Common use of Exclusive Supply Clause in Contracts

Exclusive Supply. (a) On the terms and subject to the conditions set forth in this Agreement, (i) during the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Product exclusively from Seller and its Affiliates and (ii) until the earlier of the Closing Date or the expiration or termination of the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Spare Parts (other than the items set forth on Appendix 5, it being understood and agreed that if Buyer sources any such Spare Parts set forth on Appendix 5 from a source other than Seller and its Affiliates, then (A) Seller shall not warrant such Spare Parts and shall not be responsible for any damage to the Product or other property caused by such Spare Parts and (B) such sourcing may void the warranty from Seller with respect to the subsystem of a Product with respect to which such Spare Parts are a constituent part if such subsystem is directly affected by the use of such Spare Parts) exclusively from Seller and its Affiliates. Seller and its Affiliates shall accept all POs for Product, Spare Parts and Services issued by Buyer or any of its Affiliates that comply with the terms of this Agreement and the Seller Standard Terms, in each case, without modification (or with modification only following agreement by Seller in respect of such PO), but Seller shall use commercially reasonable efforts to accept any POs that contain such modifications (including with respect to the Technical Design); provided, that if any such change results in an increase or decrease in the out-of-pocket cost or time required for the performance of the work under the PO (relative to a PO that does not contain any such modifications), there shall be a mutually agreed equitable adjustment of the PO price and the scheduled delivery dates. For the purposes of any PO issued by an Affiliate of Buyer, the term “Buyer,” as used in this Agreement shall be deemed to refer to such Affiliate issuing that PO. Buyer will cause its Affiliates that issue POs to comply with the terms of this Agreement and will be responsible for any breaches hereof by its Affiliates. (b) The Parties hereby acknowledge that the quantities of Product, Spare Parts or Services shall not, other than with respect to accepted POs, constitute a commitment or obligation by Buyer or any Affiliate to purchase any minimum volume of Product, Spare Parts or Services from Seller. (c) At all times during the Term, Seller agrees to possess and maintain the necessary capacity, machinery, personnel and resources to sell to Buyer or any of its Affiliates at least the volume of Product, Spare Parts and Services set forth in all outstanding POs accepted by Seller pursuant to this Agreement. (d) For the avoidance of doubt, (i) this Agreement, including this ‎Article IV, is not intended to limit, and does not limit, either Buyer’s or any of its Affiliates’ rights to market, distribute, or sell an LM2500 or other aero engine to any Person for applications in the O&G Segment, regardless of whether such Person intends to develop or package, or does develop and package (a “Packager”), the aero engine into a trailer-mounted gas turbine generator (provided, however, that Buyer shall not purchase any such trailer-mounted gas turbine generator from any such Packager, nor shall Buyer collaborate or partner with any such Packager in connection with such Packager’s development of a trailer-mounted gas turbine generator incorporating an aero engine, other than (A) Ordinary Course Collaborations and/or (B) sale, development or co-development of any packaging, packaging design, engineering support of such LM2500 or other engine into a trailer-mounted gas turbine generator, provided that Buyer does not use any Seller TM IP in connection with any such collaborating or partnering described in clause (A) or (B) above; provided, further, that no such collaboration or partnering described in clause (A) or (B) above shall be designed primarily to circumvent or avoid purchasing Product or Spare Parts (to the extent not listed in Appendix 5) under this Agreement, and (ii) any of (A) and (B) above or the sale of any such LM2500 or other aero engine by Buyer, any of its Affiliates, or any of its or their Affiliates as contemplated by this Section 4.02(d) is not subject to Seller’s right of first offer set forth in ‎Article X. Notwithstanding the foregoing or anything to the contrary in this Agreement, Buyer may, on behalf of the OFS Business, purchase fully assembled fracking systems from Packagers that may include trailer-mounted gas turbine generators that are not Product, and such purchases shall not be subject to the right of first refusal set forth in ‎Article X; provided that, the OFS Business uses such system to deliver fracking services to customers and does not immediately resell such system and such system is not held for resale in the ordinary course; provided further, for the avoidance of doubt, that the OFS Business may resell such system prior to the end of such system’s useful life.

Exclusive Supply. (ai) On For the terms period beginning with the Effective Date and ending on December 31, 2003 (the "EXCLUSIVE SYSTEM PERIOD"), Buyer shall purchase all of Buyer's and its Affiliates' requirements for new Systems (excluding electron beam or x ray accelerators with power of 150 kilowatts or more) from Seller, and Seller shall supply all of Buyer or its Affiliates' requirements for such systems, unless Seller either (A) approves in writing a specific purchase of Systems by Buyer from a third party, or (B) provides written notice to Buyer that (y) it is unable to supply a System or Systems within the delivery window specified by Buyer or its Affiliate's applicable Statement of Work so long as the specified delivery window is within Seller's published lead times for its customers, or (z) it will be unable to comply with the Specifications in any prospective Statement of Work, in any of which case Buyer shall be free to purchase such specific System only, subject of Seller's written notice under this clause (B), from a third party or manufacture the System for itself. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer's and its Affiliates' requirements for new Systems from Seller during the remainder of the Exclusive System Period other than any Systems covered by such notice. (ii) During the Exclusive System Period, Buyer shall only purchase Maintenance and Support Services for Buyer's and its Affiliates' Systems, including spare parts, from Seller, unless Seller either (A) approves in writing a specific purchase of specific maintenance and support services by Buyer from a third party, or (B) provides written notice to Buyer that it is unable to supply Maintenance and Support Services to Buyer, in which case Buyer shall be free to purchase such specific Maintenance and Support Services only, subject of Seller's written notice under this clause (B), from a third party. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer's and its Affiliates' requirements for Maintenance and Support Services for the remainder of the Exclusive System Period other than the Maintenance and Support Services covered by such notice. (iii) For the period beginning with the Effective Date and ending on December 31, 2002 (the "EXCLUSIVE INTEGRATION SERVICES PERIOD"), Buyer shall only purchase Integration Services from Seller, unless Seller either (A) approves in writing a specific purchase of Integration Services by Buyer from a third party, (B) provides written notice to Buyer that (y) it is unable to supply a specific Integration Service within the delivery deadlines specified by Buyer or its Affiliate's applicable Statement of Work, or (z) it will be unable to comply with the Specifications in any prospective Statement of Work applicable to the conditions Integration Service, in any of which case Buyer shall be free to purchase such specific Integration Service only, subject of Seller's written notice under this clause (B), from a third party. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer's and its Affiliates' requirements for Integration Services from Seller during the remainder of the Exclusive Integration Services Period other than the Integration Services covered by such notice. (iv) To the extent requested by Buyer or an Affiliate and agreed by Seller, Seller shall provide to Buyer or its Affiliate system engineering, proposal perparation, sales support, professional design and engineering services or other services as requested by Buyer or an Affiliate in connection with proposal presentation and sales, site analysis and System specification as well as system engineering modifying and configuring the Systems or any components of the Systems, including, without limitation, the information and control system as necessary to use the System for its intended application or to otherwise comply with the specifications of a customer of Buyer or its Affiliates ("DESIGN SERVICES"). Seller shall perform Design Services professionally and in accordance with established business standards and ethics. All Design Services shall conform to the specifications and performance standards set forth in this Agreement, the Statement of Work. (iv) during the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Product exclusively from Seller and its Affiliates and (ii) until the earlier of the Closing Date or the expiration or termination of the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Spare Parts (other than the items set forth on Appendix 5, it being understood and agreed that if Buyer sources any such Spare Parts set forth on Appendix 5 from a source other than Seller and its Affiliates, then (A) Seller shall not warrant such Spare Parts and shall not be responsible for any damage to the Product or other property caused by such Spare Parts and (B) such sourcing may void the warranty from Seller with respect to the subsystem of a Product with respect to which such Spare Parts are a constituent part if such subsystem is directly affected by the use of such Spare Parts) exclusively from Seller and its Affiliates. Seller and its Affiliates shall accept all POs have no obligation to generate any requirements for Product, Spare Parts and Services issued by Buyer or any of its Affiliates that comply with the terms of this Agreement and the Seller Standard Terms, in each case, without modification (or with modification only following agreement by Seller in respect of such PO), but Seller shall use commercially reasonable efforts to accept any POs that contain such modifications (including with respect to the Technical Design); provided, that if any such change results in an increase or decrease in the out-of-pocket cost or time required for the performance of the work under the PO (relative to a PO that does not contain any such modifications), there shall be a mutually agreed equitable adjustment of the PO price and the scheduled delivery dates. For the purposes of any PO issued by an Affiliate of Buyer, the term “Buyer,” as used in this Agreement shall be deemed to refer to such Affiliate issuing that PO. Buyer will cause its Affiliates that issue POs to comply with the terms of this Agreement and will be responsible for any breaches hereof by its Affiliates. (b) The Parties hereby acknowledge that the quantities of Product, Spare Parts Systems or Services shall not, other than with respect to accepted POs, constitute a commitment or obligation by Buyer or any Affiliate to purchase any minimum volume of Product, Spare Parts or Services from Sellerotherwise market the Systems. (c) At all times during the Term, Seller agrees to possess and maintain the necessary capacity, machinery, personnel and resources to sell to Buyer or any of its Affiliates at least the volume of Product, Spare Parts and Services set forth in all outstanding POs accepted by Seller pursuant to this Agreement. (d) For the avoidance of doubt, (i) this Agreement, including this ‎Article IV, is not intended to limit, and does not limit, either Buyer’s or any of its Affiliates’ rights to market, distribute, or sell an LM2500 or other aero engine to any Person for applications in the O&G Segment, regardless of whether such Person intends to develop or package, or does develop and package (a “Packager”), the aero engine into a trailer-mounted gas turbine generator (provided, however, that Buyer shall not purchase any such trailer-mounted gas turbine generator from any such Packager, nor shall Buyer collaborate or partner with any such Packager in connection with such Packager’s development of a trailer-mounted gas turbine generator incorporating an aero engine, other than (A) Ordinary Course Collaborations and/or (B) sale, development or co-development of any packaging, packaging design, engineering support of such LM2500 or other engine into a trailer-mounted gas turbine generator, provided that Buyer does not use any Seller TM IP in connection with any such collaborating or partnering described in clause (A) or (B) above; provided, further, that no such collaboration or partnering described in clause (A) or (B) above shall be designed primarily to circumvent or avoid purchasing Product or Spare Parts (to the extent not listed in Appendix 5) under this Agreement, and (ii) any of (A) and (B) above or the sale of any such LM2500 or other aero engine by Buyer, any of its Affiliates, or any of its or their Affiliates as contemplated by this Section 4.02(d) is not subject to Seller’s right of first offer set forth in ‎Article X. Notwithstanding the foregoing or anything to the contrary in this Agreement, Buyer may, on behalf of the OFS Business, purchase fully assembled fracking systems from Packagers that may include trailer-mounted gas turbine generators that are not Product, and such purchases shall not be subject to the right of first refusal set forth in ‎Article X; provided that, the OFS Business uses such system to deliver fracking services to customers and does not immediately resell such system and such system is not held for resale in the ordinary course; provided further, for the avoidance of doubt, that the OFS Business may resell such system prior to the end of such system’s useful life.

Exclusive Supply. (ai) On For the terms period beginning with the Effective Date and ending on December 31, 2003 (the “Exclusive System Period”), Buyer shall purchase all of Buyer’s and its Affiliates’ requirements for new Systems (excluding electron beam or x ray accelerators with power of 150 kilowatts or more) from Seller, and Seller shall supply all of Buyer or its Affiliates’ requirements for such systems, unless Seller either (A) approves in writing a specific purchase of Systems by Buyer from a third party, or (B) provides written notice to Buyer that (y) it is unable to supply a System or Systems within the delivery window specified by Buyer or its Affiliate’s applicable Statement of Work so long as the specified delivery window is within Seller’s published lead times for its customers, or (z) it will be unable to comply with the Specifications in any prospective Statement of Work, in any of which case Buyer shall be free to purchase such specific System only, subject of Seller’s written notice under this clause (B), from a third party or manufacture the System for itself. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer’s and its Affiliates’ requirements for new Systems from Seller during the remainder of the Exclusive System Period other than any Systems covered by such notice. (ii) During the Exclusive System Period, Buyer shall only purchase Maintenance and Support Services for Buyer’s and its Affiliates’ Systems, including spare parts, from Seller, unless Seller either (A) approves in writing a specific purchase of specific maintenance and support services by Buyer from a third party, or (B) provides written notice to Buyer that it is unable to supply Maintenance and Support Services to Buyer, in which case Buyer shall be free to purchase such specific Maintenance and Support Services only, subject of Seller’s written notice under this clause (B), from a third party. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer’s and its Affiliates’ requirements for Maintenance and Support Services for the remainder of the Exclusive System Period other than the Maintenance and Support Services covered by such notice. (iii) For the period beginning with the Effective Date and ending on December 31, 2002 (the “Exclusive Integration Services Period”), Buyer shall only purchase Integration Services from Seller, unless Seller either (A) approves in writing a specific purchase of Integration Services by Buyer from a third party, (B) provides written notice to Buyer that (y) it is unable to supply a specific Integration Service within the delivery deadlines specified by Buyer or its Affiliate’s applicable Statement of Work, or (z) it will be unable to comply with the Specifications in any prospective Statement of Work applicable to the conditions Integration Service, in any of which case Buyer shall be free to purchase such specific Integration Service only, subject of Seller’s written notice under this clause (B), from a third party. Any notice from Seller under Clause (B) hereof shall not affect the continuing obligation of Buyer to purchase all of Buyer’s and its Affiliates’ requirements for Integration Services from Seller during the remainder of the Exclusive Integration Services Period other than the Integration Services covered by such notice. (iv) To the extent requested by Buyer or an Affiliate and agreed by Seller, Seller shall provide to Buyer or its Affiliate system engineering, proposal perparation, sales support, professional design and engineering services or other services as requested by Buyer or an Affiliate in connection with proposal presentation and sales, site analysis and System specification as well as system engineering modifying and configuring the Systems or any components of the Systems, including, without limitation, the information and control system as necessary to use the System for its intended application or to otherwise comply with the specifications of a customer of Buyer or its Affiliates (“Design Services”). Seller shall perform Design Services professionally and in accordance with established business standards and ethics. All Design Services shall conform to the specifications and performance standards set forth in this Agreement, the Statement of Work. (iv) during the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Product exclusively from Seller and its Affiliates and (ii) until the earlier of the Closing Date or the expiration or termination of the Term, Buyer will, and will cause its Affiliates to, source all of their collective requirements for Spare Parts (other than the items set forth on Appendix 5, it being understood and agreed that if Buyer sources any such Spare Parts set forth on Appendix 5 from a source other than Seller and its Affiliates, then (A) Seller shall not warrant such Spare Parts and shall not be responsible for any damage to the Product or other property caused by such Spare Parts and (B) such sourcing may void the warranty from Seller with respect to the subsystem of a Product with respect to which such Spare Parts are a constituent part if such subsystem is directly affected by the use of such Spare Parts) exclusively from Seller and its Affiliates. Seller and its Affiliates shall accept all POs have no obligation to generate any requirements for Product, Spare Parts and Services issued by Buyer or any of its Affiliates that comply with the terms of this Agreement and the Seller Standard Terms, in each case, without modification (or with modification only following agreement by Seller in respect of such PO), but Seller shall use commercially reasonable efforts to accept any POs that contain such modifications (including with respect to the Technical Design); provided, that if any such change results in an increase or decrease in the out-of-pocket cost or time required for the performance of the work under the PO (relative to a PO that does not contain any such modifications), there shall be a mutually agreed equitable adjustment of the PO price and the scheduled delivery dates. For the purposes of any PO issued by an Affiliate of Buyer, the term “Buyer,” as used in this Agreement shall be deemed to refer to such Affiliate issuing that PO. Buyer will cause its Affiliates that issue POs to comply with the terms of this Agreement and will be responsible for any breaches hereof by its Affiliates. (b) The Parties hereby acknowledge that the quantities of Product, Spare Parts Systems or Services shall not, other than with respect to accepted POs, constitute a commitment or obligation by Buyer or any Affiliate to purchase any minimum volume of Product, Spare Parts or Services from Sellerotherwise market the Systems. (c) At all times during the Term, Seller agrees to possess and maintain the necessary capacity, machinery, personnel and resources to sell to Buyer or any of its Affiliates at least the volume of Product, Spare Parts and Services set forth in all outstanding POs accepted by Seller pursuant to this Agreement. (d) For the avoidance of doubt, (i) this Agreement, including this ‎Article IV, is not intended to limit, and does not limit, either Buyer’s or any of its Affiliates’ rights to market, distribute, or sell an LM2500 or other aero engine to any Person for applications in the O&G Segment, regardless of whether such Person intends to develop or package, or does develop and package (a “Packager”), the aero engine into a trailer-mounted gas turbine generator (provided, however, that Buyer shall not purchase any such trailer-mounted gas turbine generator from any such Packager, nor shall Buyer collaborate or partner with any such Packager in connection with such Packager’s development of a trailer-mounted gas turbine generator incorporating an aero engine, other than (A) Ordinary Course Collaborations and/or (B) sale, development or co-development of any packaging, packaging design, engineering support of such LM2500 or other engine into a trailer-mounted gas turbine generator, provided that Buyer does not use any Seller TM IP in connection with any such collaborating or partnering described in clause (A) or (B) above; provided, further, that no such collaboration or partnering described in clause (A) or (B) above shall be designed primarily to circumvent or avoid purchasing Product or Spare Parts (to the extent not listed in Appendix 5) under this Agreement, and (ii) any of (A) and (B) above or the sale of any such LM2500 or other aero engine by Buyer, any of its Affiliates, or any of its or their Affiliates as contemplated by this Section 4.02(d) is not subject to Seller’s right of first offer set forth in ‎Article X. Notwithstanding the foregoing or anything to the contrary in this Agreement, Buyer may, on behalf of the OFS Business, purchase fully assembled fracking systems from Packagers that may include trailer-mounted gas turbine generators that are not Product, and such purchases shall not be subject to the right of first refusal set forth in ‎Article X; provided that, the OFS Business uses such system to deliver fracking services to customers and does not immediately resell such system and such system is not held for resale in the ordinary course; provided further, for the avoidance of doubt, that the OFS Business may resell such system prior to the end of such system’s useful life.