Standard OEM Purchase Agreement - Packeteer Inc. and Lucent Technologies Inc.
LUCENT TECHNOLOGIES INC.
STANDARD OEM PURCHASE AGREEMENT TERMS AND CONDITIONS
Agreement No. SC11990054
Sheet 1 of 28
Packeteer Inc.
10495 N. De Anza Blvd.
Cupertino, CA 95014
This Agreement is made by and between Lucent Technologies Inc. ("Company")
having an office at 188 Mt Airy Road, Basking Ridge, NJ 07920 and Packeteer Inc.
("Supplier") having an office at 10495 N. De Anza Blvd., Cupertino, CA 95014.
Company agrees to purchase and Supplier agrees to sell in accordance with the
terms and conditions stated in this Agreement and any attachments to this
Agreement.
WHEREAS, Company wishes to purchase products of Supplier's (design and)
manufacture for resale to Company's customers, and
WHEREAS, Supplier desires to sell such materials to Company for resale to
Company's customers,
THEREFORE, the parties agree as follows
1. AGREEMENT EFFECTIVE PERIOD
The term of this Agreement shall commence on, June 25, 1999, and
shall, except as otherwise provided in this Agreement, continue in effect
thereafter until September 21, 2003.
2. MATERIAL
"MATERIAL" as used in this Agreement shall mean Supplier's
PacketShaper Products as listed in APPENDIX A, attached and made a part of
this Agreement. Such MATERIAL is hereby offered for sale of hardware and
license to software by Supplier and may be purchased by Company in
accordance with the terms, conditions and specifications stated in this
Agreement. This Agreement is a non-commitment agreement and MATERIAL shall
be furnished by Supplier on an as-ordered basis.
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"Specification(s)" as used in this Agreement shall mean all of the
specifications made part of this Agreement.
3. OPTION TO EXTEND
Company shall have the right to extend the period specified in the
section "AGREEMENT EFFECTIVE PERIOD" for up to twelve (12) months by
giving Supplier at least thirty (30) business days prior written notice.
Within ten (10) business days of the date of Company's notice to
extend the period, Supplier shall notify Company in writing whether
Supplier proposes to revise the price(s) under this Agreement. If the
parties fail to agree on the revised price(s) within twenty (20) business
days after the date of Supplier's notice, Company's notice of extension
shall be considered withdrawn and prices for outstanding orders or orders
placed during the term of this Agreement shall not be revised.
4. PRICE AND DISCOUNTS
Prices shall be as shown in APPENDIX A. Prices as listed in
Appendix A shall remain in effect during the period June 25, 1999 through
June 24, 2000. Thereafter, Supplier may increase prices once in the
remaining twelve (12) months term of the Agreement. Supplier shall notify
Company sixty (60) business days in advance of any proposed price
increase. Orders placed prior to the proposed effective date shall not be
affected by the proposed price revision. If Company and Supplier fail to
agree upon prices by the proposed effective date, Company reserves the
right to terminate this Agreement and any outstanding purchase orders
placed against this Agreement without any cost to or liability or
obligation of Company.
5. COST REDUCTION
Both parties shall endeavor to reduce the costs of products
furnished under this Agreement.
6. BEST PRICE
If, at any time during the term of this Agreement Supplier should
sell to any customer other than to affiliates or subsidiaries of Supplier,
material at least equal or similar quality and volume at a price lower
than that in effect under this Agreement, Company shall pay such lower
price on all deliveries of MATERIAL which are made during the period when
such lower price is in effect Subject to Company's obligations including
without limitation, Company's obligations of confidentiality, and upon ten
(10) days written notice and not more than twice per calendar year, a
qualified third party, reasonably acceptable to both parties, may audit
Supplier's applicable books and records for the purpose of verifying
Supplier's compliance with this provision. Such third party shall be
subject to a confidentiality agreement and any report shall be limited to
verifying Supplier's obligations under this section.
7. TERMS OF PAYMENT
Net thirty (30) business days from the date of shipment of the
MATERIAL to Company, or designate, or receipt of the applicable invoice.
* 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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8. FORECASTS
Company shall provide Supplier with a [*] forecast submitted to
Supplier by the fifth (5th) business day of each calendar month. Such
forecast shall be used by Supplier for planning purposes only and shall
not be deemed a commitment by Company to purchase the MATERIAL shown in
the forecast.
9. FOB
The MATERIAL shall be shipped FOB Supplier's location ( or such
other Supplier's location as may be designated by Supplier). Company shall
select the carrier(s) and provide the name(s) of the carrier(s) and
Company's account number(s) with said carriers to Supplier within thirty
(30) days of execution of this Agreement.
10. FREIGHT CLASSIFICATION
MATERIAL purchased under this Agreement shall be shipped to Company
or Company's customers subject to freight charges appropriate for goods
classified as Data Communication Products. Supplier shall indicate on the
bill of lading that Company's contract rates apply.
11. NON-EXCLUSIVE MARKET RIGHTS
This Agreement neither grants to Supplier an exclusive right or
privilege to sell to Company any or all products of the type described in
the MATERIAL section which Company may require, nor requires the purchase
of any MATERIAL or other products from Supplier by Company. Therefore,
Company may contract with other manufacturers and suppliers for the
procurement of comparable products. In addition, Company shall, at its
sole discretion, decide the extent to which Company will market advertise,
promote, support or otherwise assist in further offerings of the MATERIAL.
Purchases by Company under this Agreement shall neither restrict the
right of Company to cease purchasing nor require Company to continue any
level of such purchases. Company's right to any supply of MATERIAL
hereunder is non-exclusive except for MATERIAL marked with INSIGNIA.
Supplier shall have the right to supply comparable products to third
parties.
12. SPECIFICATIONS OR DRAWINGS
Supplier's standard commercial specifications (data sheets) are
included by reference and further defined in APPENDIX B
("Specifications"). Supplier shall manufacture MATERIAL in accordance with
Specifications, so that MATERIAL conforms to such Specifications.
In accordance with the notification requirements outlined in Section
"PRODUCT CHANGES", Supplier shall provide Company with at least thirty
(30) business days prior written notice of any hardware change, and any
notification of any software change
* 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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to be made by Supplier in the MATERIAL furnished pursuant to said
Specifications under this Agreement.
If Company, in its sole discretion, does not agree to the change
proposed by Supplier, Company may submit a Modification Request to address
the change. If the Company's Modification Request is not an acceptable
solution, then in lieu of all other rights and remedies at law or equity
or otherwise, and without any cost to or liability or obligation of
Company, Company shall have the right to terminate this Agreement .
Supplier shall continue to supply MATERIAL to Company pursuant to
the Specifications for the term of the Agreement. If Supplier is unable to
continue to thus supply or discontinues manufacture of MATERIAL, Company
shall be entitled to three (3) month's advance notice, provided (i) the
discontinuance is at Supplier's election and (ii) there has been a
reasonable amount of purchases during the period preceding Supplier's
notice of discontinuance.
13. ASSIGNMENT
Supplier shall not assign any right or interest under this Agreement
(excepting solely for moneys due or to become due) without the prior
written consent of Company, provided however, no such consent shall be
required in connection with the sale of all or substantially all of the
business of Supplier related to MATERIAL or in connection with any merger,
reorganization or sale of Supplier. Except where Company has specified a
designated subcontractor, Supplier shall be responsible to Company for all
work performed by Supplier's subcontractor(s) at any tier. In the event of
an assignment, Company may terminate this Agreement or an order, in whole
or in part, by written notice to Supplier. In such case, Company's
liability shall be limited to payment of the amount due for Work performed
and/or MATERIAL provided by Supplier up to and including the date of
termination.
14. BANKRUPTCY AND TERMINATION FOR FINANCIAL INSECURITY
Either party may terminate this Agreement by notice in writing:
(i) if the other party makes an assignment for the benefit of
creditors (other than solely an assignment of monies due); or:
(ii) if the other party evidences an inability to pay debts as they
become due, unless adequate assurance of such ability to pay
is provided within thirty (30) days of such notice.
If a proceeding is commenced under any provision of the United
States Bankruptcy Code, voluntary or involuntary, by or against either
party, and this Agreement has not been terminated, the non-debtor party
may file a request with the bankruptcy court to have the court set a date
within sixty (60) days after the commencement of the case, by which the
debtor party will assume or reject this
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Agreement, and the debtor party shall cooperate and take whatever steps
necessary to assume or reject the Agreement by such date.
15. CFC PACKAGING
Supplier warrants that all packaging materials furnished under this
Agreement and all packaging associated with MATERIAL furnished under this
Agreement were not manufactured using and do not contain
chlorofluorocarbons. "Packaging" means all bags, wrapping, boxes, cartons
and any other packing materials used for packaging. Supplier shall
indemnify and hold Company harmless for any liability, fine or penalty
incurred by Company to any third party or governmental agency arising out
of Company's good faith reliance upon said warranty.
16. CHOICE OF LAW
This Agreement and all transactions under it shall be governed by
the laws of the State of New Jersey excluding its choice of laws rules and
excluding the Convention for the International Sale of Goods. Supplier
agrees to submit to the jurisdiction of any court wherein an action is
commenced against Company based on a claim for which Supplier has agreed
to indemnify Company under this Agreement.
17. COMPLIANCE WITH LAWS
Supplier and Company and all persons furnished by Supplier and
Company shall comply at their own expense with all applicable laws,
ordinances, regulations and codes, export regulations, including the
identification and procurement of required permits, certificates,
licenses, insurance, approvals and inspections in performance under this
Agreement.
18. CONTINUING AVAILABILITY
Supplier shall offer for sale to Company, during the term of this
Agreement and for at least six (6) months after the expiration of this
Agreement, MATERIAL conforming to the Specifications set forth in this
Agreement. Supplier further shall offer for sale to Company, during the
term of this Agreement and until [*] after the expiration of this
Agreement, maintenance, replacement, and repair parts ("Parts") which are
functionally equivalent for the MATERIAL covered by this Agreement. The
price for the MATERIAL and Parts shall be the price set forth in
Supplier's then current agreement with Company for said MATERIAL or Parts
or, if no such agreement exists, at a price agreed upon by Company and
Supplier. If the parties fail to agree on a price, the price shall be a
reasonably competitive price for said MATERIAL or Parts at the time for
delivery. The MATERIAL and Parts shall be warranted as set forth in the
"WARRANTY" section of this Agreement. The term "Parts" is included in the
term "MATERIAL."
In the event Supplier fails to supply such MATERIAL or Parts and
Supplier is unable to obtain another source of supply for Company, then
Company and Supplier shall endeavor to develop an alternative method of
provisioning MATERIAL or parts, which
* 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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may include licensing Manufacturing Rights to Company. At that time, both
parties shall determine necessary measures required for Company to obtain
MATERIAL under this license.
19. DEFAULT
If either Supplier or Company shall be in breach or default of any
of the terms, conditions or covenants of this Agreement or of any purchase
order, and if such breach or default shall continue for a period of thirty
(30) days after the giving of written notice to the other party then, in
addition to all other rights and remedies which each party may have at law
or equity or otherwise, Supplier or Company shall have the right to cancel
this Agreement and/or any purchase orders placed by Company without any
charge to or obligation or liability of either party.
20. ELECTRONIC DELIVERY SERVICE
Supplier agrees, if requested by Company, to implement Electronic
Delivery Service (EDS) ordering arrangements as an electronic means of
trading business document with Company when it can reasonably accomplish
the task. The electronic business documents include purchase orders,
acknowledgments, purchase order changes, ship notices, remittance advice,
or such purchasing communications as may be requested by Company for
transaction under this Agreement.
21. EPIDEMIC CONDITION
If during the term of this Agreement and for [*] after the last
shipment date of MATERIAL under this Agreement Company notifies Supplier
that MATERIAL shows evidence of an "Epidemic Condition," Supplier shall
prepare and propose a Corrective Action Plan ("CAP") with respect to such
MATERIAL within fifteen (15) working days of such notification, addressing
implementation and procedure milestones for remedying such Epidemic
Condition(s). An extension of this time-frame is permissible upon mutual
written agreement of the parties.
Upon notification of the Epidemic Condition to Supplier, Company
shall have the right to postpone all or part of the shipments of unshipped
MATERIAL, by giving written notice of such postponement to Supplier,
pending correction of the Epidemic Condition. Such postponement shall
temporarily relieve Supplier of its shipment liability and Company of its
shipment acceptance liability. Should Supplier not agree to the existence
of an Epidemic Condition or should Company not agree to the CAP, then
Company shall have the right to suspend all or part of its unshipped
orders without liability to Company until such time as a mutually
acceptable solution is reached.
An Epidemic Condition will be considered to exist when one or more
of the following conditions occur:
(1) Failure reports or statistical samplings show that MATERIAL
shipped contain a potential safety hazard (such as personal injury or
death, fire, explosion, toxic
* 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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emissions, etc.), or exhibit a highly objectionable symptom (such as
emissions of smoke, loud noises, deformation of housing) or other
disconcerting symptoms of this type.
(2) Reliability plots of relevant data indicate that the MATERIAL
has actual Mean Time Between Failures (MTBF) of less than 80% of the MTBF
stipulated in the Specification. The MTBF parameter of MATERIAL is defined
as the total operating or power-on time of any population under
observation ("T"), in hours, divided by the total number of critical
failures ("n") that have occurred during the observed period. A critical
failure is defined as a failure to operate per the requirements of the
Specification. The total operating time of a population is the summation
of operating time of individual units in that population. MTBF is
expressed as MTBF = T/n. An Epidemic Condition shall exist when data
derived from populations being tracked confirms the condition with 80%
confidence. (3) MATERIAL Dead on Arrival (DOA) failures exceed the
Epidemic DOA failure rate which is defined as 1.2 x DOA specified in the
section of this Agreement entitled PRODUCT CONFORMANCE REVIEW.
Only major hardware failures and visual/mechanical/appearance
defects are considered for determining Epidemic Condition. MATERIAL could
be either sampled or, a Company's option, 100% audited at Company
warehouses, factories or Company's customers' locations. If MATERIAL is
sampled, the data must have 80% or better statistical confidence.
For the purpose of this Agreement, functional DOA shall be defined
as any MATERIAL that during the test, installation or upon its first use
fails to operate in accordance with the Specifications as defined or
specified in writing. Visual/mechanical/appearance DOA is defined as any
MATERIAL containing one or more major defects that would make the MATERIAL
unfit for use or installation.
An Epidemic Condition shall not include failures due to customer
misapplication, utilization of parts not approved by Supplier, or chain
failures induced by internally or externally integrated subassemblies.
In the event that Supplier develops a remedy for the defect(s) that
caused the Epidemic Condition and Company agrees in writing that the
remedy is acceptable, such acceptance shall not be unreasonably withheld
or delayed, Supplier shall:
(a) Incorporate the remedy in the affected MATERIAL in accordance with
Company's written instructions.
(b) Ship all subsequent MATERIAL incorporating the required modification
correcting the defect(s) at no additional charge to Company; and
(c) Repair and/or replace MATERIAL that caused the Epidemic Condition. In
the event that Company incurs reasonable and documented costs due to such
repair and/or
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replacement, including but not limited to labor and shipping costs,
Company shall supply such documentation and Supplier shall reimburse
Company for such reasonable costs. Supplier shall bear risk of in transit
loss and damage for such repaired and/or replaced MATERIAL.
Supplier and Company shall mutually agree in writing as to the
remedy's implementation schedule. Supplier shall use its best efforts to
implement the remedy in accordance with the agreed-upon schedule.
If Supplier is unable to develop a mutually agreeable remedy, or
does not adequately take into account the business interests of Company,
as reasonably agreed by the parties, Company may (1) develop and implement
such remedy and, in such case, implementation costs and risk of in-
transit loss and damage shall be allocated between the parties as set
forth in this section, and/or (2) cancel postponed orders without
liability and return all MATERIAL affected by such Epidemic Condition for
full refund, payable by Supplier within thirty (30) business days after
receipt of returned MATERIAL (with risk of loss or in-transit damage borne
by Supplier) and/or (3) terminate this Agreement without further
liability.
22. EXPORT CONTROL
Supplier and Company will not use, distribute, transfer or transmit
any products, software or technical information (even if incorporated into
other products) provided under this Agreement except in compliance with
U.S. export laws and regulations (the "Export Laws"). Supplier and Company
will not, directly or indirectly, export or re-export the following items
to any country which is in the then current list of prohibited countries
specified in the applicable Export Laws:(a) software or technical data
disclosed or provided to Supplier by Company or by Company to Supplier or
Company's subsidiaries or affiliates; or (b) the direct product of such
software or technical data. Supplier and Company agree to promptly inform
the other party in writing of any written authorization issued by the U.S.
Department of Commerce office of export licensing to export or re-export
any such items referenced in (a) or (b). The obligations stated above in
this clause will survive the expiration, cancellation or termination of
this Agreement or any other related agreement.
23. FORCE MAJEURE
Neither party shall be held responsible for any delay or failure in
performance of any part of this Agreement (except for the obligation to
pay money) to the extent such delay or failure is caused by fire, flood,
strike, civil, governmental, or military authority, act of God, or other
similar causes beyond its control and without the fault or negligence of
the delayed or non performing party or its subcontractors. Supplier's
liability for loss or damage to Company's MATERIAL in Supplier's
possession or control shall not be modified by this section. When a
party's delay or nonperformance continues for a period of at least fifteen
(15) days, the other party may terminate, at no charge, this Agreement or
an order under the Agreement.
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24. GOVERNMENT CONTRACT PROVISIONS
The following provisions regarding equal opportunity, and all
applicable laws, rules, regulations and executive orders specifically
related thereto, including applicable provisions and sections from the
Federal Acquisition Regulation and all supplements thereto are
incorporated in this Agreement as they apply to work performed under
specific U.S. Government contracts: 41 CFR 60-1.4, Equal Opportunity; 41
CFR 60-1.7, Reports and Other Required Information; 41 CFR 60-1.8,
Segregated Facilities; 41 CFR 60-250.4, Affirmative Action For Disabled
Veterans and Veterans of the Vietnam Era (if in excess of $10,000); and 41
CFR 60-741.4, Affirmative Action for Disabled Workers (if in excess of
$2,500), wherein the terms "contractor" and "subcontractor" shall mean
"Supplier". In addition, orders placed under this Agreement containing a
notation that the material or services are intended for use under
Government contracts shall be subject to such other Government provisions
printed, typed or written thereon, or on the reverse side thereof, or in
attachments thereto.
25. HEAVY METALS IN PACKAGING
Supplier warrants to Company that no lead, cadmium, mercury or
hexavalent chromium have been intentionally added to any packaging or
packaging component (as defined under applicable laws) to be provided to
Company under this Agreement and that packaging materials were not
manufactured using and do not contain chlorofluorocarbons. Supplier
further warrants to Company that the sum of the concentration levels of
lead, cadmium, mercury and hexavalent chromium in the package or packaging
component provided to Company under this Agreement does not exceed 100
parts per million. Upon request, Supplier shall provide to Company
Certificates of Compliance certifying that the packaging and/or packaging
components provided under this Agreement are in compliance with the
requirements set forth above in this section.
26. IDENTIFICATION
Except where provided by law, neither party shall, without the other
party's prior written consent, which consent shall not be unreasonably
withheld, engage in publicity related to this Agreement, or make public
use of any Identification in any circumstances related to this Agreement.
"Identification" means any semblance of any trade name, trademark, service
mark, insignia, symbol, logo, or any other designation, or drawing of
either party or its affiliates. Supplier shall remove or obliterate any
Identification prior to any use or disposition of any MATERIAL rejected or
not purchased by Company.
27. INDEMNITY
At Company's request, Supplier agrees to indemnify, defend and hold
harmless Company, its affiliates, customers, employees, successors and
assigns (all referred to as "Company") from and against any losses,
damages, claims, fines, penalties and expenses (including reasonable
attorney's fees) that arise out of or result from: (i) injuries or death
to persons or damage to property, including theft, in any way arising out
of or caused or alleged to have been caused by the Work or services
performed by, or material provided by Supplier or persons furnished by
Supplier; (ii) assertions under
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Workers' Compensation or similar acts made by persons furnished by
Supplier; or (iii) any failure of Supplier to perform its obligations
under this Agreement; provided however, Supplier shall not be liable for
any expense or settlement under this section unless Supplier shall have
complete control of the defense of any claim or settlement, and Company
timely notifies Supplier of any claim or allegation and shall cooperate,
at Supplier's expense, in good faith with Supplier to facilitate the
defense of any such claim or allegation. Supplier agrees not to make any
admissions that would be detrimental to Company.
28. INFRINGEMENT
Supplier shall indemnify and save harmless Company, its affiliates
and their customers, officers, directors, employees (all referred to in
this section as "Company") from and against any losses, damages,
liabilities, fines, penalties, and expenses (including reasonable
attorneys' fees) that arise out of or result from any and all claims (i)
of infringement of any patent, copyright, trademark or trade secret right,
or other intellectual property right, private right, or any other
proprietary or personal interest, and (ii) related by circumstances to the
existence of this Agreement or performance under or in contemplation of it
(an Infringement Claim). If the Infringement Claim arises solely from
Supplier's adherence to Company's written instructions regarding services
or tangible or intangible goods provided by Supplier (Items) and if the
Items are not (i) commercial items available on the open market or the
same as such items, or (ii) items of Supplier's designated origin, design
or selection, Company shall indemnify Supplier. Company or Supplier (at
Company's request) shall defend or settle, at its own expense any demand,
action or suit on any Infringement Claim for which it is indemnitor under
the preceding provisions; provided however, the party shall not be liable
for any expense or settlement under this section unless such party shall
have complete control of the defense of any Infringement Claim or
settlement and each shall timely notify the other of any assertion against
it or any Infringement Claim and shall cooperate in good faith with the
other to facilitate the defense of any such Claim.
29. INSIGNIA
Upon Company's written request, "Insignia", including certain
trademarks, trade names, insignia, symbols, decorative designs or
packaging designs of Company, or evidences of Company's inspection will be
properly affixed by Supplier to the MATERIAL furnished or its packaging.
Such Insignia will not be affixed, used or otherwise displayed on the
MATERIAL furnished or in connection therewith without written approval by
Company. The manner in which such Insignia will be affixed must be
approved in writing by Company in accordance with standards established by
Company. Company shall retain all right, title and interest in any and all
packaging designs, finished artwork and separations furnished to Supplier.
This section does not reduce or modify Supplier's obligations under the
"IDENTIFICATION" and "USE OF INFORMATION" section.
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30. INSURANCE
Supplier shall maintain and cause Supplier's subcontractors to
maintain during the term of this Agreement: (i) Workers' Compensation
insurance as prescribed by the law of the state or nation in which the
Work is performed; (ii) employer's liability insurance with limits of at
least $500,000 for each occurrence; (iii) automobile liability insurance
if the use of motor vehicles is required, with limits of at least
$1,000,000 combined single limit for bodily injury and property damage for
each occurrence; (iv) Commercial General Liability ("CGL") insurance, iso
1988 or later occurrence form of insurance including Blanket Contractual
Liability and Broad Form Property Damage, with limits of at least
$1,000,000 combined single limit for bodily injury and property damage for
each occurrence; and (v) if the furnishing to Company (by sale or
otherwise) of products or material is involved, CGL insurance endorsed to
include products liability and completed operations coverage in the amount
of $5,000,000 per occurrence. All CGL and automobile liability insurance
shall designate Company, its affiliates, and its directors, officers and
employees (all referred to as "Company") as additional insured. All such
insurance must be primary and non-contributory and required to respond and
pay prior to any other insurance or self-insurance available. Any other
coverage available to Company shall apply on an excess basis. Supplier
agrees that Supplier, Supplier's insurer(s) and anyone claiming by,
through, under or in Supplier's behalf shall have no claim, right of
action or right of subrogation against Company and its customers based on
any loss or liability insured against under the foregoing insurance.
Supplier and Supplier's subcontractors shall furnish prior to the start of
Work, certificates or adequate proof of the foregoing insurance, including
if specifically requested by Company, endorsements and insurance policies.
Company shall be notified in writing at least thirty (30) days prior to
cancellation of or any change in the policy. Insurance companies providing
coverage under this Agreement must be rated by A-M Best with at least an
A-rating.
31. INVOICING FOR GOODS
Supplier shall: (i) render original invoice, or as otherwise
specified in this Agreement, showing Agreement and order number, through
routing and weight, (ii) render separate invoices for each shipment, and
(iii) mail invoices with copies of shipping notices to the address shown
on this Agreement or order. If prepayment of transportation charges is
authorized, Supplier shall include the transportation charges from the
F.O.B. point to the destination as a separate item on the invoice stating
the name of the carrier used.
32. INVOICING FOR STOCKS
If Company requests for reasons other than covered by Section "FORCE
MAJEURE", that shipment be postponed beyond the date shown on a purchase
order, Supplier may invoice Company as of the original scheduled delivery
date for MATERIAL manufactured under this Agreement, if it has been
inspected and approved by Company's designated quality organization
(provided inspection has been specified in this Agreement or in an order
issued under this Agreement).
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33. JURISDICTION
Subject to the section "MEDIATION", the parties agree that any
action or legal proceeding arising out of this Agreement shall be brought
only in a court of competent jurisdiction in the United States of America
and the parties expressly submit to, and accepts the jurisdiction of, any
such court in connection with such action or proceeding and the parties
further consent to the enforcement of any judgment arising therefrom in
any jurisdiction in which a losing party has or shall have any assets.
34. LICENSES
Except as provided in Section 42, no Licenses, express or implied,
under any patents, copyrights, trademarks or other proprietary rights are
granted by Company to Supplier, or by Supplier to Company, under this
Agreement or order.
35. MARKING
All MATERIAL furnished under this Agreement shall be marked for
identification purposes in accordance with the specifications set forth in
this Agreement and as follows:
(a) with Supplier model/serial number; and
(b) with month and year of manufacture.
(c) with Company's Comcode
In addition, Supplier shall add any other identification which might
be requested by Company such as but not limited to indicia conforming to
the Company's Serialization Plan (KS-23490) as shown in APPENDIX E.
Charges, if any, for such additional identification marking shall be as
agreed upon by Supplier and Company. This section does not reduce or
modify Supplier's obligations under the "IDENTIFICATION" section.
36. MEDIATION
If a dispute relates to this Agreement, or its breach, and the
parties have not been successful in resolving such dispute through
negotiation for not more than thirty (30) days from the notice by either
party of such a dispute, the parties shall attempt to resolve the dispute
through mediation by submitting the dispute to a sole mediator selected by
the parties or, at any time at the option of a party, to mediation by the
American Arbitration Association ("AAA"). Each party shall bear its own
expenses and an equal share of the expenses of the mediator and the fees
of the AAA. All defenses based on passage of time shall be suspended
pending the termination of the mediation. Nothing in this section shall be
construed to preclude any party from seeking injunctive relief in order to
protect its rights pending mediation.
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37. MONTHLY ORDER AND SHIPMENT REPORTS
Supplier shall render monthly order and shipment reports on or
before the fifth working day of the succeeding month containing the
information required on report form APPENDIX C. These forms will be
furnished by Company.
38. NEW AND CHANGED METHODS, PROCESSES AND EQUIPMENT
Supplier shall keep abreast of major developments in Supplier's
industry and to promptly advise Company of any developments which might
affect the production of any MATERIAL under this Agreement.
39. NON DISCLOSURE AGREEMENT
Whereas Company and Supplier each expect to disclose to the other
party certain information concerning products, business and strategies
which are considered confidential and proprietary and which neither party
wants to disclose to others, they have entered into a Non Disclosure
Agreement. A copy of the Non Disclosure Agreement is attached hereto and
made a part hereof, as APPENDIX D. This section does not reduce or modify
Supplier's obligations under Section "USE OF INFORMATION."
40. NON WAIVER
The failure of either party at any time to enforce any right or
remedy available to it under this Agreement or otherwise with respect to
any breach or failure by the other party shall not be construed to be a
waiver of such right or remedy with respect to any other breach or failure
by the other party.
41. NOTICES
Any notice given or demand which under the terms of this Agreement
or under any statute must or may be given or made by Supplier or Company
shall be in writing and shall be given or made by confirmed facsimile, or
similar communication or by certified or registered mail addressed to the
respective parties as follows
To Company: Lucent Technologies Inc.
Global Procurement Organization
188 Mt. Airy Road
Room C222
Basking Ridge, NJ 07920
Attn.: [*]
-OR-
To Supplier: Packeteer Inc.
10495 N. De Ariza Blvd.
Cupertino, CA 95014
Attn: Bill Klaus
* 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 notice or demand shall be deemed to have been given or made
when sent by facsimile, or other communication or when deposited, postage
prepaid in the U.S. mail. The above addresses may be changed at any time
by giving prior written notice as above provided.
42. OPERATING SYSTEM SOFTWARE
The term MATERIAL includes any software (operating program in
machine readable form and related documentation) and storage media
therefor normally furnished with or embedded in the MATERIAL. Title to the
software, including copyright, shall remain in Supplier. The party having
title to the MATERIAL shall have title to the software storage media. For
the life of the MATERIAL listed in this Agreement, Supplier grants to
Company and any subsequent purchaser, lessee or other end user (referred
to collectively in this section as "end user") a non-exclusive license to
use said software on the MATERIAL on which it was delivered and only in
accordance with Supplier's documentation. Company and any subsequent end
user may not copy the software included on any storage media of the
MATERIAL except as such copy may be created by the execution or loading of
such software. Company will not reverse compile or disassemble the
software. Company will include and display all proprietary notices and/or
copyrights in or on the software in the form delivered by the Supplier
when the MATERIAL is operational.
43. OZONE DEPLETING CHEMICALS
Supplier hereby warrants that it is aware of international
agreements and pending legislation in several nations, including the
United States, which would limit, ban and/or tax importation of any
product containing, or produced using ozone depleting chemicals ("ODCs"),
including chloroflurocarbons, halons and certain chlorinated solvents.
Supplier hereby warrants that the MATERIAL furnished to Company will
conform to all applicable requirements established pursuant to such
agreements, legislation and regulations, and the MATERIAL furnished to
Company will be able to be imported and used lawfully (and without
additional taxes associated with ODCs not reported to Company by Supplier
as set forth in this section) under all such agreements, legislation and
requirements. Supplier also warrants that it is currently reducing, or if
Supplier is not the manufacturer of the MATERIAL, is currently causing the
manufacturing vendor to reduce and will, in an expeditious manner,
eliminate, or, as applicable, have its manufacturing vendor eliminate the
use of ODCs in the manufacture of the MATERIAL.
If the MATERIAL furnished by Supplier under this Agreement is
manufactured outside the United States, Supplier shall, upon execution of
this Agreement, and at any time that new products are added to this
Agreement or changes are made to the MATERIAL furnished under this
Agreement, complete, sign and return to Company the attached ODC Content
Certification. The ODC Content Certification must be signed by Supplier's
facility manager, corporate officer or his delegate.
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The term "ODC content" on the ODC Content Certification means the
total pounds of ODC used directly in the manufacture of each unit of
MATERIAL. This includes all ODCs used in the manufacturing and assembly
operations for the MATERIAL plus all ODCs used by Supplier's vendors and
any other vendors in producing components or other products incorporated
into the MATERIAL sold to Company.
Supplier is responsible to obtain information on the ODC content of
all components and other products acquired to manufacture the MATERIAL and
to incorporate such information into the total ODC content reported to
Company. Provided however, that Supplier should not include in the ODC
content those components or other products which are manufactured in the
United States. Supplier hereby warrants to Company that all information
furnished by Supplier on the ODC Content Certification is complete and
accurate and that Company may rely on such information for any purpose,
including but not limited to providing reports to government agencies or
otherwise complying with applicable laws. Supplier shall defend, indemnify
and hold Company harmless of and from any claims, demands, suits,
judgments, liabilities, fines, penalties, costs and expenses (including
additional ODC taxes as provided for in paragraph one of this section and
reasonable attorney's fees) which Company may incur under any applicable
federal, state, or local laws or international agreements, and any and all
amendments thereto by reason of Company's use of reliance on the
information furnished to Company by Supplier on the ODC Content
Certification or by reason of Supplier's breach of this section. Supplier
shall cooperate with Company in responding to any inquiry concerning the
use of ODCs to manufacture the MATERIAL or components thereof and to
execute without additional charge any documents reasonably required to
certify the absence or quantity of ODCs used to manufacture the MATERIAL
or components thereof.
44. OZONE DEPLETING SUBSTANCES LABELING
Supplier warrants and certifies that all MATERIAL and other
products, including packaging and packaging components, provided to
Company under this Agreement have been accurately labeled, in accordance
with the requirements of 40 CFR, Part 82 entitled "Protection of
Stratospheric Ozone, Subpart E- The Labeling of Products Using Ozone
Depleting Substances."
45. PACKING, LABELING AND SERIALIZATION
MATERIAL purchased, repaired, replaced or refurbished under this
Agreement shall be packed, labeled and serialized by Supplier at no
additional charge in accordance with specifications PKG-91NJ1045
"Packaging, Packing, Palletization, Labeling and Marking Requirements for
Material being Delivered to Lucent Technologies Manufacturing and
Distribution Locations", and KS-23490 "Product Bar Code, Serial and
Comcode Label," as changed from time to time with Supplier's written
approval, which Specifications are attached and made a part of this
Agreement as APPENDIX E. Company shall pre-approve and if approved, incur
the initial expenses for development of
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the packaging and labeling as specified in PKG-91NJ1045 and KS-23490. In
no event shall Company's labeling or other Identification marks be applied
to the interior of the MATERIAL, nor shall Supplier's marks be removed
from the interior of the MATERIAL. Pursuant to Company's written approval
of the design, all MATERIAL will be affixed with Supplier's logo.
46. PRODUCT CHANGES
Supplier shall provide Company with at least thirty (30) days, prior
written notice of any change proposed to be made in accordance with this
Agreement, or in the Specification and documentation covered by this
Agreement that would impact upon: (i) reliability, or (ii) functional
equivalency (as defined below).
The only exception will be in those cases where an extremely
hazardous or unsatisfactory condition requires immediate action.. In such
cases, verbal notification shall be made, followed by Supplier's prompt
written confirmation. Procedures for reporting MATERIAL changes are
described in "Product Change Notice Procedure", APPENDIX F.
Supplier shall submit changes to the following address:
Lucent Technologies Inc.
188 Mt. Airy Road
Room: C261
Basking Ridge, NJ 07920
Attn.: [*]
If the plan for MATERIAL Change is not accepted by Company, in
addition to all other rights and remedies at law or equity or otherwise,
and without any cost to or liability or obligation of Company, Company
shall have the right to terminate this Agreement and to terminate any or
all orders for MATERIAL affected by such change. Notwithstanding the
above, Supplier shall continue to provide functionally equivalent MATERIAL
for a period of twelve (12) months from the date the change is effective.
47. PRODUCT CONFORMANCE REVIEWS
Sections (1) or (2) applies if either is indicated in this Agreement
or an order issued pursuant to this Agreement. Section 30 applies to both
section (1) and (2). (1) All MATERIAL is subject to a Product Conformance
Review ("Review") prior to shipment. (1) Supplier shall notify Company's
designated quality inspection organization, at (609) 639-3149, when
MATERIAL is ready for such Review. (2) Supplier may ship MATERIAL without
a review but Company may perform such review prior to shipment by giving
Supplier notice to that effect, in which event Supplier shall notify
Company's designated quality inspection organization when MATERIAL is
ready for such review. (3) Supplier will provide, without charge,
appropriate production testing facilities and
* 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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personnel at a site of Supplier's selection required to perform or assist
in the Review as specified in the applicable Quality Program Specification
or other quality specification provided under this Agreement or order.
Company's Reviews as set forth herein may only be waived by written
notification from Company's designated quality inspection organization.
Quality Program Specification (QPS) No. 40.030, which may be changed
from time to time with Supplier's written approval, is attached and made a
part of this Agreement as APPENDIX G.
48. PRODUCT DOCUMENTATION
Supplier shall furnish, at no charge, product documentation, and any
succeeding changes thereto, as described in the Specifications. Company
may use, reproduce, reformat, modify and distribute such product
documentation.
Company shall reproduce Supplier's copyright notice contained in any
documentation reproduced without change by Company. For documentation
which is reformatted or modified by Company, Company shall have the right
to place only Company's own copyright notice on the reformatted or
modified documentation; provided that Supplier's copyright notice shall be
placed on any documentation or derivative work of Company.
49. PURCHASE ORDERS
Purchase orders issued under this Agreement shall be sent to the
following address:
Packeteer Inc.
10495 N. De Ariza Blvd.
Cupertino, CA 95014
Attn.: Sales Department
Purchase orders shall specify: (i) description of MATERIAL,
inclusive of any numerical/alphabetical identification referenced in the
price list in this Agreement, (ii) delivery date, (iii) applicable price,
(iv) location to which the MATERIAL is to be shipped and (v) location to
which invoices shall be sent for payment.
50. POINT OF SALE INFORMATION
Company shall provide Supplier, on a quarterly basis, data on the
location of Company's customers who purchase Supplier's MATERIAL provided
pursuant to this Agreement. Such information shall be supplied in machine
readable "softcopy" form in Excel format electronic mail to [*] in no
more than 45 days after the end of each calendar quarter. Format and
method of transmission may be changed from time to time pursuant to
agreement by both parties. Email address shall change upon notice by
* 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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Supplier to Company. Information supplied shall include, without
limitation: MATERIAL product number, quantity sold, zip code of US
shipment or country (if international shipment).
51. REGISTRATION AND RADIATION STANDARDS
When MATERIAL furnished under this Agreement is subject to Part 68,
Part 15 or any other part of the Federal Communication Commission's Rules
and Regulations, as may be amended from time to time (hereinafter "FCC
Rules"), Supplier warrants that such MATERIAL complies with the
registration, certification, type-acceptance and/or verification standards
of the FCC Rules including, but not limited to, all labeling, customer
instruction requirements, and the suppression of radiation to specified
levels. Supplier shall also establish periodic on-going compliance
retesting and follow a Quality Control program, submitted by Company, to
assure that MATERIAL shipped complies with the applicable FCC Rules.
Supplier shall indemnify and save Company harmless from any liability,
fines, penalties, claims or demands (including the costs, expenses and
reasonable attorney's fees on account thereof) that may be made because of
Supplier's noncompliance with the applicable FCC Rules. Supplier shall
defend Company, at Company's request, against such liability, claim or
demand provided Supplier is promptly notified of any such claim or demand
and Company tenders full control of any such claim or demand to Supplier.
Company shall promptly advise Supplier in writing of any such claim and
shall reasonably cooperate, at Supplier's expense, with Supplier in the
defense or settlement thereof.
In addition, during the WARRANTY period, should MATERIAL which is
subject to Part 15 of the FCC Rules, during use generate harmful
interference to radio communications, Supplier shall provide the Company
information relating to methods of suppressing such interference and pay
the cost of suppressing such interference or, at the option of Company,
accept the return of the MATERIAL and [*].
To the extent that MATERIAL furnished under this Agreement is also
subject to FCC Rules governing the use of the MATERIAL as a component in a
system as identified in Supplier's Specifications , Company shall be
responsible for compliance with the applicable FCC Rules governing the
system. Supplier shall fully cooperate with Company, by providing
technical support and information, and, upon written request from Company,
shall modify MATERIAL to enable Company to ensure ongoing compliance with
the FCC Rules. Company shall pay any increase in Supplier's costs and/or
expenses resulting from Company's request to modify MATERIAL to enable
Company to comply with the FCC Rules.
Nothing in this section shall be deemed to diminish or otherwise
limit Supplier's obligations under the "WARRANTY" section or any other
section of this Agreement.
* 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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52. REJECTIONS
If Company rejects any or all of the MATERIAL, Company may, in lieu
of other rights and remedies at law or equity, exercise one or more of the
following remedies: (1) return rejected MATERIAL for full credit at the
price charged plus transportation charges from Supplier's plant, and
return; or (2) accept a conforming part of any shipment; or (3) have
rejected MATERIAL replaced by Supplier at the purchase price stipulated in
this Agreement.
53. RELEASES VOID
Neither party shall require (i) waivers or releases of any personal
rights or (ii) execution of documents which conflict with the terms of
this Agreement, from employees, representatives or customers of the other
in connection with visits to its premises and both parties agree that no
such releases, waivers or documents shall be pleaded by them or third
persons in any action or proceeding.
54. REPAIRS NOT COVERED UNDER WARRANTY
In addition to repairs provided for in the "WARRANTY" section
Supplier shall provide repair service on all MATERIAL ordered under this
Agreement during the term of this Agreement and until * * *
after the expiration of this Agreement. MATERIAL to be repaired under
this section will be returned to a location designated by Supplier, and
unless otherwise agreed upon by Supplier and Company, Supplier shall ship
the repaired MATERIAL which meets the Specifications set forth in the
"SPECIFICATIONS OR DRAWINGS" section and all other Specifications within
ten (10) business days of receipt of the defective or non-conforming
MATERIAL. With the concurrence and scheduling of Company, repair may be
made by Supplier on site.
If MATERIAL is returned to Supplier for repair as provided for in
this section and is determined to be beyond repair, Supplier shall so
notify Company. If requested by Company, Supplier will sell to Company a
replacement at the price set forth in Supplier's then current agreement
with Company for said MATERIAL or, if no such agreement exists, at a price
agreed upon by Supplier and Company. If the parties fail to agree on a
price, the price shall be a reasonably competitive price for such MATERIAL
at the time for delivery. Further, if requested by Company, Supplier shall
take the necessary steps to dispose of the unrepairable MATERIAL and pay
to Company the salvage value, if any. Replacement and repaired MATERIAL
shall be warranted as set forth in the "WARRANTY" section.
This Agreement does not grant Supplier an exclusive privilege to
repair any or all of the MATERIAL purchased under this Agreement for which
Company may require repair; and Company may perform the repairs or
contract with others for these services. In addition, Supplier authorizes
Company and any qualified repairer with whom Company may contract to
perform repairs on all MATERIAL purchased under this Agreement. Not
withstanding any provision of this Agreement to the contrary, any MATERIAL
not repaired by Supplier shall not be covered by any warranty hereunder.
<PAGE> 20
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All transportation costs of and in transit risk of loss and damage
to MATERIAL returned to Supplier for repair under this section will be
borne by Company and all transportation costs of and in transit risk of
loss and damage to such repaired or replacement MATERIAL returned to
Company will be borne by Company.
Price schedules for repairs under this section are listed in
APPENDIX A.
55. REPAIR PROCEDURES
Company shall furnish the following information with MATERIAL
returned to Supplier for repair: (a) Company's name and complete address;
(b) name(s) and telephone numbers(s) of Company's employee(s) to contact
in case of questions about the MATERIAL to be repaired; (c) ship-to
address for return of repaired MATERIAL if different than (a); (d) a
complete list of MATERIAL returned; (e) the nature of the defect or
failure if known; and (f) whether or not returned MATERIAL is in warranty.
Supplier shall, within ten (10) days of the execution of this Agreement,
provide a written notice to Company specifying (i) the name(s) and
telephone number(s) of the individual(s) to be contacted concerning any
questions that may arise concerning repair, and (ii) if required, any
special packing of MATERIAL which might be necessary to provide adequate
in-transit protection from transportation damage.
MATERIAL repaired by Supplier shall have the repair completion date
stenciled or otherwise identified in a permanent manner at a readily
visible location on the MATERIAL and the repaired MATERIAL shall be
returned with a tag or other papers describing the repairs which have been
made.
All invoices originated by Supplier for repair services must be
clearly identified as such, and must contain: (i) a reference to Company's
purchase order for these repair services, (ii) a detailed description of
repairs made by Supplier and the need therefor, and (iii) an itemized
listing of parts and labor charges, if any. Replaced parts will, upon
request, be available for inspection by or returned to Company. Further,
the provisions of the "INVOICING" and "SHIPPING" sections, other than
provisions relating to transportation charges with respect to MATERIAL
repaired under warranty, shall apply to Supplier's return to Company of
repaired MATERIAL.
56. RIGHT OF ENTRY
Subject to prior written notice of ten (10) days and not more than
twice per calendar year, each party shall have the right to enter the
premises of the other party during standard business hours for the purpose
of reasonable verification of each party's performance under this
Agreement, including an inspection or a Quality Review, subject to all
plant rules and regulations, clearances, security regulations and
procedures as applicable. Each party shall provide safe and proper
facilities for such purpose. No charge shall be made for such visits.
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57. SAFETY CERTIFICATION
All MATERIAL purchased under this Agreement shall be designed to be
in compliance with the applicable Underwriters Laboratories (UL)and
Canadian Standards Association (CSA) rules and regulations. It is agreed
that Supplier shall be responsible for filing the required documents to
obtain compliance with said Underwriters Laboratories Standards and
Canadian Standards. Supplier shall be responsible for making the MATERIAL
available for testing.
58. SECTION HEADINGS
The headings of the sections in this Agreement are inserted for
convenience only and are not intended to affect the meaning or
interpretation of this Agreement.
59. SERVICES
Visits by Supplier's representatives or its suppliers'
representatives for inspection, adjustment or other similar purposes in
connection with MATERIAL purchased under this Agreement shall for all
purposes be deemed "Work under this Agreement" and shall be at no charge
to Company unless otherwise agreed in writing between the parties.
60. SEVERABILITY
If any of the provisions of this Agreement shall be invalid or
unenforceable, such invalidity or unenforcability shall not invalidate or
render unenforceable the entire Agreement, but rather the entire Agreement
shall be construed as if not containing the particular invalid or
unenforceable provision or provisions, and the rights and obligations of
Supplier and Company shall be construed and enforced accordingly.
61. SHIPPING
Supplier shall: (i) ship the MATERIAL covered by this Agreement or
order complete unless instructed otherwise, (ii) ship to the destination
designated in the Agreement or order, (iii) ship according to routing
instructions given by Company, (iv) place the Agreement and order number
on all subordinate documents, (v) enclose a packing memorandum with each
shipment and, when more than one package is shipped, identify the package
containing the memorandum; and (vi) mark the order number on all packages
and shipping papers. Adequate protective packing shall be furnished at no
additional charge. Shipping and routing instructions may be furnished or
altered by Company without a writing. If Supplier does not comply with the
terms of the FOB section of the Agreement,Supplier authorizes Company to
deduct from any invoice of Supplier (or to charge back to Supplier), any
increased cost incurred by Company as a result of Supplier's
noncompliance.
62. SHIPPING INTERVAL
The delivery schedule applicable to each purchase order will be
agreed upon by Supplier and Company and set forth in the purchase order.
(Note: Supplier has indicated that MATERIAL can usually be shipped an
average of [*] after receipt of
* 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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Company's purchase order; however, in no event shall the delivery interval
[*] after acceptance of purchase order.)
If Supplier exceeds the above maximum interval then in lieu of all
other rights and remedies at law or equity or otherwise, and without any
liability or obligation of Company, Company shall have the right to: (a)
cancel such purchase order, or (b) extend such delivery date to a later
date, subject, however, to the right to cancel as in (a) preceding if
delivery is not made or performance is not completed on or before such
extended delivery date. If Company elects to extend such delivery date,
Supplier shall absorb the difference between the charges to ship normal
transportation and the charges to ship premium overnight.
If a purchase order is canceled by Company pursuant to the above,
Company shall have the right to retain or return any or all MATERIAL
received by or paid for by Company under such purchase order. Within [*]
business days of Supplier's receipt of returned MATERIAL, Supplier shall
reimburse Company for the costs of shipping the MATERIAL returned to
Supplier and for any amounts, including shipping costs, previously paid by
Company for the MATERIAL. Company shall pay for any MATERIAL if retains at
the prices set forth in APPENDIX A, less applicable discounts which shall
be applied on the basis of the quantity specified in the purchase order.
If, during the course of this Agreement, Supplier determines that
Supplier will no longer be able to ship within the above interval,
Supplier shall immediately notify Company's buyer to that effect.
Supplier shall also notify Company's buyer, as soon as it becomes
apparent, if Supplier is unable to meet the delivery date for an order.
However, nothing contained in this paragraph shall waive Company's rights
as set forth above in this section.
63. SHIPPING LOCATION
The material shall be shipped FOB ORIGIN.
64. STORAGE OF PAID FOR STOCK
Subject to the section "OPERATING SYSTEM SOFTWARE", Company has and
shall have at all times all right, title and interest in all MATERIAL
invoiced to Company in accordance with the section "INVOICING FOR STOCKS"
provided Company is in accordance with TERMS OF PAYMENT. Such MATERIAL
shall be referred to in this section as "Company Property." Supplier shall
store such Company Property without cost to Company at Supplier's
[ADDRESS] facility and ship such Company Property as ordered by Company
for a period not to exceed one (1) month. After said one (1) month,
Supplier may transfer Company Property to Company at Company's designated
facility. In addition, Supplier shall:
(i) Be responsible for the safekeeping of the Company Property as a
secondary insurer to Company, assume all risks of loss or damage to the
same and be
* 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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liable for the value paid for such Company Property. In case of removal of
all or any part of the Company Property from one building to another,
Supplier's responsibility for loss or damage shall continue and Supplier
shall give Company at least ten (10) days advance notice in writing of the
removal, except when the removal is required to comply with Company's
shipping orders or to protect the Company Property from loss or damage.
(ii) Permanently mark or if impracticable to do so then affix
labeling stating that the Company Property is the "PROPERTY OF LUCENT
TECHNOLOGIES INC." For purposes of this section, the term "LUCENT
TECHNOLOGIES INC." shall be deemed to mean Company or the Company
affiliated or associated company which owns the tooling, as applicable.
(iii) Store the Company Property safely, indoors in protected areas
approved by Company. Store the Company Property segregated from other
property in sections of Supplier's plant marked Property of Company.
(iv) Deliver the Company Property only to Company or Company's
designated customers in accordance with Company's orders or upon Company's
demand, FOB Supplier's plant without additional charge for removal,
packing, or crating.
(v) Supplier shall not allow any security interest, lien, tax lien
or other encumbrance (collectively referred to as "encumbrance") to be
placed on any Company Property. Supplier shall give Company immediate
written notice should any third party attempt to place or place an
encumbrance on such Company Property. Supplier shall indemnify and hold
Company harmless from any such encumbrance. Supplier shall, at Company's
request, promptly execute a "protective notice" UCC-1 form and all other
documents reasonably necessary to enable Company to protect its interest
in such Company Property. This Agreement shall constitute the security
agreement required by the UCC of the appropriate state.
(vi) Company may inspect, inventory, and authenticate the account of
the Company Property during Supplier's normal business hours. Supplier
shall provide Company access to the premises where all such Company
Property is located.
The obligations assumed by Supplier with respect to the Company
Property are for the protection of Company's property. If Supplier
defaults in carrying out Supplier's obligations under this Agreement,
then, at no cost to Company and upon twenty-four (24) hours notice to
Supplier, Company may cancel this Agreement in whole or in part or
withdraw all or any part of the Company Property, or both. Supplier shall,
at Company's option, return to Company or hold for Company's disposition
any or all of such Company Property in Supplier's possession.
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65. SUPPLIER'S INFORMATION
Supplier shall not provide under, or have provided in contemplation
of, this Agreement any idea, data, program, technical, business or other
intangible information, however conveyed, or any document, print, tape,
disc, semiconductor memory or other information-conveying tangible
article, unless Supplier has the right to do so, and Supplier shall not
view any of the foregoing as confidential or proprietary. If Supplier must
furnish any such information to Company with restrictions, it shall be
furnished after negotiation and execution on behalf of Company of a
separate written agreement specifically identifying the documents to be
furnished and setting forth Company's rights and obligations with respect
hereto.
66. SURVIVAL OF OBLIGATIONS
Section 16, 18, 26, 27, 28, 29, 34, 37, 41, 42, and 61 shall survive
termination, cancellation or expiration of this Agreement.
67. TAXES
Company shall reimburse Supplier only for the following tax payments
with respect to transactions under this Agreement unless Company advises
Supplier than an exemption applies: state and local sales and use taxes,
as applicable. Taxes payable by Company shall be billed as separate items
on Supplier's invoices and shall not be included in Supplier's prices.
68. TECHNICAL SUPPORT
Company will be the primary interface to the customer and will
provide Tier 1, Tier 2 and Tier 3 technical customer support.
Supplier will provide Tier 4 technical customer support. "Tier 4"
means the fourth of four levels of technical customer support and
addresses issues escalated from Tier 3 when either the source of the issue
cannot be identified, or the issue is identified and must be addressed by
the manufacturer of the MATERIAL. Tier 4 technical customer support will
be provided 24 hours a day, 7 days a week via telephone or pager to
Company's support personnel at no charge. Supplier's response time shall
be within 30 minutes on Monday through Friday, 8:30 am - 5:30 pm (Pacific
Time), and within 2 hours at all other times.. Nine (9) months after the
effective date of this Agreement and every six months thereafter, Supplier
may request a review of Company's Tier 4 support requests that Supplier
believes do not fit into the category of support issues as defined in this
Section. Company shall be given a reasonable cure period to correct any
problem areas identified in the review before re-opening the Tier 4
compensation provision of this Section.
69. TERMINATION OF PURCHASE ORDER
Company may at any time terminate any portion or the total quantity
of any purchase order(s) placed under this Agreement. Company's liability
to Supplier with respect to such termination shall be limited to (i)
Supplier's purchase price of all
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components for the MATERIAL (not usable in Supplier's other operations or
salable to Supplier's other customers), plus (ii) the actual costs
incurred by Supplier in procuring and manufacturing MATERIAL (not usable
in Supplier's other operations or salable to Supplier's other customers)
in process as of the date of giving notice of termination, less (iii) any
salvage value thereof. However, no such termination charges will be
invoiced if, within sixty (60) days of notice of termination, MATERIAL
equivalent in kind to that being terminated is ordered by Company. If
requested, Supplier shall substantiate such cost and price with proof
satisfactory to Company.
70. TIMELY PERFORMANCE
If Supplier has knowledge that anything prevents or threatens to
prevent the timely performance of the Work under this Agreement, Supplier
shall immediately notify Company's Representative thereof and include all
relevant information concerning the delay or potential delay.
71. TITLE AND RISK OF LOSS
Title (other than software) and risk of loss and damage to MATERIAL
shall vest in Company when the MATERIAL has been delivered at the FOB
point.
72. TOXIC SUBSTANCES AND PRODUCT HAZARDS
Supplier hereby warrants to Company that, except as expressly stated
elsewhere in this Agreement, all MATERIAL furnished by Supplier as
described in this Agreement is safe for its foreseeable use, is not
defined as a hazardous or toxic substance or material under applicable
federal, state or local law, ordinance, rule, regulation or order
(hereinafter collectively referred to as "law" or "laws"), and presents no
abnormal hazards to persons or the environment. Supplier also warrants
that it has no knowledge of any federal, state or local law, that
prohibits the disposal of the MATERIAL as normal refuse without special
precautions except as expressly stated elsewhere in this Agreement.
Supplier also warrants that where required by law, all MATERIAL furnished
by Supplier is either on the EPA Chemical Inventory compiled under Section
8 (a) of the Toxic Substance Control Act, or is the subject of an
EPA-approved pre manufacture notice under 40 CFR Part 720. Supplier
further warrants that all MATERIAL furnished by Supplier complies with all
use restrictions, labeling requirements and all other health and safety
requirements imposed under federal, state, or local laws. Supplier further
warrants that, where required by law, it shall provide to Company, prior
to delivery of the MATERIAL, a Material Safety Data Sheet which complies
with the requirements of the Occupational Safety and Health Act of 1970
and all rules and regulations promulgated thereunder.
Supplier shall defend, indemnify and hold Company harmless for any
expenses (including, but not limited to, the cost of substitute material,
less accumulated depreciation) that Company may incur by reason of the
recall or prohibition against continued use or disposal of MATERIAL
furnished by Supplier as described in its Agreement whether such recall or
prohibition is directed by Supplier or occurs under
<PAGE> 26
Agreement No. SC11990054
Sheet 26 of 28
compulsion of law. Company shall cooperate with Supplier to facilitate and
minimize the expense of any recall or prohibition against use or disposal
of MATERIAL directed by Supplier or under compulsion of law.
Supplier further shall defend, indemnify and hold Company harmless
of and from any claims, demands, suits, judgments, liabilities, costs and
expenses (including reasonable attorney's fees) which Company may incur
under any applicable federal, state or local laws, and any and all
amendments thereto, including but not limited to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980; the
Consumer Product Safety Act of 1972; the Toxic Substance Control Act;
Fungicide, Rodenticide Act; the Occupational Safety and Health Act; and
the Atomic Energy Act; and any and all amendments to all applicable
federal, state, or local laws, by reason of Company's proper acquisition,
use, distribution or disposal of MATERIAL furnished by Supplier under this
Agreement.
73. TRAINING
If requested by Company, Supplier will:
(a) provide instructors and the necessary instructional material of
Supplier's standard format to train Company's personnel in the
installation, planning and practices, operation, maintenance and repair of
MATERIAL furnished under this Agreement. These classes shall be conducted
at reasonable intervals at locations agreed upon by Supplier and Company.
The costs associated with the TRAINING are described in APPENDIX A.
Or, at the option of Company,
(b) provide to Company training modules or manuals and any necessary
assistance, covering those areas of interest outlined in (a) of this
section, sufficient in detail, format and quantity to allow Company to
develop and conduct a training program.
74. USE OF INFORMATION
Supplier shall view as Company's property any idea, data, program,
technical, business or other intangible information, however conveyed, and
any document, print, tape, disc, tool, or other tangible
information-conveying or performance-aiding article owned or controlled by
Company, and provided to, or acquired by, Supplier under or in
contemplation of this Agreement (Information). Supplier shall, at no
charge to Company, and as Company directs, destroy or surrender to Company
promptly at its request any such article or any copy of such Information.
Supplier shall keep Information confidential and use it only in performing
under this Agreement and obligate its employees, subcontractors and others
working for it to do so, provided that the foregoing shall not apply to
information previously known to Supplier free of obligation, or made
public through no fault imputable to Supplier.
<PAGE> 27
Agreement No. SC11990054
Sheet 27 of 28
75. VARIATION IN QUANTITY
Company assumes no liability for MATERIAL produced, processed or
shipped in excess of the amount specified in this Agreement or in an order
issued pursuant to this Agreement.
76. WARRANTY
Supplier warrants to Company, as defined in this section, that
MATERIAL furnished will be new, merchantable, free from defects in design,
material and workmanship and will conform to and perform under normal use
in all material respects with the Specifications, drawings and samples set
forth in this Agreement. These warranties extend to the future performance
of the MATERIAL and shall continue for a period of twelve (12) months from
the date of delivery to an end user customer (hereinafter "Customer") but
no longer than fifteen (15) from the date of shipment or, for MATERIAL
installed by Company or its re-sellers, for a period of twelve (12) months
from the completion of installation but no longer than fifteen (15) months
from date of shipment.
Supplier also warrants to Company that services will be performed in
a first class, workmanlike manner. In addition, if MATERIAL furnished
contains one or more manufacturer's warranties, Supplier hereby assigns
such warranties to Company provided such assignment is expressly permitted
under such warranties. Supplier warrants that at the time of delivery to
Company such MATERIAL shall be free of any security interest or any other
lien or any other encumbrance whatsoever. All warranties shall survive
inspection, acceptance and payment.
Defective or non-conforming MATERIAL will, at Company's option,
either be returned to Supplier for repair or replacement, at no cost to
Company, with risk of in-transit loss and damage borne by Supplier and
freight paid by Supplier, or be repaired or replaced by Supplier on
Customer's site or another site designated by Company at no cost to
Company. Unless otherwise agreed upon by Supplier and Company, Supplier
shall complete repairs and ship the repaired MATERIAL within [*] of
receipt of defective or non-conforming MATERIAL, or at Company's option,
ship replacement MATERIAL within [*] after verbal notification is given
Supplier by Company. Supplier shall bear the risk of in-transit loss and
damage and shall prepay and bear that cost of freight for shipments to
Company of repaired or replaced MATERIAL. If requested by Company,
Supplier shall begin on-site repairs within [*] after verbal notification
is given Supplier by Company.
If MATERIAL returned to Supplier or made available to Supplier on
site for repair as provided for in this section is determined to be beyond
repair, Supplier shall promptly so notify Company and, unless otherwise
agreed to in writing by Supplier and Company, Supplier shall ship
replacement MATERIAL without charge [*] of such notification.
* 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.
<PAGE> 28
Agreement No. SC11990054
Sheet 28 of 28
Replacement MATERIAL shall be warranted as set forth above in this
"WARRANTY" section. Any MATERIAL which is repaired, modified, or otherwise
serviced by Supplier shall be warranted as provided in this "WARRANTY"
section for the remainder of the warranty period (based upon the date
repair, modification or other service is completed and accepted by
Company) or [*] after the MATERIAL is returned to a Customer, whichever
is later.
Supplier considers MATERIAL year 2000 ready if the MATERIAL's
performance and functionality are unaffected by the processing of dates
prior to, during and through the year 2000 transition, provided that
hardware, firmware, software, and databases used in combination with the
MATERIAL properly exchange accurate and correctly formatted date data with
the MATERIAL.
The MATERIAL defined in APPENDIX A are considered Year 2000 ready.
EXCEPT AS EXPRESSLY PROVIDED IN SECTION 76 AND 28, MATERIAL IS
PROVIDED ON AN "AS IS" BASIS WITHOUT ANY WARRANTY, AND SUPPLIER EXPRESSLY
DISCLAIMS ALL WARRANTIES, EXPRESS, IMPLIED, AND STATUTORY INCLUDING
WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS AND FITNESS FOR A PARTICULAR
PURPOSE.
77. ENTIRE AGREEMENT
This Agreement shall incorporate the typed or written provisions on
Company's orders issued pursuant to this Agreement and shall constitute
the entire agreement between the parties with respect to the subject
matter of this Agreement and the order(s) and shall not be modified or
rescinded, except by a writing signed by Supplier and Company. Printed
provisions on the reverse side of Company's orders (except as specified
otherwise in this Agreement) and all provisions on Supplier's forms shall
be deemed deleted. Estimates or forecasts furnished by Company shall not
constitute commitments. The provisions of this Agreement supersede all
contemporaneous oral agreements and all prior oral and written
communications, and understandings of the parties with respect to the
subject matter of this Agreement.
Accepted (Date) June 25, 1999
PACKETEER, INC LUCENT TECHNOLOGIES INC.
* 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.