EXHIBIT 10.1
Note: Redacted portions have been marked with (***). The redacted portions are
subject to a request for confidential treatment that will be promptly filed with
the Securities and Exchange Commission.
AMENDED AND RESTATED
PROCUREMENT AGREEMENT
BETWEEN
QWEST COMMUNICATIONS CORPORATION
AND
TELLIUM, INC.
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TABLE OF CONTENTS
1. DEFINITIONS ...............................................................4
2. SCOPE .....................................................................9
3. SUPPLIER OBLIGATIONS .....................................................11
4. QWEST OBLIGATIONS ........................................................12
5. GOVERNANCE ...............................................................12
6. PRICING ..................................................................13
7. ORDERING .................................................................13
8. DELIVERY AND SHIPMENT ....................................................14
9. PAYMENT TERMS ............................................................16
10. PRODUCT REQUIREMENTS .....................................................16
11. CHANGES IN THE WORK ......................................................18
12. (***) AND ACCEPTANCE .....................................................19
13. SOFTWARE .................................................................21
15. INFRINGEMENT WARRANTY AND INDEMNITY ......................................25
16. KNOW HOW AND NEW TECHNOLOGY ..............................................26
17. WARRANTY .................................................................26
18. GENERAL INDEMNITY ........................................................29
20. CONFIDENTIALITY ..........................................................30
21. TERMINATION, SURVIVAL ....................................................31
22. FORCE MAJEURE ............................................................33
23. JOINT WORK PRODUCT .......................................................33
24. ASSIGNMENT ...............................................................34
25. DISPUTES .................................................................34
26. RELATIONSHIP OF THE PARTIES ..............................................35
27. AMENDMENT ................................................................35
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28. COMPLIANCE WITH LAWS .....................................................36
30. NO WAIVER ................................................................36
31. SEVERABILITY .............................................................37
32. COUNTERPARTS .............................................................37
33. CHOICE OF LAW ............................................................37
34. REMEDIES .................................................................37
35. IMMIGRATION REFORM AND CONTROL ACT .......................................37
36. IMPORT/EXPORT ............................................................38
37. PUBLICITY ................................................................38
38. NOTICES ..................................................................38
39. INSURANCE REQUIREMENTS ...................................................39
40. ORDER OF PRECEDENCE ......................................................40
41. ENTIRE AGREEMENT .........................................................40
SCHEDULE A ...................................................................43
APPROVED AFFILIATES ..........................................................43
SCHEDULE B - PURCHASE ORDER ..................................................44
SCHEDULE C - PRODUCT PRICE LIST ..............................................45
SCHEDULE E - TRAINING ........................................................50
SCHEDULE F - AURORA OPTICAL SWITCH RELEASE TEST PLAN .........................52
SCHEDULE G - TECHNICAL SUPPORT SERVICES ......................................53
SCHEDULE H - TELLIUM REPAIR AND RETURN POLICY ................................57
SCHEDULE I - SOFTWARE MAINTENANCE AGREEMENT ..................................58
SCHEDULE J - TELLIUM PRODUCT ROLL-OUT SCHEDULE ...............................59
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AMENDED AND RESTATED PROCUREMENT AGREEMENT
This amended and restated procurement agreement is made and entered into as
of December 14, 2001 (the "Effective Date") by and between Tellium,
Inc.("Supplier"), a Delaware corporation, with a place of business at 0 Xxxxxxxx
Xxxxx, Xxxxxxxxx, XX 00000, and Qwest Communications Corporation, a Delaware
corporation, having its principal offices and place of business at 0000
Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000 ("Qwest") (Supplier and Qwest each
being referred to herein as a "Party" and collectively as the "Parties").
WHEREAS, the Parties entered into a Procurement Agreement as of September
1, 2000, and amended such Procurement Agreement in the First Amendment to the
Procurement Agreement on April 10, 2001 (together, the "Existing Agreement");
WHEREAS, prior to the Effective Date hereof and under the Existing
Agreement Qwest has purchased services, products and equipment of Supplier (the
"Existing Products") in exchange for which Qwest has paid and Supplier has
received a payment of (***);
WHEREAS, the Parties now desire to amend and restate the Existing Agreement
by this Agreement to, among other things, modify the purchase commitment of
Qwest in connection with the (cancellation) of certain warrants to acquire
shares of Supplier;
WHEREAS, the Parties intend that this Agreement, as defined below, is and
completely describes the sole and entire agreement between the Parties relating
to the subject matter hereof;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
promises and covenants hereinafter expressed, the Parties hereto agree as
follows:
1. DEFINITIONS
1.1 The terms used in this Agreement shall have their normal or common
meaning, except that in addition to terms defined at other places in
this Agreement, the following terms shall have the following meanings
for the purposes of this Agreement, the Schedules and any attachments
thereto:
(a) "Affiliate" means (i) any individual, corporation, partnership,
joint venture, limited liability company, limited liability
partnership, practice, association, joint stock company, trust,
unincorporated organization or other venture or business vehicle
(each an "Entity") in which a Party owns a (***) or greater
equity interest; (ii) any Entity which, directly or indirectly,
is in control of, is controlled by or is under common control
with a Party, as applicable, after applying the attribution rules
of Section 318 of the Internal Revenue Code; or (iii) any other
Entity agreed by the Parties. For the purposes of this Agreement,
control of an Entity ("Control") shall include the power,
directly or indirectly, whether or not exercised (i) to vote
(***) (or such lesser percentage as is the maximum allowed to be
owned by a foreign corporation in a particular jurisdiction) or
more of the securities or other interests having ordinary voting
power
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for the election of directors or other managing authority of such
Entity; or (ii) to direct or cause the direction of the
management or policies of such Entity, whether through ownership
of voting securities, partnership interest or equity, by contract
or otherwise. Schedule A (Approved Affiliates) contains the names
of Qwest Affiliates who have been approved as Approved Affiliates
as of the Effective Date.
(b) "Agreement" means this Amended and Restated Procurement
Agreement, the schedules listed in Section 2.5 and attached
hereto (the "Schedules"), and any Purchase Orders hereunder.
(c) "Class A Change" means a modification, revision, replacement,
correction or release of existing Supplier manufactured Product
(other than an ISU or an Enhancement) to remedy a nonconformance
to the Specifications required to correct design defects of a
type that results in electrical or mechanical inoperative
conditions or unsatisfactory operating conditions, or which is
recommended to enhance safety, provided that the Product
incorporating such change, is at least as equally compatible with
Qwest's network components and other Supplier Products as the
same Product prior to incorporation of such change.
(d) "Current Release" means the latest Version or Release of the
Software which has been approved by Supplier for commercial use.
(e) "Days" or "days" means calendar days, unless otherwise provided
herein.
(f) "Documentation" means the user, technical and operating manuals,
including the operating instructions, guides and manuals,
necessary to enable Qwest properly to use and maintain the
Products.
(g) "Effective Date" has the meaning set forth in the preamble
hereto.
(h) "Equipment" means any hardware, equipment, embedded software
(including firmware) and all physical components, including
cabling, available from or offered by Supplier.
(i) "Enhancement" means any modification or revision to the Software
that Qwest may license at its option when offered by the Supplier
in the future and which (i) substantially improves existing
functions or features, including functions and features for which
Qwest has already been granted a license, or (ii) adds new
functions or features.
(j) "Form, Fit or Function" shall have the following meaning. "Form"
means shape; "Fit" means physical size, weight and mounting
arrangement (e.g., electrical or mechanical connections); and
"Function" means features and capabilities.
(k) "Incremental Software Update" or "ISU" means any modification or
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revision to the Software, other than Enhancements, that (i)
corrects Software Nonconformities or other errors; (ii) supports
new releases of third party operating systems with which the
Software is designed to operate; (iii) supports new Equipment;,
(iv) improves the performance of the Software; or (v) provides
other updates and corrections. If a modification or revision
described in clause (ii), (iii) or (iv) above adds new functions
or features or substantially improves the network performance, it
shall be deemed to be an Enhancement with respect to those new
functions and features.
(l) "Installation Site" means the building, complex of buildings or
remote site at which any of the Products are installed.
(m) "Intellectual Property Rights" mean all forms of intellectual
property rights and protections including:
(i) All right, title and interest in and to all letters patent
and all filed, pending or potential applications for
letters patent, including any reissue, reexamination,
division, continuation or continuation-in-part
applications throughout the world now or hereafter filed;
(ii) All right, title and interest in and to all trade secrets,
and all trade secret rights and equivalent rights arising
under the common law, state law, federal law and laws of
foreign countries;
(iii) All right, title and interest in and to all mask works,
copyrights, other literary property or author's rights,
whether or not protected by copyright or as a mask work,
arising under common law, state law, federal law and laws
of foreign countries; and
(iv) All right, title and interest in and to all proprietary
indicia, trademarks, trade names, service marks, symbols,
trade dress, logos and/or brand names protected under
common law, state law, federal law and laws of foreign
countries.
(n) "Network Compatible" or "Network Compatibility" with respect
to a Product means that: (i) the Product shall comply, only
as applicable to each Product with the American National
Standards Institute ("ANSI"), International Standards
Organization ("ISO"), European Telecom Standards Institute
("ETSI"), Network Equipment Building Standards ("NEBS"),
industry standards, Telecordia Publications, Qwest Technical
Publications, and the applicable Specifications, as all of
the above exist and are in effect on the date that Qwest
issues a Purchase Order, and any other standards mutually
agreed to by the Parties in writing; (ii) the Product can be
operationally deployed in the network in which it is
intended without requiring the replacement of any equipment;
(iii) the Product shall be fully compatible and shall
inter-operate with other
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Products provided under this Agreement unless Supplier
specifically notifies Qwest otherwise prior to Qwest's purchase;
and (iv) the Product shall be fully compatible and shall
inter-operate with third party equipment identified in this
Agreement or a Purchase Order. Qwest in its sole discretion may
waive the foregoing compatibility requirements for the purpose of
deploying new technology offered by Supplier during the Term.
(o) "Nonconformity" means an instance of failure of a Product to be
Operative.
(p) "Supplier Personnel" mean any employees, trainers, or other
support personnel provided by Supplier under this Agreement
whether or not employed by Supplier (to the extent that such are
permitted elsewhere under this Agreement). Supplier shall be
performing under this Agreement at all times as an independent
contractor to Qwest, and the Supplier Personnel shall not be
considered as employees or agents of Qwest.
(q) "Object Code" means machine-readable computer instructions that
can be executed by a computer.
(r) "Operating Platform" means the computer equipment, hardware and
operating system, which execute the Object Code and on which the
Software runs.
(s) "Operative" means (i) conforming in all respects to the
Specifications, the requirements of this Agreement and the
applicable Purchase Orders in effect at the time Supplier accepts
the Purchase Order, and (ii) Network Compatible.
(t) "Products" means any Equipment, Software, and Documentation,
including any part thereof, whether or not described in the
Schedules, available from or offered by Supplier and the Existing
Products.
(u) "Program Manager" means the senior manager of a Party who shall
have overall responsibility for the day-to-day management and
administration of this Agreement and who shall work together with
the other Party's Program Manager to facilitate an efficient
delivery of Products and Services.
(v) "Purchase Order" means the written instrument described in
Section 7, a form of which is attached hereto as Schedule B,
under which Qwest orders and Supplier delivers Products or
Services under this Agreement.
(w) "Release" means any revision, modification, replacement, or
correction to the Software, including an Enhancement or ISU, that
Supplier makes available to any of its customers for use.
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(x) "Representative" means, with respect to a Party, employees,
officers, agents or advisors of such Party.
(y) "Segment" means a continuous route within the Qwest network.
(z) "Services" mean work performed and labor provided by Supplier,
including design, engineering and implementation of Products,
Software testing, warranty, technical support, training and
similar activities.
(aa) "Software" means any software, including Object Code and Source
Code that is delivered to Qwest under this Agreement, inclusive
of the Supplier Intellectual Property Rights, whether or not the
subject of any patent or copyright, issued or pending. Software
may include programs used to create, enhance, test or maintain
any Product delivered under this Agreement. Software includes all
Releases and Versions.
(bb) "Source Code" means the human-readable code from which a computer
can compile or assemble the Object Code of the Software, together
with a description of the procedure for generating the Object
Code.
(cc) "Specifications" mean the technical, functional, performance,
design, operational, and physical characteristics of a Product as
defined in the Documentation and as may be described in the
applicable ANSI, ETSI, NEBS, Telecordia, Qwest documented
standards, ISO standards, Supplier proposal or other Supplier
documentation, including the requirements set forth in Schedule F
(Product Testing Procedure), Schedule J (Tellium Product Delivery
Schedule and Specifications) and Purchase Orders. If one of the
above standards is not available for a Product, the formal
specification developed by Supplier and provided to Qwest shall
be used.
(dd) "System" means an Operative combination of Products designed,
engineered, furnished, installed or implemented by Supplier under
this Agreement.
(ee) "Turn-Over" means, with respect to a delivered Product, the
acceptance procedure set forth in Section 12 has been completed.
(ff) "Version" means a Release of Software intended for use with a
particular make and model of computer or a particular operating
system.
(gg) "Warranty Period" means the time period specified in Section 17.
1.2 Additional definitions appear elsewhere in the recitals and subsequent
Sections of this Agreement.
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2. SCOPE
2.1 The initial term of this Agreement ("Initial Term") commences on the
Effective Date and continues until December 31, 2005 unless earlier
terminated or extended in accordance with other provisions of this
Agreement or unless extended in writing by the Parties. At its option,
Qwest may extend the Initial Term for a period of up to six (6) months
(the "Extended Term") by written notice to Supplier prior to the
expiration date of this Agreement (the Extended Term, if any, together
with the Initial Term, are hereinafter the "Term").
2.2 (a) Subject to the terms and conditions of this Agreement, during the
Initial Term, Qwest will make purchases of Products and Services under
this Agreement as follows (the "Commitment"): (i) during the period
from the Effective Date until (***), Qwest will make purchases under
this Agreement for an aggregate purchase price of not less than
(***)and (ii) during the period from the Effective Date until (***),
Qwest will make purchases under this Agreement for an aggregate
purchase price of not less than (***). Purchases under this Agreement
that contribute to the satisfaction of the obligation stated in clause
(i) of the preceding sentence also contribute to the satisfaction of
the obligation stated in clause (ii) of the preceding sentence.
(b) Subject to the terms and conditions of this Agreement, Qwest will make
purchases of Supplier's Aurora Full Spectrum ("AFS") product under
this Agreement (the "Additional Commitment") in an aggregate amount of
not less than (***) on or before (***) (such date, as it may be
extended from time to time, the "Termination Date"). The Additional
Commitment shall be subject to, and will only be effective upon, the
agreement of the Parties (each, in their sole discretion and with no
obligation to reach any agreement) with respect to (i) the price and
technical specifications of the AFS product and (ii) the schedule of
the development, production and deployment of the AFS product. If the
Additional Commitment shall become effective, then, notwithstanding
anything to the contrary, from time to time Qwest may, (***) elect to
delay, extend or postpone the Termination Date (***) by written notice
thereof to (***); provided, however, that in any event (***) the
Additional Commitment (***) shall terminate on (***). Any such notice
shall state the new Termination Date and may or may not include any
reasons for the election. No such election(s) shall be subject to
review, modification or change by any court, arbitrator, governmental
body or other person. Qwest shall have no liability whatsoever to any
Supplier or any other person with respect to any such election(s). If
the Additional Commitment does not become effective, Qwest shall have
no obligation under this Section 2.2(b).
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As used in this Agreement, "Commitment" shall include, if effective,
the Additional Commitment.
(c) Supplier will complete development and deployment of the products
and deliverables as set forth in the attached Schedule J. If Supplier
(i) fails to meet any purchase order delivery date due to a delay or
failure to have the products described in Schedule J available for
successful general availability as of their corresponding delivery
dates, or (ii) otherwise fails to have the products described in
Schedule J available for successful general availability as of their
corresponding delivery dates, the Commitment will terminate and all
obligations of Qwest to purchase any Products or Services hereunder
shall terminate and Qwest will have no further obligation with respect
to the Commitment. When used in this Section 2.2(c) and in Schedule J,
"available for successful general availability" shall mean that such
products have successfully completed tests substantially similar in
form and depth to the testing process set forth in Schedule F (Product
Testing Procedure), in which Qwest shall be entitled to participate,
and are available for general availability on Supplier's general price
list.
(d) Subject to Section 21.3, all purchases of Products or Services
from Supplier or its Affiliates by any of Qwest and its Affiliates
will be credited toward the Commitment.
2.3 This Agreement shall apply to purchases of Products and Services by
Qwest or its Affiliates.
2.4 Qwest's Affiliates may issue a Purchase Orders under this Agreement if
they (i) (***), which fulfillment of (***) will determine within (***)
after notice from (***) and (ii) (***) and (***) of this Agreement. If
Supplier has not provided written acknowledgement of an Affiliate's
failure to meet such credit standards within such (***) period, the
Affiliate shall be deemed to have been authorized to purchase under
this Agreement and shall be deemed an Approved Affiliate. If there has
been a transfer of (***) or more of the assets of any Approved
Affiliate who (i) is seeking to place an new Purchase Order under this
Agreement or (ii) has an outstanding Purchase Order of (***) or more,
Supplier shall have the right to (***) Purchase Order and the right to
review such Approved Affiliate's (***) as such. If, upon review, the
Approved Affiliate no longer qualifies for approval pursuant to this
Section, such Affiliate shall no longer be eligible to place Purchase
Orders under this Agreement without the satisfaction of another (***).
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2.5 The following Schedules attached hereto are an integral part of this
Agreement and are incorporated herein by reference.
A. Approved Affiliates
B. Form Purchase Order
C. Product and Price List
D. Purchase Order Confirmation Procedure
E. Training
F. Product Testing Procedure
G. Technical Support Services
H. Tellium Repair and Return Policy
I. Software Maintenance Agreement
J. Tellium Product Delivery Schedule and Specifications
3. SUPPLIER OBLIGATIONS
3.1 Supplier shall perform all Services and deliver all Products ordered
under this Agreement and shall perform all work in a professional and
workmanlike manner, in accordance with all requirements, acceptance
criteria and Specifications of this Agreement and the warranties
provided hereunder. Among its obligations, Supplier shall:
(a) complete all tasks required by an accepted Purchase Order by
providing all necessary resources, personnel, materials and
equipment;
(b) adhere to agreed delivery dates;
(c) supervise and manage the overall Supplier effort under each
Purchase Order and this Agreement and coordinate its efforts with
the Qwest Program Manager; and
(d) provide competent personnel of sufficient experience and
expertise to fulfill the goals of this Agreement.
3.2 In addition to other requirements contained in this Agreement,
Supplier will consider the following Qwest objectives in its delivery
of Products and Services under this Agreement:
(a) ensuring a smooth transition from the existing products to new
Products provided hereunder as possible;
(b) training; and
(c) using an orderly approach for any significant implementation of
new Products.
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3.3 Supplier is responsible for providing qualified personnel in the
quantities and of the experience necessary to fulfill the requirements
of this Agreement. When requested by Qwest, Supplier shall provide the
names of Supplier Personnel providing Services at Qwest sites.
4. QWEST OBLIGATIONS
4.1 (***) by the end of the third quarter of each calendar year, Qwest
will provide Supplier with a forecast of Qwest's estimated
Product requirements for the next calendar year (each a "Forecast").
Qwest will update this Forecast each quarter and when significant
changes occur. The Forecast shall be for planning purposes only and
shall not represent Qwest's commitment to purchase any or all such
Products or create any other obligation whatsoever by Qwest.
4.2 Qwest agrees that all Supplier Personnel who are approved in writing
by Qwest to be involved in any effort under this Agreement will be
provided reasonable access to Qwest's premises during mutually agreed
times as necessary. Supplier Personnel shall comply with site and
security regulations specified by Qwest.
4.3 For all Products not on Supplier's price list ("Non-Price List
Products"), Qwest shall issue a written request for proposal ("RFP")
to Supplier no later than (***) prior to the required equipment ship
date for Non-Price List Products included in the Forecast.
Non-forecasted Non-Price List Products equipment will require (***)
advance notice to Supplier. Supplier's sales engineering shall issue a
written proposal to Qwest for Product purchases within two weeks of
receipt of the RFP, or a reasonable time thereafter as necessary to
complete the proposal.
4.4 For avoidance of doubt, Qwest shall have no obligation to provide any
Forecast, access, RFPs, meetings or any other matter with respect to
any Products and Services it expects to purchase in connection with
the satisfaction of the Commitment.
5. GOVERNANCE
5.1 The Parties will mutually determine appropriate intervals for periodic
meetings to be held between representatives of Qwest and Supplier. The
Parties currently expect these meetings will include the following:
(a) a weekly meeting between the respective project management teams;
(b) a monthly management meeting to review Supplier's progress under
open Purchase Orders, project schedules, financial and
administrative matters and such other matters as appropriate; and
(c) a quarterly executive review meeting to review relevant contract
and performance issues. Each Party's Program Manager or individual
designated by the Program Manager will attend each meeting.
Each Party's Program Manager or individual designated by the Program
Manager will attend each meeting.
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5.2 Qwest reserves the right to require replacement of any Supplier's
employee or contractor performing work for Supplier under this
Agreement if Qwest is dissatisfied with the performance of that
individual and determines that the continued assignment of such
individual is not in the best interest of Qwest. Qwest shall give
Supplier written notice requesting that the individual be replaced
(***). Supplier shall replace such individual with a person of
suitable ability and qualifications within (***) from the request or
such additional time period as may be reasonably required under the
circumstances.
5.3 Supplier shall provide to Qwest written progress reports as agreed by
the Parties, on at least a weekly basis, delivered by electronic mail
followed by a paper copy to Qwest's designated representative.
Progress reports shall include: (i) the status of delivery under all
open Purchase Orders for Products; (ii) items completed during the
reporting period; (iii) items to be completed within the next
reporting period; (iv) open action items; and (v) any other action
items required by Qwest, listing the party responsible for such
actions.
6. PRICING
6.1 Qwest will receive a (***) discount off the list price of all Supplier
Products and Services, including the Products set forth in Schedule C
(the "List Price").
7. ORDERING
7.1 (a) Qwest shall issue Purchase Orders, a form of which is attached
hereto as Schedule B, to acquire all Products and Services under this
Agreement. All Purchase Orders must be submitted (***) prior to the
delivery date designated in the Purchase Order (with respect to (i),
below) or as agreed upon by the Parties (with respect to (ii), below)
(the "Order By Date"). Upon request by Qwest, the Parties will in good
faith discuss a shorter period for Purchase Order submission.
(i) For all Purchase Orders less than or equal to (***) of the
Forecast amount which are submitted prior to the Order By Date,
Supplier agrees to be bound by the designated delivery date.
(ii) For all Purchase Orders that are in excess of (***) of the
Forecast or are submitted after the Order By Date, (***) will (***) on
the (***).
7.2 Supplier shall confirm and accept the Purchase Order in writing in
accordance with Schedule D at which point the Purchase Order shall
become a binding commitment. Subject to Section 7.1, Supplier agrees
to accept all Purchase Orders issued by Qwest under this Agreement
provided that such Purchase Orders conform with the requirements of
this Agreement.
7.3 Any changes to a Purchase Order shall be made in writing.
7.4 All Purchase Orders issued hereunder by Qwest or the Approved
Affiliates shall
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reference this Agreement and shall be deemed to incorporate and be
governed solely by the terms and conditions set forth herein. Any
changes to the terms and conditions of the Agreement contained in
Supplier's written acknowledgement of a Purchase Order shall have no
force or effect.
7.5 Qwest Affiliates approved by Supplier may purchase Products and
Services under this Agreement, provided that such Affiliate agrees to
be bound by the applicable terms and conditions of this Agreement with
respect to Qwest. Each Affiliate purchasing any Products or Services
under this Agreement shall have the rights and obligations of Qwest
under this Agreement with respect to such Products and Services, the
term "Qwest" shall refer to such Affiliate with respect to such
Products and Services, and Qwest shall not have any obligations with
respect to such Products and Services.
8. DELIVERY AND SHIPMENT
8.1 Supplier shall deliver Products as required under this Agreement to
Qwest at the locations and at the times specified by Qwest, and agreed
to by Supplier in an accepted Purchase Order, this Agreement or as
otherwise agreed in writing by the Parties. For purposes of this
Section 8, "Buyer" shall mean Qwest or its Affiliate, as applicable.
Supplier shall deliver all Products and Services at the designated
location in a timely manner.
8.2 Supplier shall ship all Products, freight prepaid, FOB destination
designated in the Purchase Order or to such other location as the
Parties may agree ("Destination"). The method of shipment shall be
consistent with the nature of the Products and hazards of
transportation. Risk of loss for all Products ordered in accordance
with this Agreement shall pass to Buyer upon delivery by Supplier at
the Destination except loss or damage attributable to the Supplier's
fault or gross negligence. Such loss, damage, or destruction shall not
release Supplier from any obligation hereunder. Title to Products
(excluding Software) shall pass to Buyer upon delivery to the
Destination. Supplier shall convey good title, free from any claim or
encumbrance, for all Products (excluding Software) delivered to Buyer
under this Agreement. Supplier will pack the Products purchased
hereunder for transport in accordance with its commercial standards
and will deliver the Products to a carrier of the mode of
transportation selected by Supplier unless otherwise agreed upon in
writing by the Parties.
8.3 If Supplier fails to meet any agreed schedule, Buyer, without limiting
its other rights or remedies as may exist, may direct expedited
routing of Products and any excess costs incurred thereby shall be
paid by Supplier unless otherwise agreed in writing by the Parties.
Buyer shall not be liable for Supplier's commitments or production
arrangements in excess of the amount, or in advance of the time,
necessary to meet Buyer's delivery schedule. Delivery shall not occur
(***) in advance of the scheduled date of delivery unless otherwise
agreed in a signed writing by Supplier and Buyer. For delivery to new
sites, such advance delivery shall not be allowed, except as set forth
in a signed writing executed by Buyer. If delivery occurs prior to the
period authorized above and designated storage has
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not already been established by Supplier, Buyer may (i) return
delivered items at Supplier's expense for proper delivery, or (ii)
place delivered items in storage at Supplier's expense until the
scheduled date of delivery.
8.4 The Parties agree that for all shipments that otherwise meet the
designated delivery dates (a) any failure to supply all Products
ordered in a single shipment or (b) any partial shipment or delivery
of an Order in installments shall not constitute a breach of this
Agreement provided that Supplier has received Buyer's prior written
approval of the same, such approval not to be unreasonably withheld;
it being understood that any such Products shall not be deemed
delivered unless all Products included in any Purchase Order are
delivered.
8.5 Performance Incentives
(a) Subject to Section 8.4, for accepted Purchase Orders of Products
with an aggregate value of (***) or more, Supplier and Qwest
agree that it may be difficult, if not impossible, to accurately
determine the amount of damages that Qwest may incur if Supplier
fails to deliver the Products as scheduled. Accordingly, if
delivery has not occurred with respect to any Product, Segment or
System within (***) of a Forecast as of the scheduled date, in
addition to its other rights and remedies hereunder, Buyer shall
be entitled to daily performance incentives in a specified and
predetermined amount of (***) of the total price of the affected
Product, Segment or System, per day late, up to a maximum of
(***) of total price of the Product, Segment or System
("Performance Incentive").
(b) Buyer shall not assess Performance Incentives to the extent that
Supplier has been delayed by Buyer not fulfilling its obligations
described in Section 4.
(c) Buyer may in its sole discretion by written notice to Supplier
(a) unilaterally delay the scheduled delivery date of any Product
or Service or (b) cancel or suspend delivery of any Product or
Service ordered under this Agreement. Such unilateral delay,
cancellation or suspension shall be without penalty or cost
provided that Buyer gives written notice to Supplier at least
(***) prior to the scheduled shipping date of the affected
Product or the scheduled delivery date of the affected Service.
If a delay directed by Buyer lasts more than (***) beyond the
scheduled delivery date of the Product, or a cancellation
directed by Buyer occurs within (***) of the scheduled shipping
date of the Product, Buyer agrees to pay Supplier for the actual
restocking costs it incurs as a result of the delay or
cancellation, not exceeding (***) of the (***) of the affected
Product. The foregoing shall be Supplier's sole remedy for delay,
cancellation or suspension of the delivery of a Product or
Service by Buyer.
8.6 Equipment Tracking Data. Supplier shall provide Qwest with quarterly
reports containing the following information in a jointly developed
format. The reports
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shall contain Equipment information, including: (1) a description of
the Equipment; (2) Supplier part number; (3) Equipment destination by
building (final); (4) shipping date; and (5) Supplier serial number.
8.7 In the event that Qwest installs a bar coding system for its fixed
assets, Supplier shall apply a Qwest asset tag (to be supplied by
Qwest) at either the manufacturing site or at the point of shipment
for the Equipment in a manner that allows Qwest to easily read the
asset tag. Supplier may charge an agreed fee to cover any reasonable
Supplier's costs associated with such bar coding system. A joint
meeting will be held between Supplier and Qwest within thirty (30)
days of contract execution to further define these requirements and
fees (if any).
9. PAYMENT TERMS
9.1 Subject to Section 12, Supplier shall invoice Qwest for Products upon
shipment and Qwest shall pay to Supplier the price of each shipment
(including any prepaid transportation and/or insurance) within (***)
from the date of Acceptance. For all other Services, Supplier shall
invoice Qwest upon Acceptance of the Services. Charges for any other
amounts payable pursuant to this Agreement shall be paid by Qwest
within (***) from the date of invoice. All payments shall be made in
U.S. Dollars. The date of the payment shall be deemed to be the date
(***) is (***).
9.2 Qwest is not required to pay invoiced amounts disputed in good faith
until such dispute is resolved; provided, however, Qwest shall pay
that (***) of a (***) which is (***) unless it is (***) to (***). Once
the dispute is resolved, the invoice shall be paid within (***)
following such resolution, or in the time frame set out in Section
9.1, whichever is greater.
9.4 Credits owed to Qwest under this Agreement, may be applied against
amounts owed to Supplier under this Agreement, or at Qwest's request
for amounts other than Management Discounts, retroactive discounts
paid to Qwest within (***) following such request.
9.5 Payment shall not be considered Acceptance of any Products or Services
(which Acceptance shall be as set forth in Section 12. Supplier shall
provide Equipment, Software and Services without interruption in the
event of disputes concerning an invoice amount provided that the
Parties are working together in good faith to resolve the dispute.
10. PRODUCT REQUIREMENTS
The following provision shall apply to all Products provided under this
Agreement.
10.1 Documentation.
(a) Supplier shall furnish to Qwest one set of Documentation per
Installation
-16-
Site on CD ROM, and a reasonable number of complete sets in both
CD ROM and paper form for Qwest engineering staff for use in the
operation and ongoing maintenance of the Products. Supplier shall
deliver reasonable Documentation to allow Qwest to install and
use each ISU and Enhancement.
(b) Qwest may copy the Documentation subject to the rights and
restrictions in this Agreement and for Qwest's internal use only.
All such Documentation is to be treated in accordance with the
terms of this Agreement. Updates to Documentation shall be
provided at no charge during the Warranty Period.
(c) The Documentation shall describe fully the proper procedure for
using the Products and provide sufficient information to enable
Qwest to operate and maintain the Products.
10.2 Equipment.
----------
(a) Supplier shall make available to Qwest sufficient repair and
spare parts for each Product furnished under this Agreement to
keep such Product Operative for a period of (***) from the date
of last shipment of the Product. (***) for (***) shall not exceed
(***) for (***) from the (***) of (***). After such period, (***)
for such (***) shall be at (***). Supplier, at its option and
expense, may replace Products for which repair parts are no
longer available with functionally equivalent Products provided
that such products are Network Compatible.
(b) Supplier shall provide Qwest with written notice of the
manufacturing discontinuance for any particular Product, and,
subject to subsection (a) above, shall furnish the repair parts
to Qwest at the (***) unless furnished during the Warranty Period
in which case a supply that may be reasonably needed during the
Warranty Period, and would otherwise be included at no cost
pursuant to the Warranty provided in Section 17, shall be
supplied (***).
(c) Supplier shall neither provide nor incorporate any Product which
adversely affects Form, Fit or Function, Network Compatibility,
interface or interchangeability of Qwest's existing hardware or
software environment without the prior express written approval
of Qwest. Qwest shall notify Supplier if it becomes aware that a
Product is not Network Compatible.
(d) In the event of a Class A Change; Supplier shall provide
immediate written notice to Qwest and shall proceed promptly to
make the necessary changes at Supplier's expense per the repair
and return procedures set forth in Schedule H, Supplier shall
bear all costs and expenses relating to such retrofit or
replacement and all peripheral equipment and software
-17-
(e) All changes must be Network Compatible.
10.3 Substitutions and Modifications.
-------------------------------
Supplier shall give Qwest (***) advance written notice of any material
modification in the design or Specifications of the Products supplied
hereunder to Products previously made available hereunder. If any such
modification, which affects the Form, Fit or Function of the Products
and (i) adversely affects the expected life, operation or performance
of any Equipment or Software; (ii) causes Qwest to incur significant
costs (including a write down of equipment or equipment-related
assets); (iii) prevents proper operation of equipment in the Qwest
network that otherwise meets Specifications; or (iv) prevents any
Product from meeting the applicable Specifications, Qwest shall have
the right to return to Supplier such modified Product and Supplier
shall have the obligation of replacing such modified Product with
compliant Product. No such replacement or substitution shall result in
an increased purchase price.
10.4 Incremental Software Updates.
----------------------------
During the Warranty Period and in accordance with Section 13.2,
Supplier shall offer to Qwest any ISUs contained in a Release or
Version of the Software at no additional charge when they are made
available to any of Supplier's other customers or upon a production of
new Release or Version. Providing such ISUs shall not relieve Qwest of
its obligation to pay license fees otherwise due for Enhancements used
by Qwest. Qwest shall be responsible for installation of such ISUs in
the network. Supplier shall make all Releases available to Qwest no
later than it makes the same available to any of Supplier's other
customers.
10.5 Training.
--------
Supplier shall provide the training courses referred to in Schedule E
at the prices set forth in Schedule C. Supplier shall provide, at no
additional charge, (***) network training seat days ("Seat Days") for
the Term of this Agreement; provided, however, that (***) where the
training involves teaching trainers how to train other individuals at
Qwest (hereinafter a "Train The Trainer Seat Day") will count as
(***). The training will take place at a Supplier training location
agreed to by the Parties, and will consist of materials developed and
controlled by Supplier. All travel and living expenses for the
training sessions shall be borne by Qwest. Training in addition to
that described in this Section 10.5 shall be provided at the then
current Supplier rates.
11. CHANGES IN THE WORK
11.1 Any additional charges authorized by Qwest in writing, not contained
in any Purchase Order or Schedule, shall reflect Supplier time and
materials (and Supplier subcontractor time and materials) as stated in
Schedule C or as otherwise agreed by the Parties in writing and shall
apply towards the satisfaction of the
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Commitment.
11.2 Claims for Delay.
----------------
(a) Beginning in 2003, if Supplier wishes to request an extension in
the delivery date for Products provided in a Purchase Order,
written request shall be given to Qwest at the time the delay
begins, or within (***) thereafter if the resulting delay was not
reasonably foreseeable. The request shall state the circumstances
of the occurrence, the justification for the delay and extension
of time, and the estimated duration of the delay and extension
requested. Supplier shall also be obligated to do all in its
power to mitigate the adverse impact of such delay at no
additional cost to Qwest.
(b) Supplier agrees that it shall not request extensions of time
resulting from normal inclement weather.
(c) An extension of time shall be the sole remedy of Supplier for any
delay caused by any reason or occurrence. Subject to Section 8.5,
Supplier acknowledges such extension of time to be its sole
remedy and agrees to make no claim for damages or added charges
of any sort for delay in the performance of this Agreement or any
Purchase Order for any reason. Entitlement to any such extension
of time shall be subject to compliance with all notice and
submission requirements imposed by the Agreement concerning such
claims.
12. (***) AND ACCEPTANCE
12.1 (***).
All Products shall be subject to a (***) as set forth in (***) hereto.
In addition, for Products not certified by Qwest as (***) Accepted,
Qwest agrees to (***) and (***) a (***) by (***) by (***), such (***)
to be generally in accordance with (***), and as finally (***) by
(***). Upon successful completion of the (***) Qwest will (***) in a
form determined by Qwest, such Products as certified for "Expedited
Acceptance." Upon receipt of such certification by Qwest, Qwest shall
have the right to inspect and reject such Products for failure to be
Network Compatible or other errors for a period of (***) from delivery
(the "Expedited Inspection Period"). Such Products shall be deemed to
have passed inspection and accepted ("Acceptance" or "Accepted") after
the expiration of the Expedited Inspection Period, unless Qwest
notifies Supplier, during the Expedited Inspection Period, of a
reasonable cause for rejection of the Products due to a failure (***)
or other error. For all Products that have not been (***) Accepted by
Qwest, each Approved Affiliate may perform (***). Upon successful
completion of the (***), such Approved Affiliate (***) that for such
Approved Affiliate, such Product is certified for Expedited
Acceptance. Such Approved Affiliate shall then have the right to
inspect and reject such Product for failure to be Network
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Compatible for the Expedited Inspection Period.
12.2 Acceptance.
----------
For any Products not certified for Expedited Acceptance, Qwest shall
have the right to inspect and reject such Products for failure to be
Network Compatible or other errors (or other failures to meet the
Specifications) for a period of (***) from scheduled delivery (the
"Inspection Period"). Such Products shall be deemed to have passed
inspection and accepted after the expiration of the Inspection Period,
unless Qwest notifies Supplier, during the Inspection Period, of a
reasonable cause for rejection of the Products due to a failure (***)
or other error. Notwithstanding the foregoing, Products will be deemed
accepted upon the full (***) for (***) with (***) by Qwest,
irrespective of Expedited Acceptance status or the expiration of the
Inspection Period. Any subsequent order of a Product that has
previously been accepted pursuant to this Section 12.2 must (***) the
(***) in (***).
12.3 Failure of Acceptance.
---------------------
Qwest's payment obligations in Section 9 are contingent upon
acceptance of the corresponding Product and related Services in
accordance with Sections 12.1 and 12.2 and (***). If a Product fails
to achieve acceptance as provided in Sections 12.1 or 12.2 (***) (or
otherwise fails to meet the Specifications), Qwest may return the
Product, title to which shall pass to Supplier upon delivery to
Supplier, and apply amounts paid for such Product or Service to any
unpaid invoice from Supplier or, in Qwest's sole discretion, demand
repayment from Supplier. Supplier shall repay such amounts within
(***) of any such demand. In any event, the Commitment shall be
reduced by the invoiced amount of such returned Product or Service.
12.4 New Products.
------------
In the event Supplier develops New Products Supplier will give Qwest
(***) notice thereof, along with the expected Specifications therefor
and pricing and discounts. Qwest may request that this Agreement be
amended in order to make the terms of this Agreement applicable to the
purchase by Qwest of New Products and the Parties shall negotiate in
good faith the terms of such amendment, including pricing, discounts,
and delivery schedules, and the conduct by Qwest of a (***) for the
New Product. Such (***) shall be substantially similar to the (***)
described in (***) hereto. The terms of this Agreement, as amended
with respect to the New Product, shall apply to the purchase and sale
of such new Products. New Products shall mean Products with material
changes in previously applicable Specifications, which Specifications
have not been approved by Qwest.
-20-
13. SOFTWARE
13.1 License Grant.
-------------
Upon delivery of Software hereunder, Supplier grants to Qwest and each
of its Affiliates (***) (for the purposes of this Section, each a
"Licensee") a nonexclusive, irrevocable, perpetual, worldwide license
and right to use and make copies of the Software and the Intellectual
Property Rights for which the Licensee has paid Supplier a license fee
for use solely with the applicable Products so long as Licensee uses
such Products in accordance with this Agreement. Enhancements may be
provided at a later date as set forth in Schedule C. A "right to use"
license under the same terms and conditions as set forth in this
Section 13 for such Enhancement will be effective upon payment by the
Licensee.
13.2 Releases.
--------
Supplier may, from time to time, issue Releases of the Software. As
set forth in Section 1 (Definitions), Supplier may classify such
Release as (i) an Enhancement, (ii) an ISU or (iii) both. During the
Warranty Period and the term of any maintenance or support agreement,
(***) shall (***) with (***) of (***). The Licensee acknowledges that
from time to time Enhancements may be contained in a Release that have
not been licensed to the Licensee. The Licensee and Supplier shall
agree in writing on the license fee for Enhancements that the
Licensee, in its sole discretion, decides to use. Notwithstanding the
foregoing, ISUs and Enhancements shall not include the cost of any
associated hardware that may be required to update such ISUs. The
Licensee shall be responsible for the installation of such Releases in
the Network.
13.3 Title.
-----
Subject to Section 13.5, Title to the Software described herein shall
remain with Supplier, or with the various suppliers to Supplier whose
software or software components are contained in the Software and
whose rights of ownership are maintained through restrictive
agreements with Supplier.
13.4 Limitations of License Grant.
----------------------------
(a) The Software and Documentation are to be used only by the
Licensee, for its own business use, and only for the intended use
of the Software and Documentation (***) and (***) and only in
connection with Product for which a license fee has been paid.
(b) Licensed use is limited to the Software as delivered by Supplier
to Licensee and does not permit modification or use of any
modified form of the Software, except for minor user
modifications or customizations. Licensee may not duplicate the
Software, except to make a reasonable number of backup copies of
the Software for use in the event of Product failure. If
duplication (***) for (***) then (***) shall (***) and (***) to
-21-
(***) the (***) of (***).
(c) The Software and Documentation furnished hereunder are the
property of Supplier and are to be considered Supplier's
proprietary information. Licensee shall not (***) or (***) the
(***) or (***), or (***) or (***) of (***)), before or after
termination of this Agreement, except as may be permitted in
writing by Supplier. Licensee shall immediately notify Supplier,
in writing, of any knowledge that any unlicensed party possesses
the Software or Documentation. Licensee shall safeguard said
Software with the same degree of care and diligence as Licensee
affords to its own similar property.
(d) The Licensee acknowledges that Software may contain programs that
have been supplied by, and are proprietary to, third party
software suppliers. The terms and conditions of any such third
party program licenses may be different than the terms herein,
and in such event, the Licensee must agree in writing to such
terms prior to delivery for such terms to be effective. Supplier
will extend to the Licensee any rights Supplier may have under
any such third party licenses.
13.5 Derived Products and Derived Dependent Products.
-----------------------------------------------
(a) Any (i) Licensee (***) from the (***) of the (***) and the (***)
of (***) by the Licensee (ii) Licensee (***) or (***); (iii)
Licensee (***) or (***) of the (***) or (***) the Licensee; and
(iv) unless otherwise set forth in a signed writing by the
Parties referencing this Section, any portion of a (***)
configuration, application or arrangement of the Software created
by Supplier (either with or without the Licensee) after a (***)
by the Licensee therefore shall not be considered derived
products and shall be distinct in ownership from that of the
Software as received by the Licensee and shall be owned by the
Licensee (and are hereby assigned to the Licensee) (collectively,
the "Qwest Products"). The foregoing (iv) shall not (***) to
(***) or (***) or (***) and does not (***) in any (***) to (***)
of the (***) from (***) of any (***) or (***). Any other
configuration, application, or arrangement of the Software, shall
be considered a derivative work and shall be the sole and
exclusive property of Supplier; provided, however, that Supplier
may, at its discretion, assign or license (***) or (***) not to
be unreasonably withheld.
(b) Any (***) or (***) of (***), which are (***) of the (***) and are
(***) the (***) for (***), shall be considered a derived products
to which Supplier retains title and ownership and to which
Licensee is granted an exclusive perpetual, irrevocable,
worldwide right to use solely in its dependent form, and in
conjunction with the Software for so long as such Licensee uses
such Software in accordance with this Agreement.
(c) Supplier expressly prohibits, and Licensee agrees to refrain
from, any
-22-
attempt by Licensee, Licensee's agent or to permit any third
party to disassemble, reverse compile, reverse engineer, or, in
any similar way, expose the actual instruction sequences,
internal logic, protocols, algorithms or other intellectual
property represented within the Software, which Supplier
considers to be its proprietary information and trade secret
whether or not said intellectual property is included in any
patent or copyright. Notwithstanding any other provision of this
Agreement, any (***), or (***) by Licensee or any other party
shall not be assigned and shall be deemed the property of
Supplier, for which no right to use is granted to Licensee herein
and for which Supplier shall bear no obligations for support.
13.6 Software Maintenance and Support.
--------------------------------
(a) Supplier shall provide Software technical support services as
provided in Schedule G.
(b) Notice to the Licensee of corrections or additions, modifications
or adjustments to the Software generally available to other
Supplier's customers with the same Release shall be sent to a
designated the Licensee contact. Supplier will, at its own
discretion, make such additions, modifications or adjustments to
the Release of the Software commonly known as the Current Release
except if such adversely affects the Form, Fit or Function, in
which case the Licensee may refuse to accept such without
amending its rights or Supplier's obligations hereunder.
(c) Supplier agrees that at any point in time it will support the
then Current Release of the Software plus the (***) immediately
preceding Releases.
13.7 (***) Delivery.
--------------
(a) Supplier shall keep and maintain a copy of Software (***) and
other Documentation relevant to the use and maintenance of the
Software licensed hereunder, including the Current Release of the
Software. Should Supplier at a future date (i) declare voluntary
bankruptcy or be the subject of an involuntary bankruptcy (***)
or (***) (or, (***) may (***) or (***)) of the Software; or (ii)
cease supporting the Products or any other product incorporating
such Software (***) pursuant to this Agreement for a non-material
amount of time, then Supplier agrees and commits to the Licensee
that it will promptly and (***) to the fullest extent permitted
by any third party intellectual owners, make available all such
Software (***) and other relevant Supplier proprietary data
information which Supplier has a legal right to sublicense, and
hereby grants to each Licensee a non-exclusive perpetual,
irrevocable, worldwide license to use, modify (including creating
derivative works), and copy such Software (***) solely for the
purpose of supporting and maintaining the Products including
Software and only for so long as Licensee (***) such Products or
Software
-23-
in accordance with this Agreement.
(b) Supplier acknowledges that if a trustee in bankruptcy or Supplier
as a debtor in possession rejects this Agreement, the Licensee
may elect to retain its rights under this Subsection as provided
in Section 365(n) of Xxxxx 00, Xxxxxx Xxxxxx Code (the
"Bankruptcy Code"). In that event, the license for the Software
(***) or other relevant information will include the following
provisions:
(i) The Licensee has no further recourse with respect to
support in the areas to which the license applies;
(ii) Supplier will assume no obligations or liabilities with
respect to infringement (related to the (***)), and/or the
Licensee's inability to successfully support the Software
(***); and
(iii) Supplier's then standard terms applicable to
confidentiality obligations and Supplier's disclaimer of
liabilities with respect to the Licensee's subsequent use
(of the Software (***)).
13.8 Documentation.
-------------
In addition to the requirements of Section 10.1, Supplier shall
provide one set of instructions and reference manuals in both printed
and electronic forms free of charge for all Software. All such sets of
instructions and reference manuals are ordered as separate line items.
Licensee may purchase additional sets at the price and discount
specified on Schedule C. Planning guides are available and will be
delivered free of charge with each and every Release delivered to
Licensee.
13.9 Transfer of License.
-------------------
(a) The Licensee may transfer, assign or sublicense (such sublicense
only to the extent (***) to (***) those rights (***) to use the
Products), any license granted by Supplier hereunder, to any
Affiliate, holding company, subsidiary of holding company,
subsidiary, associated company, or successor in interest of the
Licensee or any person controlling or controlled by any of the
foregoing or to any person directly or indirectly under common
control with the Licensee (collectively, "License Transferee"),
provided such License Transferee (i) has (***) to be (***) by the
(***) of (***) and (ii) of which (***) has (***).
(b) The Licensee and any successor to the Licensee's title in any
Products shall have the right without further consent of Supplier
to assign or sublicense (such sublicense only to the extent
necessary to grant those rights necessary to use the Products),
the License herein granted to any other party who subsequently
acquires the right to use the applicable Products, provided that
any such other party prior to the transfer of the applicable
Software (***) the terms and conditions of this license.
-24-
14. TECHNOLOGY CURRENCY
Supplier understands and acknowledges that Qwest is entering into this
obligation (including the incorporated pricing and discount terms) based on
the expectation that Supplier will (***) (i) continue to remain
technologically competitive and (ii) offer products to Qwest that will
allow productivity savings, based on Qwest's use of such products. Supplier
shall (***) provide products using current technologies that will enable
Qwest to take advantage of technological advancements in its industry and
support Qwest's efforts to remain competitive in the markets in which it
competes.
15. INFRINGEMENT WARRANTY AND INDEMNITY
15.1 Supplier warrants that it or its Affiliates are the owner of the
Intellectual Property Rights of the Products, or, if the Products or
other materials contain third party products or software, that
Supplier has the full power and authority to deliver, convey and grant
to Qwest the related license and other rights granted under this
Agreement. Supplier further warrants that Supplier's provision of
Services under this Agreement, grant of the licenses hereunder, and
Qwest's use of the Products will not constitute a misappropriation of
any trade secrets, infringement or misappropriation of any copyright
or trademark or (***) any patent.
15.2 Supplier shall defend or settle, at its expense, any threatened or
actual claim, suit or proceeding made against Qwest that use of the
Products infringes any patent, trademark, copyright, trade secret or
other intellectual property right of a third party ("Infringement
Claim"), and shall indemnify Qwest and hold it harmless against all
damages, claims, costs of investigation, litigation, settlements,
judgments and disbursements, including reasonable attorneys' fees
("Losses") arising out of the foregoing. In order for this
indemnification to apply to a claim, Qwest shall give Supplier prompt
notice following Qwest's knowledge of any such Infringement Claim,
shall allow Supplier to control the defense of and settlement
negotiations with regard to such claim, provided that Qwest shall
approve the terms of any settlement or compromise with respect to any
Infringement Claim directed to Qwest's use of the Product unless
Supplier has the (***) the settlement or compromise. The Parties shall
provide reasonable cooperation and assistance in the defense of the
Infringement Claim.
15.3 If any Product furnished under this Agreement becomes, or in Qwest or
Supplier's reasonable opinion is likely to become, the subject of any
claim, suit, injunction or proceeding arising from or alleging
infringement of, or in the event of any adjudication that such Product
infringes on, any Intellectual Property Right, Supplier, at its
expense, shall take the following actions in the listed order of
preference:
(a) (***) procure in a timely manner for Qwest and its Affiliates (if
applicable) the right to continue using the Product (***) or
(***) of (***) or (***); or if those efforts are unavailing;
-25-
(b) (***) replace or modify the Product to make it non-infringing;
provided, however, that such modification or replacement shall
not materially degrade the operation or materially impair the
performance of the Product, or otherwise make it incompatible
with Qwest's current network; or
(c) if (a) and (b) are commercially impracticable or would cause the
Products to fail to be Network Compatible, accept return of the
Product and refund Qwest all amounts paid therefor, including any
prepaid maintenance and support fees, and pay Qwest any
additional costs incurred by Qwest in acquiring a comparable
replacement for the infringing Product. Any refund of amounts
paid may be reduced based on depreciation of the Product on
straight line basis over a (***).
15.4 Supplier shall have no liability in respect of any Infringement Claim
based on the use of a Product to the extent that such claim (i) is
based on a use of a Product by Qwest in a manner or for a purpose not
contemplated by this Agreement; (ii) is based on a use of the Product
by Qwest in combination with other non-Supplier products where such
combination is not reasonably contemplated by this Agreement, provided
the Infringement Claim arises solely from such combination; or (iii)
is based on a modification of the Product by Qwest where such
modification has not authorized by Supplier in writing.
15.5 This Section 15 establishes the entire rights and obligations of the
Parties for claims of infringement of Intellectual Property Rights.
16. KNOW HOW AND NEW TECHNOLOGY
Notwithstanding anything to the contrary contained in this Agreement, each
Party shall be entitled, without royalty to the other Party, to use,
disclose and sell any know-how retained in the minds of employees of such
Party, expertise, techniques, approaches or concepts (the "Know-how")
developed or acquired in the course of performing under this Agreement. The
Parties agree that Know-how shall not include any Qwest, Supplier or third
party (***) and (***) or (***), any (***), or any Confidential Information
of the other Party. The foregoing shall not be construed as granting a
license in any Intellectual Property Rights. The Parties recognize that New
Technology may be developed during the Term. If any New Technology is
deemed by the Party that created it to be deserving of intellectual
property protection, then that Party is responsible for taking steps to
protect any interests it may have in such New Technology and may (***) such
New Technology during its pursuit of Intellectual Property Rights in the
same.
17. WARRANTY
17.1 Equipment
(a) Supplier warrants that Equipment supplied hereunder will be
Operative and free from defective material and faulty workmanship
for (***) from
-26-
the (***) stamped on the Equipment or, if the date of shipment is
not marked on the Equipment, (***) from the (***) ("Warranty
Period").
(b) The foregoing Equipment warranty shall not apply to the extent
that (i) the Nonconformity is caused by the Equipment having been
altered or repaired by any party other than Supplier without
Supplier's prior, written consent; (ii) the Nonconformity results
from Qwest's (***) of the Equipment; or (iii) the Equipment
having been damaged by (***). This foregoing Equipment warranty
does not apply to items normally consumed in operation, such as,
but not limited to, lamps and fuses.
(c) If a Nonconformity occurs, Qwest shall give Supplier a reasonable
opportunity to repair or replace such Equipment, as set forth in
Schedule H, before exercising any other rights or remedies it may
have under this Agreement. If Supplier does not repair or replace
such Equipment within the time frames set forth in Schedule H,
Qwest may demand a refund for the invoiced amount of the affected
Equipment. In any event, the Commitment shall be reduced by the
invoiced amount of such Equipment.
(d) Supplier shall provide technical support for a Product performed
by qualified and competent personnel for a period of (***) after
Acceptance of the Product as set forth in Schedule G.
17.2 Supplier warrants the Software, but not including embedded software or
firmware (which is addressed in Section 17.1), will be Operative
through the (***) after the (***) of the Software, provided that the
foregoing warranty shall not apply if Qwest has (***) for (***) which
would (***) of (***) and (***) to (***) such Releases. At Qwest's
option, Supplier shall provide software maintenance and support after
the initial Warranty Period pursuant to the terms and conditions of
the Software Maintenance Agreement, attached hereto as Schedule I.
17.3 Supplier warrants that the Software, ISUs, Enhancements, Releases and
Versions and any media used to distribute it does not contain any
computer instructions, circuitry, routines or other technological
means ("Harmful Code") whose purpose is to disrupt, damage or
interfere with Qwest's use of its computer and telecommunications
facilities for their commercial, test or research and development
purposes. Supplier shall indemnify Qwest and hold Qwest harmless from
and against any and all claims, losses, costs, liabilities, damages
and/or expenses, including reasonable attorneys fees, arising from the
presence of Harmful Code in or with the Software or contained on media
delivered by Supplier.
17.4 Supplier shall perform all Services required under this Agreement
including customization services, implementation, maintenance services
and training services in a good and workmanlike manner and shall be
responsible for the capabilities, limitations and performance of any
development tools used in providing its Services. With Qwest's prior
written consent, Supplier may perform
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its (***) hereunder through an agent.
17.5 Supplier warrants during the Warranty Period that the Products
provided hereunder shall be able to accurately process data
(including calculating, compiling and sequencing date data) from,
into and between the twentieth and twenty-first centuries, including
leap year calculations, and will create, store, process and exchange
(input and output) information related to or including dates on or
after January 1, 2000, without error or omissions ("Year 2000
Compliant").
17.6 The Warranty Period for any replacement Product provided by Supplier
under this Agreement shall be the greater of (i) the remaining
Warranty Period of the replaced Product on the date it went out of
service; or (ii) an additional Warranty Period of (***) from the
date of Acceptance of the replacement Product by Qwest.
17.7 Upon expiration of the applicable Warranty Period for Equipment
furnished hereunder, repair and replacement service for such
Equipment shall be available to Qwest from Supplier in accordance
with Schedule C and (***).
17.8 The warranty for any third party items used in the Product shall be
no less than the warranties for the rest of the Product. As of the
Effective Date, there are not currently any third party items used
in the Product that have a longer warranty period than the Warranty
Period. If any third party items used in the Product have a longer
warranty than granted herein then, to the extent permitted by the
manufacturer, Supplier shall assign warranties for third party items
which have a warranty period exceeding the Warranty Period to Qwest.
17.9 Supplier represents and warrants that as of the Effective Date of
this Agreement, the Supplier has not received written notice of any
pending lawsuits, claims, disputes or actions that it reasonably
considers significant (i) alleging that the Products infringe or
misappropriate any Intellectual Property Rights, or (ii) adversely
affecting the Products or Supplier's ability to undertake and
perform its obligations under this Agreement.
17.10 During the Warranty Period for a Product, Supplier shall provide
warranty support services performed by qualified and competent
personnel as set forth in Schedule H. Supplier shall deliver to Qwest
and keep current a list of persons and telephone numbers ("Calling
List") for Qwest to contact in order to obtain answers to questions
arising, or assistance in solving problems or Nonconformities
occurring, during Qwest's use of any of the Products. The Calling
List shall include (i) the first person to contact if a question
arises or problem occurs, and (ii) the persons in successively
more responsible or qualified positions to provide the answer or
assistance desired. If Supplier does not respond promptly to any
request by Qwest for telephone assistance, then Qwest may attempt
to contact the next more responsible or qualified person on the
Calling List until contact is made and a designated person
responds to the call.
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17.11 After Qwest reports a suspected Nonconformity, Supplier shall provide
a correction or work around or repair part to restore the Product
(including the entire System) to Operative condition as soon as
reasonably possible, but in any case in conformance with the
designated repair times in the Specifications in the applicable
Schedules to this Agreement.
17.12 Any Release made available to any of Supplier's customers within the
Warranty Period for any Product that correct Nonconformities shall be
provided to Qwest at no additional charge. Such Release shall be in
compliance with the performance and warranty requirements for any of
the Products under this Agreement.
17.13 Supplier warrants that the Products: (i) will meet all applicable
standards including ANSI , NEBS, ETSI, and ISO Standards; (ii) will
provide the functionality described in; (iii) will conform to the
current environmental specifications set forth in the Bellcore New
Equipment Building Standard; and (iv) will be Network Compatible.
17.14 THE EXPRESS WARRANTIES IN THIS AGREEMENT ARE IN LIEU OF ANY OTHER
WARRANTY, WHETHER EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT TO THE
PRODUCT TO BE SUPPLIED UNDER THIS AGREEMENT. EXCEPT AS EXPRESSLY SET
FORTH HEREIN, SUPPLIER SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTIES
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-
INFRINGEMENT OF THIRD PARTY RIGHTS AND THOSE ARISING FROM A COURSE OF
DEALING OR USAGE OF TRADE. SUPPLIER NEITHER ASSUMES NOR AUTHORIZES
ANY PERSON TO ASSUME FOR IT ANY OTHER LIABILITY. THE WARRANTIES
EXPRESSED HEREIN SHALL NOT BE ASSIGNABLE TO ANY OTHER PARTY EXCEPT
AS SUCH PRODUCTS OR OTHER RIGHTS ARE ASSIGNED OR OTHERWISE
TRANSFERRED PURSUANT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT.
18. GENERAL INDEMNITY
(***) shall indemnify and hold harmless (***) from any claim or damages due
to the personal injury or death of any individual and against any
reasonably foreseeable loss, damage, liability, cost or expense (including
attorneys' fees) which may be incurred on account of any suit, claim,
judgment, demand, or threat thereof, arising out of or caused by a willful
or grossly negligent act or omission or an intentional act of misconduct of
(***), its agents, employees or subcontractors.
19. LIMITATION OF LIABILITY
NEITHER PARTY SHALL BE LIABLE TO THE OTHER (OR ANYONE CLAIMING UNDER OR
THROUGH THE OTHER) FOR ANY SPECIAL, INDIRECT,
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CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES ARISING FROM OR RELATED TO
THIS AGREEMENT, INCLUDING LOST PROFITS OR OTHER ECONOMIC ADVANTAGE, EVEN IF
THE PARTIES HAVE KNOWLEDGE OF THE POSSIBILITY OF SUCH DAMAGES. PROVIDED,
HOWEVER, THAT IF THE LAW OF ANY JURISDICTION APPLICABLE TO THIS AGREEMENT
DOES NOT PERMIT SUCH DAMAGES TO BE COMPLETELY DISCLAIMED, THIS CLAUSE SHALL
BE INTERPRETED AS NECESSARY TO GIVE THE FULL BENEFIT OF ANY DISCLAIMER OR
LIMITATION OF SAID DAMAGES AS PERMITTED UNDER SUCH LAW. THE FOREGOING
LIMITATION SHALL NOT APPLY IN THE EVENT OF LIABILITY ARISING FROM: (I) AN
INDEMNITY UNDER SECTION 15 ("INFRINGEMENT WARRANTY AND INDEMNITY"), SECTION
17.3 ("HARMFUL CODE INDEMNITY") OR SECTION 18 ("GENERAL INDEMNITY"); (II) A
BREACH OF SUPPLIER'S CONFIDENTIALITY OBLIGATIONS IN SECTION 20
("CONFIDENTIALITY"); OR (III) THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
A PARTY, ITS AGENTS, ITS EMPLOYEES OR NOMINEES ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT.
20. CONFIDENTIALITY
20.1 This Agreement and all information marked as confidential and
disclosed by either Party (the "Disclosing Party") to the other (the
"Recipient"), or information of a confidential nature which is
disclosed orally and for which a written summary is provided to the
other Party (***) of (***) (provided that no written summary shall be
required for confidential information of a (***) which is disclosed
orally between the Parties' (***) which such personnel should
reasonably understand to be confidential) shall be "Confidential
Information". Confidential Information constitutes a valuable asset of
and is proprietary to the Party disclosing or originally possessing
it. Supplier acknowledges that Qwest keeps its customers' records
strictly confidential. Supplier and its Representatives shall keep
strictly confidential any Qwest customer records, whether or not they
are marked as confidential. Neither Party shall willfully disclose
Confidential Information or knowingly permit its Representatives to
disclose Confidential Information to any person other than persons,
including its Representatives, having a specific need to know in
performance of the work. Each Party shall take reasonable care to
insure fulfillment of this obligation, including instructing its
Representatives not to sell, lease, assign, transfer, use outside
their scope of employment or reveal any Confidential Information or
Qwest customer records without prior written consent of the other
Party. Recipient shall use the Disclosing Party's Confidential
Information only for purposes of exercising its rights or fulfilling
its obligations under this Agreement and shall disclose Confidential
Information only to those (***) and (***) who have a need to know
Confidential Information for purposes of this Agreement. Recipient
shall return or destroy the Confidential Information (including all
copies) when no longer needed or when requested to do so by the
Disclosing Party Each Recipient shall take reasonable care to insure
fulfillment of this obligation, including instructing its
Representatives not to sell, lease, assign, transfer, use outside
their scope of
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employment or reveal any Confidential Information, including customer
records, without prior written consent of the Disclosing Party.
20.2 If a subpoena or other legal process in any way concerning
Confidential Information is served upon Recipient, the Recipient shall
notify the Disclosing Party promptly, and the Recipient shall
cooperate with the Disclosing Party, at the latter's expense, in any
lawful effort to contest the validity of such subpoena or other legal
process.
20.3 Notwithstanding the foregoing, if either Party is required by law or
governmental regulation by compulsory judicial or administrative
process to make any disclosure, including those made in any
registration statement, report or other document filed with the U.S.
Securities and Exchange Commission or any other governmental agency,
such disclosure will not be deemed to violate the terms of this
Section, provided the Recipient promptly notifies the Disclosing Party
of such disclosure and (***) to (***) a (***) or to (***) to protect
the intent of the Parties to restrict disclosure of all Confidential
Information and the terms of this Agreement, including seeking
confidential treatment of all such information in administrative
filings. In addition, if the Recipient's efforts to seek confidential
treatment or other protective measures for such information are not
successful, such party may only make such disclosure after (i)
providing written notice of the same to the disclosing party and (ii)
(***) the Disclosing Party to take measures to secure the confidential
treatment of the information.
20.4 Qwest may disclose the Software to its contractors who have a need to
know for purposes of exercising rights related to this Agreement,
provided that such contractors have agreed in writing to observe in
substance the obligations of Qwest set forth in this Section.
20.5 The obligations of confidentiality in this Section shall not apply to
any information which a Party has in its possession when disclosed to
it by the Disclosing Party, information which a Party independently
develops, information which is or becomes known to the public other
than by breach of this Agreement or information rightfully received by
a Party from a third party without the obligation of confidentiality.
20.6 A Party shall not use the other Party's name or logo or refer to the
other Party directly or indirectly in any advertising, sales
presentation to any other person, news release, release to any
professional or trade publication or for any other similar purpose
without the other Party's prior written approval, provided that (i)
Supplier may use Qwest's name or logo, or both, in a list of
Supplier's customers, if such use does not imply endorsement and (ii)
Qwest may use Supplier's name or logo, or both, in a list of Qwest's
suppliers.
21. TERMINATION, SURVIVAL
21.1 Bankruptcy. Either Party may terminate the Agreement if the other
Party shall:
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(a) file a voluntary petition under any bankruptcy or insolvency law,
or file a voluntary petition under the reorganization or arrangement
provisions of any law of any jurisdiction, or have proceedings under
any such laws instituted against it which are not terminated within
(***) of such commencement; (b) become insolvent, bankrupt, or admit
in writing of its inability to pay all debts as they mature or make a
general assignment for the benefit of or enter into any composition or
arrangement with creditors; (c) authorize, apply for, or consent to
the appointment of a receiver, trustee, or liquidator of all or a
substantial part of its assets, or has proceedings seeking such
appointment commenced against it which are not terminated within (***)
of such commencement.
21.2 Intentionally Omitted.
21.3 Purchase Commitments of Acquired Entities. If, during the Term of this
Agreement, Qwest or any of its Affiliates acquire a controlling
interest in or substantially all the assets of an entity ("Acquired
Entity") that has an agreement with Supplier for products, services
and/or software with remaining purchase commitments, Qwest may satisfy
such purchase commitments under the original agreement between the
Acquired Entity and Supplier or this Agreement provided that any
amounts purchased by Qwest or its Affiliates that apply to the
satisfaction of a purchase commitment in another agreement (***) the
Commitment.
21.4 Change of Control. If, during the Term of this Agreement, a "Change of
Control" occurs with respect to either Qwest Communications
International Inc. ("QCII") or Supplier, either Party shall have the
right to terminate this Agreement or any part thereof upon (***)
written notice, and Qwest (or any successor) shall have no further
obligations under this Agreement except for (i) payment due for any
Products retained by Qwest for which Supplier has not received
payment; (ii) payment due for any Services completed by Supplier for
which Supplier has not received payment and (iii) payment of the
difference between the (***) (as such amount exists as of the date of
termination) and the amount of payments received by Supplier. A
"Change of Control", with respect to QCII or Supplier, shall occur if,
following the consummation of any transaction (including two or more
related transactions), (A) the persons who are shareholders of QCII or
Supplier, as applicable, immediately prior to such transaction own
less than (***) of the outstanding shares of common stock of QCII or
Supplier, as applicable, following the transaction, or (B) the person
who are members of the board of directors of QCII or Supplier, as
applicable, immediately prior to such transaction constitute less than
a majority of the board of directors of QCII or Supplier, as
applicable, following the transaction.
21.5 Termination for Cause. Until the satisfaction or termination of
Qwest's obligations to purchase Products or Services under Section
2.2(a), prior to any Party's termination or suspension for cause, the
Parties shall use the dispute resolution procedure set forth in
Section 25. Qwest's obligations (if any) with respect to the
Commitment shall be suspended until the completion of the dispute
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resolution procedure set forth in Section 25. After the satisfaction
or termination of Qwest's obligations to purchase Products or Services
under Section 2.2(a), either Party may terminate or suspend this
Agreement upon material breach of this Agreement by the other after
providing written notice to the other Party describing specific
obligations the other Party has materially breached. Upon the
breaching Party's receipt of the other Party's notice, the breaching
Party shall have (***) to cure the breach. If the breaching Party is
unable to cure such breach within such (***) period, the other Party
may terminate or suspend this Agreement in whole or part; provided
that any such termination shall (***).
21.6 Survival. All provisions of this Agreement which by their nature must
survive termination in order to achieve the fundamental purposes of
this Agreement shall survive any termination of this Agreement,
including the following Sections: 2 (Scope), 3 (Supplier Obligations),
9 (Payment Terms), 13 (Software), 15 (Infringement Warranty and
Indemnity), 16 (Know-How and New Technology), 17 (Warranty), 18
(General Indemnity), 19 (Limitation of Liability), 20
(Confidentiality), 21 (Termination), 31 (Severability) and 33 (Choice
of Law).
22. FORCE MAJEURE
22.1 Except to the extent of normal inclement weather, which shall be built
into any schedule, neither Party will be liable for delays in
performance or a failure to perform hereunder due to causes of acts of
God, acts of any government, wars, riots, fires, floods, accidents,
strikes, or embargoes. In the event of such delays, the schedules
shall be extended for such additional period of time as is determined
to be equitable by the Parties. With respect to labor difficulties, a
Party shall not be obligated to accede to any demands being made by
employees or other personnel.
If any performance date for any Product or Service under this
Agreement is postponed or extended pursuant to this Section for longer
than (***), Qwest may, at its option, by written notice given during
the postponement or extension, terminate Supplier right to render
further performance for such affected Products or Services after the
effective date of termination without liability for that termination.
23. JOINT WORK PRODUCT
The Parties, who have both been represented by legal counsel, have jointly
participated in negotiating and drafting this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if jointly drafted by the Parties and no presumption,
inference or burden of proof shall arise favoring or disfavoring a Party by
virtue of authorship of any or all of the Agreement provisions.
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24. ASSIGNMENT
24.1 Subject to Section 13.9 ("Transfer Of License"), except as provided
below, neither Party shall assign any of its rights nor delegate any
of its obligations under this Agreement without the prior express
written consent of the other Party. Any prohibited assignment or
delegation shall be null and void.
24.2 Qwest may assign this Agreement without prior approval to any company
or Entity controlling, controlled by or under common Control of Qwest
or its Affiliates which assignee is (***) to (***) obligations
hereunder. In addition and notwithstanding the foregoing, Qwest may
assign this Agreement without the approval of Supplier to any
successor in interest resulting from a merger, acquisition,
reorganization or transfer of all or substantially all of Qwest's
business with or to a successor.
25. DISPUTES
25.1 The Parties shall work together and attempt to resolve by good faith
and diligent negotiation any dispute, controversy or claim between
them arising out of or relating to any contract document, or the
breach, termination or invalidity thereof (a "Dispute"). The Parties
shall work together in good faith to informally resolve the dispute
internally by escalating it as necessary to progressively higher
levels of management. Following such internal process, if the dispute
has not been resolved within (***) after formal initiation of the
dispute process, either Party may initiate arbitration as provided for
below.
25.2 Following the procedure discussed in Section 25.1 above, either Party
may initiate binding arbitration proceedings to resolve any Dispute.
Such arbitration shall be conducted in accordance with the
then-current Commercial Arbitration Rules of the American Arbitration
Association ("AAA Rules") by (***). Within (***) of a notice of
arbitration, each Party shall appoint (***). Once the (***) arbitrator
has (***) appointment, the arbitrators shall be deemed a panel
(hereinafter, the "Impanelment").
25.3 The Federal Arbitration Act, 9 U.S.C. Secs. 1-16 shall govern the
arbitrability of all Disputes. The arbitration proceedings shall be
English and the place of arbitration shall be Denver, Colorado. The
construction and interpretation of this Agreement shall be governed by
the laws of the State of Colorado without reference to its conflicts
of law rules, or rules of statutory arbitration. Arbitral awards under
this Section 25 shall be final and binding, and shall be enforceable
in any court having jurisdiction. The arbitration shall (***) of the
date (***).
25.4 (a) Nothing in this Section will prevent any Party from applying to
any court of competent jurisdiction for preliminary or interim relief
in a judicial proceeding if such relief from a court is necessary to
preserve the status quo pending resolution or to prevent serious and
irreparable injury to that Party pending resolution of the Dispute
through arbitration, or to compel arbitration in
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accordance with this Section.
(b) For purposes of this Section each Party consents to the exclusive
jurisdiction and venue of the courts of the state and federal courts
of Denver County in the State of Colorado.
(c) The prevailing Party in an arbitration or litigation shall be
entitled to recover from the other Party reasonable attorneys' fees
and other costs of such arbitration.
(d) The Parties agree to keep all disputes arising under this
Agreement confidential, except as necessary in connection with a
judicial challenge to or enforcement of an award or unless otherwise
required by law or judicial decision. The arbitrator may issue orders
to protect the confidentiality of proprietary information, trade
secrets or other sensitive information. In the event of a conflict
between this Section and Section 20.3, this Section shall control.
26. RELATIONSHIP OF THE PARTIES
26.1 The Parties are independent contractors. Nothing in this Agreement or
in the activities contemplated by the Parties pursuant to this
Agreement shall be deemed to create an agency, partnership, employment
or joint venture relationship between the Parties. Each Party shall be
deemed to be acting solely on its own behalf and, except as expressly
stated, has no authority to pledge the credit of, or incur obligations
or perform any acts or make any statements on behalf of, the other
Party. Neither Party shall represent to any person or permit any
person to act upon the belief that it has any such authority from the
other Party. Neither Party's Representatives shall be deemed
Representatives of the other Party for any purpose.
26.2 Supplier represents and warrants that Supplier qualifies as an
independent contractor under the provisions of the Internal Revenue
Code's common law rules enacted as part of Section 1706 of the 1986
Tax Reform Act, and as such Supplier is filing all required forms and
necessary payments appropriate to Supplier's tax status. In the event
Supplier's independent status is denied or changed and Supplier is
declared to have "common law" status with respect to work performed
for Qwest, Supplier agrees to indemnify, defend and hold Qwest and its
Affiliates harmless from all costs, including legal fees, which Qwest
may incur as a result of such change in status.
27. AMENDMENT
No changes, amendments or modifications of any of the terms or conditions
of this Agreement shall be valid unless made by an instrument in writing
signed by both Parties. Subject to Xxxxxxx 00, xxxx of the terms or
conditions of this Agreement shall be modified, amended or altered by or
through a Purchase Order. Each Party shall designate by written notice to
the other Party the individual who has the authority to amend this
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Agreement.
28. COMPLIANCE WITH LAWS
The Parties shall comply with all applicable federal, state and local laws,
regulations and ordinances as they relate to this Agreement and the
Software, including the regulations of the United States Government, the
provisions of Executive Order 11246 (as amended) of the President of the
United States on Equal Employment Opportunity and the rules and regulations
issued pursuant thereto, which are incorporated in this Agreement by this
reference as if set forth in full. Supplier and the Products shall comply
with all rulings, orders and determinations by the Federal Communications
Commission and any other governmental body relating to the provision of the
Products or Services under the (***).
29. CONSTRUCTION/HEADINGS/REPRESENTATION BY COUNSEL
All Schedules and attachments, as supplemented and amended, to this
Agreement or to be attached to this Agreement are made a part of it as if
fully included in the text of this Agreement. References to any law,
legislative act, rule or regulation shall mean references to such law,
legislative act, rule or regulation in changed or supplemented form or to a
newly adopted law, legislative act, rule or regulation replacing a previous
law, legislative act, rule or regulation. All defined terms used in the
Agreement shall have the same meanings ascribed to them when used in the
Schedules, attachments and Purchase Orders, unless otherwise specified
therein. The terms "including" or "includes" shall always be construed as
meaning respectively "including, without limitation," or "includes, without
limitation,". The title, captions and headings used in this Agreement are
strictly for convenience of reference only and shall not be used in the
interpretation, construction, amplification or limitation of any of the
content of this Agreement. Whenever the singular is used herein, the same
shall include the plural where appropriate, and when the plural is used
herein, the same shall include the singular where appropriate. Each Party
represents that it has received independent legal advice from attorneys of
its own choice with respect to this Agreement and the advisability of
entering into this Agreement. Each Party represents that it has carefully
read and reviewed this Agreement and the contents are understood by such
Party. The Parties acknowledge that they have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be
construed as of drafted jointly by the Parties and no presumption or burden
of proof shall arise favoring or disfavoring any Party by virtue of any
authorship of any provisions of this Agreement. Each Party waives any claim
that this Agreement or any term thereof was the result of a mistake in law
or in fact.
30. NO WAIVER
30.1 No delay, failure or waiver of either Party's exercise or partial
exercise of any right or remedy under this Agreement shall operate to
limit, impair, preclude, cancel, waive or otherwise affect such right or
remedy.
30.2 Except with respect to the Existing Products, the Parties release and
waive any and
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all claims either Party had, has or may have against the other Party
concerning or arising under the Existing Agreement or the events
leading up to the execution of this Agreement, provided that the
waiver by Qwest herein shall be null and void and of no force or
effect if Supplier commences or has commenced against it a case or
proceeding under Title 11 of the United States Code (the "Bankruptcy
Code") within (***) period immediately following the Effective Date.
31. SEVERABILITY
If any provision of this Agreement is held invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining
provisions shall in no way be affected or impaired thereby.
32. COUNTERPARTS
This Agreement may be executed by the Parties in one or more counterparts,
and each of which when so executed shall be an original, but all such
counterparts shall constitute one and the same instrument.
33. CHOICE OF LAW
This Agreement is entered into in and shall be governed by the internal
laws and of the (***) without regard to the principles of choice of law
thereof. The Products shall be deemed to be goods within the meaning of the
Uniform Commercial Code. Each Party agrees to waive its right to a jury
trial in any action commenced hereunder.
34. REMEDIES
The remedies under this Agreement shall be cumulative and not exclusive,
and the election of one remedy shall not preclude pursuit of other remedies
generally available under the governing law.
35. IMMIGRATION REFORM AND CONTROL ACT
Supplier warrants, represents, covenants and agrees that it will not assign
to perform any efforts under this Agreement any individual who is an
unauthorized alien under the Immigration Reform and Control Act of 1986 or
its implementing regulations. Supplier shall indemnify and hold harmless
Qwest, its parent, subsidiaries and affiliated companies from and against
any and all liabilities, damages, losses, claims or expenses (including
attorneys' fees) arising out of any breach by Supplier of this section. In
the event any Supplier Personnel or contractor working under this
Agreement, or other individuals providing work to Qwest on behalf of
Supplier under this Agreement, are discovered to be unauthorized aliens,
Supplier will immediately remove such individuals from performing work and
replace such individuals with individuals who are not unauthorized aliens.
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36. IMPORT/EXPORT
The Parties hereby represent and warrant that no commodities or technical
data (including computer software) or other technology agreed to be sold or
otherwise transferred under this Agreement will be knowingly sold, leased,
delivered, transferred or conveyed to any person in any country except in
strict compliance with all export and import laws, regulations, executive
orders or decrees of the United States Government or any agencies thereof
and the government of any other country (or any agencies thereof) with
jurisdiction over such transaction. Qwest shall, solely at its own expense,
obtain all required export and import licenses, permits, approval,
certificates and verifications before shipment of any Products.
37. PUBLICITY
Neither Party shall, without the prior written approval of the other Party,
publicly disclose in any press release, filing (including any SEC filing),
brochure or document any information pertaining to this Agreement, provided
that in the event of a conflict between this Section and (***) shall
control.
38. NOTICES
38.1 In addition to those instances identified throughout this Agreement
that require notices to particular individuals via particular means
for particular purposes, all notices, requests, demands, or consents
required or permitted hereunder, other than routine operational
communication, shall be in writing and shall be delivered, sent by
facsimile transmission or overnight courier, or sent by certified or
registered mail to the respective Party at the addresses set forth
below or at such other address as shall have been given to the other
Party in writing for the purposes of this Section and Agreement. Such
notices and other communications shall be deemed effective upon the
earliest to occur of (i) actual delivery of confirmed facsimile or
electronic transmission; (ii) three (3) postal delivery days after the
date of mailing by certified or registered mail, return receipt
requested, postage prepaid; (iii) one (1) business day after dispatch
via an express courier with a reliable system for tracking delivery;
(iv) actual delivery by hand.
(a) If to Supplier:
Tellium, Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: (***), Vice President (***)
(b) If to Qwest:
Qwest Communications Corporation
000 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
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Attention: Vice President, Procurement
With a copy to:
Qwest Communications Corporation
0000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
38.2 A Party may from time to time change its address for notification
purposes by giving the other Party prior written notice of the new
address and the date upon which it will become effective, in
accordance with the manner set forth in this Section.
39. INSURANCE REQUIREMENTS
39.1 During the Term, Supplier and any of its subcontractors shall maintain
insurance of the kinds and in the amounts specified below with
insurers of recognized responsibility, whose policies are valid in the
states where the work is being performed.
39.2 In accordance with the above, Supplier and any subcontractors shall
maintain the following insurance coverages:
(a) Comprehensive general liability insurance.
Commercial general liability insurance with a combined single
limit for bodily injury and property damage of (***) each
occurrence and General and Products Liability aggregates of (***)
each, covering all operations and/or work performed under this
Agreement.
(b) Business automobile liability insurance.
Business automobile liability with a combined single limit for
bodily injury and property damage of (***) each occurrence to
include coverage for all owned, non-owned, and hired vehicles.
(c) Worker's compensation and employers' liability insurance.
Worker's compensation insurance complying with the law of the
State or States of operation, whether or not such coverage is
required by law, and employer's liability insurance with limits
of (***) each employee and (***) disease policy limit.
39.3 Certificates of such insurance shall be submitted to Qwest naming
Qwest as an additional insured prior to the start of any work
associated with this Agreement. These certificates shall provide that
there will be no termination or non-renewal of
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such coverage without thirty (30) days prior written notice to
Qwest, in which case Supplier shall still maintain insurance
and which may require certificate, and in no case where this
Agreement is still in effect.
39.4 Supplier shall require each subcontractor to provide and
maintain at all times during the term of this Agreement
insurance equivalent to that which is required of Supplier.
Any subcontractor and any subcontractors' carriers shall waive
all right to recovery against Qwest for any injuries to
persons or damage to property in the execution of work
performed under this Agreement, exclusive of such liability
resulting from Qwest's negligence or intentional misconduct
and within the limits of any applicable laws.
39.5 Should Supplier at any time neglect or refuse to provide the
insurance required, or should such insurance be canceled or
non-renewed, Qwest shall have the right to purchase such
insurance, and the cost shall be billed to Supplier. In
addition, should Supplier at any time neglect or refuse to pay
the necessary premium, Qwest shall have the right to deduct
this amount from monies due Supplier.
40. ORDER OF PRECEDENCE
In the event of an inconsistency between the terms and conditions of
the Agreement and the Schedules attached hereto, the Agreement shall
control. Unless expressly stated otherwise therein, in the event of an
inconsistency between the terms and conditions of this Agreement
(including its Schedules) and a Purchase Order, this Agreement shall
control.
41. ENTIRE AGREEMENT
41.1 This Agreement embodies the final, full and exclusive statement
of the business relationship between Qwest and Supplier except
for the (a) Warrants certificates as follows: "A" Warrants to
purchase 1,000,000 shares of Tellium Common Stock, dated as of
September 18, 2000; "B" Warrants to purchase 1,000,000 shares of
Tellium Common Stock, dated as of September 18, 2000; and "C"
Warrants to purchase 750,000 shares of Tellium Common Stock,
dated as of April 10, 2001; (b) Warrant Purchase Agreement, dated
as of September 18, 2000; (c) Supplemental Stockholders'
Agreement, dated as of September 18, 2000; (d) Supplemental
Stockholders' Agreement, dated as of April 10, 2001; and (e)
Agreement of Termination and Cancellation of "B" Warrants and "C"
Warrants dated as of December 14, 2001. Neither Party shall be
bound by or liable to the other Party for any representation,
promise or inducement made by any agent or person in their employ
relating to subject matter which is not set forth in this
Agreement. This Agreement amends, restates and replaces, in its
entirety, the Existing Agreement.
41.2 Subject to Section 40, the preprinted terms and conditions on
all forms and other purported agreements exchanged between the
Parties software shrink wrap
-40-
licenses and invoices, shall be null and void unless otherwise agreed
to both Parties in a signed agreement.
Signature Page Follows
-41-
Signature Page
IN WITNESS WHEREOF, the Parties hereto have caused this Amended and Restated
Procurement Agreement to be duly executed as of the Effective Date, such Parties
acting by their officers, being thereunto duly authorized.
Tellium, Inc. Qwest Communications Corporation
By: /s/ By: /s/
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Title: Title:
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Date: Date:
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-42-
