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\F3\C154 EAST DANA STREET
\CMOUNTAIN VIEW, CA. 94041
\F4\←L\-R\/'7;\+R\→.\→S   Telephone:
\←S\→.415-965-0557
\F1\CAugust 6,1976


Mr. Kenneth Hines
Everett Charles Co., Inc.
Pomona, California


Dear Mr. Hines:
\J

	I would like to bring Vicarm and my services into the Everett
Charles Co.   organization on the basis set forth  in this letter.  A
few underlying points bear mention at the outset.

	As  you already know, I am very  resistant to moving from the
San Francisco Bay area and  thus would strongly prefer to  remain near
to  where I  presently  am.   At the  present  time I  am  a Research
Assistant- PhD  Candidate  at  Stanford  University  in  the  special
program area  of Automation.   I  set up  this special  study area  a
couple  of years ago, and  am currently funded by  a National Science
Foundation grant through the  Artificial Intelligence Laboratory.   I
am  seriously  interested in  completing  this  PhD program  and  the
arrangement  I want to set up with  you should include some provision
for this.  To help me  achieve this goal, I have expressed to  you my
interest in  selling Vicarm to  Everett Charles Co., and setting  up a mutually
agreeable working arrangement.
	
	I propose the following terms and conditions:

	1.   Everett Charles Co. will  purchase all  of the  assets of  Vicarm,
including  machine  shop,  office  equipment, facility  improvements,
assembly jigs and fixtures,  test equipment, inventories of  finished
goods (one  demonstration arm), and other  inventory (excluding parts
needed  to complete our current orders)  for $50,000 which represents
my estimate  of  the market  value  of these  assets, including all outstanding shares of stock.
Furthurmore, Everett Charles Co. will pay  Vicarm
$100,000 for all of the rights to  trade secrets and know-how relating
to the manipulators. Everett Charles Co. will pay for these assets in cash at
the time  of  purchase; Vicarm  will  retain responsibility  for  all
liabilities it  has incurred.   Vicarm will represent and  warrant to
you that  it has marketable title to the assets described above, free
and clear of any liens or encumbrances, and that  it has authority to
effect  the  sale  of  such  assets  to  you.  Vicarm  will  complete
production of  existing  orders, and  retain  the proceeds  of  those
sales.

	2.   I will  agree to  become a  consultant to Everett Charles Co. for
three  years.  My interests  are in the area  of advanced manipulator
design and advanced manipulator  instrumentation and sensor design.   I
would like to see  my future work in these areas,  rather than in the
area  of manipulator  manufacture and  production.   Specifically,  these areas
would  include;  new manipulator  designs,  force  and  touch  sensor
systems, new end effectors, and manipulator related accessory devices
including vision systems, positioning tables, computer  based control systems, and  advanced
computer based program and control methods.

	a.   The services I will perform for Everett Charles Co. will be such of the following
as we agree upon;\.
		
		1)  Bringing to the attention of Everett Charles Co. new developments in
		the manipulator and sensor areas.

		2)  Supervise an R and D facility for Everett Charles Co. provided that
		I would have an operating budget of $100,000 per year 
		(including my consulting fees).

		3)  Industrialize the Vicarm products by providing design
		specifications, reliability testing and production drawings.

		4)  Develop applications of Vicarm products in conjunction
		with Everett Charles Co. products.

		5)  Advanced research in the areas described above which
		will be a part of my research at Stanford University.


\J	b.  I will be available for consultation  at least 6 days per
month, and will be paid $1000 per month during that time, regardless
of whether Everett Charles Co. employs any of that time.

	c.  If I consult for more than 6 days in any  calendar month,
I will be paid  $160 per day in addition to the  fee described in the
previous paragraph.

	d.  In addition to the foregoing payments, I will be paid, on
a quarterly basis, the following percentages of the net sales prices
of the M.I.T. Arm, the Stanford Arm, and sensors described in Vicarm's current sales 
literature:\.

		First and Second years after purchase		8%
		Third and Fourth years after purchase		6%
		Fifth and Sixth years after purchase		4%
		Seventh and Eighth years after purchase	2%


\J	The proposal in this letter is not intended to be an offer, but merely a 
statement of the basis from which a binding agreement could be prepared.  I will appreciate hearing your reaction to this proposal.\.

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Yours sincerely,



Victor Scheinman
    President

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