

         SECTION 9.16. Specific Performance. The Parties agree that the remedy at law for
any breach of this Agreement may be inadequate, and that, as between
Manufacturer and Buyer, any Party by whom this Agreement is enforceable shall be
entitled to seek temporary, preliminary or permanent injunctive or other
equitable relief with respect to the specific enforcement or performance of this
Agreement. Such Party may, in its sole discretion, apply to a court of competent
jurisdiction for such injunctive or other equitable relief as such court may
deem just and proper in order to enforce this Agreement as between Manufacturer
and Buyer, or the members of their respective Groups, or prevent any violation
hereof, and, to the extent permitted by Applicable Law, as between Manufacturer
and Buyer, each Party waives any objection to the imposition of such relief.

     

         SECTION 9.17. Waiver of jury trial. Subject to Article VIII, each of the Parties
hereby waives to the fullest extent permitted by Applicable Law any right it may
have to a trial by jury with respect to any court proceeding directly or
indirectly arising out of and permitted under or in connection with this
Agreement or the transactions contemplated hereby. Each of the Parties hereby
(a) certifies that no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in the
event of litigation, seek to enforce the foregoing waiver and (b) acknowledges
that it has been induced to enter into this agreement and the transactions
contemplated by this agreement, as applicable, by, among other things, the
mutual waivers and certifications in this Section 9.17. 

     

    [SIGNATURE PAGE FOLLOWS] 

     

    -17- 

     

    

    
    

         IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first written
above. 

     

    
      	
            	MANUFACTURER:
	
            	
            	 
	
            	VISHAY S.A.
	
            	
            	 
	
            	By:   	/s/ Denis Maugest	 
	
            	
            	Name: Denis Maugest
	
            	
            	Title: Directeur General
	
            	 	 
 
	 	BUYER:	
            
	
            	
            	 	
            
	
            	VISHAY PRECISION FOIL GMBH
	
            	
            	 
	
            	By:	/s/ Kai Karstensen	 
	
            	
            	Name: Kai Karstensen
	
            	
            	Title: General
Manager

    

    -18- 

     

    

    
    

    EXHIBIT A 

     

    Products: Finished RCK Hi rel foil resistor products

     

    [***] 

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Portions of this exhibit were omitted and
filed separately with the Secretary of the 
Securities and Exchange
Commission pursuant to an application for confidential treatment 
filed with
the Securities and Exchange Commission pursuant to Rule 24b-2 under the

Securities Exchange Act of 1934. Such portions are marked by
[***]. 

     

    A-1

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