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EXHIBIT 10.13
[HUGHES NETWORK SYSTEMS LOGO]
8050025
TERMS AND CONDITIONS
FOR
38GHZ ODU
BETWEEN
HUGHES NETWORK SYSTEMS
A HUGHES ELECTRONICS CORPORATION COMPANY
11717 EXPLORATION LANE
GERMANTOWN, MARYLAND 20876
AND
ENDGATE CORPORATION
321 SOQUEL WAY
SUNNYVALE, CALIFORNIA 94086
DATE: MARCH 13, 1998
CONTRACT NO.: JBG-020798-1
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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NOTICE OF PROPRIETARY INFORMATION
All information contained in or disclosed by this document is confidential and
proprietary to Hughes Network Systems, Inc. By accepting this material the
recipient agrees that this material and the information contained therein will
be held in confidence and will not be reproduced, disclosed, or used in whole or
in part except for purposes of this document.
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Subcontract Agreement
8050025 (12/93P)
TERMS AND CONDITIONS
THIS CONTRACT dated the March 13, 1998, made between Hughes Network
Systems, a Hughes Electronics Corporation company, having its principal place of
business at 11717 Exploration Lane, Germantown, Maryland 20876 (hereinafter
called "HNS"), and Endgate Corporation having its principal place of business
at 321 Soquel Way, Sunnyvale, CA 94086 (hereinafter called the "Contractor" or
"Endgate").
WITNESSETH:
WHEREAS HNS desires to buy and Contractor desires to sell Equipment and
Services as hereinafter specified and the Parties desire to define the terms and
conditions under which such Equipment and Services will be furnished.
NOW THEREFORE, the Parties hereto, in consideration of the mutual covenants
herein expressed, agree with each other as follows:
ARTICLE SCOPE OF WORK
Contractor shall provide the necessary personnel, material, services,
equipment and facilities to perform the Work specified in the Statement of Work
(Exhibit A) entitled "Statement of Work For Manufacture Of A 38-GHZ Radio
Integrated Outdoor Unit For Subscriber And Hub Stations" Revision 6 and dated
March 18, 1998, and the specification 1024668 at it's then current revision and
1025231 at it's then current revision which are attached hereto and made a part
of this Contract.
ARTICLE STRATEGIC RELATIONSHIP
The Parties agree that they are hereby entering into a strategic
relationship in which Contractor shall supply millimeter wave equipment to HNS
in accordance with this Contract. Contractor agrees to give the highest priority
commitment for the life of this relationship for the following elements:
1. Factory capacity to ensure timely delivery of Work ordered by HNS,
2. Design services and product changes to permit this Work to retain its
technical leadership and competitive position in the market and to
permiffadapt its use at other frequency bands as indicated in the SOW.
Contractor hereby grants to HNS market exclusivity for the
Point-To-Multipoint market for a [*] after completion of Acceptance of the Work
or any changes, enhancements, or derivatives before offering to sell such Work
or modified Work to others. Exclusivity will terminate if HNS fails to order [*]
of the forecasted quantity for a period of [*]. The first year Production
forecast for this Contract is [*]. HNS agrees to provide the Contractor with a
first opportunity to bid on requirements for new Point to Multipoint assemblies
at frequencies of 18 GHz and above.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
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Subcontract Agreement
8050025 (12/93P)
ARTICLE PRICE AND PAYMENT
A. For the full, satisfactory, and timely performance of all the
requirements of this Contract, Contractor shall be entitled to payment
by HNS of the amount indicated in Purchase Order P241537 and
subsequent associated purchase orders, in accordance with this Article
and paragraph C of the Article entitled PRODUCTION PHASE AND PURCHASE
ORDERS. In any event the total amount associated with the Development
Phase shall not [*] and shall be paid based on the successful
conclusion of the Development milestones as shown in paragraph C of
this Article. This amount, which shall be paid to Contractor in
accordance with this Article, includes all taxes, duties and similar
liabilities whatsoever and all charges for packaging and crating
deliverable items to destination(s) in the United States designated by
HNS, except as stated in Paragraph B below.
B. Except with respect to any State or local sale, or use taxes on the
sale to HNS or use by HNS of the items delivered under this Contract,
Contractor shall assume responsibility for and shall save HNS harmless
from all taxes, duties, and similar liabilities which may be required
under any applicable Federal, State, or local law or laws and which
become due by reason of the performance of Work under this Contract,
and shall comply with all requirements of said laws, including any
interest payment or penalties related to or arising from such taxes,
duties and similar liabilities
C. Without limiting the obligations of Contractor to comply with all the
requirements of this Contract, FINS agrees to make payments to
Contractor in accordance with the following schedule:
DEVELOPMENT PHASE
MILESTONE PAYMENT
--------- --------
Project Turn-On [*]
PDR
CDR
Qualification Unit [*]
Field Trial Unit [*]
FDR
Acceptance
where Acceptance is defined by Chapter 5 of the SOW, but excludes
"Production Testing".
D. Pursuant to this Article, the applicable amounts due Contractor shall
be paid within thirty (30) days net after receipt of an invoice for
the Development Phase and sixty (60) days net after receipt of an
invoice for the Production Phase in which Contractor warrants that the
Work that is the subject of the invoice has been completed in
accordance with the requirements of this Contract, and that all
conditions established by this Contract as prerequisite to payment of
the
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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Subcontract Agreement
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invoice have been fulfilled. All invoices submitted by Contractor
shall refer to purchase order P241537, and subsequent purchase orders,
if any, and shall be sent in triplicate to:
Hughes Network Systems, Inc.
11717 Exploration Lane
Germantown, Maryland 20876
Attn: Accounts Payable
E. By mutual agreement between HNS and Contractor, HNS may make
payments other than as specified above for units of Work completed,
but such payments shall not be deemed as evidence that the Work for
which payments are made has been performed satisfactorily and shall
not relieve Contractor from responsibility for full and satisfactory
completion of all the Work required.
F. In consideration of the Strategic Relationship and Development Phase
payments set forth above, Contractor represents and warrants that the
price charged for the Work covered by this Contract shall include a
[*] over all other customers of Contractor for similar Work in similar
quantities. This discount shall be in effect only for a four year
period starting after the Development Phase.
ARTICLE PRODUCTION PHASE AND PURCHASE ORDERS
A. Upon commencement of the Production Phase, if any, orders for Products
would be made by the issuance of Purchase Orders to Contractor.
Contractor will deliver Product ordered under valid Purchase Order(s)
issued by HNS within a maximum of ninety (90) days from the date of
order, or such longer period of time as HNS may desire. Purchase
Orders will include the following (at a minimum):
1. HNS part number of Product being ordered;
2. Quantity ordered;
3. Unit price Product(s);
4. Shipping instructions;
5. Delivery schedule.
B. Production Purchase Order delivery dates are subject to the following
terms for rescheduling:
1. Within 30 days of scheduled delivery Work Product may not be
canceled or rescheduled;
2. Within 31 to 90 days of scheduled delivery Work Product may
be rescheduled out a maximum of ninety (90) days from the
original scheduled due date;
3. Quantities of Work on order with scheduled delivery more
than 90 days from reschedule notice may be canceled or
rescheduled without liability.
C. The initial prices for the [*] shall be [*] and for the [*] shall be
[*]. The table below represents the initial not to exceed, volume
based, pricing
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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prior to the completion of the design and experiencing the actual
manufacturing costs and O/H. After commencement of the Production
Phase, if any, and prior to shipment of the [*], HNS and Contractor
will negotiate the pricing for the subsequent Subscriber and the HUB
units. The subscriber pricing will [*]. The HUB pricing will follow
similar guidelines and will take into account the [*].
SUBSCRIBER UNITS HUB UNITS
QUANTITY UNIT PRICE QUANTITY UNIT PRICE
[*] [*] [*] [*]
D. It is understood, by both Parties that the target pricing of the
Subscriber units beyond the [*] will require an end cost to HNS of
[*]. To achieve this target price, after commencement of the
Production Phase, if any, and prior to shipment of the [*], HNS and
Contractor agree to negotiate a cost reduction plan in which both
Parties will work together to achieve cost reductions for the
Products. Such plan will include details of the process both Parties
will follow to identify potential cost reductions and how any cost
reductions achieved will be shared by both Parties subject to
achieving the target price. It is understood that there will be a high
level of commonality in design, materials, and manufacturing processes
between the Subscriber unit and Hub unit. Therefore, any identified
price reductions for the Subscriber unit will be incorporated in the
Hub unit price.
E. At HNS sole option the quantities on order may be increased
according to the following schedule:
Days Prior To Scheduled Delivery Allowable Increase Percent
[*] [*]
F. HNS non-binding production forecast, which is not to be interpreted as
a commitment, is for [*] to be delivered over a four year period
starting after the Development Phase.
ARTICLE DELIVERY
The Work required to be delivered to HNS by Contractor under this
Contract shall be in accordance with Attachment A, Statement Of Work.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
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SUBCONTRACT AGREEMENT
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ARTICLE ACCESS TO WORK IN PROGRESS AND DATA
All Work in progress under this Contract and data and documentation related
to this Contract are subject to continuous examination, evaluation and
inspection by HNS at any reasonable time during the period of this Contract on a
non-interfering basis in conformity with Contractors physical security program.
Thereafter, to the extent that such data and documentation is of a type normally
retained by Contractor, it shall continue to be available for such purposes.
ARTICLE INSPECTION AND TESTS
A. Inspections may be made at all reasonable times on a non-interfering
basis in conformity with Contractors physical security program by
HNS or its designated representative(s) at Contractor's site(s).
Contractor agrees to use best efforts to gain access for HNS to its
Subcontractors site(s) for inspections if requested by HNS.
B. Contractor shall give HNS adequate notice of all testing in
accordance with the Statement Of Work to be conducted under this
Contract and shall permit HNS to have its representative(s) witness
such tests.
C. When Contractor notifies HNS that the Work fully conforms with the
requirements of this Contract, in accordance with the Statement Of
Work, and is ready for inspection and test at Contractor's and/or its
Subcontractor's site(s), HNS may conduct an inspection and shall
authorize the conduct of such test(s) in accordance with Exhibit A.
After completion of the test(s), HNS shall notify Contractor either
that the Work is satisfactory for production and/or shipment to the
destination specified by HNS, or of those particulars in which the
Work does not conform with the requirements of this Contract. Where
any Work does not conform with the requirements of this Contract, then
upon remedy of such nonconforming items to meet the requirements of
this Contract, Contractor shall notify HNS that the Work is ready for
reinspection and/or retest at Contractor's and/or its Subcontractor's
site(s). HNS may conduct such reinspection and/or authorize the
conduct of such retest in accordance with the requirements of
Exhibit A. Upon successful completion of such inspection and test,
HNS'S shall notify Contractor that the Work is satisfactory for
production and/or shipment to the destination specified by HNS.
D. Remedy of the nonconforming items referred to in this Article shall be
promptly made by Contractor, at its expense, upon receipt of notice
thereof from HNS. If Contractor fails to remedy any such nonconforming
items(s), HNS may elect either (1) to have any or all such
nonconforming item(s) remedied through other means, in which event
Contractor shall pay the costs of so remedying such nonconforming
item(s) [*] of such nonconforming items, or (2)accept the Work and
reduce this Contract price by an equitable amount.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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ARTICLE ACCEPTANCE
A. AFTER receipt at destination, HNS shall promptly inspect the Work
received. Within a reasonable time after such inspection, HNS shall
either accept the Work or reject the Work, and notify Contractor in
writing of those rejected items, specifying reason(s) for rejection.
Rejected items shall be promptly corrected by Contractor at its
expense, which shall include all related costs for repair or
replacement of the rejected item(s) and all applicable shipping
charges. Upon correction of such rejected item(s), the Work shall be
accepted by HNS.
B. If Contractor fails to correct any such rejected item(s), HNS may
elect either (1) to have any or all such rejected item(s) remedied
through other means, in which event Contractor shall pay the costs of
so remedying such rejected item(s) [*] of such rejected items; or (2)
accept the Work and reduce this Contract price by an equitable amount.
ARTICLE TITLE AND ASSUMPTION OF RISK
Contractor shall convey good title, free from any claim or encumbrance, to
HNS for all items either delivered under this Contract or that become the
property of HNS pursuant to this Contract FOB Sunnyvale, California. Any loss
or damage to such items prior to passing of title shall be at Contractor's risk.
ARTICLE WARRANTIES
A. Contractor represents that it is a regular dealer in, or manufacturer
of, the Work and warrants that all Work furnished under this Contract
is free from defects in materials, design and workmanship, and is in
conformity with all requirements of this Contract.
B. Notice of any defect or nonconformity under this Contract shall be
given to Contractor within twenty four (24) months from the date of
acceptance by HNS, PROVIDED, HOWEVER, that notice of a defect that is
latent or was caused or concealed by fraud or such gross mistakes as
amount to fraud may be given at any time.
C. HNS shall have the right at any time during the period of this
warranty, and irrespective of prior inspections or acceptances, to
reject Work not conforming to the above warranty and require that
Contractor, at its expense, correct or replace such Work within ten
(10) business days with conforming Work. If Contractor fails to
correct or replace such nonconforming Work promptly after
notification, HNS may, by contract or otherwise, correct or replace
such nonconforming Work and Contractor shall be liable for and shall
pay to HNS the cost of such correction or replacement up to two (2)
times the price of the non-conforming Work.
D. In addition to the foregoing, Contractor agrees to assign, and hereby
does assign, to HNS any other warranties as Contractor or its
Subcontractor(s) customarily offer in connection with the sale of
similar items, including sales to Contractor's or the pertinent
Subcontractor's most favored purchaser. Any such assignment shall not
relieve Contractor of any of its responsibilities under this Contract.
Contractor shall notify HNS of each warranty and, upon
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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SUBCONTRACT AGREEMENT
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receipt of such warranty, shall deliver to HNS any documents issued by
the warrantor evidenoing such warranty.
E. In addition to correction of any defects in accordance with the
warranty provisions of this Agreement, the following provisions shall
apply with respect to multiple failures of the work resulting from the
same defect in design, materials or manufacturing process ("Pattern
Defects"): A Pattern Defect shall be established when HNS, in
cooperation with Contractor, shall reasonably demonstrate that [*] of
the Product delivered is failing from the same defect in design,
material or manufacturing process. In the event that a Pattern Defect
is demonstrated in any lot Contractor will promptly (a) modify the
work design, materials and/or manufacturing process so that the
Pattern Defect will no longer occur, (b) upgrade all work returned by
HNS to Contractor for any other reason and which are covered by the
provisions of this Article such that the Pattern Defect with respect
to such work shall be corrected. Further, in the event a Pattern
Defect is established as set forth above, Contractor will provide the
serial number of the work in the affected lot, and HNS may recall all
work of such lot(s) covered by the provisions of this Article, and
Contractor shall modify all such recalled work at its expense
including two way shipping costs such that the Pattern Defect with
respect to such work is corrected.
F. Contractor agrees to offer an extended warranty for Products in
service where the standard 24 month warranty described above has
expired. The extended warranty must be backwards compatible, i.e.,
Contractor will repair returned models that are of earlier vintage
than the then current production model to their original vintage, and
offer provisions equal to or better than those provided in the
standard 24 month warranty described in the preceding paragraphs. The
extended warranty shall be offered with an option to purchase on an
annual basis(includes all units returned during that extended warranty
period) or per unit basis. The cost for any extended warranty shall be
in accordance with the following schedule:
WARRANTY PERIOD PRICE
--------------- -----
[*] [*]
G. Contractor agrees to maintain a stock of Field Replaceable Units (FRU
Stock), which consists of system components, and parts and to provide
ability to ship said FRU to HNS or it's customer within 24 hours of
notice of a failure of Contractors Product. Quantity of FRU stock to
be mutually agreed upon by HNS and Contractor.
H. In accordance with Exhibit A, Statement Of Work Section 2.6.6, Out of
Box Failure Rate(OBFR) shall not exceed, [*]. Beginning with the [*]
the OBFR shall not exceed [*]. In the event that the cumulative OBFR
exceeds [*] HNS will notify Contractor in writing. Contractor agrees
to take steps to solve the problems causing such failures and shall
within 10
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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working days analyze the problem(s), prepare and submit an action plan
indicating what steps Contractor will take to remedy the problem, and
promptly initiate corrective action on delivered and future production
units. Furthermore, Contractor agrees to use it's best efforts to
achieve an overall goal of [*] OBFR as soon as possible.
I. Contractor warrants that there is nodate specific software contained
in the Product(s) delivered under this Contract and that the
Product(s) will not be adversely affected by the year 2000 date.
J. Warranty provisions do not apply to Work Products delivered under the
Development Phase of this Contract.
K. Contractor agrees to maintain a stock of Work Products to ship to HNS
or it's customer in the event a Work Product is dead on arrival (DOA)
as a loaner unit. Furthermore, Contractor agrees to ship loaner units
to HNS or it's customer in the event that Contractor does not comply
with the specified MTBF and HNS or it's customers spare stock is
depleted. Shipments of Work Product in accordance with this paragraph
are to be made via overnight delivery.
ARTICLE QUALITY OF MATERIALS AND WORKMANSHIP
Except as may be otherwise specifically provided in this Contract, all
Work furnished by Contractor under this Contract shall be new and free from
material defects.
ARTICLE INSURANCE
A. Contractor shall procure and thereafter maintain Unemployment
Compensation Insurance and the following other types of insurance and
minimum coverages with respect to performance under this Contract:
1. Worker's Compensation Insurance in accordance with statutory
requirements for all States in which Work is performed. This
policy must also be endorsed to provide coverage for employees at
the Work site who are qualified for benefits from other States
(all States endorsement).
2. Employer Liability Insurance with a limit of not less than
$1,000,000.
3. Comprehensive General Liability Insurance providing Operations
Liability, Owners and Contractual Protective Liability and
Contractual Liability (specifically, but not by way of
limitation, covering liability assumed under the Article of this
Contract entitled INDEMNIFICATION). Coverage is to include the
hazards of explosion, collapse and underground damage. The policy
shall provide a combined single limit of liability for personal
injury (including death) and property damage for not less than
$1,000,000 for each occurrence.
B. All insurance required pursuant to the provisions of this Article
shall be in such form and with such insurers satisfactory to HNS and
shall remain in force through HNS Acceptance or Final Acceptance
pursuant to the Article of this Contract entitled ACCEPTANCE.
Contractor shall file with HNS, prior to commencement of Work,
Certificates of Insurance in evidence of the
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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aforementioned insurance coverage. Contractor shall cause HNS,
including, where applicable, designated owner(s) or lessor(s) of the
Work site(s), to be named as an additional insured(s) in such general
liability policies.
C. Policies offered in compliance of this Article shall provide that HNS
shall be notified in writing by the insurer thirty (30) days in
advance of that date upon which the insurer intends to cancel any such
policy.
D. Contractor shall give HNS immediate notice of any suite or action
filed or prompt notice of any claim made against Contractor arising
out of the performance of this Contract. Contractor agrees to assist
and cooperate in every manner possible in connection with the
adjustment of all claims arising out of operations within the scope of
Work provided for under this Contract and cooperate with the insurance
carrier in all litigated claims and demands that the insurance carrier
or carriers are called upon to adjust or resist, and that arise out of
such operations.
E. The requirements of this Article shall be extended by Contractor to
each of its Subcontractors performing Work at any Work site.
ARTICLE INDEMNIFICATION
Contractor, at it's own expense, shall indemnify and hold HNS, its
directors, officers, employees, agents, subsidiaries, affiliates, customers,
designees, and assignees harmless from any loss, damage, liability or expense,
on account of damage to property and injuries, including death, to all persons,
arising from any occurrence caused by any act or omission of Contractor or its
Subcontractors related to the performance of this Contract. Contractor, at its
expense, shall defend any suit or dispose of any claim or other proceedings
brought against said indemnities on account of such damage or injury, and shall
pay all expenses, including attorney's fees, and satisy all judgments which may
be incurred by or rendered against said indemnities
ARTICLE RIGHTS IN DATA
A. All written documentation (e.g. operation manuals, maintenance
manuals, et al) which is required to be delivered under this Contract
or is delivered pursuant to the Article of this Contract entitled
REPORTS shall be the exclusive property of HNS and shall not be
disclosed to any other party, and HNS shall have the unlimited right
to the information contained therein. HNS shall protect all other
written documentation, which is marked by Contractor with an
appropriate and valid proprietary legend, such as "Contractor
Confidential," from unauthorized disclosure to any person who is not a
director, officer, employee or agent of HNS, in the same manner as HNS
protects its own confidential information, PROVIDED, HOWEVER, that HNS
shall have the right to use and duplicate such written documentation
for any HNS purpose.
B. Notwithstanding the foregoing, HNS shall have no obligation with
respect to any written documentation or information previously known
to HNS, invalidly marked, or which is or becomes in the public domain,
or which is rightfully acquired by HNS from third parties, or which is
independently developed by HNS, or which, is approved for release by
the written
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Authorization of Contractor, or Which HNS has the Right to Disclose
Pursuant to Any Licenses Granted Under the Article of This Contract
Entitled PATENT RIGHTS.
ARTICLE REPORTS
The Contractor shall provide reports, schedule information and progress
reports as specified in the Statement of Work.
ARTICLE HNS PROPRIETARY INFORMATION
Contractor agrees, that with respect to any data, drawings, documents or
other writings supplied by HNS to Contractor and identified as proprietary or
HNS confidential (hereinafter referred to as "Proprietary Information"):
1. To use such Proprietary Information only in performance of the Work
under this Contract;
2. Not to make copies of any such Proprietary Information or any part
thereof without the written permission of HNS, or as required to
perform the subject tasking of this contract, as limited by
subparagraph 4 below;
3. To limit dissemination of such Proprietary Information to persons
within Contractor's organization who are directly involved in the Work
under this Contract and have a need to use such Proprietary
Information for purposes of such Work only;
4. Not to disclose any such Proprietary Information or any part thereof
to others for any purpose;
5. To return such Proprietary Information and any copies thereof to
HNS, or, with prior approval from HNS, to certify destruction of all
Proprietary Information at the completion of all Work under this
Contract or at such earlier date as HNS may designate. However,
Contractor may retain one copy of the Proprietary Information for
archival purposes with HNS agreement.
ARTICLE PATENT RIGHTS
A. All inventions conceived or first actually reduced to practice by either
Party under this Contract, either solely or jointly with the other Party
and all Patents issuing thereon, shall be the joint property of the Parties
in accordance with paragraph G of this Article. Promptly after acquiring
knowledge of each such invention, Contractor will disclose the same to HNS
in writing, and will provide HNS with such additional information and
cooperation as HNS may require to secure Patent protection on the same, if
HNS decides to seek Patent protection.
B. With respect to other Patents not falling under Paragraph A above and only
with respect to Work performed and Product(s) delivered under this
Contract, Contractor hereby grants to HNS an irrevocable, nonexclusive
license to practice and have practiced throughout the world any invention
covered by each Patent now or hereafter owned, acquired or licensable by
Contractor. In the event Contractor is unable or unwilling to provide Work
or Work Products which meet
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the requirements of this Contract, such license shall allow HNS to make or
have others make the items deliverable under this Contract, for use by
HNS or for sale or lease or resale by HNS customers. Such license herein
granted shall be (1) deemed fully paid-up only for the purpose of use,
redesign or modification of any items delivered under this Contract, or for
manufacture in the event Contractor is unable or unwilling to provide items
which meet Contract requirements; and (2) on reasonable terms and
conditions for other purposes.
C. Any other provisions of this Contract notwithstanding, with respect to any
inventions that any person or entity is authorized by the terms of this
Contract to use or practice only under certain conditions or limitations,
such use or practice shall be:
1. Free, unconditional and unlimited from and after the time that the
rights in inventions come into the public domain, or
2. At the sole discretion of such person or entity, on other terms from
and after the time that such rights in inventions become otherwise
lawfully available to such person or entity on such other terms.
D. This Article shall not be construed as limiting any rights of HNS or
obligations of Contractor under this Contract, including specifically the
right of HNS for no additional compensation to Contractor, to use, have
used, deliver, lease, modify for the benefit of HNS' users, sell or
otherwise dispose of any item or any part thereof required to be delivered
under this Contract.
E. Contractor shall, unless otherwise authorized or directed by HNS, include
in each subcontract hereunder involving experimental, developmental, or
research work or studies, a Patent Rights Article pursuant to which each
such Subcontractor agrees to grant to HNS rights to obtain licenses under
Patents owned or licensable by the Subcontractor to the same extent as the
rights granted by Contractor in Paragraphs A and B above. In the event of
refusal by a Subcontractor to accept such a Patent Rights Article,
Contractor (1) shall promptly submit a written report to HNS setting forth
the Subcontractor's reasons for such refusal, and (2) shall not proceed
with the subcontract without the written authorization of HNS.
F. Nothing in this Contract shall be construed by implication, estoppel, or
otherwise to:
1. Require either Party to file any Patent application, to secure any
Patent, or to maintain any Patent in force; or
2. Bring or prosecute actions or suits against third-party infringement.
G. JOINT INVENTIONS
1 Each Party shall have an equal, undivided one-half interest in and
to Joint Inventions, as well as in and to patent applications and patents
thereon in all countries. An assignment of rights in all Joint Inventions
shall be executed in the names and for the benefit of both Endgate and
Hughes.
2 Endgate shall have the first right of election to file patent
applications in any country, including the selection of the attorney or
agent to prepare the patent application, and Hughes
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shall have a second right of election. Each Party in turn shall make its
election at the earliest practicable time, and shall notify the other
Party, in writing, of its decision.
3 The expenses for preparing, filing and securing each Joint Invention
application, and for issuance of the respective patent shall be borne by
the Party which prepares and files the application. The other Party shall
furnish the filing Party with all documents or other assistance that may be
necessary for the filing and prosecution of each application. Where such
Joint Invention application for patent is filed by either Party in a
country which requires the payment of taxes, annuities or maintenance fees
on a pending application or on an issued patent, the Party which files the
application shall, prior to filing, request the other Party to indicate
whether it will agree to pay one-half of such taxes, annuities or
maintenance fees. If within sixty (60) Days of receiving such request, the
non-filing Party fails to assume in writing the obligation to pay its
proportionate share of such taxes, annuities or maintenance fees, or if
either Party subsequently fails to continue such payments within sixty (60)
Days of demand, it shall forthwith relinquish to the other Party,
providing that said other Party continues such payments, its share of the
title to such application and patent, subject, however, to retention of a
paid-up, non-exclusive, non-assignable license in favour of the
relinquishing Party, its parent, and any subsidiary thereof to make, use,
lease and sell, apparatus and/or methods under said application and patent.
4 Endgate may sell, lease or otherwise transfer the Work, or any
portion thereof, subject to the exclusivity, provision in the Article
entitled STRATEGIC RELATIONSHIP, which is covered by one or more Joint
Invention to any party provided that prior to any such sale, lease or
transfer, Endgate agrees in writing to pay to HNS a reasonable royalty, to
be negotiated in good faith between HNS and Endgate.
ARTICLE PROPRIETARY RIGHTS INDEMNITY
A. Contractor, at its own expense, shall indemnify and hold HNS, its partners,
directors, officers, employees, agents, subsidiaries, affiliates,
customers, designees or assignees harmless from any loss, damage, liability
or expense on account of any claim(s), and shall defend any suit AND
dispose of any claim(s) or other proceedings, based on an allegation that
the manufacture of any item in the performance of this Contract, or the
use, lease, sale or importation of any item delivered or scheduled to be
delivered under this Contract, infringes any United States or foreign
Patent(s), copyrights, or other proprietary right(s). Contractor shall pay
any royalties and other costs or expenses, including attorney's fees,
related to the defense, settlement, or disposition of such infringement
claim(s). HNS shall promptly notify Contractor in writing of any such
infringement claim or action and give Contractor authority and any
assistance or information reasonably available to HNS for the defense of
such claim(s). Any such assistance or information which is furnished by HNS
at the request of Contractor is to be at Contractor's expense.
B. If the manufacture of any item in the performance of this Contract, or the
use, lease or sale of any item delivered or scheduled to be delivered under
this Contract, is enjoined as a result of a suit based on any such claim(s)
of infringement, Contractor agrees to utilize its best efforts (i) to
negotiate a license or other agreement with the claimant so that the item
is no longer subject to such injunction, or (2) to modify such item
suitably or suitable a suitable item therefor (subject to the technical
approval of HNS), which modified or substituted item is not subject to such
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injunction, and to extend the provisions of this Article thereto. In the
event that neither of the foregoing alternatives is suitably accomplished
by Contractor, Contractor shall be liable to HNS for HNS' additional
costs and damages arising as a result of such injunction.
C. Contractor agrees to use its best efforts to design, develop and
manufacture the items to be delivered under this Contract so that the
manufacture, use, lease, sale or importation of any such items shall not
infringe any United States or foreign Patent(s) or other proprietary
right(s). Contractor further agrees to use its best efforts to identify and
promptly report to HNS any unexpired Patents or other proprietary
rights of third parties which may be infringed by the manufacture, use,
lease, sale or importation of any item delivered under this Contract.
D. HNS neither represents nor warrants that the performance of any Work or the
manufacture, use, lease or sale of any deliverable item will be free from
any third-party claim(s) of infringement of any United States or foreign
Patent(s) or other proprietary right(s).
ARTICLE EXCUSABLE DELAY
Acts of God, or of the public enemy, acts of the Government in its
sovereign capacity, fires, floods, strikes, epidemics, quarantine restrictions,
freight embargoes and failure of HNS to deliver HNS-furnished property as
required under this Contract, which cause failure to perform hereunder and, in
every case, are beyond the reasonable control and without the fault or
negligence of Contractor, shall constitute an excusable delay, if written notice
thereof is given to HNS within twenty (20) days after such event shall have
occurred. In the event of delay resulting from any of the above causes, only the
applicable delivery requirements will be extended accordingly. In the event
that an excusable delay should occur and go beyond ninety (90)days, HNS has the
right to terminate this Contract without liability.
ARTICLE CHANGES
A. HNS may, with mutual agreement of Contractor which agreement will not
be unreasonably withheld, by written change order, and without notice
to any surety, make changes within the general scope of this Contract
in drawings, designs, specifications, methods of shipment or
packaging/packing, quantities, or time or place of delivery require
additional Work; or direct the omission of Work. If any such change
causes an increase or decrease in the cost of, or the time required
for performance of, this Contract, an equitable adjustment shall be
made in the price(s), or delivery date(s), or both, and this Contract
shall be amended in writing accordingly. Any claim for adjustment by
Contractor under this Paragraph shall be deemed waived unless asserted
in writing within thirty (30) days from the date of receipt by
Contractor of the change order. The amount of such claim shall be
stated either when it is submitted, or at such later date not to
exceed sixty (60) days from the date of assertion of the claim. Such
later date shall be requested at the time of submission of such claim
by Contractor. If the cost of supplies or materials made obsolete or
excess as a result of a change is included in Contractor's claim for
adjustment, HNS shall have the right to prescribe the manner and means
of their disposition and shall be entitled to the proceeds, if any of
such disposition. Nothing in this Article shall excuse Contractor from
promptly proceeding with this Contract as changed. Changes to this
Contract can only be made by a duly authorized representative of the
HNS Procurement Department.
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B. If Contractor or HNS claims a right to adjustment pursuant to
Paragraph A of this Article, Contractor shall prepare and furnish to
HNS the evidence necessary to establish the amount of any increase
or decrease in the cost of, or the time required for, the performance
of this Contract caused by the change order. Subject to Paragraph D of
this Article, the amount of any such change increase or decrease shall
be determined in accordance with the Contractor's regularly
established accounting practices and shall, if requested by HNS, be
verified by an independent Certified Public Accounting firm.
C. The Parties shall attempt to reach agreement as to any equitable
adjustment that is due pursuant to Paragraph A of this Article.
Without relieving Contractor of its obligation to proceed promptly
with this Contract as changed, in the event the Parties are unable to
reach agreement as to an equitable adjustment, the matter shall be
determined in accordance with the Article entitled ARBITRATION.
D. HNS' personnel may from time to time render technical assistance or
give technical advice to, or effect an exchange of information with,
Contractor personnel concerning the Work to be furnished under this
Contract. However, Contractor shall not deviate from the requirements
of this Contract by reason of such assistance or exchange of
information, unless the deviation is incorporated into and authorized
by a change order issued in accordance with Paragraph A of this
Article. The Contractor shall not, by reason of such assistance,
advice or exchange of information, delete or in any way modify any of
HNS' rights or any of Contractor's obligations, express or implied,
which are a part of this Contract.
ARTICLE TERMINATION FOR CONVENIENCE
A. By written notice to Contractor, HNS may terminate this Contract, in
whole or in part, for its convenience at any time prior to completion.
In the event of such termination by HNS, it is agreed that the
termination charges shall be negotiated. However, in no event shall
the termination charges pursuant to this Article exceed the lesser of:
1. The total Contract price as reduced by the Contract price of Work
not terminated; or
2. For the Development Phase, HNS shall reimburse Contractor for
the costs accrued to and including the milestone of the
Development Phase at which the Contract is terminated. HMS
shall, however, not have the right to terminate the Contract
until after milestone l(Minimum level) as stated in the Article
entitled Price And Payment, paragraph C; or
3. For the Production Phase, if any, [*] of the total manufacturing
costs (exclusive of nonrecurring engineering costs), both direct
and it. direct, incurred by Contractor in the performance of the
Work so terminated.
B. In the event of termination pursuant to this Article, Contractor shall
take all action, necessary to reduce the termination costs due from
HNS, including, but not limited to, the immediate discontinuance of
the terminated Work under this Contract, and the placing of no further
orders for labor, material or services required under the terminated
portion. Contractor agees to take
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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such action as may be necessary, or as HNS may direct, for protection
of property in Contractor's possession in which HNS may have acquired
an interest.
C. Contractor shall continue performance of the portion of this Contract
not terminated. HNS shall have no obligations to Contractor with
respect to the terminated portion of this Contract, except as herein
provided.
D. Contractor agrees to advise HNS in writing of all proposed
settlements with vendors in the event of termination, and Contractor
further agrees not to enter into any binding settlement until either
HNS has approved the proposed settlement or thirty (30) days have
elapsed from the date HNS was first notified of such
proposed settlement.
E. Direct and indirect costs shall be determined in accordance with
generally accepted accounting practices and verified by an independent
Certified Public Accountant. HNS shall pay Contractor the termination
charges due under this Article within sixty (60) days after submission
to HNS of such total costs certified by the independent Certified
Public Accountant. Payment of any termination charges hereunder shall
be in an amount equal to the total termination charges less the
following:
1. Amount(s) previously paid by HNS to Contractor for the terminated
Work pursuant to this Contract; and
2. Amount(s) representing Contractor's total cost of segregable
items of inventory for the terminated Work not desired by HNS
and which Contractor elects to retain for its use.
Should the sum of (1) and (2) above exceed the total termination
charges, Contractor shall repay to HNS within sixty (60) days the
amount by which the sum of (l) and (2) above exceed the total
termination charges.
F. In the event of such TERMINATION, all inventory for the terminated
Work, including, but not limited to, the Work Product of Contractor
generated under this Contract, other than as specified in Paragraph E2
of this Article, shall become the property of HNS.
ARTICLE TERMINATION FOR DEFAULT
A. By written notice of default to Contractor, HNS may terminate this
Contract, in whole or in part, in any one of the following
circumstances:
1. If Contractor fails to make delivery of the Work within the time
specified herein or any extension thereof; or
2. If Contractor fails to perform any of the provisions of this
Contract, or so fails to make progress as to endanger performance
of this Contract in accordance with its terms, and in either of
these two circumstances does not cure such failure within a
period of twenty (20) days (or such longer period as HNS may
authorize in writing) after receipt of notice from HNS specifying
such failure; or
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3. The Contractor becomes insolvent or the subject of proceedings
under any law relating to bankruptcy or the relief of debtors or
admits its inability to pay its debts as they become due.
B. In the event of default under this Article, Contractor shall repay to
HNS any payments made by HNS in excess of the price of Work delivered
by Contractor and accepted by HNS. In no event shall HNS be liable for
the cost of completed Work not delivered and accepted by HNS.
C. In the event HNS terminates this Contract, in whole or in part, as
provided in Paragraph A of this Article, HNS may procure, upon such
terms and in such manner as HNS may deem appropriate, Work similar to
that so terminated, and Contractor shall be liable to HNS for any
excess costs(which HNS will make reasonable efforts to limit)for such
similar Work [*] for the Development Phase and [*] for any [*] under
this Article, PROVIDED, HOWEVER, that Contractor shall continue
performance of this Contract to the extent not terminated under the
provisions of this Article.
D. If this Contract is terminated as provided in Paragraph A of this
Article, in addition to any other rights provided in this Article, HNS
may require Contractor to transfer title and deliver to HNS in the
manner and to the extent directed by HNS, (1) any completed supplies,
and (2) such partially completed supplies and materials, parts, tools,
dies, jigs, fixtures, and contract rights (hereinafter called
"Manufacturing Materials") as Contractor has specifically produced or
specifically acquired for the performance of such part of this
Contract as has been terminated, and Contractor shall, upon direction
of HNS, protect and preserve property in the possession of
Contractor in which HNS has an interest. Payment for completed
supplies delivered to and accepted by HNS shall be at the price stated
in this Contract. Payment for Manufacturing Materials delivered to and
accepted by HNS, and for the protection and preservation of property,
shall be in an amount agreed upon by Contractor and HNS; failure to
agree on such amount shall be a dispute within the meaning of the
Article of this Contract entitled ARBITRATION. HNS may withhold from
amounts otherwise due Contractor for such completed supplies or
Manufacturing Materials, such sum(s) as HNS deems necessary to protect
HNS against any loss arising in connection with outstanding liens or
claims of former lien holders.
E. If, after notice of termination of this Contract under the provisions
of this Article, it is determined for any reason that Contractor was
not in default under the provisions of this Article, or that the
default was excusable under the provisions of the Article of this
Contract entitled EXCUSABLE DELAYS, the rights and obligations of the
Parties shall be the same as if the notice of termination had been
issued pursuant to the Article of this Contract entitled TERMINATION
FOR CONVENIENCE.
F. The rights and remedies of HNS, provided in this Article, include the
right to recovery of attorney's fees, and are not exhaustive and are
in addition to any other rights and remedies under this Contract or by
operation of law.
ARTICLE ESCROW OF DESIGN RIGHTS AND DOCUMENTATION
Contractor shall deposit in an Escrow account, to be mutually agreed to,
all pertinent drawings, documentation, test procedures, artwork, design data,
including but not limited to source source code and/or other software, necessary
to manufacture, test, use, support and sell the Product(s) at the earliest
possible time after generation of such drawings, documents, design data and
software, but no later than
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
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SUBCONTRACT AGREEMENT
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20 days after its generation. The right to utilize and manufacture, without
cost, such drawings, documentation, artwork, design data, including but not
limited to software source code and/or other software will convey to HNS as
provided for in the Article of this Contract entitled RIGHTS TO MANUFACTURE.
This right or remedy shall be in addition to any other rights or remedies
provided by law.
ARTICLE RIGHTS TO MANUFACTURE
HNS, at its sole option, may request and Contractor shall provide all
pertinent and required documentation, including software, artwork, test
procedures, specifications, parts lists, drawings, etc., as escrowed pursuant to
the Article of this Contract entitled ESCROW OF DESIGN RIGHTS AND DOCUMENTATION,
necessary for HNS to manufacture or have manufactured, test, support, use, sell
and resell the Product(s) should any of the circumstances listed in the Article
of this Contract TERMINATION FOR DEFAULT occur or in the event this Contract is
terminated under the provisions of the Article of this Contract TERMINATION FOR
DEFAULT.
Further, the right to manufacture shall be granted as a non-exclusive,
worldwide, unrestricted, non-transferable, royalty free right to HNS. Contractor
shall also provide reasonable consultation of its key personnel at no cost to
HNS other than the reasonable and actual travel and living costs should HNS
require any travel.
ARTICLE LIQUIDATED DAMAGES
A. The Parties hereto agree that timely performance is a primary
consideration in this Contract, and, therefore, it is agreed that time
is of the essence hereunder.
B. Following an initial grace period of thirty (30) calendar days of
delay, for each calendar week of delay thereafter, up to a maximum of
ten (10) calendar weeks, following the required delivery date(s)
Contractor shall pay to HNS as fixed, agreed and liquidated damages,
and not as a penalty, for said delay, one percent (1%) per week of the
Purchase Order value.
C. Any amount(s) Contractor owes to HNS, pursuant to the provisions of
this Article, may be deducted by HNS from Contractor's invoice(s)or
other surety if any.
D. If Contractor does not fully demonstrate that the Work meets the
requirements of this Contract, and HNS does not exercise its right
to terminate this Contract for default in accordance with the Article
of this Contract entitled TERMINATION FOR DEFAULT, the liquidated
damages in this Article shall be the sole compensation to which HNS
shall be entitled for delays for the number of days stated in
Paragraph B of this Article provided, however, that damages incurred
by HNS after said period of delay for which liquidated damages are
recovered shall be as at law or as otherwise provided in this
Contract.
E. As used in this Article, "Calendar Days" or "Calendar Weeks" shall
mean part of a day or week commencing at twelve (12) o'clock midnight,
EST.
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ARTICLE ARBITRATION
If any dispute or disagreement arising between Contractor and HNS in
connection with this Contract cannot be settled to the mutual satisfaction of
Contractor and HNS within thirty (30) days (or such longer period as may be
mutually agreed upon) from the date that either Party informs the other in
writing that such dispute or disagreement exists, the parties shall submit such
disputes to binding arbitration. Within thirty (30) days after either party has
notified the other in writing that it is submitting a dispute to arbitration,
one arbitrator shall be selected under the then current rules of the American
Arbitration Association ("AAA") pertaining to commercial disputes and shall be
held in Washington, D.C. The arbitration shall be conducted in accordance with
the Commercial Arbitration rules of the AAA, except the AAA shall not have
authority to make any award for damages excluded herein. The arbitration award
shall be by a written decision and shall be final and binding and enforceable by
any court of competent jurisdiction. Either party may seek appropriate
injunctive relief in any court of competent jurisdiction.
ARTICLE CONTRACTOR'S RESPONSIBILITY
A. Contractor is an independent contractor and is responsible to HNS
for all acts and omissions of all persons directly or indirectly used
by it or any of its subcontractor(s), unless a subcontractor is
designated by HNS, in connection with the Work required by this
Contract, PROVIDED, HOWEVER, that nothing in this Contract shall be
construed as creating any contractual relationship between HNS and
any subcontractor.
B. The granting of any approvals by HNS shall not affect the
responsibility of Contractor for the design of the Work to meet
Contract requirements or for the correctness of Contractor's drawings
and specifications. No such granting by HNS or course of dealing
between the Parties shall be held to constitute a waiver by HNS of any
of HNS rights under this Contract. All waivers by HNS shall be in
writing.
ARTICLE TRADE NAMES, TRADEMARKS AND TRADE DRESS
A. Contractor agrees to comply with all HNS instructions regarding the
trade dress packaging, trade names, trademarks, service marks or other
indicia of source which shall appear on items to be delivered under
this Contract. Contractor further agrees that, after delivery of said
item(s) to HNS or a designated HNS customer, HNS may modify the trade
dress or packaging thereof, and/or replace, modify, or supplement any
indicia of origin appearing thereon, to identify HNS as the source of
said item(s).
B. Neither Party shall use any mark or trade name of the other Party or
refer to the other Party in connection with any product, equipment,
promotion, or publication without the prior written approval of the
other Party.
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ARTICLE PUBLIC RELEASE OF INFORMATION
Contractor shall obtain the prior written approval of HNS concerning the
content and timing of news releases, articles, brochures, advertisements,
speeches and other information releases concerning the Work performed or to be
performed hereunder by Contractor, its Subcontractor(s) or employee(s) or
consultant(s) of either. Contractor agrees to give HNS reasonable advance time
for review of any material submitted to HNS for approval.
ARTICLE NOTICES
Any notice(s) required or permitted to be given or made in this Contract
shall be in writing. Such notice(s) shall be deemed to be duly given or made
when it shall have been delivered by facsimile transmission [FAX], hand, or
registered mail to the Party to which it is required to be given or made at such
Party's address specified below:
HNS: Hughes Network Systems, Inc.
11717 Exploration Lane
Germantown, Maryland 20876
Attn: John Grimes
Purchasing Agent
TEL (301) 548-8401
FAX (301) 548-8458
Contractor: Endgate Corporation
321 Soquel Way
Sunnyvale, CA 94086
Attn: Julianne Marie Biagini
TEL (408) 737-7300
FAX (408) 737-6794
ARTICLE ORDER OF PRECEDENCE
In the event of any ambiguity and/or inconsistency between the Terms and
Conditions, Statement of Work, Specifications, Drawings or other documents
incorporated by reference, the following descending order of precedence shall
control:
1. Terms and Conditions and any amendments thereto;
2. Exhibit A, Statement of Work Revision 6 and dated March 18, 1998;
3. Exhibit B, Performance Requirements Specification 1024668 and 1025231
at their current revision;
4. Purchase Order(s);
5. Drawings and other documents attached to the Specifications or
incorporated by reference.
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ARTICLE APPLICABLE LAW
This Contract shall be interpreted, construed and governed by the laws of
the State of Maryland.
ARTICLE GENERAL
A. Contractor agrees that the Work performed under this Contract,
including the Products and services of that Work, shall comply with
all applicable permits and licenses and the requirements ofal
applicable laws, regulations and standards as required by the
Statement Of Work.
B. Where this Contract or any code, ordinance, or governmental regulation
requires a material or item to conform to a particular standard,
Contractor shall, at the request of HNS, deliver to HNS a certificate
from the manufacturer or its authorized representative stating that
the material or item furnished conforms to the standard prescribed.
Such certificate shall be in triplicate and in such form as HNS may
require.
C. Contractor agrees that it will neither incorporate any provision in
its subcontracts nor enter into any agreement, written or oral, either
directly or indirectly, with Subcontractors or vendors which has or
may have the effect of prohibiting Subcontractor or vendor sales
directly to HNS of any supplies like those manufactured or services
like those furnished, by any tier Subcontractor or vendor pursuant to
this Contract.
D. Neither Party shall assign or delegate this Contract or any of its
rights, duties or obligations thereunder to any person or entity
without the prior written approval of the other Party.
E. All documentation, notices, reports and correspondence under this
Contract shall be submitted and maintained in the English language.
ARTICLE EXAMINATION OF CONTRACT
A. By executing this Contract, the Parties represent that they have
thoroughly examined this Contract and believe it to be complete,
consistent and accurate.
B. The terms of this Contract constitute the final and entire agreement
between the Parties, and no prior or contemporaneous representations,
expressions or agreements, either written or oral, shall vary or
supplement the terms of this Contract. The terms of this Contract
shall not be supplemented or contradicted by course of dealing, usage
of trade or course of performance under this or other contracts.
C. Amendments to this Contract shall be in writing and signed by both
Parties.
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ARTICLE PRODUCT SUPPORT
A. The Contractor warrants that the items purchased under this Order,
including subassemblies and spare parts, shall be available to HNS and
its customers during the operational life of the items purchased or
fifteen (15) years after the date of final shipment under this Order,
whichever is later.
B. In the event the Contractor discontinues manufacture of the
aforementioned items, subassemblies and spare parts therefore and does
not provide for another qualified source, the Contractor shall make
available to HNS all drawings, specifications, data, etc., which will
enable HNS or its customers to manufacture or procure said items,
subassemblies and spare parts under a royalty-free license which is
hereby granted.
C. The Contractor shall support the items purchased hereunder during the
operational life of the items or for a period of fifteen (15) years
from the date of final shipment under this Order. Said support
includes, but is not limited to, technical services and maintenance of
Contractor's stock of subassemblies and spare parts as may be required
to be ordered to support the operation of the items.
ARTICLE KEY PERSONNEL
Contractor represents and warrants to HNS that the services of certain key
personnel, specifically John Mikulsky, Dick Mayeur, Dan Teuthorn, Jim Wilfong,
Bryson Wallace and Ray Biasing and the Key Personnel Retention Plan (Exhibit C)
will be applied to the performance of this Contract during the Development Phase
and HNS has relied on this representation and warranty as a material
inducement to entering into this Contract. Accordingly, should the services of
John Mikulsky, Dick Mayeur, Dan Teuthorn, Jim Wilfong, Bryson Wallace and Ray
Blasing cease to be applied to the performance of this Contract, Contractor and
HNS will promptly confer and if Contractor does not demonstrate within ten
(10) business days to HNS's reasonable satisfaction the substitution of an
alternate individual of equal or greater knowledge, skill, experience and
judgement, HNS may declare Contractor in default pursuant to the provisions of
the Article TERMINATION FOR DEFAULT. Contractor shall notify HNS of any
material changes to the Key Personnel Retention Plan as shown in Exhibit C
attached hereto which is deliverable to HNS within ten (10) working days of
execution of this Contract.
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ARTICLE SURVIVAL
The provisions of this Contract that by their sense and context are intended to
survive the termination of this Contract shall so survive.
IN WITNESS WHEREOF, the Parties hereto have executed this Contract.
HUGHES NETWORK SYSTEMS
ATTEST: BY: /s/ Suresh Arora
--------------------------------- ---------------------------
NAME: /s/ Suresh Arora
-------------------------
TITLE: Vice President
------------------------
ENDGATE CORPORATION
ATTEST: /s/ JULIANNE M. BIAGINI BY: /s/ James Bybokas
--------------------------------- ---------------------------
NAME: James Bybokas
-------------------------
TITLE: Vice President
------------------------
22
