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Exhibit 10.22
TRITON NETWORK SYSTEMS, INC.
SUPPLY AGREEMENT
This Supply Agreement (the "Agreement") is made as of
April _, 2000 (the "Effective Date")
between Triton Network Systems, Inc., ("Seller", also referred to as "Triton")
a Delaware corporation with its principal place of business at:
8529 South Park Circle,
Orlando, FL; USA 32819
and
CAVU, Inc. ("Buyer" and includes Buyer's Affiliates) a Georgia corporation
with its principal place of business at:
4525 Vineland Road, Suite 209
Orlando, Florida; USA 32811.
In consideration of the mutual covenants contained herein, the Parties agree as
follows:
TRITON NETWORK SYSTEMS, INC. SUPPLY AGREEMENT NUMBER:_____
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ARTICLE 1. DEFINITIONS
As used in this Agreement, the following terms have the following meanings:
1.01 "ACCEPTED" with respect to the delivery of the Products to Buyer,
means that the applicable shipment has been inspected by Buyer, the
paperwork, including the packing list, accurately matches the shipment
and the shipment matches the Buyer's Purchase Order or other written
delivery instructions.
1.02 "AFFILIATE" means any entity listed in Exhibit 1, attached hereto or
any entity which is a parent or subsidiary of a Party or which is
controlled by or under common ownership or control of a Party.
1.03 "AGREEMENT" means this Supply Agreement and the Exhibits attached
hereto, as may be amended from time to time.
1.04 "ADDITIONAL TERM" has the meaning set forth in Article 3 of this
Agreement.
1.05 "ASSIGNMENT" means the form of Agreement as set forth in Exhibit 8 of
this Agreement, which will be signed by Buyer, Seller and any person
to whom Buyer assigns rights to any Products purchased pursuant to
this Agreement, which Products are used in a network sold or
transferred to Buyer.
1.06 [*]
1.07 "BASIC ANNUAL SOFTWARE SUPPORT FEE" has the meaning set forth in
subsection 8.03 of this Agreement.
1.08 "BASIC ANNUAL SOFTWARE SUPPORT" has the meaning set forth in
subsections 8.03 and 8.04 of this Agreement.
1.09 "CHANGE ORDER" has the meaning set forth in subsection 5.05(b) of this
Agreement.
1.10 "CONFIDENTIAL INFORMATION" means all information including, without
limitation, specifications, drawings, documentation, know-how, and
pricing information, of every kind or description, which may be
disclosed by either Party to the other Party in connection with this
Agreement, provided the disclosing Party shall clearly mark all such
information disclosed in writing as the confidential property of the
disclosing Party and the disclosing Party shall identify the
confidential nature of any such information which it orally discloses
at the time of such disclosure and shall provide a written summary of
the orally disclosed information to the recipient.
1.11 "DISABLING CODE" has the meaning set forth in subsection 13.05 of this
Agreement.
1.12 "DOCUMENTATION" means the system standard documentation provided to
Buyer, in written or electronic form, as set forth in Exhibit 2.08 of
this Agreement. All Documentation shall be subject to applicable
copyright and confidentiality restrictions.
1.13 "EFFECTIVE DATE" has the meaning set forth on the first page of this
Agreement.
1.14 "EQUIPMENT" means the hardware Products provided to Buyer as set forth
in Exhibit 2.01 of this Agreement. In addition to hardware developed
by the Seller, Equipment generally includes OEM Equipment and other
Third Party equipment, except as otherwise provided in this Agreement.
1.15 "EXPEDITED REPLACEMENT POLICY" has the meaning set forth in subsection
13.0 1(h) of this Agreement.
1.16 "F.O.B." means free-on-board.
1.17 "FORECAST" means the non-binding forecasts of Buyer's anticipated
orders for Products as set forth in Exhibit 6 of this Agreement, as
amended from time to time by Buyer.
1.18 "IFU" refers to Triton's Invisible Fiber(TM) unit.
1.19 "INITIAL TERM" has the meaning set forth in Article 3 of this
Agreement.
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1.20 "INSTALLATION SITE" means the location or locations where Buyer
installs the IFUs purchased pursuant to this Agreement.
1.21 "INTELLECTUAL PROPERTY" means patents, pending patents, patent
applications, know-how, drawings, engineering knowledge, manufacturing
procedures, manufacturing processes, ASIC or printed circuit masks,
circuit diagrams, and all other Intellectual Property rights
whatsoever embodied in the Product or system, regardless if it may be
patented.
1.22 "LATE SHIPMENT" has the meaning set forth in subsection 5.04(b)(xii)
of this Agreement.
1.23 "LICENSED SOFTWARE" means the Software that Buyer has licensed from
the Seller or the Seller's Affiliate pursuant to this Agreement.
1.24 "LIST PRICE" means the Seller's standard Product and/or Support price
before any discount, as may be available in price lists from time to
time.
1.25 "MARKETING MATERIALS" means Seller's brochures, flyers, Product
descriptions and other materials used to stimulate sales of Seller's
Products.
1.26 "MATERIAL CONFORMANCE WITH THE SPECIFICATIONS" means the Product is
(i) capable of being placed into revenue-producing service with no
significant restrictions on its abilities to perform its designed
function and (ii) performs in accordance with it's respective
Specifications.
1.27 [*]
1.28 "MINIMUM PURCHASE COMMITMENT" has the meaning set forth in subsection
4.01 of this Agreement.
1.29 "MINIMUM PURCHASE COMMITMENT CANCELLATION FEE" has the meaning set
forth in subsection 4.03 of this Agreement.
1.30 "NET PRICE" means the price the Buyer will pay after any applicable
discount or credit.
1.31 "NETWORK" means the collection of Triton wireless Equipment, together
with any Buyer supplied routing and switching equipment, configured in
multiple buildings, for the purpose of providing wireless
communication services.
1.32 "NEW PRODUCTS" has the meaning set forth in subsection 5.08 of this
Agreement.
1.33 "NOC SUPPORT" has the meaning set forth in subsection 9.03 of this
Agreement.
1.34 "NON-LICENSED SOFTWARE" means Software for which Buyer has not yet
obtained a license nor paid applicable Software License Fees, but
which Software may be included with Software loads delivered to Buyer
hereunder.
1.35 "PARTY" means either Buyer or Seller.
1.36 "PARTIES" means the Buyer and the Seller collectively.
1.37 "PRODUCTS" means, individually and collectively, the Equipment,
Software, and Documentation specified in Exhibit 2, attached hereto.
In addition any item Seller adds to its generally available standard
Product price list or so identifies to Buyer in a Quotation shall be
deemed incorporated into this Agreement upon the mutual agreement of
the Buyer and Seller, subject to additional terms and conditions
specified in the applicable Product Exhibit, if any.
1.38 "PURCHASE MODIFICATION FEE" has the meaning set forth in subsection
5.03(d) of this Agreement.
1.39 "PURCHASE MODIFICATION ORDER" has the meaning set forth in subsection
5.03(d) of this Agreement.
1.40 "PURCHASE ORDER" (PO) means a written, numerically controlled and
dated purchase authorization document issued by Buyer or Buyer
Affiliate to Seller or Seller Affiliate, specifying the types and
quantities of Products and/or Services to be furnished by Seller.
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1.41 "QUOTATION" means a written budgetary or firm price quotation or
"quoted", as specified in this Agreement, issued by Seller to Buyer
for the supply of any Products and/or Services pursuant to this
Agreement.
1.42 "RECEIVABLES" has the meaning set forth in subsection 17.02(b) of this
Agreement.
1.43 "RING ARCHITECTURE LICENSE" means that license granted by Seller to
Buyer to utilize Seller's method for configuring IFUs on multiple
buildings to provide redundancy and enhance system reliability.
1.44 "RMA" means "return materials authorization" and has the meaning set
forth in subsection 13.01(d) of this Agreement.
1.45 "SHIP DATE" means the date on which a Product ordered by Buyer is to
be shipped as agreed to by the Parties, or in the case of Software
which is available for download by Seller rather than, or in addition
to being physically shipped, the date upon which such Software is to
be downloaded to the Product or system.
1.46 "SHIPPING FACILITY" means Seller's shipping facility located in
Orlando, Florida, USA.
1.47 "SOFTWARE" means the Seller's proprietary and/or Third Party Software
computer programs provided to Buyer (consisting of firmware and logic
instructions in machine readable code residing in, or intended to be
loaded in computer memories which provide basic logic, operating
instructions and Seller-related Application instructions, but
excluding customer data) as well as the Documentation used to
describe, maintain and use the programs. Any reference herein to
Software being "sold," "purchased" or the like is understood to be a
reference in fact to the program being licensed.
1.48 "SOFTWARE LICENSE" has the meaning set forth in subsection 8.01 (a) of
this Agreement.
1.49 "SOFTWARE LICENSE FEE" has the meaning set forth in subsection 8.03 of
this Agreement.
1.50 "SOFTWARE RELEASE" means revisions to Software or new Software
containing enhancements, but specifically does not include new
features or new fractionality and/or certain problem fixes that may be
supplied by Seller to Buyer from time to time.
1.51 "SOURCE CODE" has the meaning set forth in subsection 8.11 of this
Agreement.
1.52 "SPECIFICATIONS" means the specifications and or practices set forth
in the Seller's standard Documentation or similar documents published
by Seller as amended from time to time, provided however that any
amendment to the Specifications will not reduce the functionality of
the Equipment. The current Specifications have been (or will be)
provided to Buyer.
1.53 "STANDARD INTERVAL" means the standard time prior to the shipment of a
Product following acceptance of a Purchase Order by Seller. Seller's
Standard Interval will be ninety (90) days for Forecasted quantities
and one hundred twenty (120) days for non-Forecasted quantities.
1.54 "SYSTEM" means a configuration of one or more Products, providing a
specified functionality that conforms to the applicable
Specifications, if any.
1.55 "TAC SUPPORT" means Technical Assistance Center support and has the
meaning set forth in subsection 9.01 of this Agreement.
1.56 "TERM" means the duration of this Agreement as set forth in Article 3
of this Agreement.
1.57 "TERRITORIES" has the meaning set forth in Exhibit 5 of this
Agreement.
1.58 "TEST ACCEPTANCE PROCEDURE" means those test procedures developed
from time to time by Seller which demonstrate the full functionality
of the Equipment, provided however, that any amendment to the test
procedures will not reduce the functionality of the Equipment. The
current Triton Test Acceptance Procedure is set forth in Exhibit 9 of
this Agreement.
1.59 "THIRD PARTY" means any individual or legal entity not including Buyer
and Seller or their respective Affiliates.
1.60 "THIRD PARTY EQUIPMENT" means any Equipment not of Seller's
manufacture as listed in the various Exhibits
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attached to this Agreement. In addition any Product Seller adds to its
generally available standard Third Party Equipment price list or so
identifies to Buyer in a Quotation shall be deemed incorporated into
this Agreement upon the mutual agreement of the Buyer and Seller,
subject to additional terms and conditions specified in the applicable
Exhibit, if any. Seller may also recommend Third Party Equipment that
is not included in the Exhibits or provided by the Seller. Any Third
Party Equipment recommended by but not sold by the Seller is not
covered under the terms and conditions set forth in this Agreement.
1.61 "THIRD PARTY SOFTWARE" means any Software not owned by Seller which is
included within licensed Software or non-Licensed Software.
1.62 "Y2K COMPLIANCE"- means Year 2000 compliance and has the meaning set
forth in subsection 13.05(c) of this Agreement.
ARTICLE 2. SCOPE OF AGREEMENT
2.01 This Agreement sets forth the term's and conditions under which Buyer
and its Affiliates set forth in Exhibit 1, attached hereto may order
Products from Seller and its Affiliates and Seller and its Affiliates
shall supply Products to Buyer and its Affiliates. Unless otherwise
set forth herein, any reference in this Agreement to Seller shall be
deemed to include its Affiliates. Buyer may use the Products itself,
or may use the Products to provide services to others or sell the
Products as part of a Network or to expand an existing Network,
subject to the terms and conditions of this Agreement. It is the
intention and understanding of the Parties that Buyer will not resell
or distribute Products purchased under this Agreement to Third
Parties. Notwithstanding the above, in the event Buyer installs
Seller's Products in a Buyer Network, such Network may be sold,
transferred or assigned by Buyer to Third Parties; provided however,
that Buyer's and Seller's rights and obligations under this Agreement
may only be assigned pursuant to an Assignment Agreement substantially
in the form of Exhibit 8.
2.02 Unless specifically stated otherwise, all references to money or
currency shall be in U.S. dollars and all documentation,
correspondence, and communication shall be in the English language.
ARTICLE 3. TERM
The initial term of this Agreement is three (3) years from the Effective Date
(the "Initial Term"). Following the Initial Term, this Agreement shall be
automatically renewed for successive one (1) year terms (each an "Additional
Term") provided, that Buyer commits to the annual purchase of [*] IFUs prior to
each Additional Term; and provided further, at any time beginning one year after
the expiration of the Initial Term, Buyer or Seller may terminate this Agreement
by providing ninety (90) days prior written notice to the other Party. Provided
further, if either Party materially breaches this Agreement and such breach
occurs, continues or remains uncured after thirty (30) days written notice of
such breach, the non-breaching Party may terminate this Agreement upon written
notice to the breaching Party.
ARTICLE 4. PURCHASE RIGHTS, COMMITMENTS AND PRIORITIES
4.01 Purchase Rights & Commitments
Subject to the terms and conditions contained herein, Seller agrees to sell and
Buyer and its Affiliates agrees to buy Products in accordance with the pricing
and benefits set forth in Exhibit 2, attached hereto. Before and during the
first twelve (12) months of the Initial Term of this Agreement, Buyer and its
Affiliates shall place Purchase Orders for [*] IFUs described in Exhibit 2.01
attached hereto, of which [*] IFUs shall be delivered to Buyer and/or its
Affiliates no later than December 31, 2000, and an [*] IFUs shall be delivered
to Buyer no later than June 30, 2001 (the "Minimum Purchase Commitment").
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4.02 Cancellation of Purchase Commitments
Buyer may, without any further liability to Seller, cancel its Minimum Purchase
Commitment upon the occurrence of any of the following events:
(a) Seller materially breaches this Agreement and such breach
recurs, continues or remains uncured after thirty (30) days
written notice to Seller from Buyer of such breach;
(b) If more than [*] of the Products fail to meet performance
requirements as set forth in the Specifications during the
first twelve (12) months of this Agreement;
(c) Seller files a voluntary petition in bankruptcy or has an
involuntary petition in bankruptcy filed against it that is
not dismissed within forty-five (45) days of such involuntary
filing; Seller admits the material allegations of any
petition in bankruptcy filed against it; Seller is adjudged
bankrupt; Seller makes a general assignment for the benefit
of creditors; if a receiver is appointed for all or a
substantial portion of Seller's assets and such receiver is
not discharged within sixty (60) days of his/her appointment;
or Seller commences any proceeding for relief from its
creditors in any court under any state insolvency statutes;
(d) Buyer is enjoined from using any Products and Seller is
unable to cure the effects of such injunction pursuant to
subsection 14.02 herein;
(e) Seller fails to ship to Buyer [*] of the quantity of Products
set forth in an accepted Purchase Order [*] (which Products
conform with Specifications) within fifteen (15) days after
the Ship Date set forth in such accepted Purchase Order;
(f) Seller materially disregards or materially violates any
applicable laws;
(g) The Specifications or the price is materially changed due to
the effect of changes in government regulations which require
such change;
(h) A force majeure event which impedes Seller's performance
hereunder continues for a period of thirty (30) days
(regardless of whether, as a result of such event, Buyer
cancels any Purchase Order in accordance with subsection 5.06
herein.)
4.03 Failure to Meet Minimum Purchase Commitment
If Buyer fails to take delivery of Equipment that Seller has shipped in
accordance with accepted Purchase Orders (or later cancels such Purchase
Orders), (other than pursuant to subsection 4.02 or 5.06 (d) herein) that would
satisfy the Minimum Purchase Commitment by December 31, 2000 and June 30, 2001,
respectively, Buyer shall pay to Seller a penalty equal to [*] of the purchase
price of the lowest priced Equipment (currently the 38Ghz IFU Equipment)
multiplied by the number of undelivered IFUs (hereinafter referred to as the
"Minimum Purchase Commitment Cancellation Fee"). The Minimum Purchase Commitment
Cancellation Fee shall not be applicable if the reason for Buyer's failure to
satisfy the Minimum Purchase Commitment was solely due to Seller's failure or
inability to ship Equipment ordered by Buyer, by the respective Minimum Purchase
Commitment due dates of December 31, 2000, and June 30, 2001. The Minimum
Purchase Commitment Cancellation Fee shall be Seller's sole remedy (subject to
Article 3 and section 5.06(b)) in the event Buyer fails to take delivery of the
Equipment in accordance with this section 4.03.
4.04 [*]
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[*]
ARTICLE 5. TERMS OF PURCHASE
5.01 Pricing
(a) The pricing of the Products and Services is set forth in
Exhibit 2, attached hereto, plus applicable taxes, unless
otherwise agreed to between the Parties in writing, or in the
event of regulatory change as specified in this subsection
5.01 (a). The prices set forth in Exhibit 2, attached
hereto, for Seller manufactured Equipment are based on
Seller's design, manufacture, and delivery pursuant to its
design criteria and manufacturing processes and procedures in
effect on the Effective Date of this Agreement. If, solely as
a result of the imposition of requirements by any Federal,
State or local government during the Initial Term there is a
change in such criteria, processes or procedure or any
material change in the Equipment, the prices may be adjusted
by Seller to reflect the added cost and expense of such
change(s). Any OEM Equipment or other Third Party Products
identified in Exhibit 2 and delivered by Seller shall be
furnished subject to the applicable vendor's then-current
terms, conditions and specifications.
(b) All prices listed in Exhibit 2 and Quotations, unless
otherwise noted, are based upon shipment F.O.B. Seller's
Shipping Facility, and excludes any and all prepayment of all
freight, insurance, duties, taxes (more specifically
including but not limited to excise, sales, value added,
goods & services, and usage taxes), and any and all other
levies as might be incurred after the F.O.B. point.
(c) [*]
5.02 Payment
(a) Equipment and Documentation Payment - Payment of the full
purchase price for Equipment and Documentation shall be due
within [*] days of the later of: Seller's (i) shipment of the
applicable Equipment or (ii) issuance of an invoice for the
applicable Equipment.
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Notwithstanding any other provision herein, in the event
that, (i) Buyer fails to make timely payment for Equipment
and Documentation pursuant to this subsection 5.02(a), and
(ii) Buyer does not make payment to Seller for all applicable
Products within fifteen (15) days after receipt by Buyer of
written notice from Seller of such failure, Seller shall have
no obligation to ship any Products to Buyer hereunder until
such time as Buyer remits such delinquent payment to Seller.
(b) Software and Service Payment - Payment of the full purchase
price for the Software and any services referenced in this
Agreement shall be due within [*] days of issuance of Seller's
applicable invoice.
(c) Support Payment - Payment for Support ordered by Buyer shall
be due within [*] days of the date of issuance of Seller's
invoice.
(d) Timely Payment - Past due amounts shall bear interest from
the expiration of the applicable payment period at the rate
of one and one-half percent (1/2%) per month (or such lesser
rate as may be the maximum permissible rate under applicable
law).
(e) Security Interest - Until the total amount due under each
Purchase Order is paid in full, Seller hereby retains and
Buyer hereby grants to Seller a security interest in the
Products delivered to Buyer. Buyer agrees to promptly execute
any documents requested by Seller in order to perfect and
protect such security interest. In addition, prior to payment
in full of the total amount due under each Purchase Order,
Buyer agrees that it shall not, without the prior written
consent of Seller,
(i) sell or lease the Products subject to the applicable
Purchase Order (or license or sublicense the
Software); or
(ii) allow any liens or encumbrances (other than liens
subordinate to Sellers security interest), to attach
to the Products subject to the applicable Purchase
Order.
(f) Release of Security Interest - Upon full payment of the
amounts due for any Product, Seller shall immediately release
its security interest in such Products and promptly file all
documents required to release such security interest.
(g) Taxes - Buyer's price for Products does not include any
taxes, duties or charges of any kind imposed by any federal,
state or local governmental entity on the sale or shipment to
Buyer of Products, excluding only those taxes based solely on
Seller's net income. When Seller has the legal obligation to
collect such taxes, the appropriate amount shall be added to
Buyer's invoice and shall be paid by Buyer unless Buyer
provides Seller with a valid tax exemption certificate
authorized by the appropriate taxing authority.
5.03 Purchase Orders
(a) Generally - All purchases pursuant to this Agreement shall be
made by means of a written Purchase order issued from time to
time by Buyer and accepted by Seller in writing. Any Purchase
Order issued by Buyer to Seller for Products shall be
governed in all respects by the terms and conditions of this
Agreement. Buyer and Seller agree that except for
non-conflicting administrative terms as provided for below,
any additional or preprinted terms or conditions on a
Purchase Order shall be null, void and of no effect. Each
Purchase Order shall include the following information, in
addition to other appropriate information as may be mutually
agreed upon by the Parties:
(i) name and address of Buyer, or Buyer Affiliate;
(ii) Buyer Purchase Order number and Purchase Order date
of issuance;
(iii) name and address of Seller, or as appropriate,
Seller Affiliate, that will be providing the Product
being ordered;
(iv) incorporation within, by reference, of this
Agreement;
(v) types and quantities of Products and/or Services to
be furnished by Seller as set forth in Exhibit 2,
attached hereto, or as provided in a Quotation;
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(vi) applicable prices, charges, and fees with respect to
such Products as set forth in Exhibit 2, attached
hereto, or as provided in a Quotation;
(vii) location or facility to which Product is to be
delivered;
(viii) Ship Date of Product;
(ix) billing address of the Party responsible for the
payment whether such responsible party is the Buyer,
or Buyer Affiliate to which Buyer intends to resell
the Product, if any, which shall be an Affiliate set
forth in the Exhibit 1, attached hereto;
(x) proper authorization of Buyer or Buyer's agent; and
(xi) specification of the List Price and Net Price of the
Product.
A form Purchase Order is attached hereto as Exhibit 7.
(b) Acceptance of Purchase Orders - Seller shall accept all
Purchase Orders submitted by Buyer under this Agreement
except for those Purchase Orders which (i) are missing the
material terms required to be included in a Purchase Order as
set forth in subsection 5.03(a) above, or (ii) have Ship
Dates that materially vary from Seller's Standard Intervals.
Without limiting the foregoing, all Purchase Orders shall be
deemed to have been accepted by Seller unless (i) Seller
notifies Buyer in writing within [*] business days of Seller's
receipt of the applicable Purchase Order, such notification
stating that Seller will not accept the Purchase Order, and
(ii) Seller rightfully declines to accept such Purchase Order
pursuant to the provisions contained in the first paragraph
of this subsection 5.03(b). [*]
(c) Validity of Purchase Orders - A Purchase Order submitted
pursuant to the terms and conditions of this Agreement, and
which Seller has accepted, shall constitute an Agreement
between the Buyer and the Seller or applicable Seller
Affiliate. Any Purchase Order which Seller rightfully rejects
and for which Seller gives timely notice of rejection shall
be deemed void.
(d) Changes to Purchase Orders -Buyer may at any time request
additions, alterations, deductions, or deviations to a
Purchase Order. However, such change requests must be
mutually agreed upon by the Parties, and if so agreed, such
agreement must be set forth in a written revision to the
applicable Purchase Order ("Purchase Modification Order")
signed by a designated Buyer representative and Seller
representative.
Purchase Modification Orders which are processed outside of
Seller's customary processing cycle or which require
additional work by Seller to comply with such changes, may be
subject to a reasonable modification fee ("Purchase
Modification Fee") provided that Seller has given Buyer a
written quote for such Purchase Modification Fee and Buyer
and Seller have mutually agreed to such Purchase Modification
Fee in writing prior to or concurrent with the execution of
the Purchase Modification Order. If Buyer fails to accept the
Purchase Modification Fee, Seller has no obligation to accept
or comply with the Purchase Modification Order.
(e) Issuance Mode of Purchase Orders - Purchase Orders may be
issued either electronically or via traditional manual
methods as mutually agreed to by the Parties.
5.04 Delivery.
(a) Terms of Delivery - Delivery of Products under this Agreement
shall be F.O.B. Seller's Shipping Facility. The Seller shall:
(i) be responsible for and arrange for shipment of the
Products to Buyer's site as specified in the applicable
Purchase Order; (ii) prepay all shipping and handling charges
for the Products; and (iii) invoice Buyer for such charges
upon shipment of all the Products specified in the applicable
Purchase Order. Buyer shall reimburse Seller for such charges
at Seller's actual cost.
If any Product is lost or damaged in transit, then Seller
shall use all commercially reasonable best
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efforts to repair or supply a permanent replacement Product
within the shortest possible time on the same price and terms
as applicable to the original Purchase Order. [*] Buyer shall
be responsible for payment of any invoice relating to such
lost or damaged Products, whether or not such Products are
covered by insurance. With respect to the replacement Product,
Seller will invoice Buyer, but will defer Buyer's obligation
to pay for such replacement Product for a period of [*] in
order to process any insurance claims. Buyer remains
obligated to pay for such replacement Products.
(b) Conditions of Shipment - All shipments are subject to the
following conditions:
(i) Partial shipments or early shipments may only be
sent by Seller if Buyer has approved such partial or
early shipments in writing in advance;
(ii) Seller shall notify Buyer via e-mail or facsimile
when orders are shipped;
(iii) Packing slips shall Accompany shipment and shall
include serial numbers, when available, in barcode
and human readable format and shall reference
Buyer's Purchase Order number;
(iv) The outside of packing cartons shall be clearly
marked with (i) Model name or number, (ii) part
number, (iii) serial number, when applicable, in
barcode when available and human readable format and
(iv) Buyer Purchase Order number;
(v) Shipment via truck load or less than truck load
shall be stretch wrapped on pallets with markings
facing outwards;
(vi) Buyer may reject shipments that do not materially
comply with the preceding shipping requirements;
(vii) Buyer shall inspect the Seller Product upon delivery
and shall advise Seller in writing of any obvious
physical defects, discrepancies, and/or shortages
observed between the Product physically inspected
and the corresponding Product shipment packing list
provided by the Seller. Buyer shall issue to Seller
a defect/discrepancy written report within ten (10)
business days of receipt of Product. If no such
report is issued to Seller within ten (10) business
days the Buyer shall be deemed to have Accepted the
Products as delivered;
(viii) Seller shall not ship Products more than five (5)
business days prior to the requested and accepted
Ship Date set forth in the Purchase Order without
the consent of Buyer. Subject to the immediately
preceding sentence, in the event Seller ships
Products to the Buyer, unless Buyer requests the
earlier date, prior to the Ship Date in the Purchase
Order, Seller shall provide Buyer with reasonable
advance notice of the date on which Seller intends
to ship such Products, provided that no payment is
required until thirty (30) days after the previously
scheduled Ship Date;
(ix) In the absence of specific shipping instructions
from Buyer, Seller may ship by the method it deems
most advantageous;
(x) Buyer shall store all Products at the proper
temperature and other environmental conditions, as
specified in the Specifications, to maintain Product
quality. In the event of damage to any Product, by
reason of improper storage, thereby rendering
Product unfit for intended use, Buyer shall promptly
notify Seller in writing of the facts, and shall not
use such Product except as directed by Seller;
(xi) Seller shall have no obligation to ship Products to
Buyer if Buyer is in violation of its payment
obligations hereunder (and such failure to pay is
not due to Seller's breach of its obligations
hereunder), provided further, that if Buyer raises a
good faith dispute as to any single invoice
obligation, Seller will continue to ship Products to
Buyer (subject to Buyer's obligation to timely pay
for such Products),
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for a period of [*] from the date of the
shipment of the Products which are the subject of the
payment dispute, after which Seller may discontinue
all shipments to Buyer if the dispute is not resolved
as of the [*] day;
(xii) [*]
(xiii) Title to Product (excluding Software) and risk of
loss shall pass to Buyer upon delivery of the Product
to the carrier at the Seller's Shipping Facility
subject to Seller's security interest in the Product.
5.05 Equipment Changes
(a) Changes - Up to [*] prior to the scheduled Ship Date (or such
later time as agreed to by Seller), Buyer may request
Equipment addition(s) or deletion(s) to an original Equipment
configuration.
(b) Change Order - Except as provided in this Agreement, all
changes shall be documented in a written change order ("Change
Order") which shall be executed by Buyer and returned to
Seller prior to implementation of the requested changes. The
Change Order shall detail any and all adjustments required by
Buyer for any aspect of its performance under this Agreement.
(c) Adjustment to Equipment Price for Changes - Price calculations
for any Equipment reconfigurations prior to the Ship Date
shall be based on Prices as quoted by Seller based on the
requested Buyer Change Order, provided that any deletions
shall include applicable discounts; and, provided further,
that the net cumulative amount of changes shall not reduce the
price of a Purchase Order by more than ten percent (10%).
5.06 Cancellation
(a) Subject to subsection 5.06(b), upon written notice to Seller,
Buyer may cancel all or any part of a Purchase Order if Seller
receives a written and dated Purchase Order cancellation
notice prior to the applicable Ship Date.
(b) Buyer shall pay cancellation charges based on the date a
Purchase Order cancellation notice is received by the Seller.
Such cancellation charges shall not exceed the schedule as
shown below. Seller may
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make a claim for cancellation charges and shall make such a
claim in writing to Buyer within thirty (30) days of Seller's
receipt of a Purchase Order cancellation notice from Buyer.
<TABLE>
<CAPTION>
DAYS PRIOR NOTICE OF PO CANCELLATION PO CANCELLATION CHARGE
------------------------------------ ----------------------
<S> <C>
o Within 30 days of Seller's Receipt
of Purchase Order [*]
o Greater than 60 days before Ship Date [*]
o Between 30 days and 60 days before
Ship Date [*]
o Less than 30 days before Ship Date [*]
</TABLE>
(c) Buyer may not cancel a Purchase Order after the Ship Date.
(d) In the event that [*] days after the requested Ship Date for
any Purchase Order Seller has not shipped the Products
subject to such Purchase Order, Buyer shall have the right to
cancel such Purchase Order without cost or charge upon
written notice to Seller by facsimile, e-mail or otherwise,
which written notice is received by Seller prior to Shipment.
Seller shall notify Buyer via e-mail if Seller is unable to
ship Products on the Ship Date. Seller shall pay any
additional costs required to expedite late shipment.
(e) Seller's sole remedy (subject to Article 3) for Buyer's late
cancellation of a Purchase Order pursuant to section 5.06(b)
shall be the Cancellation Charges imposed under that section.
5.07 Invoicing
Each invoice shall include the following information:
(a) Buyer's Purchase Order number;
(b) Seller's invoice number;
(c) quantity and price of each Product shipped or services
rendered;
(d) applicable sales or other tax;
(e) freight charges (if applicable);
(f) final total cost; and
(g) invoices shall be issued upon shipment.
5.08 New Products
If Seller develops products other than the Products referenced in
Exhibit 2, attached hereto, ("New Products"), Seller agrees to negotiate in good
faith with Buyer for volume discount pricing on such New Products and if pricing
is agreed upon, to enter into a supply agreement on substantially the same terms
and conditions as this Agreement, or amend this Agreement to include such New
Products, as mutually agreed by the Parties.
ARTICLE 6. [*]
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[*]
ARTICLE 7. PRODUCT CHANGES
With respect to any Purchase Orders issued under this Agreement, notwithstanding
any other provisions contained herein, Seller reserves the right, without prior
approval from, but with notice to, Buyer, to (i) make changes in the Products in
whole or in part, or in the related Specifications or other related
Documentation, or (ii) substitute Products of later design at any time prior to
delivery thereof, provided that such changes do not materially adversely affect
performance or function, or increase the price of Products, provided that the
changed or substituted Products meet or exceed Specifications. Such changes
and/or substitutions do not obligate Seller to make any changes in the Products
previously delivered to Buyer unless such changes affect the interoperability of
Products, in which case such changes to previously delivered Products will be
made at Seller's expense in order to maintain the interoperability and
functionality of such Products.
ARTICLE 8. SOFTWARE LICENSING
8.01 Grant of License
(a) Software License
With respect to Software and Documentation acquired under this
Agreement and upon payment of the applicable Software license
fees (if any), Seller shall grant to Buyer a non-transferable
(except as otherwise provided herein), non-exclusive license
to use the Software and Documentation in accordance with the
terms set forth below ("Software License"). Buyer is granted
no title or ownership rights to the Software or Documentation,
which rights shall remain with Seller or Seller's suppliers,
as applicable. This Software License does not entitle Buyer to
the receipt or use of, or access to, Software source code or
any right to reproduce the Software or Documentation except as
set forth herein. Buyer agrees that it shall not decompile,
reverse engineer or otherwise attempt to gain access to the
Software Source Code. The obligations of Buyer under this
section shall survive the expiration or termination of this
Agreement. Notwithstanding the foregoing, Buyer may reproduce
or copy Software or Documentation for installation, back-up or
archival purposes and may provide such copies to Third Parties
who provide installation or maintenance services for Buyer.
Buyer will notify Seller in the event it provides copies of
Software to Third Parties.
(b) Ring Architecture License
Seller hereby grants to Buyer a non-exclusive license to use
Seller's proprietary Ring Architecture ("Ring Architecture
License"). Seller shall provide this Ring Architecture License
to Buyer at no cost to Buyer. Buyer may also sublicense this
Ring Architecture License to Third Parties that purchase a
network from Buyer which utilizes Seller's Products. Such
sublicense shall be at no cost to Buyer or Third Party
provided that the sublicense is for use of the Ring
Architecture in an existing network and not a newly created
network unless created in coordination with Buyer.
Title and ownership rights to Seller's Ring Architecture shall
remain in Seller. This Ring Architecture License does not
entitle Buyer to receipt of, use of, or access to the Ring
Architecture's source code, or any right to reproduce the Ring
Architecture. Buyer agrees that it shall not decompile,
reverse engineer or otherwise attempt to gain access to the
Ring Architecture source code. The obligations of Buyer under
this section shall survive the expiration or termination of
this Agreement.
8.02 Condition Precedent to grant of Licenses and Supply of Software
As a condition precedent to the grant of the above-stated licenses and
to the supply of Software by Seller pursuant to this Agreement, Seller
requires Buyer to give proper assurances to Seller for the protection
of the Software as required in this Agreement. Accordingly, all
Software supplied by the Seller shall be treated by Buyer as the
exclusive property, and to the extend not publicly available, as
proprietary and as a trade secret,
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of Seller and/or its suppliers, as appropriate.
8.03 Software License and Support Fees
Buyer shall pay to Seller an initial software license fee which shall
be pro-rated on a twelve (12) month basis at [*] of the applicable IFU
cost. Such initial software license fee shall be payable within [*] of
Seller's issuance to Buyer of the applicable IFU invoice. Thereafter,
Buyer shall pay to Seller a [*] basic annual Software support fee
("Basic Annual Software Support Fee") for basic annual support of the
Software ("Basic Annual Software Support") as set forth in Exhibit
2.07, attached hereto. Price and payment of the Basic Annual Software
Support Fee shall be subject to the terms and conditions as set forth
in Exhibit 2.06, attached hereto.
Buyer must pay the Basic Annual Software Support Fee in order to obtain
Software, Software updates and Software Releases and any other Software
support set forth in Exhibit 2,07, attached hereto.
8.04 Software Support
Basic Annual Software Support shall include Software, Software updates,
Software Releases and all other Seller provided Software necessary to
operate the Products in Buyer's network, in addition to the support set
forth in Exhibit 2.07, attached hereto. Moreover, Basic Annual Software
Support shall provide Buyer with access to the IFU Link Manager and the
IFU Software. Seller shall also make available to Buyer up-to-date
copies of the IFU Link Manager and IFU Software. The terms in this
subsection 8.04 are conditioned upon Buyer being current on all
applicable Basic Annual Software Support Fees.
8.05 Scope of Software License
Upon Buyer's payment of the Software License Fee and the applicable
Basic Annual Software Support Fee, Buyer shall be granted a perpetual,
non-exclusive, transferable (subject to the provisions of this
Agreement), non-assessable, unlimited-user, paid-up Software License
to:
(a) use such features contained in the release of the Software
furnished;
(b) use and make adaptations of the Software (or any part
thereof), subject to the provisions of this Software License,
provided that any such adaptations are created as an integral
step in the use of the Software in conjunction with a Product
and that it is not used in any other manner;
(c) make as many copies of the Software and any related
Documentation as Buyer deems necessary for its use, archival
purpose, or test purposes, including use by Third Parties who
are acting under the control and direction of Buyer; and
(d) use the associated Software Documentation.
Buyer agrees that this Software License is subject to its continued use
on and ownership of the Equipment upon which such Software is installed
and that Buyer shall have the right to sell, pledge as security, or
otherwise transfer the Equipment upon which the Software resides,
provided the transferee agrees to be bound by the terms of the Software
License granted to Buyer under this Agreement. Buyer shall be granted
no title or ownership rights to the Software, which rights shall remain
in Seller or its suppliers, as appropriate, and upon sublicense of the
Software by Buyer, the terms of this Software License shall apply to
the transferee.
8.06 Interest in Software
All Software supplied by Seller under or in implementation of this
Agreement shall be treated by Buyer as the exclusive property, and as
proprietary and a trade secret, of Seller and/or its suppliers, as
applicable.
8.07 Non-Licensed Software
Certain Software delivered by Seller may include non-Licensed Software
("Non-Licensed Software"). Non-Licensed Software includes:
(a) any Software for which the Software License Fee and the
applicable Basic Annual Software Support Fees have not been
paid; and
(b) Software for which a periodic Basic Annual Software Support
Fee has expired and the applicable
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additional Basic Annual Software Support Fees have not been
paid.
Buyer shall submit to Seller a Purchase Order for any Non-Licensed
Software that Buyer desires to license.
When Non-Licensed Software is placed into service, the applicable
Software License Fee, if any, shall be due and payable. Buyer shall
also have the option to pay the applicable Basic Annual Software
Support Fees for any Non-Licensed Software upon installation of a
Software load containing such Non-Licensed Software.
To ensure Buyer's proper activation and/or usage of only the
appropriate Software, Buyer shall complete the appropriate notification
to Seller, according to the then designated Seller procedure, prior to
the activation and/or usage by Buyer of any Non-Licensed Software.
Buyer shall identify all Software desired to be activated and/or used
in each System and shall transmit such information to Seller.
8.08 Software Releases
Software Releases shall be made available to Buyer as part of the Basic
Annual Software Support Fee and [*]. The Software Releases may be
updated periodically throughout the Initial Term of this Agreement. [*]
8.09 Software and Technical Support
Seller shall provide Buyer with Software support and technical support
subject to payment of any applicable fees, as set forth in Exhibit 2.07
and Exhibit 2.05 respectively, attached hereto, provided that Buyer
maintains the Software for at least two (2) previous Software Releases
to the then current Software Release or as otherwise specified in this
Agreement.
8.10 Escrow
[*] place a copy of all Software source code, including copies of the
source code for any upgrades or new releases developed by Seller in
the future when they are available (collectively "Source Code"), with
an independent escrow agent reasonably acceptable to Buyer along with
written escrow instructions to deliver all Source Code to Buyer upon
request from Buyer without further instructions in the event Seller
declares bankruptcy, or is involuntarily bankrupt. The Source Code
shall be designated in writing as being held in escrow for Buyer. The
escrow agent shall hold the Source Code for the Initial Term of the
Agreement. If, at any time, Seller declares bankruptcy, or is
involuntarily bankrupt, upon notice from Buyer, the escrow agent shall
immediately transfer the Source Code to Buyer. Possession of the
Source Code does not give Buyer any rights to sell, rent or lease the
Source Code or Software to Third Parties.
8.11 [*]
[*]
ARTICLE 9. SUPPORT COMMITMENTS
9.01 TAC Support
Seller shall provide Buyer with [*] Technical Assistance Center support
("TAC Support")(as specified in Exhibit 2.03, attached hereto)), for
[*] from the Effective Date of this Agreement [*]. After such [*]
period, Seller shall provide Buyer with [*] TAC Support (as specified
in Exhibit 2.03, attached hereto), for [*]. Thereafter, Seller shall
make available to Buyer and Buyer's Affiliates [*] TAC Support as
selected by Buyer or Buyer's Affiliates at the prices set forth in
Exhibit 2.03, attached hereto.
The [*] TAC support commitment provided for in this subsection 9.01 is
conditioned upon Buyer satisfying its Minimum Purchase Commitment.
9.02 Technical Support
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Seller will make available to Buyer continuing technical support as set
forth in Exhibit 2.05, attached hereto, for the [*]. After such [*],
Seller shall provide Buyer with continuing technical support at the
prices set forth in Exhibit 2.05, attached hereto. The technical
support provided for in this subsection 9.02 shall be limited to the
Buyer only, and shall not be made available to Buyer's Affiliates.
9.03 NOC Support
Seller will provide Buyer with Network Operations Center support ("NOC
Support") (as set forth in Exhibit 2.04, attached hereto)), [*]
following the date of Buyer's installation of the first [*] IFUs
purchased by Buyer, or sooner if requested by Buyer. After such [*],
Seller shall have no obligation to provide Buyer with continuing NOC
Support. Seller will make such NOC Support available to Buyer on [*]
basis for the [*] of Buyer's installation of the first [*] IFUs
purchased by Buyer, or sooner if requested by Buyer. However, the NOC
Support provided for in this subsection 9.03 shall be limited to Buyer
only, and shall not be made available to Buyer's Affiliates.
9.04 All of Seller's support obligations under paragraphs 9.01 and 9.03
above, are conditioned upon Buyer providing Seller with remote access
to Buyer's Networks (to the extent necessary), when and as support is
needed.
ARTICLE 10. BUYER TRAINING
For every [*] IFUs delivered to Buyer and/or Buyer's Affiliates during the
Initial Term of this Agreement, Seller shall make available to Buyer or Buyer's
designees, [*], however, such training days will only be applied to a maximum
of [*] IFUs (i.e., in the event Buyer purchases [*] then Seller will make
available to Buyer a maximum of [*] training days); however, should Buyer
purchase in excess of [*] IFUs, [*] training days over the [*] days will be
made available. Such training will take place at Seller's facilities. Seller
shall train any of Buyer's designees that exceed the above commitment at the
prices and in accordance with the provisions set forth in Exhibit 4, attached
hereto.
ARTICLE 11. USE OF SELLER'S MARKETING MATERIALS & INTELLECTUAL PROPERTY
Seller shall provide Buyer with copies of Seller's Marketing Materials for use
by Buyer. Any proposed modifications to Seller's Marketing Materials suggested
by Buyer must have Seller's prior written consent before such modifications are
made. Moreover, any Seller approved modifications to Seller's Marketing
Materials, or Buyer's use of Seller's Intellectual Property, shall neither cause
confusion in the applicable Product market, nor in any way dilute the
trademarks or infringe the Intellectual Property rights of Seller.
Notwithstanding the foregoing, Seller will provide photographs of its IFUs to
Buyer for Buyer's use in Buyer's Marketing Materials, subject however to the
condition that Buyer shall not remove, cover, or otherwise alter, any trademark,
patent or other markings on the IFUs during or as a result of such use in the
Marketing Materials. Furthermore, any use of Seller's Marketing Materials,
including photographs of Seller's IFUs, by Buyer shall in no way represent or
infer to Third Parties or the public that Buyer is a reseller, distributor or
sales agent of Seller.
ARTICLE 12. INDEMNIFICATION
The Parties agree to defend, indemnify, and hold harmless each other against any
loss, liability, damage, cost, or expense arising out of any claims, loss,
damage or suits, arising from (i) any breach of any term, condition, obligation,
representation, or warranty of this Agreement, (ii) any personal injury or
product liability arising from the use of the Seller's Products or the Buyer's
systems exclusive of the Products; or (iii) any negligent act, omission,
failure, or intentional or willful misconduct by either Party in the performance
or failure of performance of this Agreement.
The terms of this Article 12 shall survive any expiration or termination of this
Agreement.
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ARTICLE 13. WARRANTIES
13.01 Seller Supplied Equipment
(a) Seller warrants that for a period of [*] months from
Equipment's Ship Date, that under normal use and service the
Equipment subject to this Agreement will be free from
material defects or faulty workmanship, and shall operate in
compliance with the applicable Specifications. The foregoing
warranty shall not apply to items normally consumed during
operation such as, but not limited to, lamps and fuses. All
like-kind Equipment (i.e., Equipment with the same frequency,
functionality, and model number) sold by Seller to Buyer
under this Agreement shall be Backwards Compatible with all
such like-kind Equipment for a period of [*] from the earlier
of (i) the end of the Initial Term of this Agreement, or (ii)
termination of this Agreement. If Equipment is not free from
material defects or faulty workmanship and fails to comply
with the applicable Specifications during the warranty
period, Seller will, within thirty (30) days, at its option,
repair, replace, or modify the Equipment so that it is free
from defects and complies with the applicable Specifications.
This warranty service shall be performed at the Buyer's
installation site or Seller's facility, as determined by
Seller. If Seller is unable to repair or modify the Equipment
within thirty (30) days, so that the Equipment conforms to
the applicable Specifications, Seller shall replace the
Equipment with Equipment that conforms to such
Specifications. In such cases Seller does not guarantee that
Equipment with like serial numbers will be returned to the
Buyer. Seller's sole obligation and Buyer's exclusive remedy
under the warranty provisions of this Article 13 with respect
to Equipment shall be limited to repair, modification, or
replacement of the defective Equipment or refund to Buyer the
applicable Equipment's purchase price in the event Seller
cannot provide Buyer with Equipment that complies with
Specifications.
(b) The warranties set forth in this Article 13 shall not apply to
any Equipment where the defect or non-conformance is due to:
(i) accident, alteration, abuse, misuse, or repair not
performed by Seller;
(ii) storage or operation of Equipment other than as set
forth in the Equipment Specifications;
(iii) failure to comply with all applicable environmental
requirements for Equipment as set forth in the
Equipment Specifications, including but not limited
to temperature or humidity ranges;
(iv) performance of Equipment installation, maintenance,
operation, repair, relocation, or other service not
in compliance with the Equipment Specifications,
unless such non-complying service was performed by
Seller or on Seller's behalf;
(v) breakage, damage, alteration, or removal of any
Seller affixed seal or label located on the IFU
without the Seller's prior written approval. The IFUs
contain no Buyer serviceable parts;
(vi) use in conjunction with a product, or category of
products specified by Seller as incompatible with
such Equipment;
(vii) any error, act, omission, vandalism, mishandling or
misuse of Equipment by anyone other than Seller or
Seller's agents, employees, subcontractors and
vendors; or
(viii) where written notice of the defect has not been given
to Seller within the applicable warranty period.
(c) Buyer shall be responsible for de-installation and
re-installation of any warranty repair or replacement
Equipment. Buyer shall use only qualified technicians to
perform any maintenance and/or repair to the Equipment during
the warranty period, where such maintenance and/or repair
shall be confined to routine tasks performed in accordance
with Seller provided Documentation.
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(d) A return material authorization ("RMA") must be obtained by
Buyer from the Seller prior to the return of any Equipment.
Information regarding the RMA process is set forth in Exhibit
3, attached hereto.
(e) Warranty replacement Equipment may be new or reconditioned to
perform as new, at Seller's option. Notwithstanding the
foregoing, the warranty period of Equipment which has been
subject to repair or replacement by Seller shall commence on
the Ship Date of the repaired or replacement Equipment to
Buyer and shall expire on the later of one hundred and twenty
(120) days from such Ship Date or the last day of the original
warranty period for the Equipment that was repaired or
replaced.
(f) All Equipment to be repaired or replaced, whether in or out of
warranty, shall be packed by Buyer in accordance with Seller's
reasonable instructions and shall follow Seller's repair and
return policy and procedures. Buyer shall bear risk of loss
and shall pay for all transportation charges for Equipment
returned to Seller and Seller shall bear such risk of loss and
pay for transportation charges for repaired or replacement
Equipment shipped to Buyer. Seller shall use commercially
reasonable best efforts to ship repaired or replacement
Equipment within thirty (30) days of receipt of the defective
Equipment for routine warranty repair or replacement. Seller
shall return the repaired or replaced Equipment to the Buyer
using the same transport method in which the Buyer sent the
Equipment to the Seller.
(g) If the Equipment that is returned to Seller is determined by
Seller to be beyond repair and is outside the warranty period,
Seller shall notify Buyer and Seller shall sell to Buyer, upon
Buyer's request, replacement Equipment at the then current
Agreement price between the Parties for such Equipment, or if
no such Agreement exists, at Seller's then current list price
for such Equipment.
(h) In the event an IFU under warranty fails to perform in
accordance with Specifications, and Buyer requests expedited
warranty replacement of such IFU, Seller will provide Buyer
with replacement spare Equipment within [*] of Buyer's
request for such replacement spare Equipment ("Expedited
Replacement Policy"). Seller shall impose a monetary charge
for such Expedited Replacement Policy in the amount of [*]
for each replacement spare Equipment shipped to Buyer on an
expedited basis. Once shipped, the replacement spare
Equipment shall become the property of Buyer, and upon
shipment, Seller will be entitled to keep the defective IFU
which Buyer must return to Seller within seven (7) days of
Buyer's request for the replacement spare. In the event
Seller fails to receive the defective IFU within seven (7)
days, Seller may invoice Buyer for the cost of the
replacement spare. It is anticipated that this Expedited
Replacement Policy will only be used to replace Seller's
Equipment that was previously installed in a network and such
Equipment subsequently failed to perform and Buyer did not
have sufficient spare Equipment on hand to replace such
Equipment. Seller's obligation to provide expedited
replacement of spares shall be limited to an inventory of two
(2) IFUs for each category of Equipment installed by Buyer.
Seller shall replenish its inventory of replacement spare
Equipment within thirty (30) days of sending any replacement
spare Equipment to Buyer pursuant to this policy.
13.02 Equipment Spare Parts Inventory
Seller shall maintain an adequate inventory of spare parts to repair or
replace all Equipment for a period beginning on the Effective Date of
this Agreement and ending on the fifth anniversary of the termination
of the Initial Term of this Agreement or, if longer, as otherwise
provided by law.
13.03 Extended Equipment Warranty for Seller Supplied Equipment
Seller shall offer Buyer an optional extended Equipment warranty
annually, for a period not to exceed five (5) years from the date of
purchase of the applicable IFU, in accordance with the terms and
conditions set forth in Exhibit 2.02, attached hereto.
13.04 Third Party Equipment
(a) With respect to any Third Party Equipment furnished by Seller
to Buyer, Seller shall secure from the applicable
manufacturers such warranties and indemnities as may be
available with respect to such Third Party Equipment, and
assign and pass to Buyer all available warranties and
indemnities for such Third Party Equipment to the extent
legally assignable. In the event such warranties and
indemnities are not assignable to Buyer, Seller shall enforce,
if necessary, such warranties and indemnities on
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Buyer's behalf. In addition to the above, Seller shall, at Buyer's
request, register Buyer with any and all Third Party Equipment vendors
(for Third Party Equipment that constitute systems as opposed to
individual components) such that Buyer is acknowledged as a support
obligation of the Third Party Equipment vendors and Buyer can receive
and obtain product notices directly from the Third Party Equipment
vendors. Seller shall produce evidence of such registration within [*]
calendar days from the date Buyer requests that Seller obtain such
registration.
(b) All Third Party Equipment unless otherwise stated in this
Agreement, or in the Third Party warranties, will follow the
same repair and return procedures as set forth in subsection
13.01 herein, (Seller Supplied Equipment).
13.05 Software
(a) Seller represents and warrants that under normal use and
service the Software shall perform according to Specifications
[*]. Seller further represents and warrants that, to the best
of its knowledge, any Software provided by Seller hereunder,
for a period ending fifteen (15) months from the Ship Date,
does not contain and will not receive from any Seller data
transmission via modem or other Seller medium, any virus,
worm, trap door, back door, timer, clock, counter, or other
limiting routine, instruction, or design that would erase data
or programming or otherwise cause the Software to become
inoperable or incapable of being used in the full manner for
which it was designed and created ("Disabling Code"); however,
this representation and warranty specifically excludes locking
mechanisms designed to prevent Buyer from using those Software
features or functions not licensed to Buyer under the terms of
this Agreement, including, without limitation, any limitations
that are triggered by:
(i) the Software being used or copied a certain number of
times, or after the lapse of a certain period of
time;
(ii) the Software being installed on or moved to a central
processing unit or system that has a serial number,
model number, or other identification different from
the central processing unit or system on which the
Software was originally installed; or
(iii) the occurrence or lapse of any similar triggering
factor or event.
(b) In the event Seller introduces a Disabling Code into the
Software, Seller shall:
(i) take all steps necessary at Seller's sole cost to
test a new copy of the Software for the presence of
Disabling Codes;
(ii) furnish to Buyer a new copy of the Software without
the presence of Disabling Codes;
(iii) install and implement such new copy of the Software
at no additional cost to Buyer; and
(iv) take all steps necessary, at Seller's sole cost, to
restore any and all data or programming lost by Buyer
as a result of such Disabling Code. In the event
Disabling Codes are identified by Buyer or Seller in
the Software, Seller shall furnish to Buyer a new
copy of the Software without the presence of
Disabling Codes.
(c) Seller warrants, with respect to Seller's Software, that
Seller has undertaken commercially practicable efforts to
ensure, to the extent within its reasonable control, that when
such Software is properly used in accordance with the
applicable Specifications, then both before and after January
1, 2000 such Software will accurately receive, provide, and
process date and date dependent data (including calculating,
comparing, and sequencing) from, into, and between the
twentieth (20th) and the twenty first (21st) century.
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The Parties agree that the above constitutes being year 2000
compliant ("Y2K" Compliance"). Seller further warrants that
during Software warranty period, as specified in this
Agreement, Software shall function without any material
service affecting or non-conformance to the applicable
Specifications as a consequence of date or date dependent
data, to the extent that other software used in combination
with Seller's Software sold or licensed hereunder is also Y2K
Compliant and properly exchanges date and date dependent data
with Seller's Software. If Software fails to so function as a
consequence of Y2K Compliance, Buyer's sole remedy and
Seller's sole obligation under this warranty is for Seller to
correct such failure through the replacement or modification
of the Software or such other actions as the Parties
reasonably determine to be appropriate within sixty (60) days
of such failure. However, if Seller is unable to correct such
Y2K Compliance failure through replacement or modification of
the Software, then the Parties shall negotiate a commercially
reasonable solution.
(d) Any modification to Software not performed by Seller or at
Seller's direction, other than with respect to modifiable
Software, shall void this warranty. Seller shall not be
responsible for the failure of any Software to comply with the
applicable Specifications if such failure was the result of:
(i) the combination of Software with any non-Software
supplied by a Third Party, and not provided by
Seller; or
(ii) modification of Software by Buyer or any other Third
Party.
13.06 THE WARRANTIES AND REMEDIES SET FORTH IN THIS ARTICLE 13 CONSTITUTE THE
ONLY WARRANTIES WITH RESPECT TO THE PRODUCTS PROVIDED, AND BUYER'S
EXCLUSIVE REMEDIES IN THE EVENT SUCH WARRANTIES ARE BREACHED. THEY ARE
IN LIEU OF ALL OTHER WARRANTIES WRITTEN OR ORAL, STATUTORY, EXPRESS,
IMPLIED OR OTHERWISE, INCLUDING WITHOUT LIMITATION THE WARRANTY OF
MERCHANTABILITY AND THE GENERAL IMPLIED WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE. SELLER SHALL NOT BE LIABLE FOR ANY INCIDENTAL,
CONSEQUENTIAL, OR SPECIAL DAMAGES OF ANY NATURE WHATSOEVER.
13.07 Survival
The terms of this Article 13 shall survive any expiration or
termination of this Agreement.
ARTICLE 14. PATENT AND COPYRIGHT INFRINGEMENT INDEMNITY
14.01 Indemnification
Seller hereby indemnifies Buyer, as set forth herein with respect to
any suit, claim, or proceeding brought against Buyer alleging that
Buyer's use of the Products and Ring Architecture License constitutes
an infringement of any United States or foreign patent or copyright.
Seller agrees to defend Buyer, at Seller's expense against any such
claims and to pay all settlement payments, costs and legal expense, in
addition to any damages awarded in any final judgment arising from such
suit, claim or proceeding; provided, however, that Buyer shall promptly
advise Seller of any such suit, claim, or proceeding and shall
cooperate with Seller in the defense or settlement of such suit, claim
or proceeding and provided Seller shall have sole control thereof. In
the event that Seller's control of the defense in such suits, claims or
proceedings may materially affect Buyer's network and operations,
Seller agrees to consult with Buyer in good faith to obtain Buyer's
input on appropriate defense methods. The obligation of Seller
hereunder with respect to any infringement claim shall not apply to
infringement claims based on:
(a) use of Product by Buyer in a manner, including combinations
with other products not provided by Seller, and neither
contemplated nor suggested by this Agreement or Seller's
product documentation existing as of or subsequent to the
Effective Date of this Agreement; or
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<PAGE> 21
(b) use of Product by Buyer in any other combination with other
products not provided by Seller, unless Seller would
otherwise normally be liable for such a combination as a
direct (or on the basis of contribution or inducement)
infringement, and provided that but for the existence of such
combination by Buyer, there would be no infringement claim;
or
(c) use of Product in a Territory other than that the Territories
set forth in Exhibit 5, attached hereto; or
(d) Buyer's use of Third Party Equipment;
(e) modifications made by Buyer without Seller's consent; and
(f) Seller's use of specifications or designs (except
specifications or designs which are or become industry
standards or are used by Seller in a Product that is supplied
to other customers) which are supplied by Buyer to Seller for
use in Seller Products to be purchased under this Agreement
provided that but for such use by Seller there would be no
infringement claim and further provided that the Seller team
providing the custom development and the Seller employees
assigned to the Buyer account team shall use all commercially
reasonable best efforts, without violating any Third Party
confidentiality obligations, to determine whether the
requested specification or design would violate any Third
Party patent, copyright, trademark, or other Intellectual
Property right and provide notice to Buyer of such knowledge
as soon as reasonably possible. Notwithstanding the above, in
the event the Seller develops custom Products for the Buyer,
such custom Product shall be subject to Seller's Product
indemnification;
(g) The foregoing exclusions shall not apply to use of Products,
Equipment or Software in Buyer's data communications network
if Buyer and Seller have agreed in writing to the use and
implementation of Seller's Product with other products not
provided by Seller and Buyer has purchased Products for use
in its network in a manner consistent with such written
agreement by Seller.
14.02 Injunction
In the event that an injunction is obtained against Buyer's use of
Equipment or Software arising from such patent or copyright suit,
claim or proceeding, in whole or in part, Seller shall, at its option,
use commercially reasonable best efforts to either:
(a) procure for Buyer the right to continue using the portion of
the system enjoined from use; or
(b) replace or modify the same so that Buyer's use is not subject
to any such injunction.
If Seller is unable to achieve any of the above-stated remedies in
this subsection 14.02, Seller, after using commercially reasonable
best efforts, Seller shall refund the purchase price of the applicable
Equipment or Software and pay for the deinstallation of the Equipment
in addition to any other remedy available to Buyer.
14.03 Limitation of Liability
THE FOREGOING SETS FORTH THE ENTIRE LIABILITY OF SELLER FOR PATENT OR
COPYRIGHT INFRINGEMENT BY THE PRODUCTS. THE REMEDIES CONTAINED HEREIN
ARE BUYER'S SOLE REMEDY FOR ANY CLAIM OF INFRINGEMENT OF THIRD PARTY
PATENT, COPYRIGHT, TRADEMARK, TRADE SECRET OR OTHER INTELLECTUAL
PROPERTY RIGHTS.
14.04 Survival
The terms of this Article 14 shall survive any expiration or
termination of this Agreement.
ARTICLE 15. CONFIDENTIALITY
15.01 Confidentiality
Buyer, Seller and their respective Affiliates shall receive in
confidence from each other technical information, business
information, documentation and expertise, including the terms of this
Agreement ("Confidential Information"), and shall not, except as
previously authorized in writing by the other Party, publish, disclose
or make use of such Confidential Information (except as required by
law and after notice to the other Party) for
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any purpose other than in the performance of their obligations or
their respective operations as contemplated by this Agreement, unless
and until the Confidential Information has ceased to be proprietary as
evidenced by general public knowledge or has been legally acquired by
such Party from a Third Party without obligations of confidentiality.
This prohibition against disclosure, publication or use of
Confidential Information shall not restrict either Party from
developing similar information in the exercise of its own technical
skill, so long as such other information is independently developed by
such Party without making use of the Confidential Information.
15.02 Release of Information
Neither Party shall, without the express written consent of the other
Party, publicly announce the existence or terms of this Agreement
except such disclosures that may be required to comply with securities
laws, court orders or similar orders of an administrative or
regulatory agency, provided each Party shall use reasonable best
efforts to seek confidential treatment or other protective order
which are available to limit such disclosures and provide the other
Party with advanced notice of such disclosures. Notwithstanding the
foregoing, either Party shall be entitled to disclose this Agreement
and its specific terms and conditions to its financing sources,
including prospective financing sources and to its auditors, attorneys
and other agents in the ordinary course of business and any trier of
fact in the resolution of a dispute hereunder; provided that such
financing sources, auditors, attorneys, other agents and triers of
fact keep such information confidential.
ARTICLE 16. LIMITATION OF LIABILITY
16.01 Generally
EXCEPT AS OTHERWISE PROVIDED HEREIN, THE TOTAL LIABILITY OF SELLER FOR
ALL CLAIMS OF ANY KIND FOR ANY LOSS OR DAMAGE, WHETHER IN AGREEMENT,
WARRANTY, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE,
OR CLAIMS FOR INDEMNIFICATION ARISING OUT OF, CONNECTED WITH, OR
RESULTING FROM THE PERFORMANCE OR NON-PERFORMANCE OF THIS AGREEMENT
(EXCEPT FOR ARTICLE 14) SHALL IN NO CASE EXCEED THE TOTAL PRICE OF THE
PRODUCTS SPECIFIED IN THE PURCHASE ORDER ACCEPTED UNDER THIS AGREEMENT
GIVING RISE TO THE CLAIM. EXCEPT AS OTHERWISE PROVIDED HEREIN, THE
TOTAL LIABILITY OF BUYER FOR ALL CLAIMS OF ANY KIND FOR ANY LOSS OR
DAMAGE WHETHER IN AGREEMENT, WARRANTY, TORT (INCLUDING GROSS
NEGLIGENCE), STRICT LIABILITY OR OTHERWISE, OR CLAIMS FOR
INDEMNIFICATION ARISING OUT OF, CONNECTED WITH OR RESULTING FROM THE
PERFORMANCE OR NON-PERFORMANCE OF THIS AGREEMENT (EXCEPT FOR DILUTION
OF SELLER'S TRADEMARKS OR INFRINGEMENT OF SELLER'S INTELLECTUAL
PROPERTY RIGHTS, OR ANY WILLFUL OR NEGLIGENT ACTS OF BUYER OR ITS
EMPLOYEES OR AGENTS RELATING TO THE INSTALLATION OR OPERATION OF THE
SELLER'S PRODUCTS), SHALL IN NO CASE EXCEED THE GREATER OF SIXTEEN
MILLION FIVE HUNDRED THOUSAND ($16,500,000) DOLLARS OR THE TOTAL
PURCHASE PRICE OF THE PRODUCTS PURCHASED BY BUYER UNDER THIS
AGREEMENT. NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT, NEITHER
PARTY SHALL BE LIABLE FOR LOST PROFITS, LOSS OF DATA OR COSTS OF
PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, OR FOR ANY INCIDENTAL,
INDIRECT, CONSEQUENTIAL, OR SPECIAL DAMAGES OF ANY NATURE WHATSOEVER
FOR ANY ACTION ARISING UNDER THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, THOSE RESULTING FROM THE USE OF PRODUCTS PURCHASED
HEREUNDER, OR THE FAILURE OF THE PRODUCTS TO PERFORM, OR FOR ANY OTHER
REASON. THESE LIMITATIONS SHALL APPLY NOTWITHSTANDING THE FAILURE OF
THE ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
16.02 Other Limitations to Liability
Subject to the terms of this Agreement, Seller shall not be
responsible for any failures or inadequacies of performance resulting
from products not supplied by Seller or Seller's agents or
subcontractors under this
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Agreement. Seller shall not be responsible for interference or
disruption of service caused by operation of other radio systems,
lightning, motor ignition or other similar interference. In the event
Buyer utilizes facilities or services supplied by others such as
common carrier circuits, antennas or towers, Buyer shall have the
total responsibility for the availability or adequacy of such services
or facilities. Seller shall have no liability as a result of
non-performance, failures or poor performance of the Product caused
by, resulting from or attributable to Buyer supplied designs,
specifications or Product configuration requirements utilized by
Seller in the applicable Product that have not been discussed with and
approved in writing by Seller.
16.03 Survival
The terms of this Article 16 shall survive any expiration or
termination of this Agreement.
ARTICLE 17. MISCELLANEOUS
17.01 Applicable Law
The validity, construction, and performance of this Agreement shall be
governed by and interpreted in accordance with the laws of the State
of Florida, without giving effect to the principles of conflict of
laws thereof except to the extent that any mandatory provisions of
local laws in any country take precedence over the provisions of this
Agreement and Florida State law. Jurisdiction will reside in the state
and federal courts in Orange County, Florida, USA. Notwithstanding the
above, neither Party shall institute a proceeding in any court or
administrative agency to resolve a dispute between the Parties before
that Party has sought to resolve the dispute through direct
negotiations with the other Party.
17.02 Assignment
Other than as explicitly stated in this Agreement, neither Party may
assign or transfer this Agreement, or any of its rights hereunder,
without the prior written consent of the other Party, which consent
shall not be unreasonably withheld. Consent shall not be required for
the following:
(a) any assignment or transfer by a Party of all or any part of
this Agreement or of such Party's rights hereunder, to any of
its Affiliates; or
(b) any assignment or transfer by Seller to any Third Party of
all or part of Seller's right to receive any monies
("Receivables") which may become due to Seller pursuant to
this Agreement. Buyer shall notify such Third Party assignee
or transferee with respect to any claim made by Seller,
informing such Third Party of Buyer's justification for
failure to pay monies due to Seller pursuant to this
Agreement; or
(c) a transaction involving the reorganization, merger,
consolidation or other form of corporate transaction or
series of transactions; or
(d) a transaction involving the sale of all or substantially all
of the assets of the Seller or Buyer, provided that Buyer is
not selling to a direct competitor of Seller; and
(e) a transaction involving the acquisition of all or
substantially all of Seller's outstanding equity, provided
that Buyer is not selling to a direct competitor of Seller.
Buyer may assign or transfer Equipment or Software purchased pursuant
to this Agreement, if such Equipment or Software is used in a Buyer
Network which is being assigned or transferred by Buyer, pursuant to
an Assignment Agreement substantially in the form attached hereto as
Exhibit 8.
Any assignment or transfer in violation of this Agreement shall be
void. No assignment or sublicense of or under this Agreement, or of
any rights under this Agreement, by Buyer, shall relieve Buyer of the
primary responsibility for performance of Buyer's Minimum Purchase
Commitment and payment obligations under this Agreement.
Seller reserves the right to refuse to honor any assignment or
sublicense which, in the opinion of its legal
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counsel, would require it to violate any United States export
restriction, other law, or regulation.
Seller reserves the right to assign or subcontract any portion of its
obligation under this Agreement, however, such assignment (including
under section 17.02(a)) or subcontract shall not relieve Seller of its
primary responsibility for its performance obligations under this
Agreement, except in the case of an assignment to a successor entity
of Seller. Seller or any successor entity may assign all or part of
the right to payments under this Agreement.
17.03 Consents
Each Party hereto represents and warrants that:
(a) it has obtained all necessary approvals, consents, and
authorizations of third parties and governmental authorities
to enter into this Agreement and to perform and carry out its
obligations hereunder;
(b) the persons executing this Agreement on its behalf have
express authority to do so, and, in so doing, binds the Party
thereto;
(c) the execution, delivery, and performance of this Agreement
has been duly authorized by all necessary partnership or
corporate action and this Agreement is a valid and binding
obligation of such Party, enforceable in accordance with its
terms;
(d) in the case of Buyer, that Buyer has obtained the required
licenses to use the relevant radio spectrum; and
(e) in the case of Seller, that Seller has obtained all necessary
governmental approvals for the manufacture and sale of the
Products.
17.04 Counterparts and Facsimile Signatures
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original and all of which taken together shall
constitute one and the same instrument. Facsimile signatures shall
have the same effect as original signatures, but any Party
transmitting a signature by facsimile shall promptly follow up with a
copy of the same document bearing the original signature of that
Party.
17.05 Entire Agreement
This Agreement, including the Exhibits which are attached hereto and
incorporated herein, comprises all the terms, conditions, and
agreements of the Parties hereto with respect to the subject matter
hereof and supersedes all previous negotiations, proposals,
commitments, writings, publications, and understandings of any nature
whatsoever. No agent, employee, or representative of Seller has any
authority to bind Seller to any affirmation, representation, or
warranty, except as stated in this Agreement and unless such
affirmation, representation, or warranty is specifically included
within this Agreement it shall not be enforceable by Buyer or any
assignee or sub-licensee of Buyer. Buyer hereby acknowledges and
agrees that it has not relied on any representations or warranties
other than those expressly set forth in this Agreement.
17.06 Export
Buyer shall not export any Product or technical data received from
Seller pursuant to this Agreement, or release any such Product or
technical data with the knowledge or intent that such Product or
technical data will be exported or transmitted to any country or to
foreign nationals of any country, except in accordance with applicable
laws or regulations concerning the exporting of such items arising in
the United States or other such jurisdiction affecting the Product.
Buyer shall obtain all authorizations from the appropriate government
in accordance with applicable law prior to exporting or transmitting
any such Products or technical data as specified above. Seller will
provide such assistance as Buyer reasonably requests to obtain such
authorizations. Seller acknowledges that the transfer of Products or
components thereof, and associated Documentation outside of Canada or
the United States, may be subject to the specific approval of the
applicable Product suppliers and other suppliers. All such approvals,
if applicable, shall be conditions precedent to any of the obligations
of Seller hereunder respecting such Products or component thereof and
associated documentation.
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17.07 Factoring
Seller may, upon notice to Buyer, sell receivables to a Third Party or
Affiliate (so long as the recipients are not direct competitors of the
Buyer). Buyer grants permission for Seller to disclose the provisions
of this Agreement to purchasers and prospective purchasers of
Receivables, or their Affiliates (so long as the recipients are not
direct competitors of the Buyer), and their respective agents,
attorneys, auditors, rating agencies, and other advisors.
17.08 Force Majeure
If the performance by a Party of any of its obligations under this
Agreement shall be prevented, restricted, or interfered with by reason
of any circumstances beyond the reasonable control of that Party,
including without limitation, fire, explosion, embargoes, government
ordinances or requirements, civil or military authorities, acts of God
or of the public enemy, war, revolution, civil commotion, acts or
omissions of carriers, inability to obtain necessary materials or
services from suppliers, loss of sources of energy, power failure,
breakdown of machinery, or labor difficulties, including without
limitation, strikes, slowdowns, picketing, or boycotts, or other
causes beyond the reasonable control of the Party whose performance is
affected, then the Party affected, upon giving prompt notice to the
other Party, shall be excused from such performance on a day-for-day
basis to the extent of such prevention, restriction, or interference
(and the other Party shall likewise be excused from performance of its
obligations on a day-for-day basis to the extent such Party's
obligations relate to the performance so prevented, restricted or
interfered with), provided that the Party so affected shall use
reasonable efforts to avoid or remove such causes of non-performance
and both Parties shall proceed to perform their obligations with
dispatch whenever such causes are removed or cease. With respect to
labor difficulties as specified above, a Party shall not be obligated
to accede to any demands being made by employees or other personnel.
Either Party shall be permitted to cancel this Agreement without
liability to the other Party in the event of an event of force majeure
which continues for greater than thirty (30) days.
17.09 Headings
All headings used herein are for index and reference purposes only,
and shall not be given any substantive effect. This Agreement has been
created jointly by the Parties and no rule of construction requiring
interpretation against the drafter of this Agreement shall apply in
its interpretation.
17.10 Litigation Expense
The Party prevailing in arbitration, at trial, or on appeal shall be
entitled, in addition to such other relief as may be granted, to a sum
the court or arbitration may fix as reasonable attorneys fees, plus any
associated costs.
17.11 Modification of Agreement
No addition to or modification of this Agreement shall be effective or
binding on either of the Parties hereto unless reduced to writing and
executed by the respective duly authorized representatives of each of
the Parties hereto.
17.12 Non-Waiver
The failure by either Party hereto at any time to require performance
by the other Party or to claim a breach of any provision of this
agreement shall not be construed as affecting any subsequent breach or
the right to require the performance with respect thereto or to claim
a breach with respect thereto.
17.13 Notice
All notices required or permitted to be given hereunder shall be in
writing and shall be deemed given when delivered electronically, or
via traditional manual methods. If notice is given via traditional
manual methods, then such notice shall be delivered to the applicable
address listed on the signature page of this Agreement by (i)
certified mail, return receipt requested, or (ii) nationally
recognized overnight courier, or (iii) by hand.
Any notice given pursuant to this subsection 17.13 shall be effective
five (5) days after the day it is mailed or upon receipt as evidenced
by the Postal Service return receipt card, or courier or hand delivery
written confirmation, whichever is earlier. Either Party hereto may
change its address by a notice given to the other Party hereto in the
manner set forth above.
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All Purchase Orders and invoices to be delivered pursuant to this
Agreement shall be delivered via a delivery provider that provides
proof of delivery, such as certified mail, overnight mail or private
courier company.
17.14 Publicity
A Party shall not release, without the prior written approval of the
other Party, any advertising or other publicity relating to this
Agreement wherein such other Party may reasonably be identified. In
addition, each Party shall take reasonable precautions to keep the
terms and existence of this Agreement confidential so long as this
Agreement remains in effect and for a period of five (5) years
thereafter, except as may be otherwise expressly provided in this
Agreement or as may be reasonably required to enforce this Agreement
by law.
17.15 Registration
Products furnished under this Agreement for installation within the
United States shall, at the time of installation, comply to the extent
applicable, with the requirements of the Federal Communications
Commission's Rules and Regulations including, without limitation, all
labeling and customer instruction requirements. Products furnished
under this Agreement for installation outside the United States shall
comply with local governmental regulations, as applicable.
17.16 Relationship of the Parties
The provisions of this Agreement shall not be construed to establish
any form of partnership, agency, or other joint venture of any kind
between Seller and Buyer, nor to constitute either Party as the agent,
employee, or legal representative of the other. All persons provided
by either Party to accomplish the intent of this Agreement shall be
considered solely as the providing Party's employees or agents and the
furnishing Party shall be solely responsible for compliance with all
laws, rules, and regulations involving, but not limited to, employment
of labor, hours of labor, working conditions, workers' compensation,
payment of wages, and withholding and payment of applicable taxes,
including, but not limited to income taxes, unemployment taxes, and
social security taxes.
17.17 Severability
If any of the provisions of this Agreement shall be declared or
determined to be invalid or unenforceable under applicable law and a
Party deems such provisions to be material, that Party may terminate
this Agreement upon written notice to the other Party. Otherwise such
invalidity in whole or in part, of any terms, covenant, condition, or
provision of this Agreement shall not affect the validity of the
remainder of such terms, covenants, conditions or provisions in this
Agreement nor render this Agreement unenforceable, instead this
Agreement shall be construed as if it does not contain the particular
invalid or unenforceable provision and the rights and obligations of
the Parties shall be construed and enforced accordingly.
17.18 Third Party Beneficiaries Disallowed
Except as otherwise expressly permitted herein, all covenants and
agreements of the Parties hereto are solely and exclusively for the
benefit of the Parties to this Agreement and no other person or entity
shall have standing to require performance of any such covenants and
agreements, and no person or entity shall, under any circumstances, be
deemed to be a beneficiary of such obligations.
17.19 Waiver of Breach
Failure by either Party at any time to require performance by the
other Party or to claim a breach of any provision of this Agreement
shall not be construed as affecting any subsequent breach or the right
to require performance with respect thereto or to claim a breach with
respect thereto.
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SIGNATURES
IN WITNESS WHEREOF, the Parties hereto have executed this "Agreement" as of the
"Effective Date" shown above, by their representative(s) being duly authorized
and having signed accordingly.
THE "SELLER" THE "BUYER"
TRITON NETWORK SYSTEMS, INC. CAVU, INC.
Signed: Signed:
----------------------------- ------------------------------
Name: Skip Speaks Name:
----------------------------- ------------------------------
Title: President & CEO Title:
----------------------------- ------------------------------
Date: April 14, 2000 Date:
----------------------------- ------------------------------
Address for Notice: Address for Notice:
------------------- -------------------
8529 South Park Circle 4525 Vineland Road, Suite 209
Orlando, Florida 32819 Orlando, Florida 32811
U.S.A. U.S.A.
With Copy to: With Copy to:
------------- -------------
Louis T.M. Conti, Esq. Christopher N. Fountas, Esq.
Holland & Knight LLP Baker & Hostetler LLP
200 South Orange Avenue, Suite 2600 200 South Orange Avenue, Suite 2300
Orlando, Florida 32801 Orlando, Florida 32801
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EXHIBIT 2
PRODUCTS AND PRICING
EXHIBIT 2.01 EQUIPMENT
(i) IFUs
o 38GHz OC-3 or Fast Ethernet:
[*]
o 28Ghz, 29 Ghz and 31 Ghz OC-3 or Fast Ethernet:
[*]
[*]
(ii) Mounting Brackets - [*].
(iii) Outdoor Cable Kit - [*],
(iv) IFU Link Manager Test Cable - [*].
[*] Confidential treatment requested.
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EXHIBIT 2.02 EXTENDED EQUIPMENT WARRANTY FOR SELLER SUPPLIED EQUIPMENT
Seller offers to Buyer the following optional extended IFU warranty terms:
o An additional twelve (12) month warranty which may be
purchased at a price equal to [*].
o This extended IFU warranty may be purchased prior to the
expiration of the standard IFU warranty set forth in
subsection 13.01 of this Agreement. This extended warranty is
incremental to [*] in the standard IFU warranty set forth in
subsection 13.01 of this Agreement.
o The return and replacement terms and conditions of the
standard IFU warranty apply to this extended IFU warranty.
o This extended IFU warranty shall apply to Equipment only.
o This extended warranty may be renewed for successive twelve
(12) month periods by Buyer, for a period of five (5) years
from the date of shipment of the applicable IFU. Thereafter,
Seller will offer an extended warranty to Buyer, subject to
Seller's right to charge the then current price for such
extended warranty.
[*] Confidential treatment requested.
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EXHIBIT 2.03 TECHNICAL ASSISTANCE CENTER (TAC) SERVICE LEVEL AGREEMENT
TAC support services is limited to Equipment purchases only.
(a) BRONZE LEVEL TAC SERVICES
o Included as provided in this Agreement and Exhibit
2.06.
o Regular business hour support (08:00 to 17:00 Eastern
Time; Mondays through Fridays excluding Seller's
observed holiday schedule).
o Non-business hour paging services with maximum three
(3) hour response time.
o E-mail communication available for information
inquiries with maximum three (3) business day
response.
o Service begins immediately upon the Effective Date of
this Agreement.
o [*] per hour service charge of telephone and
administrative time to expended for repair or
replacement of Seller Equipment and Third Party
equipment which is out of warranty.
(b) SILVER LEVEL TAC SERVICES
o Additional charge based on quantity of IFUs purchased
in accordance with Seller's then current published
price list for such TAC services.
o Dedicated TAC telephone line.
o Extended Telephone Technical Assistance Hours (8-8
EST M-F; 8-5 Weekends; Non-Holidays).
o Non-business hour paging services with maximum two
(2) hour response time.
o E-mail communication available for information
inquiries with maximum one (1) business day response.
o [*] per hour service charge of telephone and
administrative time to expended for repair or
replacement of Seller Equipment and Third Party
equipment which is out of warranty.
(c) GOLD LEVEL TAC SERVICES
o Additional charge based on quantity of IFUs purchased
in accordance with Seller's then current published
price list for such TAC services.
o Dedicated TAC telephone line.
o Dedicated TAC personnel available twenty-four (24)
hours per day, seven (7) days per week with immediate
response time.
o Single point of contact for all network related
issues including Third-Party Equipment and Software.
o E-mail communication available for information
inquiries with maximum half (0.5) business day
response.
o No per hour service charge of telephone and
administrative time to expended for repair or
replacement of Seller Equipment and Third Party
equipment which is out of warranty.
SELLER WILL PROVIDE BUYER WITH GOLD LEVEL TAC SERVICE FOR A PERIOD OF ONE
HUNDRED AND EIGHTY (180) DAYS FROM THE EFFECTIVE DATE OF THIS AGREEMENT AT NO
CHARGE TO BUYER. THEREAFTER, UNLESS BUYER REQUESTS AND PAYS FOR SILVER OR GOLD
LEVEL TAC SERVICES BUYER SHALL BE ENTITLED ONLY TO BRONZE LEVEL TAC SERVICE
PROVIDED FURTHER THAT BUYER PAYS THE BASIC ANNUAL SOFTWARE SUPPORT FEE DESCRIBED
IN EXHIBIT 2.06.
[*] Confidential treatment requested.
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EXHIBIT 2.04 NETWORK OPERATIONS CENTER (NOC) SUPPORT AGREEMENT
Seller will provide buyer assistance in the design and configuration of the
Buyer's Network Operations Center (NOC). This assistance will consist of the
following:
(i) Monitoring of Buyer network, for IFUs only, for a
period of [*] after installation of the first
IFU, and specifically such monitoring does not
include router equipment.
(ii) Provide consultation in the design and configuration
of the Buyer's NOC center (limit of 16 hours with
scheduling agreed upon between Buyer and Seller).
(iii) Provide Buyer with NOC center training at Seller's
facility (maximum of [*] for [*] each). Seller does
not have a formal NOC training program for clients,
but client personnel will receive basic on-the-job
instruction and training.
[*] Confidential treatment requested.
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EXHIBIT 2.05 TECHNICAL SUPPORT SERVICE
Seller will provide technical support to Buyer before and during the Initial
Term of this Agreement as follows:
1. Initial deployment for [*] IFUs for each of the first [*]:
- Recommend contractor certified by Seller.
- Perform technical site surveys for up to [*] total sites,
regardless of market.
- Provide all site survey equipment required for the first [*]
total sites, regardless of market.
- Determine requirements for -48vdc power (provided by Buyer).
- Prepare RF Link Budgets, path availability calculations and
frequency plan for [*] IFUs.
- Load software & stage IFU's.
- Instruct Buyer's engineers on procedures.
- Provide engineering consultation on Buyer's router equipment.
- Assist Buyer with network design.
- Provide commissioning of Seller IFU's in three locations for [*]
IFUs.
- Provide overall program management for the first [*] networks.
2. Support for [*] Installation ([*] IFUs in [*] buildings):
- Review scope of work and assist Buyer in selecting contractors.
- Provide up to [*] man days for preparation of RF link budgets,
path availability calculations and preliminary frequency plan
templates from CAVU provided technical site survey forms.
- Provide for [*] trip to [*] for up to [*] days to evaluate and
finalize RF design. All site survey information needed to complete
the RF design shall be provided by Buyer to Seller not later than
[*] days prior to scheduled commissioning date.
- Provide Buyer with [*] man days of network engineering services
including hardware and software configuration, protocol design
review and test plan review. The final Network equipment
configuration validation, including the performance and test results
of the equipment, will be the responsibility of Buyer.
- Provide internet protocol addressing plan required for Triton NOC
monitoring.
- Supervise the installation and commission of Seller manufactured
products for up to [*] weeks.
- Provide supervision for system testing for up to [*] weeks.
- After the [*] IFU Network is operational, provide Buyer with
all RF attributes and engineering reports.
- Provide overall program management through final test for the
[*] IFU Network.
- Provide [*] set of "Smartbits" test equipment including lap top
computer for up to [*].
- The above services are provided to Buyer [*] and include travel
and living expenses.
- Supervise, assist and train Buyer's personnel in the 'staging' and
preparation of Seller's equipment prior to shipment, assuming Seller
has provided all relevant engineering information in a timely
manner.
3. Support provided during the Initial Term of this Agreement:
[*] Confidential treatment requested.
Confidential
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<PAGE> 33
Seller will provide, [*], basic technical sales support which includes
the following:
(a) Provide specifications and information for Seller's Equipment.
(b) Provide program management for Equipment delivered to Buyer.
(c) Assist Buyer with requests for training, Third Party
contractor selection, preparation of contractor statements of
work, and selected site auditing of contractors to ensure
quality.
4. Optional Services:
The services listed below are offered to Buyer at the then current relevant
prices set forth in Seller's standard price book or as Quoted based on agreed to
scope of work. Reasonable and actual expenses [*] or per them will be Quoted
for each optional service requested by Buyer.
(a) Site surveys.
(b) Perform alignment and/or commissioning of IFU's.
(c) Perform test of IFU links.
(d) Provide additional RF and network engineering services.
(e) Training classes.
[*] Confidential treatment requested.
Confidential
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EXHIBIT 2.06 INITIAL SOFTWARE LICENSE FEE & BASIC ANNUAL SOFTWARE SUPPORT
FEE PAYMENT PROVISIONS
A. Initial Software License Fee:
o All Purchase Orders will include an initial Software License
Fee of [*] of the Purchase Order's Net Price for IFUs. The
Software License Fee of [*] will be pro-rated for the balance
of the calendar year in which the Purchase Order is issued
beginning the month following the scheduled ship date of the
IFUs.
B. Basic Annual Software Support Fee:
In addition to the Initial Software License Fee, a Basic Annual
Software Support Fee shall be invoiced and paid annually, in order to
obtain Software Support on the terms described below:
o On January of each year Seller shall send an invoice to Buyer
for the purpose of allowing Buyer to obtain Basic Annual
Software Support coverage during the next twelve (12) months.
The amount set forth in such invoice will be based on [*] of
all IFUs installed in a Buyer Affiliate network. The period of
such coverage shall commence on the date of the applicable
invoice and end on the last day of January in the following
year. The Basic Annual Software Support Fee includes [*] TAC
Support (as defined in Exhibit 2.05) and all Software Releases
and updates.
o If Buyer fails to pay the Basic Annual Support Fee, the Buyer
shall be solely responsible for all Software-related issues.
Seller shall not be responsible for providing technical
assistance to the Buyer or for any other Software related
issues. Moreover, Seller shall not be responsible for
providing TAC support or any new Software Releases, upgrades
and updates to the Buyer, unless Buyer pays the prevailing
rates or fees for such TAC support or Software Release,
including any costs which may be necessary to bring the
Buyer's network current with respect to Seller's Software
Releases.
o Reinstatement of any Basic Annual Software License will
require Buyer to purchase all Software Releases issued during
the period Buyer's Basic Annual Software License lapsed at the
then current price for each Software Release.
[*] Confidential treatment requested.
Confidential
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EXHIBIT 2.07 SOFTWARE SUPPORT
In the event Seller's Software does not function in accordance with
Specifications during the warranty period, Seller will respond in accordance
with the following table:
SOFTWARE SUPPORT RESPONSE
<TABLE>
<CAPTION>
CATEGORY DEFINITION RESPONSE BY SELLER
-------- ---------- ------------------
<S> <C> <C>
Critical End User Impacting Dedicated and immediate engineering
Network Down response until problem is resolved. Upon
resolution, correction is made available to
Buyer immediately.
Major OAM&P Problem or Non- Correction will be made in the next
End User Impacting Difficulty appropriate software release.
Managing Network
Minor Non-End User or Non- Included in customer feature request for
Network Impacting future software release.
</TABLE>
Software support will include Software Releases and technical assistance for all
Software-related failures.
Confidential
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EXHIBIT 2.08 DOCUMENTATION
Upon request by Buyer, Seller will provide up to [*] sets, per market, of
technical Documentation on computer disk, including any updates, shall be made
available electronically [*] to Buyer. Additional electronic versions and/or a
hardcopies of the Documentation will be provided at a charge to the Buyer in an
amount equal to the Seller's published prices. All technical Documentation is
proprietary information of the Seller. Buyer and it's employees, agents and
assignees, agree to use all commercially reasonable efforts to maintain all such
technical Documentation as confidential.
[*] Confidential treatment requested.
Confidential
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EXHIBIT 3
RETURN MATERIALS AUTHORIZATION
------------------------------
The following document should be referenced when returning Triton Network
Systems product.
BEFORE OBTAINING AN RMA (CUSTOMER RESPONSIBILITY)
The customer should attempt troubleshooting procedures as provided within
existing Triton Network Systems documentation and work, with the Triton Network
Systems Technical Assistance Center (TAC) to resolve any problems. If
reasonable attempts at troubleshooting do not bring resolution, then the item
should be replaced and a Return Material Authorization (RMA) should be
generated.
OBTAINING AN RMA
The customer should call the TAC at 877-687-4866 or +1-407-903-0997 or contact
the TAC via fax or e-mail to obtain an RMA number. The minimum information
required (or confirmed from previous troubleshooting) for generation of an RMA
by the TAC is:
o Customer Company.
o Contact Name.
o Contact Phone, FAX
o Site Address of Product
o Shipping Address for Repaired Product
o Part Number of Product if printed on unit
o Model Number of Product if printed on unit
o Serial Number of Product
o Description of Problem
PACKAGING AND RETURN PROCEDURES
The TAC will provide an RMA number to the customer who will indicate the RMA
and serial number on the return label. The IFU must be returned in packaging
that provides a level of protection equal to the original type packaging. If
original type packaging is not available, Triton Network Systems will upon
request from Customer provide packaging.
All Equipment to be repaired or replaced, whether in or out of warranty, shall
be packed by Customer in accordance with Triton Network Systems's reasonable
instructions and shall follow Triton Network Systems's Repair and Return policy
and procedures. Customer shall bear risk of loss and shall pay for all
transportation charges for Equipment returned to Triton Network Systems and
Triton Network Systems shall bear such risk and pay for transportation charges
for repaired or replacement Equipment shipped to Customer.
WHERE TO SEND RMA PRODUCT
RMA product should be sent to the following address:
Triton Network Systems, Inc.
8337 South Park Circle
Attn: Kevin Haney, Depot Manager
Orlando, Florida 32819
(407) 903-2254
IMPROPERLY RETURNED PRODUCT
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If product is sent to Triton Network Systems without a valid RMA number, it
will be returned to the customer at their expense without repairs being
performed.
Confidential
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EXHIBIT 4
BUYER TRAINING
--------------
o SELLER WILL OFFER THE FOLLOWING CUSTOMER TRAINING.
VOLUME
PRICE AT DISCOUNT
TRITON PER PRICE AT
COURSE MAXIMUM DAY PER TRITON/DAY/
TRAINING COURSE LENGTH CLASS SIZE STUDENT STUDENT(*)
--------------- ------ ----------- ---------- ----------
1. Invisible Fiber(TM) Unit 5 days 10 students $ [*] $[*]
Installation & Commissioning
2. Invisible Fiber(TM) Unit 3 days 4 students $ [*] $[*]
OAM&P - Operations
3. Invisible Fiber(TM) Unit 2 days 4 students $ [*] $[*]
OAM&P - Administration
4. Invisible Fiber(TM) Unit 3 days 4 students $ [*] $[*]
Network Engineering
DISCOUNT TABLE: AS LISTED BELOW.
<TABLE>
<CAPTION>
COURSE PRICE 1 2 3 4 5 6 7 8 9 10
PER STUDENT STUDENT STUDENTS STUDENTS STUDENTS STUDENTS STUDENTS STUDENTS STUDENTS STUDENTS STUDENTS
----------- ------- -------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Installation & Commission [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
OAM&P Operations [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
OAM&P Administration [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
IFU Network Engineering [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
</TABLE>
NOTES:
o All payments are in US dollars.
o Volume discounts are based on individual course actual volumes and the
discounted price is applicable to all students of that class.
o Price is based on a per student per day fee structure, excluding
travel and facilities costs.
o Prices include all course material.
o Minimum number of 4 students per day per course for the Installation &
Commissioning Course and 2 students per day per course for all other
courses (or the equivalent price for a single student).
o All courses are based at Triton in Orlando, Florida.
o CUSTOMER PREMISE TRAINING
o Travel Expense for two (2) Seller Trainers including lodging, meals,
rental care, and airfare.
o Shipment of any training material and Equipment.
o Two (2) fully installed and operational Buyer supplied IFUs to be used
for training purposes.
o Buyer shall pay Seller for above training within thirty (30) days if
Seller's issuance of the invoice to Buyer.
[*] Confidential treatment requested.
Confidential
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EXHIBIT 5
TERRITORIES
-----------
Seller authorizes Buyer to purchase and install Seller Equipment anywhere in
the United States of America. Seller agrees that once the Seller is ready to
ship Products [*], that Seller will authorize Buyer to purchase and install
Seller Equipment [*], subject to Buyer's payment of any and [*], fees and costs
associated with shipment [*], and provided further, that Buyer will be
responsible for obtaining all licenses and complying with all laws necessary to
ship such Products [*], as the case may be.
[*] Confidential treatment requested.
Confidential
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EXHIBIT 6
FORECAST
--------
The Forecast for shipment of 38Ghz Product to Buyer the first six (6) months of
this Agreement shall be as follows:
Shipped On Or Before Number of IFUs
-------------------- --------------
[*] [*]
TOTAL
[*] Confidential treatment requested.
Confidential
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EXHIBIT 7
FORM PURCHASE ORDER
-------------------
Form of Purchase Order to be agreed.
Confidential
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EXHIBIT 8
ASSIGNMENT AGREEMENT
--------------------
Form of Assignment to be agreed.
Confidential
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EXHIBIT 9
TEST ACCEPTANCE PROCEDURE
-------------------------
The Test Acceptance Procedure to be utilized for the Invisible Fiber
Unit Customer Acceptance Test for the 38 Ghz Fast Ethernet Application is
described in Seller Part No. 5338200-0001, Release No. 1.1, dated March 2000,
and it will be made available to Buyer.
Confidential
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EXHIBIT 10
PURCHASE ORDER FOR FIRST [*] IFUs UNDER BUYER'S MINIMUM PURCHASE COMMITMENT
---------------------------------------------------------------------------
[*] Confidential treatment requested.
Confidential
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