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EXHIBIT 10.8
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
AMENDED AND RESTATED
PROCUREMENT AGREEMENT
BETWEEN
WILLIAMS COMMUNICATIONS INC.
AND
CORVIS CORPORATION
DATED JUNE 23, 2000
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Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
AMENDED AND RESTATED
PROCUREMENT AGREEMENT
BETWEEN WILLIAMS COMMUNICATIONS INC.
AND CORVIS CORPORATION
THIS AMENDED AND RESTATED PROCUREMENT AGREEMENT ("Agreement"), dated this 23rd
day of June, 2000 ("Signature Date"), is made by and between Williams
Communications Inc., a Delaware corporation, having its principal place of
business at One Williams Center, Tulsa, Oklahoma 74172 (hereinafter referred to
as "Customer"), and Corvis Corporation, a Delaware corporation, having its
principal place of business at 7015 Albert Einstein Drive, Columbia, MD 21046-
9400 (hereinafter referred to as "Corvis").
1. Customer is a leading telecommunications service provider offering a
broad range of telecommunications services requiring ever-increasing
bandwidth.
2. Corvis is a manufacturer of next-generation optical network equipment.
C. Customer is currently testing Corvis products pursuant to a Laboratory
Trial System Agreement between Corvis and Customer dated [*] (the
"Laboratory Trial Agreement") and intends to conduct tests pursuant to
a Field Trial Agreement between Corvis and Customer executed
simultaneously herewith (the "Field Trial Agreement").
D. Customer [*], and Corvis [*], Corvis equipment and software for use in
Customer's network and/or, subject to the terms of this Agreement, [*]
Customer contingent upon successful completion of the Field Trial (as
such term is defined in the Field Trial Agreement).
NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties, covenants and agreements herein contained, the
parties agree as follows:
ARTICLE 1. LABORATORY SYSTEM.
1.3 Equipment and Software. Corvis has provided to Customer certain
Equipment and Software (the "Laboratory System") pursuant to the
Laboratory Trial Agreement [*].
1.2 Ownership and Return. Pursuant to the Laboratory Trial Agreement, the
Laboratory System will remain the sole and exclusive property of
Corvis. [*] Upon successful completion of the Field Trial, Corvis will
automatically grant licenses to the software comprising the Laboratory
System on the terms and conditions under which Software is licensed
pursuant to this Agreement. If for any reason the Field Trial is not
successfully completed in accordance with the
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Field Trial Agreement, the Laboratory System will be returned as
provided in the Laboratory Trial Agreement.
ARTICLE 2. FIELD TRIAL
2.1 Equipment and Software. Corvis will provide to Customer certain
Equipment and Software (the "Field Trial System") pursuant to the
Field Trial Agreement.
2.2 Ownership and Return. Pursuant to the Field Trial Agreement, the
Field Trial System will remain the sole and exclusive property of
Corvis. Following successful completion of the Field Trial pursuant
to the terms and conditions of the Field Trial Agreement, Customer
will pay Corvis the purchase price for the Field Trial Equipment and
license and services fees for the Field Trial Software as set forth
in the Field Trial Agreement (the "Field Trial System Purchase
Price") within [*] days after [*] and pursuant to an invoice to be
submitted by Corvis as provided in the Field Trial Agreement. If the
Field Trial (i) is not successfully completed due to failure of the
Field Trial System to pass the tests contained in the Field Trial
Test Plan within the time specified in the Field Trial Agreement,
then Customer or Corvis may terminate this Agreement upon [*]
written notice to the other, or; (ii) is not successfully completed
within the time period specified in the Field Trial Agreement due to
termination by Customer for cause under Section 9 of the Field Trial
Agreement, Customer may terminate this Agreement upon [*] written
notice to Corvisor; (iii) is not successfully completed within the
time period specified due to termination of the Field Trial
Agreement by Corvis for cause under Section 9 of the Field Trial
Agreement, Corvis may terminate this Agreement upon [*] written
notice to Customer. It is agreed that upon payment by Customer of
the Field Trial System Purchase Price, all Equipment and Software
comprising the Field Trial System shall be deemed to be items
purchased under this Agreement effective as of such payment date and
will thereafter be covered by and subject to all the terms and
conditions hereof to the same extent as if the Field Trial System
had been purchased by Customer under this Agreement.
ARTICLE 3. VOLUME PURCHASE; QUANTITIES AND DELIVERY SCHEDULES.
3.1 Initial Purchase Commitments. Following notice of successful
completion of the Field Trial, Customer will purchase for its own
use or for resale to others, subject to the terms and conditions of
this Agreement, from Corvis, during the Initial Term, Corvis
Equipment, Software and Services in quantities and in configurations
priced at U.S.$200 million ("Total Minimum Purchase Commitment"),
U.S. $100 million (the "Initial Minimum Purchase Commitment") of
which must be purchased within the Initial Minimum Purchase
Commitment
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Exchange Commission. Asterisks denote omissions.
Period based on the prices and license fees set forth in Attachment
6. Amounts paid by Customer under the Field Trial Agreement shall be
deemed purchases that apply to the Initial Minimum Purchase
Commitment.
3.2 (a) Failure to Meet Initial Minimum Purchase Commitment. If, after
successful completion of the Field Trial, Customer fails to
purchase a total dollar value of Corvis Equipment, and Software
and/or Services equal to or exceeding U.S. $100 million within
the Initial Minimum Purchase Commitment Period, then Corvis may
immediately invoice Customer for an amount equal to [*] ([*])
of the difference between the purchase price and license fees
for such Corvis Equipment, Software and/or Services purchased
by Customer during the Initial Minimum Purchase Commitment
Period and $100 Million (such difference being the "Initial
Minimum Purchase Commitment Shortfall") and Customer will pay
such invoice within [*] days after receipt of invoice. If
Customer submits Purchase Orders for at least the amount of the
Initial Minimum Purchase Commitment Shortfall within such [*]
payment period and such Purchase Orders require delivery of
Corvis Equipment, Software and/or Services within [*], Customer
will receive, for application against such Purchase Orders, a
credit for the full amount of the payment made for the Initial
Minimum Purchase Commitment Shortfall. If Customer, pursuant to
the foregoing sentence, makes payment of the full amount due
with respect to the Initial Minimum Purchase Commitment
Shortfall, but fails to issue Purchase Orders for the amount of
the Initial Minimum Purchase Commitment Shortfall within such
[*] period, Customer will receive a credit equal to [*] percent
([*]) of the amount of the Initial Minimum Purchase Commitment
Shortfall and such credit may be used to pay for purchases or
licenses for Corvis Equipment, Software and/or Services (beyond
amounts Customer is otherwise obligated to purchase or license
pursuant to Section 3.4) made within [*] calendar [*]s after
the end of the Initial Minimum Purchase Commitment Period.
Amounts paid by Customer pursuant to invoices for Forecast
Shortfalls pursuant to Section 3.4 that have not been used as
credits to pay for purchases for Corvis Products and Services
shall be deemed purchases which apply to the Initial Minimum
Purchase Commitment.
(b) Failure to Meet Total Minimum Purchase Commitment. If Customer
fails to meet the Total Minimum Purchase Commitment (assuming
full credit for any amounts with respect to which Customer is
invoiced and pays in connection with the Initial Minimum
Purchase Commitment Shortfall pursuant to Section 3.2(a) above)
within the Total Minimum Purchase Commitment Period, then
Corvis may immediately invoice Customer for an amount equal to
[*] percent ([*]) of the difference between the purchase price
and license fees for such Corvis Equipment, Software and/or
Services purchased by Customer during the Total Minimum
Purchase Commitment Period and $200 million (such difference
being the
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"Total Minimum Purchase Commitment Shortfall") and Customer
will pay such invoice within [*] days after receipt of invoice.
If Customer submits Purchase Orders for at least the amount of
the Total Minimum Purchase Commitment Shortfall within such [*]
payment period and such Purchase Order requires delivery of
Corvis Equipment, Software and Services within [*], Customer
will receive, for application against such Purchase Orders, a
credit for the full amount of the payment made for the Total
Minimum Purchase Commitment Shortfall. If Customer pursuant to
the foregoing sentence, makes payment of the full amount due
with respect to the Total Minimum Purchase Commitment
Shortfall, but fails to issue Purchase Orders for at least the
amount of the Total Minimum Purchase Commitment Shortfall
within such [*] period, then Customer will receive a credit
equal to [*] of the amount of the Total Minimum Purchase
Commitment Shortfall and such credit may be used to pay for
purchases or licenses of Corvis Equipment, Software and/or
Services (beyond amounts Customer is otherwise obligated to
purchase or license pursuant to Section 3.4) within [*] after
the end of the Total Minimum Purchase Commitment Period.
Amounts paid by Customer pursuant to invoices for Forecast
Shortfalls pursuant to Section 3.4 that are not subsequently
credited against purchases for Corvis Products and Services
shall be deemed purchases which apply to the Total Minimum
Purchase Commitment (to the extent they have not already been
applied toward the Initial Minimum Purchase Commitment).
3.3 Other Purchases; Forecasts
(a) Quantity Forecast. By the [*] business day of each [*] (the [*]
in which the forecast is issued hereafter being "M"), Customer
will provide to Corvis a [*] rolling forecast (each being a
"Rolling Forecast") of deliveries for the [*] period commencing
at the beginning of the next [*]. The first [*] of each Rolling
Forecast (hereinafter "[*]") will include the quantity of each
Product, by product code, to be delivered during [*]. For the
remaining [*] of each Rolling Forecast ([*] through [*]), the
Rolling Forecast will show the quantity of each Product by
product code which Customer anticipates it will need to be
delivered during the specified [*]. The [*] of each Rolling
Forecast ([*]) will represent a binding commitment to order and
Customer will submit a Purchase Order (or multiple Purchase
Orders) for such amount with the Rolling Forecast. The forecast
issued in [*] for the [*] of each Rolling Forecast ([*]) will
be partially binding in that in the next subsequent Rolling
Forecast (in which the [*] designated as [*] and [*] in the
preceding Rolling Forecast have become [*] and [*],
respectively), the quantity of each Product by product code to
be delivered in [*] and the corresponding Purchase Order will
be not less than [*] of the quantity forecast for each Product
in the immediate preceding Rolling Forecast for that same
calendar [*]. Customer will present no more than one Rolling
Forecast each [*].
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(b) Initial Purchase Forecast; Capacity. Notwithstanding anything to
the contrary contained herein, the first Rolling Forecast under
this Agreement (the "Initial Rolling Forecast") will be mutually
agreed upon by the parties within [*] of the successful
completion of the Field Trial but at a minimum the mutually
agreed forecast will consist of amounts that will enable Customer
to meet its Initial Minimum Purchase Commitment and will
designate the [*] to constitute "[*]". Corvis will accept
Purchase Orders for delivery in [*] of Products designated in a
Rolling Forecast for such [*], provided that Corvis will not be
obligated to deliver more than [*] of the amount specified for
that product code for delivery in that calendar [*] in the
immediately preceding Rolling Forecast (in which the [*] was then
[*]). Orders of Products in excess of the said [*]% limit will be
filled based on availability. In addition to the other terms and
conditions of this Agreement, Corvis will not be obligated to
accept orders during the Initial Minimum Purchase Commitment
Period that would require Corvis to deliver Products for any
product code in excess of [*]% of the amount forecasted for each
[*] in the Initial Rolling Forecast for such product code.
3.4 If Customer fails to submit Purchase Orders for any [*] for at least
[*] of the quantity forecasted for each Product for such [*] when it
appeared as [*] in a Rolling Forecast (with [*] of the [*] forecast
less the quantity ordered for that [*] being the 'Forecast
Shortfall"), Customer will pay Corvis cancellation charges equal to
[*] of the Forecast Shortfall, provided that Corvis gives Customer
written notice of such Forecast Shortfall. Charges by Corvis for
shipping, insurance, and taxes will not be taken into account in
determining Forecast Shortfalls. Customer will pay the cancellation
charge for a Forecast Shortfall within [*] after receipt of the
invoice for such charge. In the event that Customer submits Purchase
Orders for all or part of the Forecast Shortfall within [*]
following timely payment of the charge for the Forecast Shortfall,
then (i) Corvis will deliver the Products in the time frames set
forth in the Purchase Order accepted in accordance with Section 3.5;
and (ii) the amount timely paid for the Forecast Shortfall shall be
credited against amounts due under such Purchase Orders. If Customer
pays the invoice for a Forecast Shortfall pursuant to this Section
but fails to issue Purchase Orders for all or part of the Forecast
Shortfall within [*] of timely payment of the related Forecast
Shortfall charge, Customer will receive a credit for [*] of the
amounts paid with respect to the Forecast Shortfall and not
otherwise used by Customer as a credit for purchase reflected in a
Purchase Order issued within [*] of such charge and such credit may
be used by Customer to pay for purchases or licenses of Corvis
Equipment and/or Software (beyond amounts Customer is otherwise
obligated to purchase or license for [*] and [*] at the time the
Forecast Shortfall arose) made within [*] after the [*] with respect
to which the Forecast Shortfall arose.
3.5 During the Term of this Agreement, Customer will issue Purchase
Orders
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Exchange Commission. Asterisks denote omissions.
specifying the Products and Services ordered, the quantities
necessary, the delivery site or sites (hereinafter the "Specified
Site[s]") for the Products and Services and its proposed delivery
schedule. For Product quantities shown in the Rolling Forecast for
[*], Corvis will provide Products and Services on delivery dates
specified in a Purchase Order issued in accordance with this
Agreement. Corvis will use commercially reasonable efforts to meet
delivery requests by Customer that are not forecasted.
3.6 If Corvis does not deliver a Product within [*] after the delivery
date for such Product as specified in a Purchase Order issued and
accepted in accordance with Section 3.9 of this Agreement, Customer
may cancel that portion of the Purchase Order that relates to any
such Product not delivered within [*] after the delivery date in the
Purchase Order and have the price and/or license fee applicable to
such undelivered portion of such Purchase Order count toward the
Initial Minimum Purchase Commitment or the Total Minimum Purchase
Commitment, as appropriate. In addition, for Purchase Orders issued
for [*] occurring after the [*] period immediately following the [*]
in which the Initial Rolling Forecast was mutually agreed upon, if
Corvis does not deliver a Product within [*] after the delivery date
for such Product as set forth in a Purchase Order issued in
accordance with this Agreement, Customer shall receive a Product
purchase credit equal to [*] of the price and/or license fee for any
such undelivered Product, for each additional [*] period beyond the
initial [*] delay that Corvis continues to not meet its delivery
obligations with respect to such Product. For Purchase Orders issued
for [*] occurring after the [*] period immediately following the [*]
in which the Initial Rolling Forecast was mutually agreed upon, if
Corvis does not deliver any Product within [*] Product, as specified
in a Purchase Order issued and accepted in accordance with Section
3.9 of this Agreement, the Product purchase credit for late delivery
shall be increased to [*] of the price of the undelivered Product
for each additional [*] period beyond the initial [*] delay that
Corvis continues to not meet its delivery obligations with respect
to such Product. In no event will product credits earned with
respect to any specific Product that is delivered late exceed [*]
percent ([*]%) of the price and/or license fees for such Products.
Credits accrued pursuant to this Section 3.6 will automatically
expire if not used within [*] after the date of accrual. Product
credits shall no longer accrue with respect to Purchase Orders that
have been cancelled by Customer under this Section 3.6. This Section
3.6 will not apply to any failure to meet Corvis delivery
obligations due to fault of Customer or due to events of Force
Majeure, as provided in Article 10.
3.7 Corvis agrees to follow Customer's delivery instructions delivered
from time to time, including required carrier choices and Customer
agrees to pay freight and insurance charges. Customer will bear risk
of loss or damage to the Products upon Corvis' delivery of such
Product to Customer's designated delivery destination. The preceding
provisions of this clause are valid for deliveries in the United
States, its possessions and territories only. All deliveries outside
the aforementioned areas will be mutually agreed upon on a case by
case basis.
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3.8 Customer will have the right to specify a new destination site at
least [*] prior to Corvis' scheduled shipment date for Products,
without cost or expense to Customer, by timely transmitting Notice
to Corvis of the new Specified Site(s).
3.9 Corvis will confirm receipt of Customer Purchase Orders within
[*] of receipt. Corvis will execute and deliver to
Customer an order acceptance/acknowledgment within [*]
after Corvis' receipt of each Purchase Order provided Corvis shall
be obligated to accept all Purchase Orders issued under this
Agreement subject to the [*] limit in this Section 3.9 and the [*]
limit in Section 3.3(b). If the [*] order total is in excess of [*]
of the amount forecasted for the [*] in the immediately preceding
Rolling Forecast (in which the relevant [*] was then [*]), Corvis
will indicate to what extent it will commit to delivery of the
excess amount. To the extent Corvis is able to deliver any of the
excess amount, Customer will assist Corvis in allocating that
portion of the excess amount among Customer's Purchase Orders or
designated delivery locations. Without Customer's permission, Corvis
shall not deliver Products in response to a Purchase Order unless
Corvis is able to fill the Purchase Order substantially in full.
3.10 Customer will purchase installation spares, parts and components of
the Equipment ("Spares Kits" or "Kits") reasonably designated by
Corvis and agreed upon by Corvis and Customer from time to time as
the quantity necessary to enable Corvis to provide the warranty and
support services required by this Agreement. The quantity and
locations of the Kits may change with installation requirements and
changes in the topology of Customer's network. All Spares Kits will
be warehoused at Customer's designated facilities.
3.11 [*]
3.12 [*]
3.13 [*]
3.14 [*]
ARTICLE 4. CUSTOMER TESTING; PRODUCT DISCONTINUATION.
4.1 Customer may perform any inspection or testing that Customer wishes
to perform upon receipt of Corvis' Products. Customer's inspection
or failure to inspect any Product will not relieve or excuse Corvis
from the performance of any of its obligations, or constitute a
wavier of any rights or remedies Customer may have, under this
Agreement, including Corvis warranty obligations in respect to any
Products or Services.
4.2 Corvis will notify Customer promptly upon learning of any defects in
any of the
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Products.
4.3 (a) Corvis will support all Licensed Software and Equipment for the
period specified in Attachment 5.3 ("Supported Period'), subject to
the support limitations for Licensed Software contained in
Attachment 12.1.
(b) Subject to Corvis' obligations under Sections 4.3(a) and 16.3,
if Corvis discontinues manufacture and/or support of any of the
Equipment, Corvis will at Customer's request, to the extent of
Corvis' legal right to do so, without obligation or charge to
Customer deliver to Customer all of the technical information owned
and possessed by Corvis relating to the manufacture, maintenance,
operation and/or support of the Equipment, in the form then being
used by Corvis' in its day-to-day operations of manufacture or its
support and maintenance operations, or arrange for the continuing
provision of replacement and repair spare parts for the Equipment to
Customer's reasonable satisfaction. Customer may use such technical
information only to manufacture, have manufactured, obtain such
spare parts from other sources in connection with the Equipment and
Software obtained from Corvis and owned and operated or licensed by
Customer. Title to Corvis' technical information and intellectual
property rights will remain with Corvis.
ARTICLE 5. PURCHASING INCENTIVES.
During the Term, Corvis will provide Customer with the purchasing
incentives described in Attachment 5 [*] otherwise set forth in this
Agreement.
ARTICLE 6. PRICING, INVOICING, PAYMENT AND OTHER FINANCIAL TERMS.
6.1 Prices for Products are set forth in Attachment 6. Customer will pay
the right to use fee (the "Right to Use Fee") for the Equipment
and/or Software and intellectual property associated with the
relevant equipment all as specified in Attachment 6.
6.2 The prices in this Agreement do not include any federal, state or
local sales, use, excise or similar taxes, however designated, which
may be levied or assessed on the Products or Services provided
hereunder, and any personal property taxes levied or assessed on
Products which have been delivered but as to which title has not
passed to Customer. In no event shall Customer be liable for any
personal property taxes levied or assessed on the Products unless
Customer has exclusive use of such Products. With respect to such
taxes, Customer will either furnish Corvis with an appropriate
exemption certificate applicable thereto, or pay to Corvis, such
amounts as Corvis may by law be required to collect or pay. Customer
shall not be responsible for any franchise taxes payable by Corvis
or any taxes based upon the net income of Corvis.
6.3 Payment terms are set forth as follows:
(a) Customer will remit payment to Corvis for invoiced amounts
within [*]
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(30) days after Customer's receipt of the invoice, which will
be issued upon shipment of the Product or completion of
Services, as applicable. Charges for Services and
Equipment/Software will be invoiced and paid separately by
Customer.
(b) Customer will not be required to pay for Products or Services
which are rightfully disputed, except for any Products that
Customer has used in its commercial operations.
(c) Billing Disputes. Notwithstanding the foregoing, amounts
reasonably and in good faith disputed by Customer (along with
late fees attributable to such amounts) will not be due and
payable, provided Customer: (i) pays all undisputed charges on
or before the due date, (ii) presents a written statement of
any billing discrepancies to Corvis in reasonable detail
together with appropriate supporting documentation on or before
the due date of the invoice in question, and (iii) negotiates
in good faith with Corvis for the purpose of resolving such
dispute within a [*] period. In the event such dispute is
mutually agreed upon and resolved in favor of Corvis, Customer
agrees to pay Corvis the disputed amounts together with any
applicable late fees within [*] of the resolution. To the
extent any portion of the disputed amount is by mutual
agreement resolved in favor of Customer, Customer will receive
a credit for such portion of the disputed charges and the
applicable late fees.
6.4 In the event Corvis fails to receive payment from Customer when due
hereunder, Customer will have [*] to cure such non-payment after its
notice of non-payment from Corvis. Payments provided for in this
Agreement, when not paid within [*] of receipt of invoice, will bear
interest at a rate per month equal to [*]% for the time period from
and including the due date until payment is received by Corvis.
6.5 Itemized invoices shall be mailed in duplicate with shipping papers
to:
Williams Communications, Inc.
Attn: Accounts Payable
P.O. Box 22067
Tulsa, OK 74121
Transportation charges shall be listed separately on the invoice and such
charges shall be substantiated with a copy of the freight bill. FOB point,
and discount terms, if applicable, must be shown on all invoices.
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ARTICLE 7. TERM.
7.1 The parties agree that this Agreement shall not become effective
until this Agreement has been approved by the Board of Directors of
Customer's parent company, Williams Communications Group, Inc. (the
"Board of Directors"). The "Effective Date" shall be the date on
which Customer receives approval from the Board of Directors ("Board
Approval"). In the event Customer does not receive written notice of
Board Approval within three weeks from the Signature Date of this
Agreement, this Agreement shall be deemed null and void and of no
force and effect.
Subject to the terms and conditions of this Agreement, the initial term of
this Agreement will commence on the Effective Date of this Agreement and
terminate at the end of the 24 month period commencing with the first
calendar month following the month in which the Initial Rolling Forecast is
mutually agreed upon ("Initial Term").[*] The Initial Term in combination
with any extensions is also referred to in this Agreement as the "Term".
If Customer has available unused credits under Sections 3.2 or 3.4 at the
end of the Initial Term and Corvis has given notice to terminate, then
Customer shall have the right to extend the Initial Term of [*].
ARTICLE 8. DOCUMENTATION AND REPORTS.
8.1 Corvis will provide to Customer all Documentation necessary to
operate and maintain the Products provided hereunder. Corvis will
(a) update the Documentation as such updates are made generally
available, and (b) revise data incorporating any changes to the
Products which affect form, fit, function or features, in each case
at no additional charge to Customer. Such Documentation may be
reproduced by Customer for its internal use, provided that any
copyright notice of such Documentation is copied as well. Soft
copies of such Documentation will be available upon Customer's
request. Such Documentation will be used solely for Customer's
internal use only on a need-to-know and need-to-use basis. Corvis
will provide Customer with other reports as reasonably requested by
Customer, including a weekly shipping report, the form of which will
be mutually agreed upon between the parties. Such shipping report
will include information regarding Purchase Orders placed by
Customer, date of placement of Purchase Order and Corvis' ship date
of Products.
ARTICLE 9. DELIVERY AND INSTALLATION.
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9.1 Corvis will mark each shipment to Customer with Customer's name, the
Purchase Order number, and the identity and quantity of Product and
customer's AFE number as noted on the Purchase Order. Final
destination, interim staging area or any special shipping
instructions and any applicable charge will be specified on each
Purchase Order. All Products shall be suitably packed, marked and
shipped in accordance with the requirements of the relevant common
carrier in a manner designed to adequately protect the products in
shipment and to procure the lowest transportation costs unless
otherwise specified by Customer. Packing slips shall be placed in
each shipment. Packing charges are included in the prices set forth
in Attachment 6.
(b) If requested by Customer, Corvis will perform installation
services for the Products at Corvis' then standard rates for
such services.
9.3 The provisions of Attachment 9.3 will apply to engineering,
installation, turn-up and testing services provided by Corvis
pursuant to this Agreement.
ARTICLE 10. FORCE MAJEURE.
10.1 Except as otherwise provided herein, neither Corvis nor Customer
will be liable to the other for any delay in performing in
accordance with this Agreement, other than the payment of amounts
due for Products delivered by Corvis, if such delay arises out of an
Act of God including fire, flood, earthquake, explosion, casualty,
or accident, or out of war, riot, civil commotion, or the
requirement of any governmental agency or instrumentality.
10.2 The party asserting that an event of force majeure has occurred will
send the other party prompt notice thereof setting forth a
description of the event of force majeure, an estimate of its effect
upon the party's ability to perform its obligations under this
Agreement and the duration or expected duration thereof.
10.3 The party whose performance is prevented or delayed by the event of
force majeure will be excused, on a day-to-day basis, from the
performance of its obligations under this Agreement to the extent
prevented or delayed by such event (and the party whose performance
is not prevented or delayed by the event of force majeure will be
excused, on a day-to-day basis, from the performance of its
obligations under this Agreement to the extent such obligations
relate to the other party's prevented or delayed performance);
provided, however, that the party asserting the occurrence of a
force majeure event will use diligent efforts to avoid or remove
such force majeure event.
10.4 If an event of force majeure occurs, either party shall have the
option to (a) suspend this Agreement for the duration of the event
of force majeure, or (b) extend the duration of this Agreement by
the length of the event of force majeure.
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In addition, if an event of force majeure endures for a period of 90
days where Corvis is the party whose performance is prevented or
delayed by an event of force majeure, Customer shall have the right
to terminate this Agreement upon thirty days' written notice to
Corvis. Corvis shall have no right to terminate this Agreement in
the event either its or Customer's performance hereunder is delayed
or prevented by an event of force majeure regardless of how long the
event of force majeure exists.
ARTICLE 11. TRAINING.
11.1 Corvis will provide training as per Attachment 5. In addition,
Corvis will provide, upon Customer's request and at the time or
times required by Customer during the Term of this Agreement,
training classes and training materials for Customer personnel. The
training programs necessary for full installation, operation and
maintenance of the Corvis Products are summarized in Attachment
11.1, which will be subject to change by Corvis from time to time to
reflect updates to the training methodology and courses. Such
training will be kept current to encompass the latest Licensed
Software and Equipment, or any other Software revision level and/or
Equipment revision level directed by Customer. Subject to the
foregoing, course content and material will be designed and agreed
to by mutual consent. Customer will have the right to copy Corvis'
training materials for its internal use provided that any copyright
notice included in such material is copied as well. Courses will be
limited to a maximum of [*] attendees in each course session.
Training programs, other than the training provided as part of the
Purchasing Incentives described in Attachment 5, will be charged at
a rate of U.S.$[*] per person-day of training. In all cases,
Customer is obligated to pay for all travel and lodging of Customer
personnel. All training will be conducted at Corvis' Columbia,
Maryland location, [*]. If Customer requires training to be
conducted outside of Columbia, Maryland, Customer will pay the
travel, lodging, facilities and other related costs associated with
such location choice.
11.2 Corvis will certify attendees upon successful completion of the
course. Such course content and materials may be tailored or
customized by Customer for its internal use only.
ARTICLE 12. SOFTWARE LICENSE.
12.1 Subject to payment of any and all applicable license fees set out in
Attachment 6, Corvis grants to Customer a perpetual (subject to
termination pursuant to the terms of Section 23 of this Agreement),
personal, nontransferable (except as provided in this Agreement),
and nonexclusive license (or, with respect to the Third Party
Software, a sublicense) to use the Software and its related
Documentation provided pursuant to the terms of this Agreement. Use
of the Software is restricted to the
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specified number of Network Elements or the designated equipment, as
applicable ("Designated Equipment") set forth on Customer's Purchase
Order(s). If an item of Designated Equipment becomes inoperative,
Customer will have the right to use the Software on comparable
backup equipment until such Designated Equipment is restored to
operable status. No Software license fee will be payable to Corvis
with respect to spares until such time as they are put into service.
The license grants Customer no right to and Customer will not
sublicense such Software (except to the extent otherwise provided
herein), or modify, decompile, or disassemble Software furnished as
object code to generate corresponding Source Code. Customer and its
customers will be entitled to modify only the user-controlled
features of the Software as provided for in the related
Documentation. With respect to any Third Party Software, in addition
to the terms and conditions herein, Customer will abide by the
applicable terms and conditions for such Third Party Software.
Attachment 12.1 lists the Third Party Software licenses that are
applicable as of the Effective Date.
12.2 The CEM Software provided for use on Sun Workstations may only be
used on such workstation if such Software is the only software
running on such workstation and access to such workstation is
password protected.
12.3 All Software (whether or not part of firmware) and its related
Documentation furnished by Corvis, and all copies thereof made by
Customer, including translations, compilations, and partial copies,
are and will remain the exclusive property of Corvis and its
licensors. Customer will hold such Software and related
Documentation in strict confidence, and will not, without Corvis'
prior written consent, disclose, provide, provide access to, or
otherwise make available, in whole or in part, any Software or
related Documentation including any description of the [*] sections
of the Software to anyone, except to its employees, and those agents
and subcontractors that are not Corvis Competitors having a need-to-
know for purposes of operating or maintaining the related Product,
and except to its customers to the extent necessary to permit them
to utilize customer-controlled features in accordance with the
applicable Documentation. Such availability will be limited to only
those portions of the Software and its related Documentation for
which there is a need-to-know for purposes of operating or
maintaining the related Product. Other than Customer employees
subject to an enforceable corporate policy requiring confidential
treatment of confidential information, all persons to whom the
Software and related Documentation is made available will have
agreed in writing to obligations of confidentiality at least as
protective as those set forth herein. Customer will maintain an
accurate and complete list of all persons having access to the
Software and will maintain a log of persons accessing the Software.
Customer will provide Corvis with prompt written notice of any
unauthorized use of the Software and its related Documentation and
fully cooperate with Corvis in enforcing Corvis' proprietary rights
in the Software and its related Documentation.
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Customer will not, and will not permit any other person to copy, duplicate,
modify, alter, enhance, revise, summarize, or prepare derivative works from
any portion of the [*] sections of the Software. Customer will not copy
Software embodied in firmware. With respect to Software and Related
Documentation not described in the preceding two sentences. Customer will
not make any copies of any Software or related Documentation except as
necessary for maintaining archival copies in accordance with Customer's
customary practices. Such archival copies will be stored in a locked and
secured container. Customer will reproduce and include any Corvis
copyright and proprietary notice on all such necessary copies of the
Software and its related Documentation. Customer will take appropriate
action, by instruction, agreement, or otherwise, with the persons permitted
access to the Software and related Documentation to enable Customer to
satisfy its obligations under this Agreement. When the Software and
related Documentation are no longer needed by Customer, or if Customer's
license is canceled or terminated, Customer will return all copies of such
Software and related Documentation to Corvis or follow written disposition
instructions provided by Corvis at that time, if any.
Customer shall have the right to keep a copy of the Licensed Software on a
backup system and use such copy in the event of an emergency situation
without paying any additional license or Right-to-Use fees. Customer
agrees not to use such copy on the backup system unless an emergency
situation prevents the original licensed Software from being used by
Customer.
12.4 Customer may transfer its right-to-use Software furnished under this
Agreement without the payment of an additional right-to-use fee by
third party transferee, except for additional fees which would have
been applicable to Customer with respect to usage sensitive factors
(e.g., feature pricing based on activation level)provided such
transfer may only be made to another end user for their own internal
use, but not to any Corvis Competitor and only under the following
conditions:
(1) Such Software will be used only within the United States and
such other countries for which such Software may be licensed
from time to time under the terms of this Agreement.
(2) The right to use such Software may be transferred only together
with the Designated Equipment with which Customer has a right
to use such Software, as long as such transfer of the
Designated Equipment is permitted pursuant to Section 15.3, and
such right to use the Software will continue to be limited to
use with such Designated Equipment;
(3) Before any such Software will be transferred, Customer will
notify Corvis in writing of such intended transfer and the
transferee will
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have agreed in writing (a copy of which will be provided to
Corvis before such transfer) to the terms of this Agreement and
any amendments thereto.
12.5 Subject to Section 12.2, upon written notice to Corvis, Customer may
physically transfer Software for which Customer has the right to
use, from one Customer-owned workstation computer and relocate them
to another Customer-owned workstation computer, provided that (a)
the Product from which the Software has been transferred will cease
to be Designated Equipment for such transferred Software and the
workstation to which the Software has been transferred will
thereafter be deemed to be the Designated Equipment, and (b) the
Software delivered by Corvis pursuant to a Purchase Order will not
be resident at any time on more than the total number of items of
Designated Equipment for such Software set forth on the applicable
Purchase Order. Customer will not be required to pay additional
right-to-use fees as a result of such relocation.
12.6 Corvis and Customer will enter into an escrow agreement, in the form
set forth in Attachment 12.6 ("Escrow Agreement"). The escrow agent
for the Escrow Agreement will be [*] or another escrow agent
acceptable to both parties. Corvis will bear the cost of providing
Corvis' Source Code to the Escrow Agent. Customer will pay the
Escrow Agent's charges, including any costs associated with testing
the Source Code in Escrow or with release of such Source Code. Upon
execution of the Escrow Agreement by both parties, Corvis will place
in escrow the source code version of the Software (excluding Third
Party Software). Thereafter, Corvis will supplement the materials in
escrow to include upgrades and new releases of the Software
(excluding Third Party Software) then in use by Customer. The Escrow
Agreement will provide for the release of the materials in escrow,
subject to the terms and conditions of the Escrow Agreement.
ARTICLE 13. SOFTWARE CHANGES.
13.1 Corvis will furnish to Customer preliminary planning information and
Documentation for new releases of the Software. Such information
will be provided [*] to Customer. New generally available releases
of the Software may be licensed by Customer at Corvis' then-current
standard license fees, except to the extent such releases are
included in the Maintenance and Support Services then in effect
pursuant to the terms of this Agreement.
13.2 Software licensed to Customer under this Agreement may contain
supplemental optional features or enhancements that are separately
priced. Customer agrees not to activate such optional feature or
enhancements without written authorization from Corvis and
Customer's payment of the appropriate license fees. If, in spite of
Customer's best efforts to comply with this restriction, such
features are activated, Customer agrees to so notify Corvis promptly
and to pay Corvis the license fees for the activated features as
well as the reasonable cost of money not exceeding the prime rate of
interest for the period in which such features were activated.
Corvis, through its own employees will have the right to audit
Customer's usage of Corvis
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Equipment and Software during normal business hours and upon
reasonable notice to the extent reasonably necessary to assure
compliance with the terms of this Agreement.
ARTICLE 14. PRODUCT CHANGES.
14.1 Prior to shipment, Corvis may at any time make changes in Products
or modify the drawings and specifications relating thereto or
substitute Products of later design, provided the changes,
modifications or substitutions under normal and proper use do not
impact upon form, fit, function or features of the ordered Equipment
or materially adversely affect the use, function, or performance of
the ordered Software, as provided in the Technical Requirements.
Unless otherwise agreed, no Software substitution will result in any
additional charges to Customer with respect to licenses for which
Corvis has quoted fees to Customer. With respect to changes,
modifications, and substitutions which affect the form, fit,
function, features, use or performance of an ordered Product, Corvis
will notify Customer in writing [*] prior to their effective dates.
In the event any such change is not desired by Customer, Customer
will notify Corvis within [*] from the date of notice and Corvis
will not furnish any such changed Products to Customer on any orders
in process at the time Corvis is so notified and, with respect to
the Products listed in Attachment 6 at the Effective Date, issued by
Customer under this Agreement. In no event will Corvis change the
form, fit, function, features, use or performance of any Product if
such change causes the Product not to conform to the Technical
Requirements, except to the extent such change conforms to changes
in network telecommunications standards generally accepted in the
industry and are acceptable to Customer.
Corvis may discontinue any Product or Software version if
Corvis gives Customer at least [*] notice thereof; provided,
however, that Corvis agrees to not discontinue the Products
listed in Attachment 6 until the earlier of (i) the date
Customer meets the Minimum Purchase Commitment, or (ii) the
expiration of the 24-month period commencing upon the
successful completion of the Field Trial. In the event of such
discontinuation, Corvis will provide Customer with a suggested
product replacement at the same time for the remainder of the
Term of this Agreement. Customer will have the right to
substitute the replacement product for the Product under this
Agreement, at a price to be negotiated by the parties. Customer
may give a last order ("One Time Buy Order") immediately prior
to the end of the [*] period. The One Time Buy Order is non-
cancelable, non-re-schedulable and non-returnable; except as
otherwise provided in this Agreement. Products ordered with the
One Time Buy Order will be delivered to Customer as requested
by
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Customer but no later than one year after the notice of
discontinuance.
14.2 Class Changes.
(a) After Corvis Equipment has been shipped to Customer, if Corvis
issues a Class A Change or Class B Change, or where
modification to correct an error in Documentation is to be
introduced, Corvis will promptly notify Customer of such change
("Change Notification"). Corvis will promptly provide, or cause
the respective manufacturer to provide, to Customer any changes
comparable to Class A and Class B Changes to the extent they
are made available by manufacturers with respect to Vendor
Items sold to Customer by Corvis.
(b) Corvis will, [*], furnish the parts and documentation necessary
for Customer to implement such Class A Change if it is issued
within the Supported Period for the applicable Product.
(c) In any of the instances above, if Corvis determines that the
Equipment or part thereof subject to such change is readily
returnable (e.g. plug-in items), Customer, [*], will
remove and will return such Equipment or part to Corvis'
facility and Corvis, at its expense, will implement such change
at its facility and return such changed Equipment or part to
Customer's designated location. Reinstallation will be
performed by Customer at its expense.
(d) Corvis' undertaking under this Section 14 with respect to
Vendor Items is limited to the extent changes comparable to
Class A Changes are provided by the respective manufacturers of
Vendor Items.
(e) If Customer does not make or permit Corvis to make a Class A
Change Notification within [*] after the date of the
related Change Notification, or a Class B Change within [*]
after the date of the related Change Notification, subsequent
changes, repairs, or replacements affected by the failure to
make such change may, at Corvis' option, be billed to Customer
whether or not such subsequent change, repair, or replacement
is covered under warranty.
(f) If Corvis or any applicable manufacturer of a Vendor Item
issues a Class B Change (or comparable change in the case of
such
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manufacturer) after Equipment has been shipped to Customer,
Corvis will promptly notify Customer of such change if it is
being generally offered to Corvis' customers. When a Class B
Change is requested by Customer, billing will be at Corvis'
applicable prices or the respective manufacturer's then current
prices to Corvis, as the case may be. Notwithstanding the
above, there will be [*] for any Class B Change (or, in the
case of a Vendor Item, a comparable change) if such change is
included in the Maintenance or Support Services then in effect
pursuant to the terms of this Agreement.
14.3 Corvis reserves the right to discontinue any product that is a
Product under this Agreement if Customer has not ordered any of that
Product for [*]. Corvis will provide [*] prior notice for Products
being discontinued.
ARTICLE 15. PROPRIETARY INFORMATION.
15.1 As used herein, "Proprietary Information" means and includes (i)
trade secrets and other proprietary or confidential information,
including but not limited to products, planned products, services or
planned services, the identity of or information concerning
customers or prospective customers, data, financial information,
computer software, processes, methods, knowledge, inventions, ideas,
marketing promotions, discoveries, current or planned activities,
research development or other information relating to a party's
business activities or operations and those of its customers or
subcontractors, whether disclosed verbally or in written form, but
which, if disclosed in written form, is marked 'confidential" or
"proprietary", (ii) the pricing and other terms and conditions of
this Agreement, and (iii) Corvis Equipment and Software, and all
non-public information related thereto, whether or not marked
"confidential" or "proprietary". The Proprietary Information shall
be deemed the property of the Disclosing Party (as defined below).
15.2 (a) This Agreement creates a confidential relationship between
Customer and Corvis and, in the course of negotiating or
performing this Agreement, including providing Products
pursuant to this Agreement, a party may disclose ("Disclosing
Party") Proprietary Information to the other party ("Receiving
Party"). The Receiving Party will keep Proprietary Information
confidential and, except as directed or authorized in writing,
will use Proprietary Information only in conjunction with the
provision, use, maintenance or operation of the Products and
Services covered by this Agreement and will not disclose to any
person or entity, directly or indirectly, in whole or in part,
any Proprietary Information, or information derived from
Proprietary
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Information. Not withstanding the foregoing, the Proprietary
Information may be disclosed to the officers, directors,
employees and affiliates of the Receiving Party with a need to
know and solely for the purpose of the performance of duties
hereunder. Upon termination of the agreement, the Receiving
Party will, at Disclosing Party's option, return to the
Disclosing Party, or destroy and certify to the Disclosing
Party such destruction of all documents, papers and other
materials in its control that contain or relate to Proprietary
Information. To the extent practicable all Proprietary
Information disclosed to the Receiving Party will be promptly
identified as such [*].
(b) The Receiving Party will protect the Proprietary Information
from unauthorized use or disclosure by exercising the same
degree of care that it uses with respect to information of its
own of a similar nature, but in no event less than reasonable
care.
15.3 Customer acknowledges and agrees that the Products constitute and
embody the valuable trade secrets and intellectual property of
Corvis developed at great expense to Corvis. Except as otherwise
permitted under the terms of Sections 12.4 and 26.1 and Article 24,
Customer may not sell, assign or otherwise transfer any of the
Products to a third party other than a telecommunications carrier
for its own internal use in providing telecommunication services,
without the prior written consent of Corvis, which consent will not
be unreasonably withheld. Customer agrees that it would be
reasonable for Corvis to withhold its consent to any such sale,
assignment or transfer of any Product to a Corvis competitor.
15.4 Notwithstanding anything to the contrary contained herein,
"Proprietary Information" will not include any information Receiving
Party can demonstrate : (a) is generally known to the public on the
date of disclosure of same or becomes generally known to the public
after such date through no breach of this Agreement or any other
obligation of confidentiality; (b) was known by the Receiving Party
at the time of disclosure without any obligation to hold it in
confidence ; (c) is received by the Receiving Party after the date
of disclosure from a third party without breach of any obligation of
confidentiality and without any obligation of confidentiality
binding upon the Receiving Party; (d) is independently developed by
the Receiving Party after the date of disclosure without use of, or
reference to, the Proprietary Information of the Disclosing Party;
(e) is approved for release by written authorization of the
Disclosing Party, but only to the extent of, and subject to, such
conditions as may be imposed in such written authorization; (f) is
required by law, rule or regulation, including requirements of the
applicable securities exchanges, to be disclosed, but only to the
extent and for the purposes of such required disclosure and subject
to Section 15.5; or (g) is disclosed in response to a valid order of
a court or other governmental body, but only to the extent of and
for the purposes of such order and subject to Section 15.5.
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15.5 If a Receiving Party is or may be required under 15.4(f) or (g), by
law or court order to disclose any Proprietary Information of a
Disclosing Party, such Receiving Party: (a) will provide to such
Disclosing Party immediate notice of such possible disclosure; and (b)
will permit such Disclosing Party, at Disclosing Party's expense, to
take all reasonable actions to eliminate such requirement of such
disclosure, to limit the scope of same and to obtain protective orders
to protect the confidentiality of such Proprietary Information,
including, without limitation, filing motions and otherwise making
appearances before the court.
15.6 The provisions of this Article 15 will survive any termination or
expiration of this Agreement indefinitely with regard to information
designated as a trade secret by the Disclosing Party and for a period
of two (2) years with regard to all other Proprietary Information.
ARTICLE 16. WARRANTIES, AND WARRANTY EXCLUSIONS AND LIMITATIONS.
16.1 Corvis warrants that (i) for the applicable warranty period set forth
in Attachment 16.1 ("Warranty Period"), the Corvis Equipment and
Software (as applicable) purchased under this Agreement will be of new
manufacture, will be free from defects in material and workmanship,
and will conform in all material respects to the Technical
Requirements and to the relevant information contained in Corvis' then
current published specifications and related Documentation, (ii) upon
delivery, the Equipment and Software will be free from all liens and
encumbrances, and (iii) Corvis' Services will be performed in a
workmanlike manner and with the skill and care exercised by others
performing similar services. Corvis does warrant, during the warranty
period, that Corvis Equipment and Software are compatible and will
perform in conjunction with any Third Party Software or Vendor Item
supplied under or in connection with this Agreement provided that the
Third Party Software and/or Vendor Item performs in accordance with
the manufacturer's specifications. If Corvis Software fails, or
appears to fail, to comply with the standard expressed in the
preceding sentence, then Corvis will act in a commercially expeditious
manner in cooperation with the Third Party Software licensor to
determine the source of the problem and to develop and implement a
solution. Corvis makes no warranties regarding any Third Party
Software or any Equipment furnished by Corvis but neither manufactured
by Corvis nor purchased by Corvis pursuant to its procurement
specifications (e.g., items such as personal computers and products
offered as accessories to the Corvis Products) (collectively, "Vendor
Items"). Corvis' sole obligation with respect to such Vendor Items
will be to assign to Customer any warranty provided to Corvis with
respect to such Vendor Items to the extent such warranty is
assignable, and if any such warranty is not assignable, then upon the
request of Customer to take commercially reasonable steps to enforce
the warranty for Customer's benefit.
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16.2 With respect to Products repaired or replaced during the applicable
Warranty Period, Corvis warrants, for a period equal to the greater of
(i) the remaining unexpired portion of such Warranty Period, or (ii)
[*] from the date the repair is effected, in the case of Products
repaired at the installation site, and from the date a replacement is
shipped to Customer, in the case of defective Products that are
replaced, that such Products will satisfy and perform in accordance
with the warranty set forth in clause (i) in Section 16.1, throughout
such time period.
16.3 Corvis will continue to make available for purchase by Customer repair
parts for Corvis' Products furnished pursuant to this Agreement so
long as Corvis is manufacturing or stocking such equipment or repair
parts, but in no event less than the Supported Period for the Product.
16.4 Corvis may use either new or remanufactured, reconditioned or
refurbished Equipment or parts if in like-new condition, or
functionally equivalent Equipment or parts (at equivalent or
comparable prices) in the furnishing of repairs or replacements under
this Agreement. Corvis will have appropriate safeguards and systems in
place to assure that parts previously determined to be defective are
not reused unless they have been proven to be in compliance with
applicable specifications. Subject to the provisions of this Article
16 and Article 18, Corvis warrants, except as stated in the Technical
Requirements, or as otherwise mutually agreed by the parties, that it
shall use commercially reasonable efforts to cause any Corvis Software
on the date provided to Customer by Corvis: (a) to contain no hidden
files; (b) to not replicate, transmit, or activate itself without
control of a person operating computing equipment on which it resides;
(c) to contain no harmful programs or data incorporated into Software
with criminal, malicious or mischievous intent that materially
disrupts the proper operation of a computer hardware system or
associated software; (d) contain no encrypted imbedded key unknown to
Customer, node lock, timeout or other function, whether implemented by
electronic, mechanical or other means, which restricts or may restrict
use of, or access to, any programs or data developed under this
Agreement, based on residency on a specific hardware configuration,
frequency or duration of use, or other limiting criteria. Corvis
covenants that, in the event any item listed in (a), (b) or (c) above
is found in the Software provided by Corvis to Customer pursuant to
this Agreement, and if it was introduced into such Software by Corvis
under this Agreement as a result of Corvis failing to take such
commercially reasonable actions or precautions, Corvis shall remove
such items at its expense and assist Customer is mitigating the
effects of such items.
16.5 Corvis warrants that it has good marketable title to the Equipment,
that it has the full power and authority to grant the license (or
sublicense, as applicable) granted Customer under or in connection
with this Agreement with respect to the Licensed
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Software and that the license to, and use by, Customer of the Licensed
Software or Equipment, as permitted under this Agreement, will not (or
in the case of Third Party Software, to Corvis' knowledge, will not)
constitute an infringement or other violation of any U.S. copyright,
U.S. patent, trade secret, U.S. trademark, non-disclosure, or any
other U.S. intellectual property right of any third party.
16.6 Corvis warrants that each Product, other than third party products
(which are identified as such in the applicable schedules to this
Agreement), when run with accurate date data and in accordance with
its Documentation will recognize the year 2000 as a leap year and will
not produce material errors processing date data in connection with
the year change from 1999 to 2000, as long as, and only to the extent
that, all other information technology used in combination with such
Product (e.g., software, firmware, hardware) properly exchanges date
data with it. If Customer reports to Corvis on or before expiration of
the Warranty Period for the Product that a Product does not meet the
warranty in this Paragraph 16.6, Corvis will: (i) exercise
commercially reasonable efforts to correct any material non-
compliance; and (ii) provide any resulting correction to Customer,
[*]. This is Customer's exclusive remedy for breach of the warranty
under this Paragraph 16.6. Subject to the provisions of Paragraph
16.1, Corvis makes no warranties regarding third party products
provided by Corvis under this Agreement. Corvis' sole obligation with
respect to such third party products will be to assign to Customer any
warranty provided to Corvis with respect to such products to the
extent such warranty is assignable, and if any such warranty is not
assignable, then to take commercially reasonable steps to enforce the
warranty for Customer's benefit.
16.7 THE FOREGOING WARRANTIES IN THIS ARTICLE 16 ARE THE SOLE AND EXCLUSIVE
WARRANTIES WITH RESPECT TO ANY OF THE PRODUCTS OR SERVICES PROVIDED
HEREUNDER, AND ARE IN LIEU OF ALL OTHER EXPRESS AND IMPLIED
WARRANTIES, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.
16.8 In the event that Customer (i) makes any unauthorized modifications to
the Equipment or Software, or (ii) violates the provisions contained
in the first sentence of Section 16.10, the Equipment and Software
warranty will be voided with respect to the Equipment or Software so
modified or used in a manner prohibited under the first sentence of
Section 16.10. Corvis and Customer agree to cooperate to plan the
configuration of Customer's network to optimize its efficiency.
16.9 Corvis makes no warranty with respect to defective conditions or non-
conformities resulting from the following: Customer (including third
parties contracted by Customer) modifications, misuse, neglect,
accident or abuse; improper wiring, repairing, splicing, alteration,
installation, storage or maintenance by Customer (or third parties
contracted by Customer); use in a manner not in accordance with
Corvis' published operating specifications or instructions (provided
such
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specifications or instructions have been given to Customer) or
failure of Customer to apply previously applicable Corvis'
modifications or corrections that constitute Class A Changes. In
addition, Corvis makes no warranty with respect to Products which
have had their serial numbers or month and year of manufacture
removed, altered or with respect to consumable items. Corvis makes
no warranty with respect to defects caused by Customer's equipment
and software provided by vendors other than Corvis except for Vendor
Items or Third Party Software. Moreover, no warranty is made that
Software will run uninterrupted or error free provided that the
foregoing sentence will not relieve Corvis from diligently
performing its obligations under this Agreement or alter Corvis'
warranty obligations including the obligation that the Software
perform in accordance with the Technical Requirements.
16.10 Customer agrees not to use any third party equipment or software in
connection with the Corvis Equipment and Software other than to
connect to the [*] interfaces of the Corvis [*] and [*] modules, the
[*] and order wire interfaces, or to the network management
interfaces provided by Corvis.
ARTICLE 17. REPRESENTATIONS AND OTHER WARRANTIES.
17.1 Each party represents and warrants that it is duly organized,
existing and in good standing under the laws of its State of
organization, and is duly qualified as a foreign corporation and in
good standing in all jurisdictions in which the failure to so
qualify would have a materially adverse impact upon its business and
assets.
17.2 Except as provided below, each party represents and warrants that it
has the corporate power and requisite authority to execute, deliver
and perform this Agreement, any Escrow Agreement entered into
pursuant to this Agreement, and all Purchase Orders to be executed
pursuant to or in connection with this Agreement, and that it is
duly authorized to, and has taken all corporate action necessary to
authorize, the execution, delivery and performance of this Agreement
and such other agreements and documents. The obligations of Customer
under this Agreement are subject to Board Approval
17.3 Upon the Effective Date, each party represents and warrants that
neither the execution and delivery of this Agreement and the
agreements or documents stated in Section 17.2 above executed by it
pursuant to or in connection with this Agreement, nor the
consummation of any of the transactions herein or therein
contemplated, nor compliance by it with the terms and provisions
hereof or with the terms and provisions thereof will (i) contravene
or materially conflict with any provision of applicable law to which
it is subject or any judgment, license, order or permit applicable
to it, or any indenture, mortgage, deed of trust, or other agreement
or instrument to which it is a party or by which it or its property
may be bound, or to which it or its property may be subject, (ii)
violate any provision of its articles of incorporation or bylaws or
partnership agreement, if any or (iii) require the consent or
approval of, the giving of notice to, or the registration,
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recording or filing of any document with, or the taking of any other
action in respect of, any person, entity or governmental agency.
17.4 Upon the Effective Date, each party represents and warrants that this
Agreement and the agreements or documents stated in Section 17.2 above
executed by it pursuant to or in connection with this Agreement will
constitute when executed in full and upon Board Approval, the legal,
valid and binding obligations of said party, enforceable in accordance
with their respective terms, subject to applicable bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or similar
laws affecting the enforcement of creditors rights generally and to
general principles of equity.
17.5 Customer makes the representations contained in Sections 17.2, 17.3
and 17.4 above only upon Board Approval.
ARTICLE 18. REMEDIES AND LIMITATIONS.
18.1 If any Product fails to conform to the warranty specified in Article
16 during the applicable Warranty Period, Corvis will promptly repair
or replace, at its option and expense, all such defective or
nonconforming Product within [*] of receipt of the Product. If Corvis
cannot repair or replace such Product, it will provide a refund or
credit for the original purchase price or license fee paid by Customer
for such Product. If Corvis fails to perform any Services in
accordance with Article 16 and Customer notifies Corvis of such
failure within [*] of the date on which Customer accepts such
Services, Corvis, at its option, either will correct the defective or
non-conforming Services or render a full or pro-rated (based on the
portion of the Services that are defective or non-conforming) refund
or credit based on the original charges for the Services. No Product
will be accepted for repair or replacement without the written
authorization of and in accordance with reasonable instructions of
Corvis. Removal and reinstallation expenses as well as transportation
expenses associated with returning such Product to Corvis for readily
returnable Products (e.g., plug-in items) will be borne by Customer.
Corvis will [*] of any repaired or replaced Product to the destination
designated by Customer. In repairing or replacing any Equipment or
Software medium under this warranty, Corvis may use either new
Products or parts or remanufactured, reconditioned or refurbished
Products or parts if in like-new condition or functionally equivalent
to new Products or parts. Replaced Products or parts will be retained
by Corvis and become Corvis' property. Replacement Products or parts
become the property of Customer.
18.2 In the event Customer returns Products for repair that are not
defective, Corvis may require that Customer pay with respect to any
subsequently returned Products which prove not to be defective a fee
which reflects Corvis' cost of handling, inspecting and testing and,
if applicable, travel and related expenses by Corvis' employees.
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18.3 The parties acknowledge that disclosure of any Proprietary Information
other than as allowed by Article 12 or Article 15 may give rise to
irreparable injury and may be inadequately compensable in monetary
damages and therefore the affected party will be entitled to seek
injunctive or other equitable relief against the breach or threatened
breach of the obligations of said Article 12 or Article 15, in
addition to any other remedies which may be available.
18.4 The remedies available to either party under this Agreement are
cumulative. The exercise of any one remedy will not be deemed an
election of such remedy to the exclusion of other remedies; and the
rights and remedies of the parties as set forth in this Agreement are
not exclusive and are in addition to any other rights and remedies
available to it at law or in equity.
18.5 EXCEPT FOR CORVIS' INDEMNITY OBLIGATIONS SET FORTH IN ARTICLES 21 AND
22, ANYTHING IN THIS AGREEMENT TO THE CONTRARY NOTWITHSTANDING, (I)
THE MAXIMUM AGGREGATE AMOUNT THAT CUSTOMER WILL BE PERMITTED TO
RECOVER BECAUSE OF A DEFECTIVE PRODUCT OR DEFICIENT SERVICE WILL NOT
EXCEED THE PRICE OF SUCH PRODUCT OR SERVICE INVOICED TO CUSTOMER, AND
(II) CORVIS' LIABILITY TO CUSTOMER UNDER THIS AGREEMENT OR IN
CONNECTION WITH ANY MATTERS OTHER THAN THOSE COVERED BY CLAUSE (I)
HEREOF WILL NOT EXCEED IN THE AGGREGATE THE PRICE PAID TO CORVIS UNDER
THIS AGREEMENT DURING THE [*] PRECEDING THE EVENT GIVING RISE TO SUCH
LIABILITY.
18.6 NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, NEITHER PARTY
OR ITS AFFILIATES, OR THEIR DIRECTORS, EMPLOYEES AND AGENTS WILL BE
LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, EXEMPLARY, OR
CONSEQUENTIAL DAMAGES OR LOST PROFITS, REVENUES OR SAVINGS ARISING OUT
OF THIS AGREEMENT, OR THE USE OR PERFORMANCE OF ANY PRODUCT OR
SERVICES, WHETHER IN AN ACTION FOR OR ARISING OUT OF BREACH OF
CONTRACT, TORT, INCLUDING NEGLIGENCE, INDEMNITY OR STRICT LIABILITY.
THIS PARAGRAPH WILL SURVIVE FAILURE OF AN EXCLUSIVE OR LIMITED REMEDY.
ARTICLE 19. SUPPORT AND OTHER SERVICES.
19.1 Customer and Corvis will, within [*] after the Signature Date,
mutually agree upon the terms and conditions upon which Corvis will
provide maintenance and support services to Customer. Such agreement
shall be evidenced by a separate document and shall reflect industry-
standard maintenance and support services and shall be negotiated in
the range of [*]%-[*]% of the actual purchase price paid by Customer
for the Corvis Equipment and Software.
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ARTICLE 20. INSURANCE.
20.1 Corvis will procure and maintain, during the Term of this Agreement
insurance in not less than the following amounts:
(a) Worker's Compensation insurance in accordance with the provisions
of the applicable Workers' Compensation or similar law of the
state with jurisdiction applicable to Corvis' personnel.
(b) Commercial General Liability, including Contractual Liability
insurance with a coverage limit of not less than [*] dollars
($[*]) combined single limit per occurrence for bodily injury or
property damage liability
(c) If the use of any automobile is required by the Corvis or any
third party acting on behalf of Corvis in the performance of this
Agreement, Corvis will also obtain and maintain business auto
liability insurance for the operation of all owned, non-owned and
hired automobiles with a coverage limit of not less than [*]
dollars ($[*]) combined single limit per accident for bodily
injury or property damage liability.
20.2 Corvis will deliver to Customer certificates of insurance satisfactory
in form and content to Customer evidencing that all of the insurance
required by this Agreement is in force, and that no policy may be
canceled or materially altered without first giving Customer at least
thirty (30) days prior written notice.
ARTICLE 21. INDEMNIFICATION.
21.1 Corvis will be responsible for and agrees to indemnify and hold
harmless Customer from and against all losses, liabilities, demands,
claims, actions, proceedings, suits and damages (including reasonable
legal fees) for bodily injury, including death, to persons or damage
to tangible property to the extent it results directly from the
willful misconduct or negligent acts or omissions, or strict
liability, of Corvis, its officers, agents, employees, or contractors.
21.2 Customer will be responsible for and agrees to indemnify and hold
harmless Corvis from and against all losses, liabilities, demands,
claims, actions, proceedings, suits and damages (including reasonable
legal fees) for bodily injury, including death, to persons or damage
to tangible property to the extent it results directly from the
willful misconduct or negligent acts or omissions, or strict
liability, of Customer, its officers, agents, employees or
contractors.
21.3 With respect to each of Sections 21.1 and 21.2 above, the indemnified
party will give the indemnifying party prompt written notice of all
such claims, actions, proceedings or suits. The indemnified party
will, upon the indemnifying party's request and at the indemnifying
party's expense, furnish all relevant information
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available to the indemnifying party and cooperate and assist the
indemnifying party in every reasonable way to facilitate the defense
and/or settlement of any such claim, action, proceeding or suit.
ARTICLE 22. PATENT, COPYRIGHT AND TRADE SECRET.
22.1. In the event of any claim, action, proceeding or suit by a third
party against Customer alleging an infringement of any U.S. patent,
U.S. copyright, or U.S. trademark, or a violation or
misappropriation of any trade secret or other U.S. proprietary
rights by reason of the purchase, license or use, in accordance with
Corvis' specifications, of any Product (other than Third Party
Software unless the claim is based upon Customer's unauthorized use
of the Third Party Software due to Corvis' not having the authority
to sublicense to Customer) furnished by Corvis to Customer under
this Agreement, Corvis, at its expense, will defend, indemnify and
hold harmless Customer, subject to the conditions and exceptions
stated below from such claims, actions, proceedings or suits. Corvis
will reimburse Customer for any reasonable cost, expense or
attorneys' fees, which Customer is required to incur cooperating
with Corvis at Corvis' request in the defense or settlement of such
action. Corvis will indemnify Customer against any liability
assessed against Customer by final judgment on account of such
action, proceeding or suit. The foregoing indemnity is with respect
to patent, trademark and copyright infringement arising from
Products sold or licensed for use in the United States and is
limited to the patents, trademarks, and copyrights enforced under
the laws of the United States.
22.2. Corvis' obligation to indemnify Customer pursuant to this Article 22
is contingent upon (i) Customer giving Corvis prompt written notice
of all such claims, actions, proceedings or suits alleging
infringement or violation, (ii) Customer tendering to Corvis full
and complete authority to assume the sole defense thereof, including
appeals provided that Customer shall have the right to have counsel,
at Customer's own expense, participate in such defense or appeal,
and the sole right to settle same, provided that Customer has
provided its prior written consent to such settlement, which consent
shall not be unreasonably withheld, and (iii) Customer furnishing to
Corvis all relevant information available to Customer and
cooperating with and assisting Corvis in every reasonable way to
facilitate the defense and/or settlement of any such claim, action,
proceeding or suit.
22.3. If Customer's use is enjoined or in Corvis' opinion is likely to be
enjoined, Corvis will, at its expense and at its option, either (1)
replace the enjoined Product furnished pursuant to this Agreement
with a suitable substitute free of any infringement, provided such
substitute has comparable functionality and performance
characteristics; (2) modify it so that it will be free of the
infringement, provided such modification does not result in a
material degradation in performance or functionality; or (3) procure
for Customer a license or other right to use it. If none of the
foregoing options are available to Corvis on a commercially
reasonable basis, Corvis will remove the enjoined Product, and
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refund to Customer any amounts paid to Corvis therefor less the
amortized value of the Product(s) based on the applicable Supported
Period.
22.4. No undertaking of Corvis under this Article will extend to any such
alleged infringement or violation to the extent that it: (1) arises
from adherence to design modifications, specifications, drawings, or
written instructions which Corvis is directed by Customer to follow;
or (2) arises from adherence to instructions to apply Customer's
trademark, trade name or other company identification; or (3) arises
from Third Party Software (except to the extent specifically
provided herein); or (4) relates to uses of a Product provided by
Corvis in combinations with other products obtained by Customer from
vendors other than Corvis. In the foregoing cases numbered (1), (2)
and (4), Customer will defend and save Corvis harmless, subject to
the same terms and conditions and exceptions governing Corvis'
obligations under this Article. Corvis hereby assigns to Customer
any rights which Corvis may have to indemnity from the original
manufacturer with respect to any Vendor Item provided under this
Agreement.
22.5. The liability of Corvis with respect to any and all claims, actions,
proceedings or suits by third parties alleging infringement of
patents, trademarks or copyrights or violation of trade secrets or
other proprietary rights because of, or in connection with, any
Products furnished pursuant to this Agreement will be limited to the
specific undertakings contained in this Article.
ARTICLE 23. TERMINATION.
23.1 In addition to any right of Customer to cancel a Purchase Order
pursuant to Section 3.6 or those rights to terminate this Agreement
pursuant to Sections 2.2, 10.4, 23.2 and 23.3, either party may
terminate this Agreement and any outstanding Purchase Order, in
whole or in part, in the event of a default by the other, provided
that the non-defaulting party so advises the defaulting party in
writing of the event of alleged default and affords the defaulting
party [*] within which to cure the default. Default is defined to
include:
(1) Either party becomes insolvent, makes a general assignment for
the benefit of creditors, files a voluntary petition in
bankruptcy or an involuntary petition in bankruptcy is filed
against such party which is not dismissed within [*] after the
date such petition is filed, or suffers or permits the
appointment of a receiver for its business, or its assets
become subject to any proceeding under a bankruptcy or
insolvency law, domestic or foreign, or has liquidated its
business;
(b) Either party's material breach of any of the terms or
conditions hereof;
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(3) The execution by either party of an Assignment for the benefit of
creditors or any other transfer or assignment of similar nature.
23.2 Commencing six calendar months after successful completion of the
Field Trial, Customer may upon five days' written notice to Corvis
terminate this Agreement and any outstanding Purchase Order, in whole
or in part, in the event of 'Chronic Late Delivery' by Corvis that is
not cured by Corvis within two calendar months after notice of such
problem by Customer. Chronic Late Delivery is defined as Corvis' late
delivery during any three month period commencing six calendar months
after successful completion of the Field Trial, of 60% or more of the
Products for which Customer has submitted a Purchase Order that Corvis
is obligated to accept pursuant to this Agreement.
23.3 If the network deployed by Customer with Corvis Equipment and
Software, or any significant spans within such network, fail to
perform in accordance with any material portion of the Corvis System
Specifications contained in Attachment 28 or the 'Williams SONET EMS
Functional Requirements Rev. 1.2 (25 Feb. 2000)' and Corvis fails to
cure such nonconformity within six months after notice of such failure
from Customer, Customer shall have the right to terminate this
Agreement upon five days' written notice.
23.4 Neither the termination or expiration of this Agreement shall relieve
either party from any obligations to pay the other party any amounts
accrued under this Agreement prior to such termination or expiration.
Expiration or termination of this Agreement shall not relieve any
party of liability for damages or any other rights or remedies that
either party may have under this Agreement or at law or in equity or
relieve any party from the duty to hold in confidence proprietary
information and otherwise comply with, and exercise the rights set
forth in, Articles or Sections 4.3, 6.1(Right to Use Fee), 12, 14.1,
15, 16, 18, 19, 21, 22, and 23 hereof, each of which will survive
termination or expiration of this Agreement. Customer's obligation to
meet the Total Minimum Purchase Commitment will survive the expiration
of this Agreement or the termination of this Agreement, by Corvis for
cause pursuant to Section 23.1 or pursuant to Clause (iii) of Section
2.2. Notwithstanding anything in this Agreement to the contrary,
Customer shall in no event have any obligation for the Initial Minimum
Purchase Commitment or the Total Minimum Purchase Commitment or any
portion thereof in the event of termination by either party pursuant
to Clause (i) of Section 2.2 or by Customer pursuant to Clause (ii) of
Section 2.2 or Sections 10.4, 23.1, 23.2 or 23.3 or in the event this
Agreement becomes null and void pursuant to Section 7.1.
ARTICLE 24. RESALE.
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With Corvis' consent Products purchased under this Agreement may be resold
and sublicensed by Customer to its own customers when such Product is
included as part of a sale of a package of Customer's proprietary products
with integrated value added services such as installation, training,
consulting, integration, management and maintenance. Customer is not
permitted to resell or sublicense Corvis' Products as standalone items.
Distribution and sublicense of Corvis and any Third Party Software is only
permitted if made pursuant to a license that is consistent with the rights
and obligations set forth herein and that incorporates in substance, and is
no less restrictive, than the terms and conditions of this Agreement.
Customer shall keep full, clear and accurate records with respect to all
such resold Products including but not limited to its sublicensing of
Corvis' and any Third Party Software and Customer shall permit Corvis to
audit such records under reasonable conditions. Customer acknowledges the
potential of a channel conflict between Customer's proposed activities
under this provision with Coris' own sales efforts and that such a scenario
may result in Corvis withholding consent with respect to proposed Product
resale activity by Customer. Customer agrees that it will not delete or
modify any markings, notices, etc. on Products purchased from Corvis and
resold in accordance with this paragraph.
ARTICLE 25. NOTICE AND REPRESENTATIVES OF THE PARTIES.
Any notice ("Notice") required or permitted under this Agreement must be
given in writing to the address or facsimile number provided for a party
below (or such other address or number as any party may provide to the
other in writing in the manner contemplated hereby) and will be deemed
effective as follows:
(a) if delivered in person or by courier, on the date it is
delivered;
(b) if sent by facsimile transmission, on the date that the
transmission is received and acknowledged by the recipient party
in legible form, provided that facsimile transmission must be
confirmed in writing by overnight courier; or
(c) if sent by certified or registered mail or the equivalent (return
receipt requested), on the date that mail is delivered.
Provided that any written or electronic Purchase Order or acknowledgement is
issued by an authorized representative of the transmitting party, the parties
agree that: (i) these electronic transmissions will be deemed to satisfy any
legal formalities requiring that agreements be in writing, (ii) neither party
will contest the validity or enforceability of any such electronic
transmission under any applicable statute of frauds, and (iii) computer
maintained records when produced in hard copy form will constitute business
records and will have the same validity as any other generally recognized
business records.
The Notices provided for by this Article 25 will be given to the following:
If to Customer:
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Williams Communications Inc.
Attention: Contract Administration
26/th/ Floor One Williams Center
Tulsa, Oklahoma 74172
With a copy to:
Williams Communications Inc.
ATTN: Vice President of Network Planning
One Williams Center
Tulsa, Oklahoma 74172
If to Corvis:
Corvis Corporation
ATTN: General Counsel
7015 Albert Einstein Drive
PO Box 9400
Columbia, Maryland 21046-9400
Telephone: 443.259.4110
With a copy to:
Corvis Corporation
ATTN: Sales Director
7015 Albert Einstein Drive
PO Box 9400
Columbia, Maryland 21046-9400
Telephone: 443.259.4000
ARTICLE 26. GENERAL.
26.1 Assignment. Neither party to this Agreement may assign, transfer,
pledge, encumber or hypothecate its interest in this Agreement or any
of its rights hereunder or delegate its obligations hereunder without
the prior written consent of the other party to this Agreement, which
consent will not be unreasonably withheld, and any attempted
assignment which does not comply fully with this Article 26.1 will be
null and void. Notwithstanding the foregoing, or any other provision
of this Agreement, including, among others, Sections 12.4 and 15.3
and Article 2.4, either Customer or Corvis may, upon prompt written
notice, assign all their respective rights and obligations under this
Agreement to any Affiliate or to their respective successors by
virtue of a consolidation or merger, or a transferee of substantially
all of their assets, provided that, in the event of an assignment to
an Affiliate or transfer of substantially all of their assets
Customer or Corvis, as appropriate, remain liable under this
Agreement. This Agreement will be binding upon, and inure to the
benefit of, each such permitted assignee,
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successor or transferee. Notwithstanding anything in this Agreement
to the contrary, Customer may assign some or all of its rights and
obligations hereunder to State Street Bank and Trust Company of
Connecticut, National Association, in connection with a financing by
Customer of construction of its fiber optic network; in addition,
Street Bank and Trust Company of Connecticut, National Association,
may further assign this Agreement as collateral for such financing;
provided that if Customer makes an assignment to State Street Bank
and Trust Company of Connecticut, National Association, pursuant to
this paragraph, Customer (or its assignee pursuant to an assignment
made under the other provisions of this Agreement) shall guarantee
performance of the assignee's obligations.
26.2 Governing Law. This Agreement will be construed in accordance with
and governed by the law of the State of New York without regard to
the conflict of law provisions of such state or any other
jurisdiction.
26.3 Laws and Regulations. The parties hereby agree to comply with all
local, municipal, state, federal, foreign, governmental and
regulatory laws, orders, codes, rules and regulations that are
applicable to their respective performance of this Agreement.
26.4 Amendment. Any provision of this Agreement, or any schedule, exhibit
or rider hereto, may be amended only if such amendment is in writing
and signed by all the parties hereto. Additions to the Corvis
Products in Attachment 6 may be made by each party signing an
additional Attachment page containing the following information:
Corvis Product, Equipment Description and Price.
26.5 Waiver. Any waiver or delay in the exercise by either party of any of
its rights under this Agreement will not be deemed to prejudice such
party's right of termination or enforcement for any further,
continuing or other breach by the other party.
26.6 Successors and Assigns. The provisions of this Agreement will be
binding upon and inure to the benefit of the parties hereto and their
respective permitted successors and permitted assigns.
26.7 Public Disclosures. Neither party shall publish or use any
advertising, sales promotions, or other publicity materials that use
the other party's logo, trademarks, or service marks without the
prior written approval of the other party. Subject to Article 15 of
this Agreement, each party shall have the right to review and approve
any publicity material, press releases, or other public statements by
the other that refer to such party or that describe any aspect of
this Agreement. Subject to Article 15 of this Agreement, without the
prior written approval of the other party, each party agrees not to
issue any such publicity materials, press releases, or public
statements which contain information not previously publicly
disclosed by mutual agreement of the parties, except as is required
to comply with federal or state laws. Nothing in this Agreement
establishes a lease, license or
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right for either party to use any of the other party's brands, marks,
or logos without prior written approval of the other party.
26.8 Severability. Whenever possible, each provision of this Agreement, as
well as any schedule, exhibit or rider attached hereto, will be
interpreted in such manner as to be effective and valid under
applicable law, order, code, rule or regulation, but if any provision
of this Agreement, as well as any schedule, exhibit or rider hereto,
is held to be invalid, illegal or unenforceable in any respect under
any applicable law, order, code, rule or regulation, such invalidity,
illegality or unenforceability will not affect any other provision,
schedule, exhibit or rider of this Agreement, but this Agreement,
schedule, exhibit or rider will be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable
provision, schedule, exhibit or rider had never been contained herein
or attached hereto.
26.9 Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this
Agreement.
26.10 Counterparts. This Agreement may be executed in separate counterparts
each of which will be an original and all of which taken together
will constitute one and the same Agreement.
26.11 Relationship of Parties. Neither Corvis, its subcontractors,
employees or agents will be deemed to be employees or agents of
Customer, it being understood that Corvis, its subcontractors,
employees or agents are independent contractors with respect to
Customer for all purposes and at all times. This Agreement will not
be construed as establishing a partnership or joint venture between
Customer and Corvis.
26.12 Supersession of PO. The terms and conditions of this Agreement
supersede any pre-printed terms and conditions on any Purchase Order,
both front and back, unless otherwise agreed by the parties in
writing. Any pre-printed terms or conditions on any Purchase Order,
other than the ordering information required by this Agreement, will
be of no force or effect whatsoever.
26.13 Customer will comply with the export control laws and regulations of
the United States with respect to the Products purchased under this
Agreement.
26.14 Corvis will not use any funds received under this Agreement for
illegal or "improper" purposes related to the Agreement. Corvis will
not pay any commissions, fees or rebates to any employee of Customer,
nor favor any employee of Customer with gifts or entertainment of
significant cost or value. If Customer has reasonable cause to
believe that one of these provisions has been violated, Customer or
its representative may audit the records of Corvis for the purpose of
establishing compliance with such provisions. For purposes of this
Section, Customer shall include all affiliated companies of Customer
as well.
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ARTICLE 27. INCORPORATION OF DOCUMENTS.
27.1 This Agreement hereby incorporates by reference the Attachments
referred to herein. In the event of an inconsistency or conflict
between or among the provisions of this Agreement, the inconsistency
will be resolved by giving precedence in the following order:
(1) Agreement
(2) Attachments
(3) Purchase Orders (excluding any preprinted terms and conditions)
ARTICLE 28. DEFINITIONS.
"Affiliate" means, with respect to any entity, any other entity which
controls, is controlled by, or under common control with, such entity; and
"control" means ownership of a majority of the voting equity or similar
rights of an entity.
"Board Approval" is defined in Section 7.1.
"Board of Directors" is defined in Section 7.1.
"Change Notification" is defined in Section 14.2
"Class A Change" means a modification of existing Corvis manufactured
Equipment to remedy a non-conformance to Technical Requirements required to
correct design defects of a type that results in electrical or mechanical
inoperative conditions or unsatisfactory operating conditions, or which is
recommended to enhance safety. Corvis will use standards consistent with
its practices for all its customers in determining which modifications
constitute Class A changes.
"Class B Change" means an optional change, available to Customer at an
additional cost, that provides Equipment enhancements resulting in new
features or improved service capabilities to Corvis Equipment.
"Corvis Competitor" means and includes each of the following entities:
(1) Ciena, Cisco Systems, Ericsson, Hitachi, Lucent Technologies, Nortel
Networks, Siemens and Sycamore Networks;
(2) any Affiliate or successor of any entity described in clause (a)
----------
above; and
(3) any entity that acquires or is acquired by any entity described in
clauses (a) or (b) above.
----------- ---
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"Designated Equipment" is defined in Article 12.
"Documentation" with respect to any Product means Corvis' technical
documentation and operating manuals for such Product.
"Effective Date" is defined in Section 7.1.
"Equipment" or "Corvis Equipment" means the equipment that may be purchased
from Corvis pursuant to this Agreement.
"Field Trial" is defined in Recital D.
"Forecast Shortfall" is defined in Section 3.4.
"Initial Minimum Purchase Commitment" is defined in Section 3.2.
"Initial Minimum Purchase Commitment Period" means the period of twelve
consecutive calendar months immediately following the calendar month in
which the Initial Rolling Forecast is mutually agreed upon by the parties.
"Initial Minimum Purchase Commitment Shortfall" is defined in Section 3.2.
"Initial Term" is defined in Section 7.
"Licensed Software" means the Corvis software and third party software,
each of which in machine-readable form, and subsequent Software upgrades,
necessary to install, operate, and maintain the Products purchased or
licensed by Customer pursuant to this Agreement.
"Maintenance and Support Services" is defined in Section 19.
"Network Element" means a material component of Corvis' fiber optic
transmission system, including, but not limited to, optical amplifiers,
optical routers, optical add-drop multiplexers or end nodes at given sites
or nodes in the network.
"Products" means Equipment and Software.
"Proprietary Information" is defined in Section 15.1.
"Purchase Order" means the document issued by Customer for the purchase of
Products and Services which identifies the Products or Services ordered and
specifies the scope of work, quantities, relevant product codes and dates
for delivery, billing instructions, and any other necessary information.
"Remedy Period" is defined in Section 3.6.
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"Rolling Forecast" is defined in Section 3.3.
"Services" means the services provided by Corvis to Customer as specified
in a Purchase Order to the extent such Services are not included in the
supply of other Products.
"Signature Date" is defined in the Preamble.
"Software" refers to all the programs, computer languages, and operations
used to make Equipment perform a useful function or used to enable human
access to the Equipment for the purposes of installing, operating, or
maintaining such Equipment
"SONET" means a Synchronous Optical Network which adheres to the interface
standard of the same name created by the Exchange Carriers Standards
Association for the American National Standards Institute ("ANSI"), and
promulgated by Bellcore on behalf of the Regional Bell Operating Companies.
"Source Code" means all intellectual information including but not limited
to Documentation, Software in human-readable form, flow charts, schematics
and annotations which comprise the pre-coding detailed design
specifications for Licensed Software (excluding Third Party Software).
"Specified Site" is defined in Section 3.5.
"System" means a configuration of Equipment with two (2) end terminals, any
intermediate line amplifiers connected by fiber to the end terminals, all
associated Software, which has the ability to communicate to an element
management system such that traffic can be transmitted from end terminal to
end terminal and operation can be monitored by the element management
system.
"Supported Period" for each Product is as set out in Attachment 5.3.
"Technical Requirements" means (i) the specifications set forth in
appropriate industry standard telecommunications technical requirements
where applicable or as such specifications may be most currently modified
or amended pursuant to mutual agreement of the parties, (ii) any mandatory
requirements in the telecommunications industry (iii) the System
Specifications contained in Attachment 28 and (iv) the "Williams SONET EMS
Functional Requirements Rev. 1.2 (25 Feb. 2000)."
"Third Party Software" means Software which is independently developed by a
third party and licensed or sub-licensed to Customer under this Agreement.
"Total Minimum Purchase Commitment" is defined in Section 3.2
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"Total Minimum Purchase Commitment Period" means the period of twenty-four
consecutive calendar months immediately following the calendar month in
which the Initial Rolling Forecast is mutually agreed upon by the parties.
"Total Minimum Purchase Commitment Shortfall" is defined in Section 3.2.
"Vendor Items" is defined in Section 16.1.
"Warranty Period" is defined in Section 16.1.
ARTICLE 29. ENTIRE AGREEMENT.
This Agreement together with all Exhibits and Attachments constitutes the
entire Agreement between Customer and Corvis with respect to the subject matter
hereof and supersedes all prior agreements and understandings, both written and
oral, between the parties with respect to such subject matter, and is not
intended to confer upon any person other than the parties hereto any rights or
remedies hereunder.
38
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the day and year below
written.
CORVIS CORPORATION WILLIAMS COMMUNICATIONS INC.
BY:______________________________ BY:_________________________
TITLE:___________________________ TITLE:______________________
DATE:____________________________ DATE:_______________________
39
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
LIST OF ATTACHMENTS
-------------------
Attachment 5 - [*]/Training
Attachment 5.3 - Supported Period
Attachment 6 - Prices for Products and Services
Attachment 9.3 - On-Site Service Provision
Attachment 11.1 - Corvis Training
Attachment 12.1 - Third Party Software Licenses
Attachment 12.7 - Escrow Agreement
Attachment 16.1 - Warranty Period
Attachment 19 - Maintenance and Support Services and Other Services
Attachment 28 - Corvis System Specifications
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 5
[*]/TRAINING
Corvis will provide [*] Customer [*] under this Agreement:
A. Training
--------
- Corvis will provide a total of [*] seats in the aggregate to Corvis training
programs prior to and during the initial commercial deployment by Customer of
the Equipment.
- Customer will accrue [*] additional seats for training for each [*] paid to
Corvis for the purchase of Products and Services under this Agreement.
- Customer can roll over [*] training seats acquired [*] under this Attachment 5
to the next year provided they are used up [*].
B. [*]
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 5.3
SUPPORTED PERIOD
----------------
The Supported Period for each Product is [*] years.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 6
VOLUME DEPLOYMENT PRICING SCHEDULE
----------------------------------
[*]
In consideration of Customer's commitment to purchase from Corvis during the
Initial Term a total dollar value of Products equal to the Minimum Purchase
Commitment, Corvis agrees as follows:
(4) [*].
(5) If, during Calendar Year 2000, Customer purchases from Corvis a total
dollar value of Products equal to or greater U.S.[*], then Customer may
apply the Product Credits against orders placed on and after [*] up to [*]
of the purchase price of Products ordered by Customer [*].
(6) Definitions.
-----------
(1) "Calendar Year 2000" means the period commencing on and including
------------------
January 1, 2000 and ending on and including December 31, 2000.
(2) "Calendar Year 2001" means the period commencing on and including
------------------
January 1, 2001 and ending on and including December 31, 2001.
(3) "[*] Expiration Date" means either:
-------------------
1. December 31, 2001; or
2. if the total aggregate dollar value of Products purchased by
Customer from Corvis during Calendar Year 2000 and Calendar
Year 2001 exceeds the Minimum Purchase Commitment,[*].
(4) "Extended Pricing" means the prices and license fees for the
----------------
Products set forth in this Attachment 6, as such prices and
license fees may, from time to time, be adjusted in accordance
with subsection (a) above.
(5) "Qualifying Products" means Products purchased from Corvis for
-------------------
commercial deployment in North America, but not for laboratory
testing, field trials or other similar purposes.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
(6) [*].
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 11.1
CORVIS EQUIPMENT TRAINING CLASSES
---------------------------------
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
Code Class Target Audience Duration Pre-requisites
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Corvis Transport Introduction and Basic
---------------------------------------
T-1 Operation (HW and SW):
---------------------------
Overview All operations [*] days
Operation personnel
Safety
Turn-up, Provisioning and Maintenance
Interpretation of alarm conditions
-----------------------------------------------------------------------------------------------------------------------
Corvis Switching Introduction and Basic
---------------------------------------
T-2 Operation (HW and SW):
---------------------
Overview All operations [*] days Course T-1
Operation personnel
Safety
Turn-up, Provisioning and Maintenance
Interpretation of alarm conditions
-----------------------------------------------------------------------------------------------------------------------
Transport Installation, Turn-up and Test:
----------------------------------------
T-3 Safety
Installation, turn-up and test of Corvis Installation personnel [*] days Course T-1
transport Network Elements (ONG, OA,
OADM)
-----------------------------------------------------------------------------------------------------------------------
Switching Installation, Turn-up and Test:
----------------------------------------
T-4 Safety
Installation, turn-up and test of Corvis Installation personnel [*] days Courses T-1, T-2, T-3
switching Network Elements (OR)
-----------------------------------------------------------------------------------------------------------------------
Network Operations:
------------------
T-5 Network Management System overview Network Management [*] days Courses T-1 and T-2
Installation Center personnel
Configuration
Performance monitoring
Surveillance
Fault management
-----------------------------------------------------------------------------------------------------------------------
Network Planning and Equipment
------------------------------
T-6 Engineering:
-----------
HW and SW configurations and Network Planning and [*] days Courses T-1, T-2 and T-5
deployment Engineering personnel
Route and capacity planning
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
<TABLE>
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Protection schemes_ Wavelength
planning
Capacity Upgrade strategies
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
ATTACHMENT 12.1
THIRD PARTY SOFTWARE LICENSE
----------------------------
--------------------------------------------------------------------------------
Item Version
--------------------------------------------------------------------------------
SNMP (v1) (AdventNet) 2.0
--------------------------------------------------------------------------------
Solstice Enterprise Manager 3.0
--------------------------------------------------------------------------------
Solstice OSI 8.1.1 Comm. Platform 8.1.1
--------------------------------------------------------------------------------
JRE/JVM 1.1.7b and 1.1.8
--------------------------------------------------------------------------------
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 12.7
ESCROW AGREEMENT
----------------
Account Number ______________________
This Agreement is effective _________________, 2000 ("Effective Date") among
Fort Know Escrow Service, Inc. ("Escrow Agent"), Corvis Corporation
("Depositor") and Williams Communications, Inc. ("Preferred Beneficiary"), who
collectively may be referred to in this Agreement as "the parties."
A. Depositor and Preferred Beneficiary have entered into a Procurement
Agreement dated ________________, 2000 regarding certain proprietary technology
of Depositor (referred to in this Agreement as the "Procurement Agreement").
B. Depositor desires to avoid disclosure of its proprietary technology except
under certain limited circumstances.
C. The availability of the proprietary technology of Depositor is critical to
Preferred Beneficiary in the conduct of its business and, therefore, Preferred
Beneficiary needs access to the proprietary technology under certain limited
circumstances.
D. Depositor and Preferred Beneficiary desire to establish an escrow with
Escrow Agent to provide for the retention, administration and controlled access
of the proprietary technology materials of Depositor.
E. The parties desire this Agreement to be supplementary to the Procurement
Agreement pursuant to 11 United States Bankruptcy Code, Section 365(n).
ARTICLE 1 -- DEPOSITS
1.1 Obligation to Make Deposit. Within thirty (30) days following successful
--------------------------
completion of the Field Trial (as defined in the Procurement Agreement),
Depositor will deliver to Escrow Agent the proprietary technology and other
materials ("Deposit Materials") identified on Exhibit A attached hereto.
Exhibit A will be prepared and signed by Depositor and Preferred Beneficiary.
Escrow Agent will have no obligation with respect to the preparation, signing or
delivery of Exhibit A.
1.2 Identification of Tangible Media. Prior to the delivery of the Deposit
--------------------------------
Materials to Escrow Agent, Depositor will conspicuously label for identification
each document, magnetic tape, disk, or other tangible media upon which the
Deposit Materials are written or stored. Additionally, Depositor will complete
Exhibit B to this Agreement by listing each such tangible media by the item
label description, the type of
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
media and the quantity. The Exhibit B must be signed by Depositor and delivered
to Escrow Agent with the Deposit Materials. Unless and until Depositor makes the
initial deposit with Escrow Agent, Escrow Agent will have no obligation with
respect to this Agreement, except the obligation to notify the parties regarding
the status of the deposit account as required in Section 2.2 below.
1.3 Deposit Inspection. When Escrow Agent receives the Deposit Materials and
------------------
the Exhibit B, Escrow Agent will conduct a deposit inspection by visually
matching the labeling of the tangible media containing the Deposit Materials to
the item descriptions and quantity listed on the Exhibit B. In addition to the
deposit inspection, Preferred Beneficiary may elect to cause a verification of
the Deposit Materials in accordance with Section 1.6 below.
1.4 Acceptance of Deposit. At completion of the deposit inspection, if Escrow
---------------------
Agent determines that the labeling of the tangible media matches the item
descriptions and quantity on Exhibit B, Escrow Agent will date and sign the
Exhibit B and mail a copy thereof to Depositor and Preferred Beneficiary. If
Escrow Agent determines that the labeling does not match the item descriptions
or quantity on the Exhibit B, Escrow Agent will (a) note the discrepancies in
writing on the Exhibit B; (b) date and sign the Exhibit B with the exceptions
noted; and (c) mail a copy of the Exhibit B to Depositor and Preferred
Beneficiary. Escrow Agent's acceptance of the deposit occurs upon the signing
of the Exhibit B by Escrow Agent. Delivery of the signed Exhibit B to Preferred
Beneficiary is Preferred Beneficiary's notice that the Deposit Materials have
been received and accepted by Escrow Agent. If Escrow Agent notes a
discrepancy, Depositor shall promptly act to correct such discrepancy and have
Escrow Agent issue a revised Exhibit B which contains no exceptions.
1.5 Depositor's Representations. Depositor represents as follows:
---------------------------
a. Depositor lawfully possesses all of the Deposit Materials deposited
with Escrow Agent;
b. With respect to all of the Deposit Materials, Depositor has the right
and authority to grant to Escrow Agent and Preferred Beneficiary the
rights as provided in this Agreement;
c. The Deposit Materials are not subject to any lien or other
encumbrance;
d. The Deposit Materials consist of the proprietary technology and other
materials identified in Exhibit A; and
e. The Deposit Materials are readable and useable in their current form
or, if the Deposit Materials are encrypted, the decryption tools and
decryption keys have also been deposited.
1.6 Verification. Preferred Beneficiary will have the right, at Preferred
------------
Beneficiary's expense, to cause a verification of any Deposit Materials. A
verification determines, in different levels of detail, the accuracy,
completeness, sufficiency and quality of the Deposit Materials. If a
verification is elected after
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
the Deposit Materials have been delivered to Escrow Agent, then only Escrow
Agent, or at Escrow Agent's election an independent person or company selected
and supervised by Escrow Agent, may perform the verification.
1.7 Deposit Updates. Unless otherwise provided by the Procurement Agreement,
---------------
Depositor will update the Deposit Materials within 60 days after each release of
a new version of the product that is subject to the Procurement Agreement. Such
updates will be added to the existing deposit. All deposit updates will be
listed on a new Exhibit B and each new Exhibit B will be signed by Depositor and
Escrow Agent and delivered to Preferred Beneficiary. Each Exhibit B will be
held and maintained separately within the escrow account. An independent record
will be created which will document the activity for each Exhibit B. The
processing of all deposit updates will be in accordance with Sections 1.2
through 1.6 above. All references in this Agreement to the Deposit Materials
will include the initial Deposit Materials and any updates.
1.8 Removal of Deposit Materials. The Deposit Materials may be removed and/or
----------------------------
exchanged only on written instructions signed by Depositor and Preferred
Beneficiary, or as otherwise provided in this Agreement.
ARTICLE 2 -- CONFIDENTIALITY AND RECORD KEEPING
2.1 Confidentiality. Escrow Agent will maintain the Deposit Materials in a
---------------
secure, environmentally safe, locked facility which is accessible only to
authorized representatives of Escrow Agent. Escrow Agent will have the
obligation to reasonably protect the confidentiality of the Deposit Materials.
Except as provided in this Agreement, Escrow Agent will not disclose, transfer,
make available, or use the Deposit Materials. Escrow Agent will not disclose the
content of this Agreement to any third party. If Escrow Agent receives a
subpoena or other order of a court or other judicial tribunal pertaining to the
disclosure or release of the Deposit Materials, Escrow Agent will immediately
notify the parties to this Agreement. It will be the responsibility of
Depositor and/or Preferred Beneficiary to challenge any such order; provided,
however, that Escrow Agent does not waive its rights to present its position
with respect to any such order. Escrow Agent will not be required to disobey any
court or other judicial tribunal order. (See Section 7.5 below for notices of
requested orders.) Notwithstanding the foregoing, in the event that Escrow
Agent receives any subpoena or order initiated by a party and which is not
issued pursuant to the procedure detailed in Section 7.3, Escrow Agent will not
comply with such order without first notifying the parties and permitting the
Depositor the opportunity to challenge such order or to seek to have such order
narrowed in a manner acceptable to the Depositor, as owner of the proprietary
information embodied on the Deposit Materials.
2.2 Status Reports. Escrow Agent will issue to Depositor and Preferred
--------------
Beneficiary a report profiling the account history at least semi-annually.
Escrow Agent may provide copies of the account history pertaining to this
Agreement upon the request of any party to this Agreement.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
2.3 Audit Rights. During the term of this Agreement, Depositor and Preferred
------------
Beneficiary will each have the right to inspect the written records of Escrow
Agent pertaining to this Agreement. Any inspection will be held during normal
business hours and following reasonable prior notice.
ARTICLE 3 -- GRANT OF RIGHTS TO ESCROW AGENT
3.1 Title to Media. Depositor hereby transfers to Escrow Agent the title to
--------------
the media upon which the proprietary technology and materials are written or
stored. However, this transfer does not include the ownership of the
proprietary technology and materials contained on the media including any
copyright, trade secret, patent or other intellectual property rights. Title to
all such intellectual property will at all times remain vested in Depositor.
3.2 Right to Make Copies. Escrow Agent will have the right to make copies of
--------------------
the Deposit Materials as reasonably necessary to perform its obligations under
this Agreement. Escrow Agent will copy all copyright, nondisclosure, and other
proprietary notices and titles contained on the Deposit Materials onto any
copies made by Escrow Agent. With all Deposit Materials submitted to Escrow
Agent, Depositor will provide any and all instructions as may be necessary to
duplicate the Deposit Materials including but not limited to the hardware and/or
software needed.
3.3 Right to Transfer Upon Release. Depositor hereby grants to Escrow Agent a
------------------------------
non-exclusive, non-transferable, perpetual and royalty-free license to
sublicense the Deposit Materials to Preferred Beneficiary upon any release of
the Deposit Materials for use by Preferred Beneficiary in accordance with
Section 4.5. Except upon such a release or as otherwise provided in this
Agreement, Escrow Agent will not sublicense or otherwise transfer the Deposit
Materials or permit Preferred Beneficiary to make use of the Deposit Materials.
It is expressly understood and agreed that Escrow Agent is not authorized to
enter into any sublicense or similar agreement with Preferred Beneficiary that
alters the terms of this Section 3.3. In case of any conflict between the
provisions of this Section 3.3 (or Section 4.5) and the provisions of the
Procurement Agreement relating to the scope of the Preferred Beneficiary's
license upon release from escrow, the provisions of the Procurement Agreement
will control.
ARTICLE 4 -- RELEASE OF DEPOSIT
4.1 Release Conditions. As used in this Agreement, "Release Condition" will
------------------
mean the following:
a. Depositor is in material breach of its support obligations, as
described in the Maintenance and Support Services Agreement entered
into pursuant to Article 19 of the Procurement Agreement or any other
support obligations under the Procurement Agreement, that is not cured
within a reasonable period of time and that has a material adverse
impact on Preferred Beneficiary's ability to conduct its business with
the Depositor's Products (as defined in the Procurement Agreement); or
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
b. Either party becomes insolvent, makes a general assignment for the
benefit of creditors, files a voluntary petition in bankruptcy or an
involuntary petition in bankruptcy is filed against such party which
is not dismissed within sixty (60) days after the date such petition
is filed, or suffers or permits the appointment of a receiver for its
business, or its assets become subject to any proceeding under a
bankruptcy or insolvency law, domestic or foreign, or has liquidated
its business
4.2 Request for Release. If Preferred Beneficiary believes in good faith that
-------------------
a release condition has occurred, Preferred Beneficiary may provide Escrow Agent
written notice that a Release Condition and a request for release of the Deposit
Materials. The request will include instructions to Escrow Agent for
accomplishing the release, and a description in full detail of the release
condition that Preferred Beneficiary believes occurred. Escrow Agent will
immediately send the notice to Depositor by overnight carrier.
4.3 Release by Escrow Agent. Escrow Agent will 10 days after Depositor's
-----------------------
receipt of the notice of request for release, release the Deposit Materials to
Preferred Beneficiary pursuant to the instructions included in the request for
release, unless Depositor disputes that a release condition has occurred and
demands that Escrow Agent submit a notice of dispute to the American Arbitration
Association as provided for in Section 7.3. Subject to section 5.2, Escrow
Agent will continue to store the Deposit Materials without release pending (a)
joint instructions from Depositor and Preferred Beneficiary; (b) resolution
pursuant to the Dispute Resolution provisions or (c) order of a court.
4.4 Release of Deposit. If Escrow Agent does not receive notice that Depositor
------------------
disputes the condition of release and demand for submission to arbitration then
Escrow Agent is authorized to release the Deposit materials to the Preferred
Beneficiary or if more than one beneficiary is registered to the deposit, to
release a copy of the Deposit Materials to the Preferred Beneficiary. However,
Escrow Agent is entitled to receive any fees due Escrow Agent before making the
release. Any copying expense in excess of $300 will be chargeable to the
Preferred Beneficiary. This Agreement will terminate upon the release of the
Deposit Materials held by Escrow Agent. In the event that Escrow Agent does
receive notice that Depositor disputes the release condition and demands
arbitration and subsequently receives (a) joint instructions from Depositor and
Preferred Beneficiary; (b) resolution pursuant to the Dispute Resolution
provisions; or (c) order of a court, Escrow Agent will release a copy of the
Deposit Materials to the Preferred Beneficiary in accordance with such joint
instructions from Depositor and Preferred Beneficiary; resolution pursuant to
the Dispute Resolution provisions; or court order. The provisions of the
second, third and fourth sentences of this Section 4.4 will apply to any such
release.
4.5 Right to Use Following Release. Unless otherwise provided in the
------------------------------
Procurement Agreement, upon release of the Deposit Materials in accordance with
this Article 4, Preferred Beneficiary will have the non-exclusive, non-
transferable, right to use the Deposit Materials for the sole purpose of
continuing the benefits afforded to Preferred Beneficiary by the Procurement
Agreement. Preferred Beneficiary will be obligated to maintain the strict
confidentiality of the released Deposit Materials, including maintaining such
Deposit Materials in a single, access restricted, and locked location.
Preferred Beneficiary will provide access to the released Deposit Materials to
only those of its personnel who require such access for supporting Customer's
use of the Products sold or licensed to Customer under the Procurement Agreement
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
and Customer will maintain a written list of such personnel. Without limiting
the foregoing, the Deposit Materials will also be protected as Corvis'
Proprietary Materials under Article 15 of the Procurement Agreement. Receipt by
Preferred Beneficiary of the Deposit Materials pursuant to this Article 4 does
not in any way convey title or ownership of the Depositor products or the
intellectual property rights embodied in the products. Preferred Beneficiary may
subcontract to third parties maintenance and support work permitted under this
Section 4.5; provided all such third parties enter into a written agreement
containing terms equivalent to those contained in the Procurement Agreement
regarding Depositor's confidential information and preservation of Depositor's
proprietary rights. Preferred Beneficiary will provide signed copies of all such
agreements to Depositor before providing any such party with access to the
Deposit Materials.
4.6 Preferred Beneficiary will place all Deposit Materials (including all
copies and extracts thereof) in another escrow under terms similar to this
Agreement if and when Preferred Beneficiary determines, in its sole and absolute
discretion, that Depositor is able and willing to resume performance of its
support obligations, as described in the Maintenance and Support Services and
Other Services pursuant to Article 19 of the Procurement Agreement.
ARTICLE 5 -- TERM AND TERMINATION
5.1 Term of Agreement. The initial term of this Agreement is for a period of
-----------------
one year. Thereafter, this Agreement will automatically renew from year-to-year
unless (a) Depositor and Preferred Beneficiary jointly instruct Escrow Agent in
writing that the Agreement is terminated; or (b) the Agreement is terminated by
Escrow Agent for nonpayment in accordance with Section 5.2. If the Deposit
Materials are subject to another escrow agreement with Escrow Agent, Escrow
Agent reserves the right, after the initial one year term, to adjust the
anniversary date of this Agreement to match the then prevailing anniversary date
of such other escrow arrangements.
5.2 Termination for Nonpayment. In the event of the nonpayment of fees owed to
--------------------------
Escrow Agent, Escrow Agent will provide written notice of delinquency to all
parties to this Agreement. Any party to this Agreement will have the right to
make the payment to Escrow Agent to cure the default. If the past due payment
is not received in full by Escrow Agent within one month of the date of such
notice, then Escrow Agent will have the right to terminate this Agreement at any
time thereafter by sending written notice of termination to all parties. Escrow
Agent will have no obligation to take any action under this Agreement so long as
any payment due to Escrow Agent remains unpaid.
5.3 Disposition of Deposit Materials Upon Termination. Upon termination of this
-------------------------------------------------
Agreement, Escrow Agent will destroy, return, or otherwise deliver the Deposit
Materials in accordance with Depositor's instructions. If there are no
instructions, Escrow Agent may, at its sole discretion, destroy the Deposit
Materials or return them to Depositor. Escrow Agent will have no obligation to
return or destroy the Deposit Materials if the Deposit Materials are subject to
another escrow agreement with Escrow Agent.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
5.4 Survival of Terms Following Termination. Upon termination of this
---------------------------------------
Agreement, the following provisions of this Agreement will survive:
a. Depositor's Representations (Section 1.5);
b. The obligations of Escrow Agent and Preferred Beneficiary to maintain
confidentiality with respect to the Deposit Materials;
c. The rights granted in the sections entitled Right to Transfer Upon
Release (Section 3.3) and Right to Use Following Release (Section
4.5), if a release of the Deposit Materials has been made using the
procedure described in Article 4 prior to termination;
d. The obligation to pay Escrow Agent any fees and expenses due; and
e. The provisions of Sections 7.1 and 7.2.
ARTICLE 6 -- ESCROW'S FEES
6.1 Fee Schedule. Escrow Agent is entitled to be paid its standard fees and
------------
expenses applicable to the services provided. Said fees shall be paid by
Depositor. Escrow Agent will notify Depositor for payment of Escrow Agent's
fees at least 90 days prior to any increase in fees. For any service not listed
on Escrow Agent's standard fee schedule, Escrow Agent will provide a quote
prior to rendering the service, if requested.
6.2 Payment Terms. Escrow Agent will not be required to perform any service
-------------
unless the payment for such service and any outstanding balances owed to Escrow
Agent are paid in full. Fees are due upon receipt of a signed contract or
receipt of the Deposit Materials whichever is earliest. If invoiced fees are
not paid, Escrow Agent may terminate this Agreement in accordance with Section
5.2. Late fees on past due amounts will accrue interest at the rate of one and
one-half percent per month (18% per annum) from the date of the invoice.
ARTICLE 7 -- LIABILITY AND DISPUTES
7.1 Right to Rely on Instructions. Escrow Agent may act in reliance upon any
-----------------------------
instruction, instrument, or signature reasonably believed by Escrow Agent to be
genuine. Escrow Agent may assume that any employee of a party to this Agreement
who gives any written notice, request, or instruction has the authority to do
so. Escrow Agent will not be responsible for failure to act as a result of
causes beyond the reasonable control of Escrow Agent.
7.2 Indemnification. Escrow Agent will be responsible to perform its
---------------
obligations under this Agreement and to act in a reasonable and prudent manner
with regard to this escrow arrangement. Provided Escrow
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Agent has acted in the manner stated in the preceding sentence, Depositor and
Preferred Beneficiary each agree to indemnify, defend and hold harmless Escrow
Agent from any and all claims, actions, damages, arbitration fees and expenses,
costs, attorney's fees and other liabilities incurred by Escrow Agent relating
in any way to this escrow arrangement. In no event shall any party be
responsible for any special, consequential, incidental or indirect losses
suffered by any other party.
7.3 Dispute Resolution. (a) Any dispute relating to or arising from this
------------------
Agreement will be resolved by arbitration under the Commercial Arbitration Rules
of the American Arbitration Association. Unless otherwise agreed by Depositor
and Preferred Beneficiary, arbitration will take place in Boston, Massachusetts,
U.S.A. Depositor and Preferred Beneficiary will submit any dispute relating to
the release of Deposit Materials to the jurisdiction of a board of arbitrators
(the "Board") sitting in Boston, Massachusetts for resolution and will so notify
Escrow Agent. The Board will be selected within thirty (30) days from the date
of the filing of the notice of a dispute by Escrow Agent under Section 4.3 (or
other location or time mutually agreeable to Depositor and Preferred
Beneficiary). The Board will comprise three (3) members, one selected by
Depositor, one selected by Preferred Beneficiary and the third chosen by the two
members so selected, or if they cannot agree, by the American Arbitration
Association. The sole question before the Board will be whether or not
Depositor or Preferred Beneficiary is entitled to have the Deposit Materials
released from escrow. The Board will have no authority to order a modification
or amendment of this Agreement or the Procurement Agreement. The decision of
the Board will be forthwith delivered to Escrow Agent, Depositor and Preferred
Beneficiary, will be final and binding on Depositor and Preferred Beneficiary,
and judgment thereon may be entered in any court of competent jurisdiction.
Service of a petition to confirm the arbitration award may be made by First
Class mail or by commercial express mail, to the attorney for the party or, if
unrepresented, to the party at the last known business address. The dispute
resolution procedures outlined above may be followed for any other dispute
arising out of this Agreement, but the timetables established above will be
adjusted by agreement of the effected parties to account for the event that
triggers the desire of any party to seek arbitration. The limitations on the
authority of the Board enumerated above will apply to any arbitration pursued
under this Agreement.
(b) All fees charged by the Board will be paid by the nonprevailing party
to the arbitration. Each of Depositor and Preferred Beneficiary, however, will
be responsible for payment of all fees and expenses connected with the
presentation of its respective case, except that the Board may award such
reasonable fees and expenses of presentation, including counsel fees, to the
prevailing party in the event that the Board determines that the contentions of
the nonprevailing party were made in bad faith or without reasonable
justification.
7.4 Controlling Law. This Agreement is to be governed and construed in
---------------
accordance with the laws of the State of New York, without regard to its
conflict of law provisions.
7.5 Notice of Requested Order. If any party intends to obtain an order from
-------------------------
the arbitrator or any court of competent jurisdiction that may direct Escrow
Agent to take, or refrain from taking any action, that party will:
a. Give Escrow Agent at least two business days' prior notice of the
hearing;
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
b. Include in any such order that, as a precondition to Escrow Agent's
obligation, Escrow Agent be paid in full for any past due fees and be paid for
the reasonable value of the services to be rendered pursuant to such order; and
c. Ensure that Escrow Agent not be required to deliver the original (as
opposed to a copy) of the Deposit Materials if Escrow Agent may need to retain
the original in its possession to fulfill any of its other duties.
ARTICLE 8 -- GENERAL PROVISIONS
8.1 Entire Agreement. This Agreement, which includes the Exhibits described
----------------
herein, embodies the entire understanding among the parties with respect to its
subject matter and supersedes all previous communications, representations or
understandings, either oral or written. Escrow Agent is not a party to the
Procurement Agreement between Depositor and Preferred Beneficiary and has no
knowledge of any of the terms or provisions of any such Procurement Agreement.
Escrow Agent's only obligations to Depositor or Preferred Beneficiary are as set
forth in this Agreement. No amendment or modification of this Agreement will be
valid or binding unless signed by all the parties hereto, except that Exhibit A
need not be signed by Escrow Agent, Exhibit B need not be signed by Preferred
Beneficiary and Exhibit C need not be signed.
8.2 Notices. All notices, invoices, payments, deposits and other documents and
-------
communications will be given to the parties at the addresses specified in the
attached Exhibit C. It will be the responsibility of the parties to notify each
other as provided in this Section in the event of a change of address. The
parties will have the right to rely on the last known address of the other
parties. Unless otherwise provided in this Agreement, all documents and
communications may be delivered by First Class mail.
8.3 Severability. In the event any provision of this Agreement is found to be
------------
invalid, voidable or unenforceable, the parties agree that unless it materially
affects the entire intent and purpose of this Agreement, such invalidity,
voidability or unenforceability will affect neither the validity of this
Agreement nor the remaining provisions herein, and the provision in question
will be deemed to be replaced with a valid and enforceable provision most
closely reflecting the intent and purpose of the original provision.
8.4 Successors. This Agreement will be binding upon and will inure to the
----------
benefit of the successors and assigns of the parties. However, Escrow Agent
will have no obligation in performing this Agreement to recognize any successor
or assign of Depositor or Preferred Beneficiary unless Escrow Agent receives
clear, authoritative and conclusive written evidence of the change of parties.
8.5 Regulations. Depositor and Preferred Beneficiary are responsible for and
-----------
warrant compliance with all applicable laws, rules and regulations, including
but not limited to customs laws, import, export, and re-export laws and
government regulations of any country from or to which the Deposit Materials may
be delivered in accordance with the provisions of this Agreement.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
8.6 Conflict of Interest. Escrow Agent will not pay any commissions, fees or
--------------------
rebates of significant value to any employees of Depositor or Preferred
Beneficiary, nor favor any employee of Depositor or Preferred Beneficiary with
gifts or entertainment of significant value. If Depositor or Preferred
Beneficiary has reasonable cause to believe that this provision has been
violated, Escrow Agent agrees to cooperate with Depositor or Preferred
Beneficiary in its investigation.
Williams Communications, Inc.
Depositor___________________________ Preferred Beneficiary______________
By: ________________________________ By: _______________________________
Name:_______________________________ Name:______________________________
Title:______________________________ Title:_____________________________
Date:_______________________________ Date:______________________________
By: _______________________________
Name:______________________________
Title:_____________________________
Date:______________________________
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 16.1
WARRANTY PERIOD
---------------
The Warranty Period shall be [*] years.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 19
MAINTENANCE AND SUPPORT SERVICES AND OTHER SERVICES
---------------------------------------------------
1. Support Services. Corvis offers support and maintenance services for
----------------
its equipment ("Services") to its customers, details of which are set forth in
the Maintenance and Support Services Schedule ("Schedule") to this Attachment.
Williams may purchase Services by placing Purchase Orders under this Attachment,
which are accepted in writing by Corvis.
2. Term. The initial term of the Services shall be one year from the
----
date of the Procurement Agreement (the "Initial Maintenance Term"). [*]
3. Orders. Williams agrees that each Purchase Order placed with Corvis
------
for Services is placed under the terms of this Attachment and will include the
following information: Williams' name and address; contact name and phone
number; Services selected; start date for Services; product type, quantity and
location for each product for which Services will be obtained; and price as set
forth in the Schedule attached hereto. Corvis will confirm receipt of Customer
Purchase Orders within [*] of receipt. Corvis will execute and deliver to
Customer an order acceptance/acknowledgment within [*] after Corvis' receipt of
each Purchase Order.
4. Prices and Payment. The prices for Services ordered will be those
------------------
listed in the Schedule, unless no price is specified, in which case the parties
shall mutually agree on the price at the time the order is placed. The prices
for such Services shall be [*] during the Initial Maintenance Term, and if there
is a price increase, Corvis shall send notice at least [*] prior to the end of
the Initial Maintenance Term [*]. Additional charges for special maintenance
services may apply.
5. Eligible Products. Each order for Services by Williams will
-----------------
constitute a certification by Williams that all products referenced in or
applicable to such order are operating at the current specified revision levels
as of the date of such order ("Functional Products"). Corvis will support
software Products in accordance with Section 2.0 of the Schedule. As applicable,
Williams shall allow [*], to enable Corvis to perform remote diagnosis and shall
permit, upon adequate prior notice,
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Corvis-authorized service representatives supervised on-site access to the
Functional Products. If on-site Services are required, the terms of Attachment
9.3 shall apply.
6. Customer Reports. In order to assist Williams to better manage its
----------------
resources and assist Williams in identifying training and maintenance needs,
Corvis will use its best efforts to issue a [*] report consisting of, at a
minimum, the following information, if applicable:
(a) [*]
(b) [*]
(c) [*]
(d) [*]
(e) [*]
(f) [*]
7. Termination and Default. In the event of termination by either Party
-----------------------
in accordance with Article 23 of the Procurement Agreement, Corvis shall [*].
8. Request for Service. All requests for service will be initiated when
-------------------
an authorized Williams representative contacts Corvis' support staff at the
telephone number or address provided in the Product Documentation delivered to
Williams by Corvis and provides the following information: Williams name and
address, name and telephone number of technical contact, contract number,
product type and serial number, and brief description of the problem.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Maintenance and Support Services Schedule
-----------------------------------------
The Corvis Support Program includes the following Services.
- Emergency 24 X 7 X 365 Access to the Corvis Networks Technical Assistance
Center (TAC)
(2) Basic software maintenance (patches and maintenance releases)
(3) Repair and Return - Advanced Replacement
The price for the Corvis Support Program is [*]% of the price paid by
Customer for the Network Elements and Software supported (subject to an
aggregate cap of $[*] during the Initial Maintenance Term).
The Corvis Support Program must be purchased for all Corvis Products deployed by
Customer. The Annual Fees for the Corvis Support Program are due upon shipment
of the associated Network Element or Software (pro rated for the portion of the
calendar year remaining). The term of the Corvis Support Program for individual
shipments made during a calendar year shall end on December 31 of each
applicable year, and shall be renewed for the ensuing 12-month period effective
January 1 of each year. Corvis shall invoice Customer for the Corvis Support
Program at the commencement of each calendar year for such calendar year.
Maintenance Services descriptions are provided below:
----------------------------------------------------
1.0 Corvis Emergency Technical Assistance Center (TAC)
.1 Staffing and Availability. The Corvis Support Program provides
priority Customer telephone access to the Corvis Technical Assistance
Center (TAC) 7 days per week and 24 hours per day, 365 days per year.
Corvis will provide Customer with the proper telephone number and
procedures for contacting the TAC. TAC personnel provide problem
status information to Customer for serious problems and are the
interface to Corvis Management and Development Engineering. Customer
will make every reasonable effort to ensure that
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Emergency TAC telephone support is used for emergency purposes and as
a complement to basic training of the Customer's personnel.
.2 Scope of Activities. In addition to support on problem determination
and resolution, the following information and services are available
through the TAC: technical tips, hardware information, software
release notes, information on pending software updates, problem status
report updates, and documentation updates.
.3 Problem Handling Procedures. All problems reported to the TAC will be
assigned a Severity Classification. The Severity Level will be agreed
upon between Corvis and Customer according to the table below.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
Severity Description Escalation Procedure/Response Time
<S> <C> <C>
1 Critical - Customer is experiencing a Corvis [*] and Customer Service will be
network outage that prevents its immediately notified. Corvis personnel
customers from accessing service and will update Customer at least hourly and
for which there is no workaround or will work on the problem until resolution.
recovery action possible.
2 Major - Customer is experiencing a Corvis Level 3 personnel will resolve the
problem that affects service but for problem within four hours or escalate to
which there is a workaround or Development Engineering. Corvis personnel
recovery action. Business can will update Customer at least every [*].
continue although performance may be
degraded.
3 Minor - Customer is experiencing Severity 3 problems will be resolved by
problems and requires technical advice Corvis within [*] business days or will be
or a recommendation for the best escalated to Development Engineering.
solution. Severity 3 problems have a
reliable workaround and have, at most,
a slight impact on the operational
environment.
-----------------------------------------------------------------------------------------------
</TABLE>
Corvis will meet its priority response goal as provided herein at a [*]
percent effectiveness level for any calendar month. Should Corvis fail to meet
its response goal at least [*] percent in any calendar year, Customer
maintenance Service credits of [*] of the Standard Maintenance Fee will be
refunded to Customer or may be applied towards renewals/future service
contracts.
The effectiveness level shall be calculated for any given month in
accordance with the following formula with Total Missed Calls being the number
of Severity 1 and Severity 2
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Support calls for which priority support was not delivered within [*] (Missed
Calls) of the initial call.
Effectiveness Calculation equals: Total Calls per Month - Total Missed Calls
------------------------------------------
Total Calls per Month
2.0 Software Maintenance Support. Software Maintenance Support is also
provided through the TAC. Software Maintenance includes patch releases of
software to correct reported problems, maintenance releases, upgrades to system
base software to new releases and other software updates that are made generally
available at no additional charge from time to time. Software maintenance
releases will be made available via magnetic media or remote download, as
appropriate. Major releases are anticipated to be made by Corvis [*]. New
software features and functionality offered in major new releases, if priced
separately, are not included in Software Maintenance Support. Additionally, any
incremental hardware required to support additional software is priced
separately.
In addition to software patches and maintenance releases, Corvis will
provide Customer with revision releases, including installation, verification,
and uninstall procedures, and other documentation, pertaining to problem status,
code corrections, work-around procedures and known limitations of Corvis
products.
In addition to the individual software releases referred to above, Corvis
will from time to time make available to Customer, subject to the applicable
license fees, "Baseline Package Releases" consisting of groups of Corvis'
software Products. Notwithstanding anything to the contrary in the Agreement,
Corvis will only be obligated to provide support for the current and [*]
Baseline Package Releases made available by Corvis. Corvis' obligation to
support any version of Third Party Software will be subject to the continuing
availability of support from the third party vendor for such version. Corvis
will not be obligated to provide services to correct any error or defect in any
Corvis Product that can be corrected by Customer's installation of a more recent
software release available from Corvis.
3.0 Repair and Return: Advanced Replacement
Corvis will supply replacement components for products that have failed.
As a prerequisite to advance replacement service, Customer must establish a
sparing depot. Depot inventory must be maintained at the Corvis recommended
minimum sparing levels.
Should Corvis determine that the failure is due to faulty hardware, Corvis
will send replacement component(s) to the designated depot location. Included
with such component(s) will be packing material, a prepaid shipping enclosure
and all necessary documentation to
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
facilitate the return of the defective component to Corvis by Customer or
Customer personnel. Corvis will assume all costs associated with the shipment of
the replacement component(s) and the return of the failed component(s). Customer
shall return the malfunctioning hardware product to Corvis within [*] of the
receipt of the replacement product.
Should Corvis determine that the cards are fully functional and are "no
fault found" in accordance with Corvis fault diagnostic and testing procedures,
Corvis will invoice customer for a "no fault found" fee of $[*].
Advance replacement requests received at the Corvis TAC by 3:00 p.m.
Eastern Time will be processed [*]. Corvis will make all reasonable commercial
efforts to effect delivery of the replacement hardware component into the
designated sparing depot(s) by the [*] for those locations where international
customs need not be cleared. Requests made after 3:00 p.m. Eastern Time or on
weekends or Corvis holidays will be processed on [*].
It is Corvis' intention to use Customer's preferred carrier for shipments
to Customer contingent upon availability, quality, pricing, and terms and
conditions of service that such carrier makes available to Corvis. In all
cases, Corvis will use an internationally recognized carrier. Should Corvis
elect not to use Customer's preferred carrier, Corvis will notify Customer and
will, at Customer's option, assume responsibility for package tracking.
To cover costs of shipping with overnight delivery, Corvis to charge [*] per
module per location.
4.0 Repair and Replace: Basic
For warranty coverage pursuant to Article 16 of the Procurement Agreement,
the following shall apply.
Corvis will supply replacement components for Products that have failed.
The customer is responsible for first calling Corvis Customer Repair and getting
a Return Material Authorization number. The customer is responsible for sending
the faulty component to the Corvis designated location along with the assigned
RMA# for that module/component. Customer is responsible for packing material,
shipping enclosure and all necessary documentation to facilitate the return of
the defective component to Corvis. Requests for Basic Repair and Return on
replacement module/components received by Corvis by 3:00 p.m. Eastern Time will
generally be processed and sent back to customer within [*] of receiving the
faulty module/component. Requests made after 3:00 p.m. Eastern Time or on
weekends or Corvis holidays will be processed the next business day.
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT 28
Corvis System Specifications
----------------------------
The Corvis system comprises a number of network elements, which can be
configured to form point to point and mesh network connections. The maximum span
distance that any of the [*] channels can traverse before electronic
regeneration depends on the individual fiber types and span losses between
optical amplifier sites. Corvis warrants that [*], the Corvis Optical Amplifier
[*] shall continue to conform to the Technical Requirements. The Corvis Wave
Planner automatically determines appropriate locations for each of the network
elements and regeneration sites based on the actual span losses and fiber types
in the system.
Tables 2 and 3 specify the system performance under the following assumptions:
10. all span losses in the system are identical;
11. absolute value of fiber dispersion is greater than [*] for all
channels;
12. all spans consist of Corning-LS or Lucent TrueWave-Classic, Plus, or
RS fiber and have an average [*] and in the case of all spans
consisting of Corning LEAF, to which only Table 3 is applicable,
such spans have an average [*];
13. the maximum transmission distance is 3200 km; and,
14. the system is operated using the parameters listed in Table 1.
<TABLE>
<CAPTION>
Table 1: System Parameters
--------------------------------------------------------------------------------------------------
Parameter Value Value Units
--------------------------------------------------------------------------------------------------
LS, TW-C, -P, -RS LEAF
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Amplifier Input Connector Loss 0.2 0.2 dB
--------------------------------------------------------------------------------------------------
Amplifier Output Connector Loss 0.2 0.2 dB
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
Operating Range 1530-1564 1530-1564 nm
--------------------------------------------------------------------------------------------------
Maximum System Gain Flatness Variation [*] [*] dB
--------------------------------------------------------------------------------------------------
Maximum Amplifier Gain [*] [*] dB
--------------------------------------------------------------------------------------------------
[*] ( (See note 1) [*] [*] dB
--------------------------------------------------------------------------------------------------
Nominal Fiber Launch Power / Channel [*] [*] dBm
--------------------------------------------------------------------------------------------------
Equivalent OSNR at Fiber Launch [*] [*] dB.nm
--------------------------------------------------------------------------------------------------
Maximum accumulated dispersion (See note 2) [*] [*] ps/nm
--------------------------------------------------------------------------------------------------
Receiver Sensitivity at 10/-15/ BER with FEC [*] [*] dB.m
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
Minimum EOL System Margin (See Note 3) [*] [*] dB
--------------------------------------------------------------------------------------------------
Additional EOL System Margin Connector [*] [*] dB
Penalty
--------------------------------------------------------------------------------------------------
</TABLE>
Note 1: Total loss = span loss + amplifier module loss.
Note 2: [*].
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Note 3: The Minimum EOL margin includes the following:
[*]dB [*]
[*]dB [*] variation across all [*] Channels
[*]dB Unallocated margin
Table 2: System Performance using [*]/4-6/
------------------------------------------------------
[*] Number [*] Number of Span
[*] EOL of Spans w/ Spans w/ reduction
Span Loss [*] [*] for each
(dB) OADM-HC
------------------------------------------------------
[*] [*] [*] [*]
------------------------------------------------------
[*] [*] [*] [*]
------------------------------------------------------
[*] [*] [*] [*]
------------------------------------------------------
Table 3: System Performance [*]/4-6/
-------------------------------------------------------
[*] EOL [*] Number [*] Number of Span
Span Loss of / Spans Spans w/ [*] reduction
(dB) w/ [*] for each
OADM-HC
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] [*] [*] [*]
-------------------------------------------------------
[*] Amplifiers are commercially available by Q2, 2000
Note 4: [*].
Note 5: [*].
Note 6: Based on an Amplifier Module Loss for [*] of [*] dB and a [*] dB
respectively.
The transmission distance can be calculated based on the average loss per km
(dB/km) for a span using the equation:
[*] transmission distance (km) = Minimum(3200,([*] EOL Span Loss)x(# of
spans)/(Average Loss/km).
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
A sample calculation is shown below for a system with an average loss per km of
0.245 dB/km and a 17 dB EOL span loss using G2 and G3 amplifiers.
-------------------------------------------------------------------------------
Amp System w/ [*] System w/ [*]
-------------------------------------------------------------------------------
[*] Max Distance = (17 dB/span)*([*] Max Distance = (17 dB/span)*([*]
spans)/(0.0245 dB/km)= Min(3200, spans)/(0.0245 dB/km)= Min(3200,
[*] km) = 3200 km [*] km) = 3200 km
-------------------------------------------------------------------------------
[*] Max Distance = (17 dB/span)*([*] Max Distance = (17 dB/span)*([*]
spans)/(0.0245 dB/km)= Min(3200, spans)/(0.0245 dB/km)= Min(3200,
[*] km) = 3200 km [*] km) = [*] km
-------------------------------------------------------------------------------
.Corvis Optical Amplifier
------------------------
The Corvis Optical Amplifier provides optical amplification of up to [*] optical
signal channels that allows for transmission distances up to 3,200 km without
electrical regeneration using Corvis transmitters and receivers. Two Corvis
Optical Amplifiers are provided on a single [*] amplifier shelf for use in two
fiber systems. A single rack can house up to [*] amplifier shelves. The Corvis
Optical Amplifier can be provided [*] to amplify spans with losses [*] on LS,
TW-C, TW-P and TW-RS fibers. A [*] can be added to either [*] as required to
[*] for [*] and the [*] loss is added to the span loss. The [*] amplifier may
also be used with LEAF fiber that have EOL span losses up to [*]. The Corvis
Optical Amplifier is equipped to transmit and receive [*] carrying [*] channels,
Corvis system supervisory information, and seven order wires. A Craft Interface
and Environmental Control Unit (ECU) are provided for local control of the
amplifier.
<TABLE>
<CAPTION>
[*] Amplifier
----------------------------------------------------------------------------------------------
Parameter Nominal Value Units Notes
----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Max. Amplifier Gain [*] dB Based on LS, TW-C, TW-P and TW-RS
fiber spans having an average [*]
----------------------------------------------------------------------------------------------
Operating Range 1530-1564 nm
----------------------------------------------------------------------------------------------
Gain Flatness over Operating [*] dB
Range
----------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
[*] Amplifier
---------------------------------------------------------------------------------------------
Parameter Nominal Value Units Notes
---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Max. Amplifier Gain [*] dB Based on LS, TW-C, TW-P and TW-RS
[*] [*] dB fiber spans having an average [*]
---------------------------------------------------------------------------------------------
Max. Amplifier Gain [*] dB Based on LEAF fiber having an
[*] [*] dB average [*]
---------------------------------------------------------------------------------------------
Operating Range 1530-1564 Nm
---------------------------------------------------------------------------------------------
Gain Flatness over Operating [*] dB
Range
---------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Size and Weight Specification
--------------------------------------------------
Power -48 volts @ [*] Amps
--------------------------------------------------
Heat Dissipation [*] Watts /Shelf
--------------------------------------------------
Size (WxDxH) 19"x24"x84"
--------------------------------------------------
Weight (OA3200L [*]) [*]
--------------------------------------------------
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Corvis Optical Network Gateway
------------------------------
The Corvis Optical Network Gateway (ONG) can be configured to transmit and
receive up to [*] optical signal channels for up to 3,200 km without electrical
regeneration when used with Corvis Optical Amplifiers. [*] racks are required
to house equipment for [*] transmit channels and [*] receive channels according
to the channel plan provided below. [*] ONG rack includes [*] transmit channels
and [*] receive channels along with multiplexing, demultiplexing, and monitoring
equipment. In addition, [*] rack is equipped to transmit and receive [*] and
provides a Craft Interface for local access to the ONG.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------
Parameter Min Typ Max Units Comments
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Number of channels 160
----------------------------------------------------------------------------------------------
[*] [*] [*] [*]
----------------------------------------------------------------------------------------------
GR 253
Data Rate per channel [*] Gb/s Compliant
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
Tx Output Power per channel [*] dBm
----------------------------------------------------------------------------------------------
Fiber Launch power per channel [*] dBm
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
Rx Input Power per channel [*] dBm
----------------------------------------------------------------------------------------------
Receiver Sensitivity [*] [*] [*] [*] dB.m
----------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
Parameter Value Units Comments
----------------------------------------------------------------------------------
<S> <C> <C> <C>
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Number of Racks - up to [*] Tx/Rx [*]
Channels
----------------------------------------------------------------------------------
Voltage requirements -48 V Standard Voltage
----------------------------------------------------------------------------------
Power requirements/Rack [*] A
==================================================================================
</TABLE>
<PAGE>
Confidential materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
Parameter Value Units Comments
----------------------------------------------------------------------------------
<S> <C> <C> <C>
Dimensions per Rack (WxDxH) 19x24x84 Inches
----------------------------------------------------------------------------------
</TABLE>
<PAGE>
Confidential materials omitted and filed separately with the Seurities and
Exchange Commission. Asterisks denote omissions.
CORVIS Optical Add/Drop Multiplexer [*] (OADM [*])
The OADM [*] allows up to 160 channels of Add Drop access, [*], and [*] of
channels. The OADM [*] is partitioned into [*] section that provides for [*]
and [*], which can be upgraded to provide add/drop functionality by addition of
ONGs. The rack configuration and space requirements depend on the number of
channels accessed in each direction.
-------------------------------------------------------------------------------
Parameter Min Typ Max Units Comments
-------------------------------------------------------------------------------
Number of channels [*] 160
-------------------------------------------------------------------------------
Wavelength range 1530 1564 nm
-------------------------------------------------------------------------------
[*] [*] [*]
-------------------------------------------------------------------------------
[*] [*] [*]
-------------------------------------------------------------------------------
Output optical power per channel [*] [*] [*] dBm
-------------------------------------------------------------------------------
Output optical power (160 channels) [*] [*] [*] dBm
-------------------------------------------------------------------------------
[*] [*] [*]
-------------------------------------------------------------------------------
[*] [*]
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Parameter Value Units Comments
-------------------------------------------------------------------------------
Number of Racks: [*] [*] [*]
-------------------------------------------------------------------------------
Number of Racks: OADM [*] [*] Up to [*] channels Add/Drop
in each direction
-------------------------------------------------------------------------------
Number of Racks: OADM [*] [*] Up to [*] channels Add/Drop
in each direction
-------------------------------------------------------------------------------
Number of Racks: OADM [*] [*] Up to [*] channels Add/Drop
in each direction
-------------------------------------------------------------------------------
Voltage requirements -48 V Standard Voltage
-------------------------------------------------------------------------------
Power requirements/Rack [*] A
-------------------------------------------------------------------------------
Dimensions per Rack (WxDxH) 19x24x84 Inches
-------------------------------------------------------------------------------
<PAGE>
Confidential materials omitted and filed separately with the Seurities and
Exchange Commission. Asterisks denote omissions.
Channel Plan:
The Corvis system transmits and receives [*] channels [*] as shown in the table
below. [*] resulting in total system capacity of 400 Gb/s. [*] are allocated
in the channel plan [*].
----------------------------------------------------------
WavelengthNumber Frequency (THz) Wavelength(nm)
----------------------------------------------------------
[*] [*] [*]
<PAGE>
AMENDED AND RESTATED FIELD TRIAL AGREEMENT
This Amended and Restated Field Trial Agreement (this "Agreement"), dated
---------
June 23, 2000, is between Corvis Corporation ("Corvis"), a Delaware corporation,
------
having its principal place of business at 7015 Albert Einstein Drive, Columbia,
Maryland 21046-9400, and Williams Communications, Inc., a Delaware corporation,
having its principal place of business at One Williams Center, Tulsa, Oklahoma
74172 ("Customer").
--------
A. Corvis and Customer are negotiating an agreement mutually acceptable
to both parties (the "Procurement Agreement") pursuant to which
---------------------
Customer may procure from Corvis certain telecommunications equipment
and associated software.
B. Subject to the execution of the Procurement Agreement, Customer wishes
Corvis to provide to Customer the equipment ("Equipment") and software
---------
and related documentation ("Software") identified in Exhibit A hereto
-------- ---------
to institute a system extending from [*] to [*] (collectively, the
"Field Trial System") to be used by Customer solely for the purpose of
------------------
performing the Field Trial (as defined below).
C. Corvis is willing to provide to Customer the Field Trial System in
reliance upon Customer's agreement to the following terms and
conditions.
NOW, THEREFORE, in consideration of the foregoing and the promises set
forth below, the parties agree as follows:
1. Customer will test and evaluate the Field Trial System by deploying
the Field Trial System in the configuration specified in Exhibit B to determine
whether the Field Trial System satisfies all test criteria set forth in Exhibit
C. Within [*] weeks after the date of this Agreement, the parties shall agree
upon a plan for testing the Field Trial System, including among other things,
the specific criteria that will constitute pass or fail under each of the test
criteria specified in such plan. Such mutually agreed upon test plan shall be
hereinafter referred to as the Field Trial Test Plan and shall be attached, upon
agreement, as Exhibit C. Should the Field Trial System fail to meet any test
criteria specified in the Field Trial Test Plan, Customer shall notify Corvis
and Corvis shall have [*] to cure such failure or such longer period as may be
mutually agreed. Customer will complete the Field Trial as soon as practicable,
but in any event not later that [*] days after delivery, installation, turn-up
and turn-over to Customer of the entire Field Trial System (the "Field Trial
------------
Period") or such longer period as may be agreed upon by both the parties. The
-------
testing and evaluation of the Field Trial System (the "Field Trial") shall be
-------------
conducted substantially on the schedule for such Field Trial attached hereto in
Exhibit D. Customer shall have overall authority for, and management of, the
conduct of the Field Trial, including the timing of field tests and the
personnel to be available from time to time, including Corvis personnel. All
activities of Corvis under this Agreement shall be subject to, and carried out
in accordance with, the terms of Attachment 9.3 of the Procurement Agreement and
provided further, Corvis shall bear all its costs incurred in
-1-
<PAGE>
performing its obligations under this agreement.
2. The Field Trial will be deemed successfully completed when the Field
Trial System satisfies all tests specified in the Field Trial Test Plan. Upon
successful completion of the Field Trial:
(a) Customer will acknowledge in writing the successful completion of the
Field Trial as soon as possible after completion but in no case later than [*]
days after such completion.
(b) Customer will pay Corvis the purchase price for the Field Trial
Equipment and license and service fees for Field Trial Software set forth in
Exhibit A (collectively, the "Purchase Price") within [*] after receipt of an
--------- --------------
invoice for the Purchase Price which Corvis shall send [*] the Field Trial. Upon
payment of the Purchase Price by Customer, the Field Trial System and services
specified on Exhibit A will be deemed covered by the terms and conditions of the
---------
Procurement Agreement to the same extent as if the Field Trial System has been
procured by Customer pursuant to the Procurement Agreement and the terms and
conditions of the Procurement Agreement shall supersede and replace the terms
and conditions of this Agreement with respect to the Field Trial System. Pending
payment of the purchase price for the Field Trial System, the terms and
conditions of this Agreement will apply to the Field Trial System.
3. Subject to the terms and conditions of this Agreement, Corvis grants
to Customer a non-exclusive and non-transferable license to use the Equipment
and copies of the object code form of the Software solely for the purpose of
conducting the Field Trial during the Field Trial Period, at the locations
specified in Exhibit B. Use of the Software is restricted to the Equipment.
Customer may not relocate the Field Trial System or knowingly give any third
party, except as expressly allowed by this Agreement, access to the Field Trial
System, without Corvis' prior written consent. All Software (whether or not part
of firmware) and its related documentation furnished by Corvis, and all copies
thereof made by Customer, including translations, compilations, and partial
copies, are and will remain the exclusive property of Corvis and its licensors.
Customer will hold such Software and related documentation in strict confidence,
and will not disclose, provide, provide access to, or otherwise make available,
in whole or in part, any Software or related documentation including any
description of the [*] sections of the Software to anyone, except to its
employees, and, with Corvis' prior written consent, to contractors, consultants,
agents and employees of affiliates having a need-to-know for purposes of
conducting the Field Trial. All persons to whom the Software and related
documentation is made available shall be made aware of the confidentiality
obligations under this Agreement and unless such parties are employees of
Customer or its affiliates, shall have agreed in writing to obligations of
confidentiality. In the event Customer becomes aware of any unauthorized use of
the Software and its related documentation, Customer shall provide Corvis with
prompt written notice of such unauthorized use of the Software and its related
documentation and fully cooperate with Corvis in enforcing Corvis' proprietary
rights in the Software and its related documentation. With respect to any third
party software included with the Field Trial System, Customer will abide by the
applicable terms and conditions for such third party software. The third party
software provided includes one or more of the following:
-2-
<PAGE>
-------------------------------------------------------------------------
SNMP (v1) (advertent) 2.0
-------------------------------------------------------------------------
Solstice Enterprise Manager 3.0
-------------------------------------------------------------------------
Solstice OSI 8.1.1 Comm. Platform 8.1.1
-------------------------------------------------------------------------
JRE/JVM 1.1.7b and 1.1.8
-------------------------------------------------------------------------
4. Proprietary and confidential information exchanged by the parties
pursuant to this Agreement shall be subject to the confidentiality obligations
contained in Section 15 of the Procurement Agreement
5. Customer acknowledges that the Field Trial System and each item
thereof are proprietary to Corvis and its licensors and that Corvis and its
licensors shall retain exclusive ownership of the Field Trial System and any
patent, trademark, copyright, trade secret and other proprietary right
associated therewith. Except as set forth in this Agreement, at no time shall
title to any item of the Field Trial System be transferred to or vested in
Customer, and Customer shall have no right or interest in the Field Trial
System, except for the license to use the Field Trial System in accordance with
the terms and conditions of this Agreement. Customer will, at its expense, keep
all items of the Field Trial System free and clear from any liens or
encumbrances of any kind and will give Corvis prompt written notice of any
attachment or judicial process affecting any item of the Field Trial System or
Corvis' ownership or related rights therein. Customer agrees to maintain Corvis'
copyright, trademark and proprietary rights notices on and within any items of
the Field Trial System (whether in machine readable or printed form and whether
such items are partial or complete). If requested, Customer will allow, subject
to Customer's reasonable security requirements, the inspection of the Field
Trial System during regular business hours.
6. Except as mutually agreed upon in writing by the parties, Customer
shall not, and shall not permit any other person to (i) affix, install or
connect any accessory, upgrade, network or device to the Field Trial System
other than to the [*] interfaces of the Corvis [*] and [*] modules, the [*] and
order wire interfaces, or to the network management interfaces provided on the
Field Trial System, (ii) install, interface or connect any software with the
Corvis equipment and software other than for interfacing Customer software with
the Software for the purposes of testing the network management software, (iii)
otherwise modify, uninstall, alter or reconfigure any of the individual hardware
and software components which make up the Field Trial System, or (iv) copy or
duplicate (except to create copies required solely for backup purposes), reverse
engineer, disassemble, decompile or otherwise attempt to discover any underlying
concepts, processes, algorithms or source code from the Software.
7. (a) Effective upon Customer's receipt of the Field Trial System at
Customer's locations as set forth in Exhibit B and continuing until the Field
Trial System is placed with a carrier for shipping to Corvis, Customer shall
provide at its expense (i) insurance against the loss or theft or damage to the
Field Trial System for its full replacement value, and (ii) insurance against
public liability and property damage with a combined single limit of [*] each
occurrence. Customer shall provide a certificate of insurance that such
coverage is in effect, upon request by Corvis, naming Corvis as loss payee
and/or additional insured as may be required by Corvis.
-3-
<PAGE>
(b) Corvis will procure and maintain during the term of this Agreement
insurance in not less than the following amounts and shall deliver to Customer
certificates of insurance satisfactory in form and content to Customer
evidencing that all of the insurance required by this Agreement is in force and
that no policy may be canceled or materially altered without first giving
Customer at least [*] prior written notice.:
(i) Workers' Compensation insurance in accordance with the provisions of
the applicable Workers' Compensation or similar law of the state with
jurisdiction applicable to Corvis' personnel.
(ii) Commercial General Liability, including Contractual Liability
insurance with a coverage limit of not less than [*] dollars [*] combined single
limit per occurrence for bodily injury or property damage liability.
(iii) If the use of any automobile is required by Corvis or any third party
acting on behalf of Corvis in the performance of this Agreement, Corvis will
also obtain and maintain business auto liability insurance for the operation of
all owned, non-owned and hired automobiles with a coverage limit of not less
than [*] million [*] combined single limit per accident for bodily injury or
property damage liability.
8. Customer shall bear the entire risk of loss, theft, destruction of or
damage to any item of the Field Trial System from Customer's receipt of the
Field Trial System at Customer's location until the Field Trial System is placed
with a carrier for shipping to Corvis pursuant to the provisions of this
Agreement, including, without limitation, while the Field Trial System is in
Customer's possession or under its control, except to the extent such loss,
theft, destruction or damage is caused by Corvis, its employees, contractors
and/or agents.
9. Should the Field Trial not be successfully completed (as described
above) within [*] after installation, turn-up and turn-over to Customer of the
entire Field Trial System, either party may elect to terminate the Field Trial,
the license granted hereunder and this Agreement upon written notice to the
other party. In addition, either party may terminate the Field Trial, the
license granted hereunder and this Agreement for cause upon [*] written notice
(the "Notice Period") to the other if the other party (a) materially breaches
-------------
any term or condition of this Agreement and fails to cure such breach within the
Notice Period, (b) ceases to do business as a going concern, or (c) becomes
subject to any bankruptcy or insolvency proceedings. Promptly upon termination
of the Field Trial, the license granted hereunder or this Agreement for any
reason, Customer shall (y) allow Corvis access to Customer's location for the
sole purpose of uninstalling and retrieving the Field Trial System (including
the original and any copies of the Software), or, (z) upon mutual agreement of
the parties, or at the election of Corvis and at Customer's expense if Corvis
terminates the Field Trial for cause Customer shall (i) deinstall, pack and ship
the Field Trial System to a U.S. location specified by Corvis, in the same
condition (less ordinary wear and tear) provided to Customer, (ii) return to
Corvis the original and all copies of the Software, in whole or in part, in any
form including partial copies and modifications of the Software, and (iii)
certify to Corvis that it has complied with
-4-
<PAGE>
these requirements.
Except as provided in clause (z) of this Paragraph 9, Corvis shall be
obligated to retrieve the Field Trial System upon termination of this Agreement.
If Corvis fails to retrieve the Field Trial System through no fault of Customer
within [*] after termination, then Customer may de-install, pack and ship the
Field Trial System to Corvis at Corvis' expense. If Customer fails to allow
Corvis access to its location in order to retrieve the Field Trial System within
[*] after the termination of the Field Trial, the licensed granted hereunder or
this Agreement, or if Customer is required to do so by mutual agreement of the
parties or due to Corvis' termination for cause and Customer fails to return
the Field Trial System to Corvis within [*] following its refusal to allow
Corvis access or within [*] of the mutually agreed date or the effective date of
termination for cause by Corvis, then Corvis may, at its option, take one or
more of the following actions: (i) require Customer to pay to Corvis the
Purchase Price; (ii) without breach of the peace, take possession of and remove
the Field Trial System; or (iii) exercise any right or remedy that may be
available to Corvis under applicable law. Each remedy shall be cumulative and
in addition to any other remedy otherwise available to Corvis at law or in
equity.
In the event that Board Approval (as defined in the Procurement Agreement
between the parties) is not granted within [*] of signature of the Procurement
Agreement and the Procurement Agreement becomes null and void, then this
Agreement shall be deemed terminated as if the Field Trial had not been
successfully completed and all terms and conditions which apply in that instance
shall be in effect (i.e. return of equipment and confidentiality).
10. THE FIELD TRIAL SYSTEM IS PROVIDED "AS-IS" AND CORVIS HEREBY DISCLAIMS
ALL WARRANTIES AND REPRESENTATIONS WITH RESPECT TO THE FIELD TRIAL SYSTEM,
WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT.
11. UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER FOR
ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND WITH
REGARD TO THE SOFTWARE, THE EQUIPMENT OR THIS AGREEMENT. SUCH DAMAGES INCLUDE,
BUT ARE NOT LIMITED TO, COMPENSATION, REIMBURSEMENT OR DAMAGES ON ACCOUNT OF THE
LOSS OF PRESENT OR PROSPECTIVE PROFITS, EXPENDITURES, INVESTMENTS OR
COMMITMENTS, WHETHER MADE IN THE ESTABLISHMENT, DEVELOPMENT OR MAINTENANCE OF
BUSINESS REPUTATION OR GOODWILL, FOR LOSS OF DATA, COST OF SUBSTITUTE PRODUCTS,
COST OF CAPITAL OR FOR ANY OTHER REASON WHATSOEVER.
12. EACH PARTY (THE "INDEMNIFYING PARTY") WILL DEFEND, INDEMNIFY AND HOLD
------------------
THE OTHER PARTY (THE "INDEMNIFIED PARTY") HARMLESS, FROM AND AGAINST ANY AND ALL
-----------------
THIRD PARTY CLAIMS AND DEMANDS, AND RELATED LOSSES, DAMAGES, ORDERS, JUDGMENTS
OR DECREES, FOR BODILY INJURY (INCLUDING DEATH) AND/OR DAMAGE TO TANGIBLE
-5-
<PAGE>
PROPERTY TO THE EXTENT RESULTING DIRECTLY FROM THE NEGLIGENCE OR WILLFUL
MISCONDUCT OF THE INDEMNIFYING PARTY, PROVIDED THAT THE FOREGOING INDEMNITY IS
CONTINGENT UPON THE INDEMNIFIED PARTY (I) PROVIDING TO THE INDEMNIFYING PARTY
PROMPT WRITTEN NOTICE OF SUCH THIRD PARTY CLAIMS, AND (II) PROVIDING THE
INDEMNIFYING PARTY, AT THE INDEMNIFYING PARTY'S EXPENSE, WITH ALL REASONABLE
ASSISTANCE AND COOPERATION REQUESTED BY THE INDEMNIFYING PARTY IN CONNECTION
WITH THE DEFENSE AND SETTLEMENT OF SUCH CLAIM.
13. Customer may not assign or sublicense its right to use the Field Trial
System to another party other than to an affiliate. With respect to Customer,
an affiliate shall be any entity it controls, it is controlled by or it is under
common control with. Control shall mean majority ownership. Corvis may assign
its rights under this Agreement. Any assignment in derogation of this Section
shall be null and void.
14. This Agreement will be construed in accordance with and governed by
the law of the State of New York without regard to the conflict of law
provisions of such state or any other jurisdiction.
15. Each party will comply with all applicable federal, state and local
laws and regulations, including, but not limited to, export control laws and
regulations, with respect to the Field Trial System.
16. Any provision of this Agreement, or any schedule, exhibit or rider
hereto, may be amended only if such amendment is in writing and signed by all
the parties hereto.
17. Any waiver or delay in the exercise by either party of any of its
rights under this Agreement will not be deemed to prejudice such party's right
of termination or enforcement for any further, continuing or other breach by the
other party.
18. The provisions of this Agreement will be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and
permitted assigns.
19. Neither party will issue or release for publication any materials
relating to the existence of this Agreement, the Field Trial System or any
services to be performed pursuant to this Agreement without the prior written
consent of the other party, which consent shall will not be unreasonably
withheld.
20. Whenever possible, each provision of this Agreement, as well as any
exhibit hereto, will be interpreted in such manner as to be effective and valid
under applicable law, order, code, rule or regulation, but if any provision of
this Agreement, as well as any exhibit hereto, is held to be invalid, illegal or
unenforceable in any respect under any applicable law, order, code, rule or
regulation, such invalidity, illegality or unenforceability will not affect any
other provision or exhibit of this Agreement, but this Agreement or exhibit will
be reformed, construed and enforced in such
-6-
<PAGE>
jurisdiction as if such invalid, illegal or unenforceable provision or exhibit
had never been contained herein or attached hereto.
21. This Agreement may be executed in separate counterparts each of which
will be an original and all of which taken together will constitute one and the
same Agreement.
22. Neither Corvis, its subcontractors, employees or agents will be deemed
to be employees or agents of Customer, it being understood that Corvis, its
subcontractors, employees or agents are independent contractors with respect to
Customer for all purposes and at all times. This Agreement will not be
construed as establishing a partnership or joint venture between Customer and
Corvis.
23. The terms and conditions of this Agreement supersede any pre-printed
terms and conditions on any purchase order issued by Customer, both front and
back, unless otherwise agreed by the parties in writing. Any pre-printed terms
or conditions on any purchase order, other than the ordering information
required by this Agreement, shall will be of no force or effect whatsoever.
-7-
<PAGE>
24. This Agreement together with all Exhibits constitutes the entire
Agreement between Customer and Corvis with respect to the subject matter hereof
and supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to such subject matter, and is not intended to
confer upon any person other than the parties hereto any rights or remedies
hereunder.
Corvis Corporation
By: /s/ David Huber
-----------------------------
Title: President and CEO
-------------------------
Williams Communications, Inc.
By: /s/
-----------------------------
Title: President and CEO
--------------------------
-8-
<PAGE>
EXHIBIT A
FIELD TRIAL EQUIPMENT, SOFTWARE, AND SERVICES PRICING
-----------------------------------------------------
[*], Terms to [*] Trial Pricing
The Corvis(TM) CorWave Field Trial system will be provided with the
configuration described below.
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
CORVIS Unit Extended
Product Equipment Description Price Units Price
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ONG160 [*] Optical Network Gateway with support for up to [*] [*] $[*]
[*] Gbps of capacity (any combination of
OC-48/192) Channels. Includes ONG, Racks, TxRx
Shelves, NE Firmware, Power Supplies
---------------------------------------------------------------------------------------------------------------------
OADM160 [*] Optical [*] Includes: Optical Amplifier, [*], $[*] [*] $[*]
Racks, NE Firmware, Power Supplies
---------------------------------------------------------------------------------------------------------------------
OADM160/16[*] Optical Add/Drop Mix with [*] capacity support up $[*] [*] $[*]
to [*] Gbps of capacity (any combination of
OC-48/192. Includes: Optical Amplifier, OADM
Racks, TxRx Shelves NE Firmware, Power Supplies
---------------------------------------------------------------------------------------------------------------------
OA3200L [*] Optical Line Amplifier ([*]dB) Equipment $[*] [*] $[*]
includes: Optical Amplifier, NE Firmware, Power
Supplies
---------------------------------------------------------------------------------------------------------------------
OA3200L [*] Optical Line Amplifier ([*]dB) Equipment $[*] [*] $[*]
includes: Optical Amplifier, NE Firmware, Power
Supplies
---------------------------------------------------------------------------------------------------------------------
CC-[*] Tx CC-[*] Tx Modules with [*] reach interfaces per $[*] [*] $[*]
module
---------------------------------------------------------------------------------------------------------------------
CC-[*] Rx CC-[*] Rx Modules with [*] reach interfaces per $[*] [*] $[*]
module
---------------------------------------------------------------------------------------------------------------------
Extended Hardware Price $[*]
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
ONGRTUs Optical Network Gateway (ONG) Software Right to $[*] [*] $[*]
Use License Fee
---------------------------------------------------------------------------------------------------------------------
OADM RTUs OADM Software Right to Use License Fee $[*] [*] $[*]
---------------------------------------------------------------------------------------------------------------------
OA3200 RTUs Optical Amplifier Software Right to Use License $[*] [*] $[*]
Fee
---------------------------------------------------------------------------------------------------------------------
NOC NMS SUN SystemServer (E3500), X-Term Solstice $[*] [*] $[*]
Hardware BMserver, Solstice BM Run Time Fee (clients)
---------------------------------------------------------------------------------------------------------------------
NOC NMS Corvis CorManager Wave Planner, Network Manager $[*] [*] $[*]
Software with Provisioning Surveillance, Inventory,
Software Configuration, Performance RTUs, OSS
Interface & Craft Interface
---------------------------------------------------------------------------------------------------------------------
Annual Annual Maintenance Fee for Corvis CorWare NOC $[*] [*] $[*]
Maintenance Fee software
---------------------------------------------------------------------------------------------------------------------
</TABLE>
-9-
<PAGE>
<TABLE>
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NOC NMS Corvis CorManager Services: installation and $[*] [*] $[*]
Installation system turn-up on CorManager Network Management
Software (NMS)
---------------------------------------------------------------------------------------------------------------------
System Turn-Up Corvis CorManager Services: system turn-up on $[*] [*] $[*]
and Test CorManager Network Elements.
---------------------------------------------------------------------------------------------------------------------
Total Extended Price $[*]
---------------------------------------------------------------------------------------------------------------------
[*] For Field Trial $[*]
---------------------------------------------------------------------------------------------------------------------
Field Trial Extended Price $[*]
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
</TABLE>
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<PAGE>
EXHIBIT B
FIELD TRIAL CONFIGURATION
-------------------------
[*] to [*] Summary
The Corvis(TM) CorWave product is used to establish a Field Trial system that
spans from [*] to[*]. The Field Trial system is configured in a linear add drop
configuration, shown in the following figure. Optical Network Gateways (ONGs)
are located in [*] and [*]. These ONGs are connected through [*] Optical Line
Amplifiers (OLAs) and 3 Optical Add/Drop Multiplexers, located in [*] and [*].
The initial configuration supports [*] circuits.
Diagram of [*] to [*] field trial system overlayed on a map of the United
States]
Corvis will ship network elements to Customers" preferred U.S. destination:
direct to site or Williams depots. Corvis will support the Customers' teams that
conduct site surveys, fiber plant qualification and equipment installation.
Corvis will provide equipment testing and system turn-up. Corvis is planning to
provide the appropriate number of installation and testing teams to support the
system and enable Customer to carry out the Field Trial Test Plan.
-11-
<PAGE>
EXHIBIT C
FIELD TRIAL TEST PLAN
---------------------
The objective of this field trial is to install the Corvis CorWave System on the
Williams Network and verify its functionality and interoperability. Once
installed and tested, a final Field Trial Report document will be released and
will specify the official results of our findings.
The field trial of the Corvis system will be conducted along a [*] to [*]
route. The test configuration and schedule is provided in the "Corvis
CorWave Field Trial Test and Deployment Plan Revision 7.0". The field trail will
consist of, and be performed in accordance and conformity with, the "Corvis
CorWave Field Trial Test and Deployment Plan Revision 7.0"; "Williams SONET EMS
Functional Requirements Rev. 1.2 (25 Feb. 2000)"; "Corvis EMS Test Plan Rev. 1.2
( 28 April 2000)"; and the corresponding "Corvis EMS Evaluation Summary"
(collectively the "Test Plan").
Field Trial Equipment Configuration
The following lists the Corvis equipment to be deployed on the Williams Network:
OA - Optical Amplifiers, ONG - Optical Network Gateway and OADM - Optical
Add/Drop Mux.
All equipment being deployed for field trial will first be shipped to the
Williams Communications warehouse in [*]. Initial delivery of Corvis
equipment is scheduled for delivery to [*] by [*].
-12-
<PAGE>
Field Trial Tests
The following provides an outline of the Test Plan to be conducted on the Corvis
System during the Field Trial. Additional test details are provided in the Test
Plan. Select tests may be conducted in the Williams Lab, the Corvis Lab, and/or
during one or all Phases of the Field Trial. Following system turn-up training
of the Field Trial, tests will be conducted by Williams' engineers and
technicians under Corvis & Williams supervision.
Test Sequence A - Basic Setup Tests
Power and Breaker Testing
Mechanical Keying
Verify Turn Up Procedure
Test power switching capabilities
Lamp Test
ECU Tests
Test Sequence B - Operation and Performance Testing
Signal accuracy and EMS monitoring
SONET transparency compliance
SDH interoperability/transparency
Bit Error Rate ("BER")
BER vs. OSNR
Wavelength modification
Wavelength and Power Stability
Network Interface Jitter
Receiver Verification
[*]
System Noise Tolerance
Loss of Signal Reporting
Pump Diode Failure
Transmitter/Receiver Module Failure
Orderwire Functionality
Alarm Signaling
Alarm Flooding
Hot swap module
Fiber cut safety
Trib Side Interoperability
[*] Pump Replacement
EMS-Load / Revert PMD Emulation
Dispersion Tolerance Limit
Gain Flattening
Passive Module Failure
EMI (Electo-Magnetic Interference)
[*] of OADM-HC
[*] Element communication
Node Connectivity with a single failure
Software communication / [*]
[*]
-13-
<PAGE>
Ground Isolation
Vibration
Wavelength Add/Drop
Test Sequence C - EMS/NMS
1. Communication Interfaces Testing
--- Inband and Out of Band Management testing
2. Human Interfaces Testing
--- Craft/CLI/GUI testing
3. System Requirements Testing
--- Server redundancy and synchronization testing.
--- Remote upgrade/downgrade feature testing
4. Fault Management Testing:
--- Alarm detection, reporting and logging capability of the NE/EMS Server
testing.
5. Configuration Management Testing
--- Capability of the EMS to allow a user to configure and manage NEs.
6. Performance Management Testing:
--- Recording and logging Performance Management Statistics
7. Security Testing
--- Security features offered by the EMS
8. OSS Interfaces
--- Conformance of OSS interfaces to Williams requirements.
-14-
<PAGE>
EXHIBIT D
---------
ESTIMATED PROJECT SCHEDULE
---------------------------
<TABLE>
<CAPTION>
=========================================================================================================================
Event Date Location Objective
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Begin Shipment of Field Trial [*] CUSTOMER Begin shipment of field trial network
Network Elements elements.
-------------------------------------------------------------------------------------------------------------------------
Williams to Complete Installation [*] CUSTOMER Complete installation field trial
system
-------------------------------------------------------------------------------------------------------------------------
Complete Turn-up and System Test [*] CUSTOMER Complete turn-up and system test.
-------------------------------------------------------------------------------------------------------------------------
Acceptance Testing by Williams Commencing [*] CUSTOMER Williams evaluation the Corvis CorWave
system.
==========================================================================================================================
</TABLE>
-15-
