1
EXHIBIT 10.25
SYSTEM EQUIPMENT PURCHASE AGREEMENT
This System Equipment Purchase Agreement is made and is
effective as of September 20, 1999 (the "Effective Date"), by and between
Cricket Wireless Communications, Inc. a Delaware corporation (the "Owner"),
and Lucent Technologies Inc., a Delaware corporation (the "Vendor").
RECITALS:
A. WHEREAS, the Owner desires to purchase PCS systems pursuant
to this Contract; and
B. WHEREAS, the Vendor desires to provide such PCS systems to
the Owner, as described in Exhibit A, including, but not limited to, the
Vendor's obligation to manufacture, engineer, equip, integrate, install, test
and provide technical assistance for said PCS systems in accordance with the
terms and conditions set forth herein; and
C. WHEREAS, the mutual goal of the parties hereto is to build
PCS systems that are capable of integrating new technologies while reducing
costs over time in a highly competitive marketplace;
NOW, THEREFORE, in consideration of the mutual promises and
covenants set forth in this Contract, the Owner and the Vendor hereby agree as
follows:
SECTION 1. DEFINITIONS
1.1 Definitions. In addition to the terms listed below, certain
additional terms are defined elsewhere in this System Equipment Purchase
Agreement and in the Exhibits, and all definitions are subject to the provisions
of subsection 1.2 hereof. As used in this Contract, the following terms have the
following meanings:
"Annual Release Maintenance Fee" means, with respect to each
System, those recurring annual fees of the Vendor, calculated in accordance with
Exhibit B-5 and invoiced annually on the anniversary of the earlier to occur of
(i) Substantial Completion or (ii) the date such System is placed in In Revenue
Service, full payment of which entitles Owner to receive all Initial Software
Features, together with all other base generic software features in standard
software releases, Software Maintenance Releases, Software Enhancements,
Software Maintenance Releases and Software Upgrades applicable to CDMA PCS
Products which will be made available to Owner when made generally available by
Vendor during the period for which the fees were paid.
"Applicable Laws" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, all U.S. or foreign laws, treaties, ordinances, judgments, decrees,
injunctions, writs, orders and
2
stipulations of any court, arbitrator or governmental agency or authority and
statutes, rules, regulations, orders and interpretations thereof of any federal,
state, provincial, county, municipal, regional, environmental or other
Governmental Entity, instrumentality, agency, authority, court or other body (i)
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject or (ii) having jurisdiction over
all or any part of a System or the Work to be performed pursuant to the terms of
this Contract.
"Applicable Permits" means any waiver, exemption, zoning,
building, variance, franchise, permit, authorization, approval, license or
similar order of or from any country, federal, state, provincial, county,
municipal, regional, environmental or other Governmental Entity,
instrumentality, agency, authority, court or other body having jurisdiction over
all or any part of a System or the Work to be performed pursuant to the terms of
this Contract.
"B Exhibits" is defined in subsection 2.4.
"Backwards Compatible" or "Backwards Compatibility" means (i)
with respect to new Software Maintenance Releases, Software Upgrades, Software
Combined Releases and Software Enhancements, the ability of each of the two
prior older versions of Software to remain fully functional in accordance with
and up to the performance levels to which each was performing immediately prior
to the integration with the new Software Maintenance Release, Software Upgrade,
Software Combined Releases and/or Software Enhancement, and the ability of such
new Software Maintenance Release, Software Upgrade, Software Combined Release
and/or Software Enhancement to interoperate and be compatible with all such
functionality of such prior Software versions and with all existing in-service
Vendor provided Products already installed in the System; (ii) with respect to
all Equipment Upgrades, and Equipment Combined Releases to the extent of that
portion of the Equipment Combined Release which is the Equipment Upgrade or the
use of which by Owner is not optional without losing the benefit of the
Equipment Upgrade (for purposes of this Contract, a "New Equipment Release"
means collectively the Equipment Upgrade and such non-optional portion of the
Equipment Combined Release), the ability of the existing infrastructure to
remain fully functional in accordance with and up to the performance levels to
which it was performing immediately prior to the integration with the New
Equipment Release, and the ability of the New Equipment Release to interoperate
and be fully compatible with all such functionality of such existing
infrastructure and (iii) with respect to each of Software Maintenance Releases,
Software Upgrades, Software Combined Releases, Software Enhancements and New
Equipment Releases, the ability of such Products to comply with the existing
interfaces to other third party equipment already deployed in the System and
with respect to which Vendor is already in compliance prior to the introduction
of the Software Maintenance Releases, Software Upgrades, Software Combined
Releases, Software Enhancements and New Equipment Releases.
2
3
"Base Station ("BTS")" means the radio Products that handle the
Owner's PCS radio traffic in a designated cell. The Base Station includes all
amplification, modulation, synchronization and other circuitry required to
process a radio signal.
"Base Station Controller ("BSC")" means the radio Products that
control the Owner's PCS radio traffic.
"beta testing" means pre-launch testing conducted by Owner in
respect of which no payment from customers is made to the Owner for the services
provided in connection therewith.
"Business Day" means any day of the year other than a Saturday,
Sunday or a United States Federal holiday.
"Capacity Guarantee" is defined in Section 16.3.
"Certificate of Final Acceptance" is defined in subsection
10.1(f).
"Certificate of Substantial Completion" is defined in subsection
10.1(d).
"Change Orders" is defined in subsection 11.1.
"Chattanooga Replacement" is defined in subsection 2.2.
"Claim" is defined in subsection 15.2.
"Claim Notice" is defined in subsection 15.2.
"Contract" means this System Equipment Purchase Agreement,
together with all Exhibits, Schedules and Specifications hereto, together with
all amendments, modifications and supplements.
"Contract Term" means the period commencing on the Effective
Date and ending five (5) years therefrom, unless terminated earlier in
accordance with the terms and conditions hereof, or unless extended by the
mutual written consent of the parties hereto.
"Core System" means that collection or aggregation of Products
which are designed by Vendor to operate as a functional entity in accordance
with the applicable Specifications or otherwise represented by Vendor in its
published information as being capable of operating as a functional entity. By
way of example and not limitation, a circuit pack or connecting cable which is
an OEM item, and which forms part of the 5 ESS switch would form part of a Core
System, whereas a call center system or voice mail system, though it interfaces
with the System, would not be part of a Core System, since various call center
systems or voice mail systems manufactured by several alternate manufacturers
could be utilized by Owner, and operated functionally independent of the
selection of Vendor's Equipment for the MSC.
3
4
"Covered PoP" means, with respect to a System, the population
contained within the footprint of the System at the time of Substantial
Completion. Such population shall be determined based upon the most recent
census data available at the time of Substantial Completion and shall remain
constant thereafter. For purposes of calculating the Annual Release Maintenance
Fee for a System, "Covered Pop" shall mean the greater of (i) the population
located within the footprint of the System, or (ii) fifty percent (50%) of the
population in the applicable basic trading area. The population located within
the footprint of the System and the population in the applicable basic trading
area shall be determined based upon the most recent census data available at the
time of Substantial Completion and shall remain constant thereafter.
"Customer Price Guide" means the Vendor's published price
notification release or releases furnished for the purpose of communicating to
customers the Vendor's list pricing or pricing related items applicable to
Products.
"Defects and Deficiencies", "Defects or Deficiencies" or
"Defective" means any one or a combination of the following items or other items
of a substantially similar nature:
(a) when used with respect to the performance of Services, that
such Services are not provided in a careful and workmanlike manner and
in accordance with the Specifications, using material which is free from
defects;
(b) when used with respect to structures, materials or Products,
that such items (i) are not new and of good quality and free from
defects in materials and workmanship, or (ii) do not conform to the
Specifications, or (iii) with respect to Software, that such Software
does not process dates correctly; or
(c) with respect to all other Work, that the same (i) are not
free of defects in workmanship and materials, or (ii) do not conform to
the Specifications.
"Discontinued Products" is defined in subsection 12.1.
"Documentation" means the Operating Manuals, the Maintenance and
Instruction Manuals, the Training Manuals, the "as-built" Site parameters and
all other documentation necessary for the operation of the System, the
Chattanooga Replacement, any Expansions and/or any material part thereof.
"Dollars" or "U.S. $" or "$" means the lawful currency of the
United States of America.
"Equipment" means all equipment, hardware and other items of
personal property (including, without limitation, any Documentation furnished
hereunder in respect thereof) which are required to be furnished by the Vendor
in accordance with the terms and conditions of this Contract, including repair
and replacement parts.
4
5
"Equipment Combined Release" is defined in subsection 14.2.1.
"Equipment Enhancements" means modifications or improvements
made to the Equipment which improve the performance or capacity of such
Equipment (sometimes referred to by the Vendor as its "Class B" changes).
"Equipment Upgrade" means a change or modification in any
delivered Equipment which fixes or otherwise corrects faults, design
shortcomings or shortcomings in meeting the Specifications, required to correct
defects of a type that result in inoperative conditions, unsatisfactory
operating conditions, or which is recommended to enhance safety (sometimes
referred to by the Vendor as its "Class A" changes).
"Expansions" means any additional Products ordered by the Owner
from the Vendor, which may include growth to existing Systems and additional
Products, Services and Systems.
"FCC" means the Federal Communications Commission.
"Final Acceptance" means, with respect to any System, date the
Owner signs the Certificate of Final Acceptance.
"Fit" means physical size or mounting arrangement (for example,
electrical or mechanical connections).
"Force Majeure" is defined in Section 17.
"Form" means physical shape.
"Function" means Product features and performance, or with
respect to other items, the features and performance of such items.
"Funds" is defined in subsection 2.10.
"Governmental Entity" means the United States federal government
or any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guaranteed Substantial Completion Date" means, with respect to
a System, the date by which Substantial Completion must be achieved by the
Vendor. The Guaranteed Substantial Completion Date is determined based on the
Site that is identified by the Owner in writing to be the last Site to be
included in the definition of such System (the "Last Site"). If the Owner has
issued a Purchase Order to the Vendor to proceed with Site Preparation with
respect to the Last Site, the Guaranteed Substantial Completion Date shall be
the date which is sixty (60) calendar days after the later of the date of such
Purchase Order or the date that written notice identifying the Last Site was
issued.
5
6
If the Owner has performed the Site Preparation activities with respect
to the Last Site, the Guaranteed Substantial Completion Date shall be the date
which is thirty (30) calendar days after the date the Owner issues a Site
Preparation Substantial Completion Certificate with respect to the Last Site to
the Vendor; provided that in all of the foregoing circumstances, the Guaranteed
Substantial Completion Date shall be delayed to a date mutually acceptable to
Vendor and Owner, acting reasonably, in the event that:
i. Owner has not satisfied its obligations, if any, for Site
Preparation for the installation of the switch by at least
twelve (12) weeks prior to the Substantial Completion Date (in
this case the parties agree that the period of delay shall be
equal to the number of days that the Owner's Site Preparation
obligations, if any, are delayed beyond such date which is
twelve (12) weeks prior to the Substantial Completion Date); or
ii. extreme weather and other unusual environmental conditions
beyond Vendor's reasonable control delays Vendor's completion of
Substantial Completion activities (in this case the parties
agree that the period of delay shall be equal to the period of
time associated with the duration of such extreme or unusual
condition(s)); or
iii. Vendor is not provided with all necessary and reasonable access
to the System and each Site; or
iv. at the time Owner identifies the Last Site, more than 10% of the
total number of Sites for the System are also identified
contemporaneously therewith.
Owner shall also involve Vendor through all stages of the Site Acquisition
process. In all cases, Owner shall be responsible for the provisioning of
backhaul facilities required at all Sites. Such provisioning must be completed
prior to the start of equipment integration by the Vendor at each site.
"Hazardous Materials" means material designated as a "hazardous
chemical substance or mixture" by the Administrator, pursuant to Section 6 of
the Toxic Substance Control Act, a "hazardous material" as defined in the
Hazardous Materials Transportation Act (49 U.S.C. 1801, et seq.), or a
"hazardous substance as defined in the Occupational Safety and Health Act
Communication Standard (29 CFR 1910.1200).
"In Revenue Service" or "In Revenue" means, with respect to a
System, the commercial operation of such System, exclusive of operation for
purposes of determining compliance with this Contract or beta testing, whether
or not revenue is actually being generated.
"Initial Period" is defined in Section 10.1(f).
6
7
"Initial Software Features" means those software features
contained in Vendor's standard base generic software releases together with
those additional optional software features listed in Exhibit C.
"Installation and Integration" is defined in Exhibit F.
"Intellectual Property Rights" is defined in subsection 15.2.
"Interoperability" means the ability of the Products to operate
with other Products and to operate with and within a System, all in accordance
with the Specifications.
"Liquidated Damages" is defined in subsection 16.1.
"List Price" means Vendor's published "network wireless systems
price reference guide" or other price notification releases furnished by Vendor
for the purpose of communicating Vendor's prices or pricing related information
to Vendor's customers; however this does not include firm price quotation.
"Losses" means any claims, demands, suits, proceedings, causes
of action, damages, costs, expenses, liabilities, reasonable attorneys' fees,
and amounts paid in settlement.
"Major Outage" means the cessation of operation of a System or
System Element caused by a Defect or Deficiency attributable solely to Vendor
which has a material adverse impact on Owner's ability to operate or maintain
such System, render xxxxxxxx to Owner's subscribers, or which causes a material
interruption in Owner's ability to continue to furnish or offer service
functionalities and features to such subscribers. In addition, the following
capacity and/or coverage impairment conditions shall be considered a "Major
Outage":
(i) Any impairment caused by a Defect or Deficiency
attributable solely to Vendor that has the effect of reducing by
greater than [*] the number of traffic channel resources
available in the System for access by Owner's subscribers;
and/or
(ii) Any impairment caused by a Defect or Deficiency
attributable solely to Vendor that has the effect of rendering
greater than [*] of the equipped antenna sectors in the System
unable to process origination, termination or hand-off requests;
or that reduces the forward channel power of more than [*] of
the equipped sectors in the System by greater than [*]; and/or
(iii) The persistent occurrences of an impairment
referenced in paragraphs (i) or (ii) above which, although each
occurrence falls below the [*] threshold, each occurrence
exceeds a threshold of greater than [*]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
7
8
of the applicable metric set forth above, and the total number
of such occurrences is greater than [*] events during the
Initial Period;
provided, however, that the foregoing definition shall only be applicable for
purposes of this Contract for the issuance of a Certificate of Final Acceptance
at the end of the Initial Period.
"Maintenance and Instruction Manuals" means the manuals listed
in Exhibit P and prepared by the Vendor and delivered to the Owner pursuant to
Section 9.
"Manufacturing" means the fabrication of the Equipment.
"Material Adverse Effect" is defined in subsection 24.2(b).
"Milestones" means the performance milestones set forth in the
Exhibits.
"Minimum Purchase Commitment" is defined in subsection 5.1(a).
"MSC" means a mobile switching center and usually consists of a
Lucent 5 ESS-2000(R) AnyMedia switch, an operations and management platform and
the Executive Cellular Processor Complex which includes call processing, system
intelligence handling and feature control functionality.
"Network Planning" means Work related to the design and
engineering of a System, including frequency clearance.
"Operating Affiliates" means a subsidiary or affiliate of Owner
which is authorized to operate a PCS System and which places Purchase Orders
pursuant to this Contract.
"Operating Manuals" means the operating and configuration
manuals listed in Exhibit P to be prepared by the Vendor and delivered to the
Owner pursuant to Section 9 containing detailed procedures and specifications
for the operation of any System, the Chattanooga Replacement, any Expansions
and/or any part thereof including, but not limited to, BTS manuals and BSC
manuals.
"Operator" shall mean the Owner, a Related Operator, an
Operating Affiliate or any independent contractor appointed by the Owner, which
operates a System.
"Optimization Services" means the RF optimization services
described on Exhibit G.
"Optional Software Features" means Software features for PCS
Products available to Owner on a optional, separate fee basis.
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
8
9
"PCS" means personal communication services authorized by the
Federal Communications Commission.
"Person" means an individual, partnership, limited partnership,
corporation, limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Entity or other
entity of whatever nature.
"Products" means the collective reference to the Equipment and
the Software provided by the Vendor or any Subcontractor.
"Proprietary Information" is defined in subsection 26.18.
"Punch List" means that list prepared in conjunction with any
certificate which contains one or more immaterial non-service-affecting items
which have not been fully completed as of the date of the accompanying
certificate; provided that such incomplete portion of the Work shall not, during
its completion, materially impair the normal daily operation of a System in
accordance with the Specifications.
"Purchase Order" means a written notice given by the Owner to
the Vendor in compliance with the provisions of this Contract specifying the
Products, Services or other items of Work that the Vendor is authorized to
supply or commence in compliance with the terms of this Contract.
"Purchase Order Date" means the date on which any Purchase Order
is issued by the Owner in accordance with the terms of this Contract.
"Related Operator" means an entity (other than Owner) which
holds a license issued by the FCC permitting the holder to provide wireless PCS
services, which has entered into a contract with Owner to provide management
responsibilities with respect to the operation of such a service, which may
include agreements pursuant to which Owner resells to or shares with such entity
capacity on the Owner's System as, for example, when the Related Operator's cell
site equipment is interconnected with the Owner's MSC.
"RF" means radio frequency.
"RTM License" is defined in subsection 13.6.
"RTU License" is defined in subsection 13.1.
"Services" means the collective reference to all of the services
to be furnished by the Vendor as part of the Work including, but not limited to
all design, engineering, network planning, construction, interoperability,
supply, delivery, installation, testing, training, repair, maintenance,
technical and other support services, and any and all other services to be
furnished by the Vendor as part of the Work in accordance with the terms of this
Contract.
9
10
"Site" means the physical location of a System Element Facility.
"Site Acceptance Certificate" means a document submitted by the
Vendor to the Owner and signed by an authorized representative of the Owner and
an authorized officer of the Vendor stating that, in accordance with the
requirements of this Contract, the Vendor has successfully completed all Site
Acceptance Tests with respect to the Sites specified therein.
"Site Acceptance Tests" means the collective reference to the
performance and reliability demonstrations specified in the Exhibits to
determine whether a site meets the Specifications and other requirements of this
Contract.
"Site Acquisition" means the activities to be performed by the
Owner and/or its subcontractors in connection with identifying and acquiring
sufficient rights to Sites.
"Site Acquisition Substantial Completion" means, with respect to
any System, the point at which the Owner shall have (i) acquired, by purchase,
lease or otherwise, rights to a sufficient number of Sites in the judgment of
the Owner, and (ii) that, with respect to all Sites within such System, all land
use and/or lease requirements necessary to be satisfied prior to the start of
construction activities in accordance with Applicable Laws have been satisfied.
"Site Acquisition Substantial Completion Date" means with
respect to any System, the date on which the Owner shall have achieved Site
Acquisition Substantial Completion.
"Site Preparation" means the demolition, construction and
renovation work (for example, roads, grading, fencing and structural
improvements, including, but not limited to, any buildings, towers and
commercial power) and the preparation of co-location sites necessary for the
installation of Equipment or the operation of the System, Chattanooga
Replacement, Expansions and/or any part thereof.
"Site Preparation Substantial Completion" means the completion
of all Site Preparation with respect to a Site except for Punch List items.
"Site Preparation Substantial Completion Certificate" is defined
in Section 10.1(b).
"Software" means (a) the computer software licensed to the Owner
pursuant to the terms of this Contract, (b) any Software Enhancements, Software
Maintenance Releases, Software Combined Releases and Software Upgrades, and (c)
any Documentation furnished hereunder in respect of clauses (a) and/or (b) of
this definition.
"Software Combined Release" means a Software Upgrade which is at
any time combined with any Software Enhancement.
10
11
"Software Enhancements" means modifications or improvements made
to the Software relating to Products which improve performance, capabilities or
capacity of the Software revision level with which it is associated or which
provide additional functions to the Software. A Software Enhancement may also
correct defects in earlier versions of the Software.
"Software Maintenance Release" means issues of Software which
correct defects in preceding versions of Software.
"Software Upgrades" means periodic updates to the Software
issued by the Vendor to the Owner under Warranty and Software maintenance
obligations which add to, improve or enhance existing Software features and
capabilities involving more extensive changes to the underlying Source Code or
the user interface than is the case with Software Enhancements. A Software
Upgrade may also correct defects in the Software, or otherwise to correct
shortcomings in the Software.
"Source Code" means any version of Software incorporating high
level or assembly language that generally is not directly executable by a
processor.
"Spares" is defined in Exhibit K.
"Specifications" means the collective reference to the
specifications and performance standards (including all of the Services and
Products) as set forth in this Contract, including but not limited to Exhibit I,
Exhibit J, Exhibit M; provided that (i) the Specifications shall be deemed to
include a requirement that all of the Products and Services shall be in
accordance with ANSI standards except when otherwise stated in a specific
Exhibit or otherwise agreed by the parties, and (ii) with respect to Services
and Products for which specifications and performance standards are not provided
and listed in a specific Exhibit, the term "Specifications" shall refer to
Vendor's published specifications in respect thereof.
"Subcontractor" means a contractor, vendor, supplier, licensor
or other Person, having a direct or indirect contract with the Vendor or with
any other Subcontractor of the Vendor who has been hired to assist the Vendor in
the performance of its obligations under this Contract.
"Substantial Completion" means the time at which the Owner signs
the Certificate of Substantial Completion.
"System" means the Sites and Equipment identified by the Owner
to the Vendor in writing as collectively comprising a System.
"System Element" means the Products required to perform radio,
switching and/or system element functions for a System, any Expansions and/or
the Chattanooga Replacement.
11
12
"System Element Facility" means the structures, improvements,
foundations, towers, and other facilities necessary to house or hold any System
Element and any related Products to be located at a particular location.
"Taxes" is defined in subsection 5.2.
"Training" is defined in subsection 9.4.
"Vendor Developments" is defined in subsection 14.3.1.
"Vendor Financing" means a loan to be provided by the Vendor to
the Owner pursuant to documentation acceptable to both parties.
"Warranty" means any one or more of the Equipment and Services
Warranty, Expansions Warranty, Software Warranty, Software Backwards
Compatibility Warranty, Equipment Backwards Compatibility Warranty, Compliance
Warranty and the Year 2000 Warranty.
"Warranty Period" is defined in Section 18.1.
"Work" means the furnishing of Products hereunder, and the
performance of work, engineering services, installation services and all other
related activities and obligations required to be performed by the Vendor
pursuant to this Contract.
1.2 Other Definitional Provisions. (a) When used in this
Contract, unless otherwise specified therein, all terms defined in this Contract
shall have the defined meanings set forth herein. Terms defined in the Exhibits
are deemed to be terms defined herein; provided that in the case of any terms
that are defined both in this Contract and/or an Exhibit, the definitions
contained in this Contract shall supersede such other definitions for all
purposes of this Contract; provided further, that definitions contained in any
Exhibit shall control as to such Exhibit.
(b) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Contract refer to this Contract as a whole and
not to any particular provision of this Contract and section, subsection,
schedule and exhibit references are to this Contract unless otherwise specified.
Reference herein to Section shall mean any and all subsections thereof.
(c) The meanings given to terms defined in this Contract are
applicable to both the singular and plural forms of such terms.
SECTION 2. SCOPE OF WORK, RESPONSIBILITIES AND PROJECT
MILESTONES
12
13
2.1 Scope of Work. During the Contract Term and in accordance
with Purchase Orders issued to Vendor from time to time, the Vendor shall
engineer, design, plan, manufacture, construct, install, test and perform all
Work. The terms of this Contract shall also apply to Purchase Orders issued by
Operating Affiliates and by Owner, for and on behalf of its Related Operators,
provided that in each case, the Purchase Orders are made pursuant to and
incorporate by reference the terms of this Contract. The Vendor shall be
responsible for providing in accordance with the terms of this Contract any and
all items and services which are expressly included by the terms of this
Contract or in the Exhibits. The Vendor shall furnish all labor, materials,
tools, transportation and supplies required to complete its obligations in
accordance with this Contract.
In instances where Purchase Orders are placed by Owner for or on behalf
of a Related Operator, Owner shall be considered the purchaser for purposes of
placing all orders, addressing invoices and the obligation of payment. Owner
agrees to be obligated hereunder with respect to all payments which become due
hereunder with respect to Purchase Orders placed by it for or on behalf of a
Related Operator, including but not limited to all payments for Products. In
addition, Owner shall be considered the purchaser for purposes of passage of
title and risk of loss with regard to Products and Software which are delivered
to it, even though such are subsequently re-delivered to another entity.
2.2 Plan for Chattanooga. In addition to its obligations
specified in Section 2.1, upon the terms and conditions set forth herein, the
Vendor shall provide those Products and Services described in Exhibit B-3 to the
Owner in order to provide for the technology swap for the System in Chattanooga,
Tennessee (the "Chattanooga Replacement").
2.3 Site Acquisition. The Owner shall acquire all Sites. The
Vendor, at its request, shall be kept informed of the progress made on ongoing
Site Acquisition activity. As the Site Acquisition progresses, the Vendor agrees
to alter regularly the engineering plan to determine a new search ring or rings
to take into account any changes or modifications requested by the Owner due to
the Owner's inability to acquire sufficient rights to a location which could
constitute a Site in a timely or economic manner; provided that all such
alterations requested by Owner shall be considered by Owner and addressed
pursuant to the Change Order provisions described in Section 11 below. Vendor
shall offer to Owner Site Acquisition services as defined on Exhibit E and
according to the pricing set forth on Exhibit B-7. When making changes to the RF
engineering plan, the Vendor shall take into account the Site Acquisition
already completed by the Owner. Upon Site Acquisition Substantial Completion,
Owner shall notify Vendor of the Site Acquisition Substantial Completion Date.
2.4 Expansions. During the five (5) year period commencing on
the Effective Date, the Owner may, from time to time, order Expansions from the
Vendor, subject to the provisions of Section 12. The price and terms of such
Expansions shall be as set forth in Exhibits B and B-1 through and including B-8
(collectively, the "B Exhibits").
2.5 Review of Contract. Each party has examined in detail and
carefully studied and compared the Contract with all other information furnished
by the other party
13
14
and has promptly reported to the other party any material errors,
inconsistencies or omissions so discovered or discovered by any of its
Subcontractors.
2.6 Eligibility under Applicable Laws and Applicable Permits.
The Vendor shall be responsible for ensuring that the Vendor and its
Subcontractors are and remain eligible under all Applicable Laws and Applicable
Permits to perform the Work under this Contract in the various jurisdictions
involved including, to the extent that Vendor will be responsible for
construction for any particular component of the Work, all such construction
will be done in accordance with all applicable Federal Communications Commission
requirements. Each of the Owner and the Vendor shall be responsible for
obtaining and maintaining in full force and effect the Applicable Permits listed
as its responsibility in the applicable Exhibits. Owner shall use its best
efforts to obtain such approvals, licenses, permits, tariffs, and/or other
authorities from the Federal Communications Commission and state and local
public utilities commissions as may be necessary for construction and operation
of a PCS System.
2.7 Further Assurances. The Vendor shall execute and deliver all
reasonable further instruments and documents, and will, in good faith, consider
all reasonable requests for further action, including, but not limited to,
assisting the Owner in filing notices of completion with the appropriate state
and local Governmental Entity, that may be necessary or that the Owner may
reasonably request in order to enable the Owner or the Vendor to complete
performance of the Work or to effectuate the purposes or intent of this
Contract. All such requests shall be addressed pursuant to the Change Order
procedures described below in Section 11.
2.8 Liens and Other Encumbrances. (a) The Vendor covenants and
agrees, subject to Vendor's receipt from Owner of full payment in respect
thereof, to:
(i) protect and keep free all Systems, Expansion,
Chattanooga Replacement and/or any and all interests and estates therein
acquired from the Vendor, and all improvements and materials now or
hereafter placed thereon under the terms of this Contract, from any and
all claims, liens, charges or encumbrances of the nature of mechanics,
labor or materialmen liens or otherwise arising out of or in connection
with performance by any Subcontractor, including services or furnishing
of any materials hereunder, and to promptly have any such lien released
by bond or otherwise; and
(ii) give notice of this subsection to each
Subcontractor before such Subcontractor furnishes any labor or materials
for any System.
(b) If any laborers', materialmen's, mechanics', or other
similar lien or claim thereof is filed by any Subcontractor, the Vendor shall
cause such lien to be satisfied or otherwise discharged, or shall file a bond in
form and substance satisfactory to the Owner in lieu thereof within ten (10)
Business Days of the Vendor's receipt of notice of such filing. If any such lien
is filed or otherwise imposed, and the Vendor does not cause such lien to be
released and discharged forthwith, or file a bond in lieu thereof, then, without
limiting the
14
15
Owner's other available remedies, the Owner has the right, but not the
obligation, to pay all sums necessary to obtain such release and discharge or
otherwise cause the lien to be removed or bonded to the Owner's satisfaction
from funds retained from any payment then due or thereafter to become due to the
Vendor.
(c) The Owner reserves the right to post or place within any
System notices of non-responsibility or to do any other act required by
Applicable Law, to exempt the Owner from any liability to third parties by
reason of any work or improvements to be performed or furnished hereunder;
provided that failure by the Owner to do so shall not release or discharge the
Vendor from any of its obligations hereunder.
2.9 Duty To Inform Itself Fully; Waiver of Defense. (a) Each
party shall be deemed to have notice of and to have fully examined and approved
the Specifications, the Exhibits and all other documents referred to herein, and
all drawings, specifications, schedules, terms and conditions of this Contract,
regulations and other information in relation to this Contract and/or any
amendments, modifications or supplements thereto at any time on or after the
Effective Date and to have fully examined, understood and satisfied itself as to
all information of which it is aware and which is relevant as to the risks,
contingencies and other circumstances which could affect this Contract and in
particular the installation of any System or any part thereof.
2.10 Special Provisions Regarding Vendor Financing. The
financing made available to Owner pursuant to separate financing agreements will
provide Owner with an available source of funds ("Funds") for purchases of items
other than the Products and Services specified hereunder for the Systems. With
respect to the purchase of any additional items to be used in connection with
the Systems, or any additional market area for which Owner obtains PCS licenses
utilizing the Funds, or any other items utilizing the Funds, Vendor shall be
treated as a preferred vendor and will be provided the first opportunity to
provide such additional items in accordance with the terms of this Contract,
provided such items conform to the Specifications and are priced in accordance
with the B Exhibits. In the event that Vendor does not manufacture such an item
equivalent in Form, Fit and Function to be made available for purchase at a
competitive market price, Owner shall be permitted to purchase such items from
third parties utilizing the Funds.
SECTION 3. PURCHASE ORDERS AND SCHEDULES
3.1 Purchase Orders. The Owner and any Operating Affiliate may
deliver Purchase Orders to the Vendor at any time and from time to time during
the Contract Term. Such Purchase Orders shall be sent to the Vendor either by
certified mail, electronic transmission or another mutually acceptable manner to
the address specified in Exhibit L of this Contract. All Purchase Orders shall
be governed by the terms and conditions of this Contract, unless otherwise
agreed by the parties in writing. Each Purchase Order shall specify, in
reasonable detail, the Products, Services or other items of Work to be provided
by the Vendor.
15
16
3.2 Delivery under the Contract. The Vendor shall complete the
Work specified in each Purchase Order in accordance with the terms and
conditions of this Contract.
3.3 Order Acceptance. All Purchase Orders submitted by Owner
shall be deemed to incorporate and be subject to the terms and conditions of
this Contract unless otherwise agreed in writing. All Purchase Orders, including
electronic orders, shall contain the information necessary for Vendor to fulfill
the order. All schedules and requested dates are subject to Vendor's
concurrence, provided that if orders are made within the agreed to lead times
specified in Exhibit L, Vendor shall not withhold its concurrence to the
requested dates. No provision or data on any Purchase Order or contained in any
documents attached to or referenced in any Purchase Order, or any subordinate
document (such as shipping releases), which is inconsistent with the terms of
this Contract shall be binding, except data necessary for Vendor to fill the
order. All such other data and provisions are hereby rejected. Electronic orders
shall be binding on Owner notwithstanding the absence of a signature, provided
that the parties have implemented a mutually acceptable electronic order process
and such orders deemed to be binding have been issued by Owner and accepted by
Vendor in accordance with the process agreed upon by the parties. Order
acceptance provisions, together with delivery schedules and intervals and
forecast requirements are set forth in Exhibit L.
While it is Vendor's objective to provide Owner with an acknowledgment
of each order received, Owner shall advise Vendor to the extent that Owner
becomes aware of any missing or late notifications to ensure that the order has
not been lost.
Changes made by Owner to an accepted Purchase Order shall be treated as
a separate order unless the parties expressly agree otherwise. If any such
change affects Vendor's ability to meet its obligations under the original
Purchase Order, any price, shipment date, or completion date quoted by Vendor
with respect to such original order is subject to change and shall be addressed
pursuant to the Change Order provisions below in Section 11.
3.4 Forecasts. Owner shall provide to Vendor regular forecasts
of Owner's annual Product and Services needs. If the quantities ordered are more
than 25% greater than forecast quantities, Vendor shall be permitted a
reasonable extension of time to fulfill such orders and achieve the Milestones
required of Vendor hereunder.
3.5 Deployment Plans and Milestones. The deployment plans and
intervals, together with the key milestones, order intervals, in respect of each
System, are set forth in Exhibit L.
3.6 Inventory Control and Bar-coding. Vendor shall, at no
additional charge, pack and xxxx shipping containers in accordance with its
standard practices for domestic shipments. Where in order to meet Owner's
requests, Vendor packs and/or is required to xxxx shipping cartons in accordance
with Owner's specifications, Vendor shall invoice Owner additional charges for
such packing and/or marking. Vendor shall (a)
16
17
enclose a packing memorandum with each shipment and, if the shipment contains
more than one package, identify the package containing the memorandum, and (b)
xxxx Products as applicable for identification in accordance with Vendor's
marking specifications (for example, model/serial number and month, year of
manufacture).
SECTION 4. SUBCONTRACTORS
4.1 Subcontractors. The Vendor may subcontract any portion of
its obligations under this Contract, but no such subcontract shall relieve
Vendor from primary responsibility and liability for the performance of Vendor's
covenants and obligations under this Contract. Regardless of whether or not the
Vendor obtains approval from the Owner or a Subcontractor or whether the Vendor
uses a Subcontractor recommended by the Owner, use by the Vendor of a
Subcontractor shall not, under any circumstances: (i) give rise to any claim by
the Vendor against the Owner if such Subcontractor breaches its subcontract or
contract with the Vendor; (ii) give rise to any claim by such Subcontractor
against the Owner; (iii) create any contractual obligation by the Owner to the
Subcontractor; (iv) give rise to a waiver by the Owner of its rights to reject
any Defects or Deficiencies or Defective Work; or (v) in any way release the
Vendor from being solely responsible to the Owner for the Work to be performed
under this Contract.
4.2 The Vendor's Liability. The Vendor is responsible for all of
its obligations under this Contract, including the Work, regardless of whether a
subcontract or supply agreement is made or whether the Vendor relies upon any
Subcontractor to any extent. The Vendor's use of Subcontractors for any of the
Work shall in no way increase the Vendor's rights or diminish the Vendor's
liabilities to the Owner with respect to this Contract, and in all events,
except as otherwise expressly provided for herein, the Vendor's rights and
liabilities hereunder with respect to the Owner shall be as though the Vendor
had itself performed such Work. The Vendor shall be liable for any delays caused
by any Subcontractor as if such delays were caused by the Vendor.
4.3 No Effect of Inconsistent Terms in Subcontracts. The terms
of this Contract shall in all events be binding upon the Vendor regardless of
and without regard to the existence of any inconsistent terms in any agreement
between the Vendor and any Subcontractor whether or not and without regard to
the fact that the Owner may have directly and/or indirectly had notice of any
such inconsistent term.
4.4 Assignability of Subcontracts to Owner. Vendor shall use
reasonable efforts to have each agreement between the Vendor and a Subcontractor
contain a provision stating that, in the event that the Vendor is terminated for
cause, convenience, abandonment of this Contract or otherwise, (i) each
Subcontractor shall continue its portion of the Work as may be requested by the
Owner and (ii) such agreement permits assignment thereof without penalty to the
Owner and, in order to create security interests, to third parties designated by
Owner, in either case at the option of the Owner and for the same price and
under the same terms and conditions as originally specified in such
Subcontractor's agreement with the Vendor.
17
18
4.5 Removal of Subcontractor or Subcontractor's Personnel. The
Owner has the right at any time to request removal of a Subcontractor and/or any
of a Subcontractor's personnel from Work on the System upon reasonable grounds
and reasonable prior notice to Vendor. Such request (a "Request for Removal")
shall be in writing and shall specify the Owner's reasoning therefor. The Vendor
promptly shall issue a written response to any such Request for Removal,
specifying the reasoning for its disagreement or agreement, as the case may be,
with the reasoning contained in the Request for Removal. If the parties fail to
agree, this matter shall be handled in accordance with the dispute resolution
procedures in Section 23. The exercise of such right by the Owner shall have no
effect on the provisions of subsections 4.1 and 4.2.
4.6 Subcontractor Insurance. The Vendor shall require its
Subcontractors to obtain, maintain and keep in force, during the time they are
engaged in providing Products and Services hereunder, insurance coverage of the
types and levels customary in the industry (provided that the maintenance of any
such Subcontractor insurance shall not relieve the Vendor of its other
obligations pursuant to this Contract). The Vendor shall, upon the Owner's
request, furnish the Owner with evidence of such insurance in form and substance
reasonably satisfactory to the Owner.
4.7 Review and Approval not Relief of Vendor Liability. No
inspection, review or approval by the Owner permitted under this Contract of any
portion of the Work shall relieve the Vendor of any duties, liabilities or
obligations under this Contract, but nothing contained in this subsection shall
be deemed a bar of any waiver given by the Owner to the Vendor pursuant to and
in accordance with the terms of this Contract.
4.8 Vendor Warranties. Except as otherwise expressly provided in
Section 18, the warranties of the Vendor pursuant to Section 18 shall be deemed
to apply to all Work performed by any Subcontractor as though the Vendor had
itself performed such Work and to all Products supplied by any third-party
vendor or other subcontractor as though the Vendor itself had supplied such
Products. Except as otherwise specifically provided in Section 18, the parties
agree that such warranties shall not be enforceable merely on a "pass-through"
basis but that Owner may, but shall not be obligated to, enforce such warranties
of any Subcontractor to the extent that the Owner determines that the Vendor is
not paying and/or performing its warranties; provided that any such election by
the Owner shall not relieve the Vendor from any obligations or liability with
respect to any such warranty.
4.9 Payment of Subcontractors. The Vendor shall make all
payments it is contractually required to make to all Subcontractors (except in
the case of legitimate disputes between the Vendor and any such Subcontractor
arising out of the agreement between the Vendor and such Subcontractor) in
accordance with the respective agreements between the Vendor and its
Subcontractors such that no Subcontractor shall be in a position to enforce any
liens and/or other rights against the Owner, the System, any Products or any
part thereof.
18
19
4.10 Copies. Subject to any confidentiality obligations insisted
upon by third party providers, including Subcontractors, Vendor will use its
good faith, reasonable efforts to provide Owner with any and all relevant
agreements, understandings, subcontracts and other documents pertaining to the
provision of Products or Services by a Subcontractor which Owner may reasonably
require in order for it to be provided with the information necessary to
exercise any of its rights under this Contract.
4.11 Benefit of Subcontracts. In addition to anything else
provided for in this Contract, the Owner shall be entitled to the following
benefits and rights of the Vendor under its contracts with any applicable
third-party vendors or other Subcontractors: all rights to conduct in-house
tests, to receive notice of upgrades and enhancements and to purchase spare
parts; provided however, that the Vendor shall maintain sole responsibility for
all obligations and other duties under all such contracts.
SECTION 5. PRICES AND PAYMENT
5.1 Prices; Minimum Purchases. (a) The prices for the Products,
Services and other items of Work for the Contract Term are set forth in the B
Exhibits. The prices for Expansions and the Chattanooga Replacement, including
all Work to be performed in connection with the Chattanooga Replacement, are
also set forth in the B Exhibits. The Owner agrees that the aggregate amount of
all payments to the Vendor pursuant to Purchase Orders delivered to the Vendor
during the Contract Term shall be not less than Three Hundred Thirty Million
Dollars ($330,000,000) (the "Minimum Purchase Commitment").
(b) Prices for all Products and Services shall be afforded the
following price protection. [***]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
19
20
[***]
5.2 Taxes. The Owner shall reimburse Vendor for all present or
future taxes, levies, imposts, deductions, charges, withholdings and liabilities
("Taxes") imposed on the Vendor by any Governmental Entity relating to the
provision of Products and Services by the Vendor to the Owner under this
Contract, provided, however, that the Owner shall not be liable for and shall
not pay or reimburse Vendor for any Taxes on or measured by the income or
receipts of the Vendor. If the Owner shall pay Taxes for which the Vendor
receives a credit, then the Vendor shall reimburse to the Owner an amount equal
to such credit.
5.3 Payment. Payment for the Products and Services to be
supplied pursuant to this Contract shall occur as follows (in each case
following submission of an invoice by the Vendor which shall properly document,
to the reasonable satisfaction of the Owner, all the items included):
(a) Products for Systems: except as set forth in subsections (b)
and (c) below,
(i) [*] of the amount of all Purchase Orders completed
by the Vendor with respect to a Site shall be invoiced upon shipment of
the Products in respect of such Purchase Orders;
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
20
21
(ii) [*] of the amount of all Purchase Orders completed
by the Vendor with respect to a Site shall be invoiced upon completion
of Installation and Integration of the Products with respect to each
Site;
(iii) [*] of the amount of all Purchase Orders completed
by the Vendor with respect to a Site shall be invoiced upon the date
Owner signs a Certificate of Substantial Completion in respect of the
Products forming part of such Purchase Orders; provided that in the
event that a Certificate of Substantial Completion is not issued within
five (5) Business Days after the Guaranteed Substantial Completion Date
because of a delay in reaching Substantial Completion solely
attributable to the failure or lack of performance of Owner to satisfy
its obligations and commitments in a timely manner, such amount shall be
invoiced on the fifth (5th) Business Day following Substantial
Completion; and
(iv) the balance of all amounts due Vendor pursuant to
completed Purchase Orders with respect to Products for a System shall be
invoiced upon Final Acceptance of such System.
(b) Services: Services shall be invoiced as performed, or as
soon thereafter as practical but in no event more frequently than monthly,
provided that Installation and Integration Services and Optimization Services
will only be invoiced after the Owner signs a Certificate of Substantial
Completion in respect of the System for which such Services are rendered;
provided that in the event that a Certificate of Substantial Completion is not
issued within five (5) Business Days after the Guaranteed Substantial Completion
Date because of a delay in reaching Substantial Completion solely attributable
to the failure or lack of performance of Owner to satisfy its obligations and
commitments in a timely manner, such amount shall be invoiced on the fifth (5th)
Business Day following Substantial Completion.
(c) Optional Software Features and Spares: The purchase price
for the initial Optional Software Features and Spares shall be invoiced after
the Owner signs a Certificate of Substantial Completion in respect of the System
for which such initial Optional Software Features and Spares are furnished;
provided that in the event that a Certificate of Substantial Completion is not
issued within five (5) Business Bays after the Guaranteed Substantial Completion
Date because of a delay in reaching Substantial Completion attributable solely
to the failure or lack of performance of Owner to satisfy its obligations and
commitments in a timely manner, such amount shall be invoiced on the fifth (5th)
Business Day following Substantial Completion.
(d) Expansions (Growth):
(i) [*] of the amount of all Purchase Orders completed
by the Vendor with respect to Products for which Vendor provides
installation Services pursuant to an Expansion shall be invoiced upon
delivery of such Products; and
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
21
22
(ii) [*] of the amount of all Purchase Orders completed
by Vendor with respect to Products for which Vendor provides
installation Services pursuant to an Expansion shall be invoiced upon
completion of installation of such Products; and
(iii) 100% of the amount of all Purchase Orders
completed by the Vendor with respect to Products for which Vendor
provides no installation Services pursuant to an Expansion shall be
invoiced upon delivery of such Products.
(e) Payment of Invoices. Owner shall pay the invoiced amounts,
less any disputed amounts, within ten (10) days from the date of transmission of
Vendor's invoice. Delinquent payments are subject to a late payment charge after
thirty (30) days at the rate of [*] per month, or portion thereof, of the amount
due (but not to exceed the maximum lawful rate). Any disputed items which are
determined to be validly billed are due for payment based upon the original
invoice date.
5.5 No Payment in Event of Material Breach. Subject to
Subsection 24.5, the Owner shall have no obligation to make any payment for any
Work with respect to which the Vendor is in material breach of this Contract
until and unless such breach is cured or waived by the Owner in accordance with
the terms of this Contract.
5.6 In Revenue Payments. At any time during a period of delay
the Owner may, in its sole discretion, decide to place a System which is subject
to such delay into In Revenue Service. Such placement into In Revenue Service
shall constitute Substantial Completion only for purposes of the payment
obligations above, but shall not in any way relieve the Vendor of any of its
obligations under this Contract, including without limitation achieving a
Guaranteed Substantial Completion Date nor shall such In Revenue Service trigger
the commencement of the Initial Period.
5.7 Currency and Place of Payment. Payments under this Contract
shall be made in US dollars and if such method of payment is acceptable to
Owner, Owner shall pay all amounts due Vendor hereunder using Electronic Funds
Transfer ("EFT"). EFT payments by Vendor shall be made to the following account
of Vendor or such other account as is subsequently designated by Vendor in
writing and, concurrent with the EFT payment, Owner shall fax a xxx of the
remittal to Vendor's manager of cash operations at 000-000-0000:
Chase Manhattan Bank
New York, New York
Account Name: Lucent Technologies Inc.
Acct.: 910144-9099
ABA 000000000
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
22
23
SECTION 6. AVAILABILITY OF IOS
6.1 Availability of IOS. [***]
6.2 Effect of Other Base Stations. [***]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
23
24
SECTION 7. MODCELL/MINICELL REPLACEMENT
7.1. Minicell/Modcell. For markets to be located in Chattanooga
and Nashville, Tennessee, for up to a maximum of [*] Sites, [*] shall de-install
and redeploy the minicells in such markets to a market area(s) of Owner's choice
at [*], and replace such minicells with modcells in accordance with this
Section. [*] shall be responsible for temporary warehousing of the de-installed
minicells at a location of Owner's choosing within the United States. [*] shall
be responsible, at [*], for transportation from the original location to such
warehouse, transportation from such warehouse to the new installation Site, and
re-installation at the new Site within the United States. [*] shall be
responsible for the cost of installation of the replacement modcells. In
addition, Vendor shall provide up to [*] refurbished 5 ESS(R) switches
engineered for up to 50 minicells and one carrier each at [*] for use in any of
Owner's markets at Owner's choice. [*] shall be responsible for the cost of
engineering and installation of such switches, at prices consistent with the
prices set out in Exhibit B-2 and B-3.
Vendor shall reimburse Owner [*] incurred by Owner as a result of the
use of minicells in Nashville and Chattanooga, Tennessee, up until the
replacement of the minicells with modcells in such markets. In the event that
Owner delays the installation of modcells after they are made available by
Vendor, Vendor shall not be responsible for [*] incurred by Owner after the date
that the replacement is made available.
During the time commencing on the date the minicells are decommissioned
from operation in the System, until the date that the minicells are installed in
the new reinstallation Site, the applicable Warranty Period remaining on such
Products, if any, will be suspended. Thereafter, upon reinstallation, the
Warranty Period shall continue for a period which is the greater of (i) the
remaining Warranty Period; and (ii) twelve months following reinstallation.
During period from decommissioning to redeployment, Vendor will continue
to supply all Class A Upgrades, new Software loads, and other standard support
which would otherwise be provided pursuant to this Contract. Vendor shall, at
[*]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
24
25
[*] provide reasonable quantities of spares and training in light of the new
total network deployment of modcells and minicells.
If the refurbished 5 ESS(R) switches to be delivered to Owner have not
been decommissioned immediately prior to the time that they are to be
refurbished and engineered, Vendor will provide Owner with a reasonable
opportunity to inspect the switches at the site where such switches are located,
to satisfy itself that such switches are in a reasonable state of repair and
will be fit for Owner's purposes; provided that the owner or operator of such
site consents to the site inspection. Owner may refuse to accept such a switch
that is not, in Owner's reasonable opinion, in such a satisfactory condition in
accordance with the foregoing. If the refurbished 5 ESS(R) switches to be
delivered to Owner have been decommissioned and removed from the prior
operator's network, Owner or, at Owner's request, a qualified third party
reasonably acceptable to both parties, shall have the right to conduct a
reasonable inspection on such switch, to determine whether the switches are in
such a satisfactory condition in accordance with the foregoing. If Owner
reasonably objects to the conditions of any of such switches, Vendor will either
obtain the necessary switches in a satisfactory condition, or take such other
actions as are necessary to satisfy Owner's objections.
7.2 Tennessee Swap-out Credit. In connection with the swap-out
of the existing network in Tennessee, Vendor will make available to Owner
general purchase credits in the amount of [*] (the "Tennessee Swap-out
Credits"), to be applied against any invoice issued by Vendor during the initial
twenty four (24) months of the Contract term, provided that Credits shall not be
applied to any particular invoice in an amount greater than 20% of the net
invoiced amount; provided, however that Vendor will agree with reasonable
requests by Owner to either adjust the amount which can be applied to each
invoice in order to ensure that the entire amount of the Tennessee Swap-out
Credits are applied against invoices during such initial twenty four (24) month
period or extend the initial twenty four (24) in order to facilitate the entire
usage of the Tennessee Swap-out Credits.
SECTION 8. SERVICES
8.1 Transportation. The Vendor shall at the Vendor's sole cost
and expense provide for the transportation and delivery to the Sites of all the
Products to be delivered pursuant to, and in accordance with, each Purchase
Order and the terms of this Contract. In the event of any unusual Site
selections or requirements which require transportation arrangements out of the
ordinary course having regard to normal industry standards and practices (such
as non-standard crane requirements, helicopter transportation requirements to a
remote setting, etc.), Vendor shall arrange, subject to Owner's prior approval,
for such exceptional transportation requirements from local staging facilities
or warehouse locations to the unusual Site. Vendor shall notify Owner that it
believes, in good faith, that exceptional transportation arrangements are
necessary in the circumstances, and Vendor will consult with Owner on an
approved course of action to complete delivery. Owner shall be
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
25
26
responsible for all costs with respect to such exceptional transportation
requirements in excess of transportation costs applicable to a standard Site.
8.2 Services. The Vendor shall provide the Services ordered by
Owner in accordance with the provisions of the Exhibit hereto in respect of such
Services, including, without limitation, the following Services: RF Design
Services as stated in Exhibit D, construction management and site construction
services as stated in Exhibit E, architectural & engineering services as stated
in Exhibit E, spectrum clearing and microwave relocation services as stated in
Exhibit E, Optimization Services as set forth in Exhibit G, Installation and
Integration services as set forth in Exhibit F and Wireless Support Services as
stated in Exhibit H.
8.3 No Interference. The Vendor shall install all Equipment and
build each of the Systems so as to cause no unauthorized interference with or
obstruction to lands and thoroughfares or rights of way on or near which the
installation work may be performed. The Vendor shall exercise every reasonable
safeguard to avoid damage to existing facilities, and if repairs or new
construction are required in order to replace facilities damaged by the Vendor
due to its carelessness, negligence or willful misconduct, such repairs or new
construction shall be at the Vendor's sole cost and expense. Vendor understands
that many of the Sites may be co-located with other RF transmission facilities
and Vendor shall take all necessary precautions and safety measures to ensure
the safety of all of Vendor's and Subcontractors' personnel at such Sites. The
Owner shall use its reasonable best efforts to ensure that no other third
parties employed or engaged by the Owner hinder or delay the Vendor in the
performance of its installation obligations hereunder.
Vendor represents and warrants that all Products furnished
hereunder shall comply, to the extent required, with the requirements of Part 24
of the Federal Communication Commission's Rules and Regulations (the "FCC
Rules") pertaining to personal communications services in effect upon delivery
of such Product. In addition, Vendor represents and warrants that a Product
furnished hereunder shall comply, to the extent required, with the requirements
of Subpart J of Part 15 of the FCC Rules in effect upon delivery of such
Product, including those sections concerning the labeling of such Product and
the suppression of radio frequency and electromagnetic radiation to specified
levels. Vendor makes no undertaking with respect to harmful interference caused
by (i) unauthorized installation, repair, modification or change or Products not
furnished by Vendor; (ii) Products being subject to misuse, neglect, accident or
abuse by other than Vendor; (iii) Products being used in a manner not in
accordance with operating instructions or in a suitable installation environment
or operations of other equipment in the frequency ranges reserved for Owner
within the applicable licensed area. Vendor assumes no responsibility under this
clause for items not specified or supplied by Vendor. The foregoing warranties
are collectively referred to as the "Compliance Warranty".
Vendor shall, when appropriate, have reasonable access to
Owner's premises during normal business hours and at such other times as may be
agreed upon by the parties in order to enable Vendor to perform its obligations
under this Contract. Vendor shall coordinate such access with Owner's designated
representative prior to visiting such
26
27
premises. Vendor agrees to instruct its employees to comply with all site rules
while on Owner's premises. The employees and agents of Vendor shall, while on
the Owner's premises, comply with all site rules and guidelines including, but
not limited to, where required by government regulations, submission of
satisfactory clearance from U.S. Department of Defense and other governmental
authorities concerned. Neither party shall require waivers or releases of any
personal rights from representatives of the other in connection with visits to
its premises, and no such releases or waivers shall be pleaded by either party
in any action or proceeding.
For purposes of this Section, all references to "Owner's
premises" and other similar references shall be deemed to refer to any location
where a Site is to be located, which may include land or buildings owned or
leased by Owner. To the extent that Owner does not own the premises, Vendor's
obligations to adhere to site rules and guidelines shall include, without
limitation, those rules and guidelines required by the owner, landlord or
property manager having care and control of such premises, which Owner has
provided to Vendor in advance of the commencement of the applicable Work
hereunder.
SECTION 9. MANUALS, ENGINEERING DRAWINGS AND TRAINING
9.1 Documentation. The Vendor shall provide the Documentation in
the amounts and formats listed in Exhibit P. The Documentation shall be prepared
in accordance with the relevant Specifications. Operating Manuals with
up-to-date (but not "as-built") drawings, specifications and design sheets shall
be available for the Training as set forth in subsection 9.4.
9.2 Standards for Manuals. All Operating Manuals and Maintenance
and Instruction Manuals required to be provided by the Vendor pursuant to this
Contract shall be:
(a) detailed and comprehensive and prepared in conformance with
the Specifications and generally accepted national standards of
professional care, skill, diligence and competence applicable to
telecommunications and operation practices for facilities similar to the
Systems;
(b) consistent with good quality industry operating practices
for operating personal communications service systems of similar size,
type and design;
(c) sufficient to enable the Owner to operate and maintain each
System on a continuous basis; and
(d) prepared subject to the foregoing standards with the goal of
achieving operation of each System at the capacity, efficiency,
reliability, safety and maintainability levels contemplated by this
Contract and required by all Applicable Laws and Applicable Permits.
27
28
9.3 Equipment and Data. The Vendor shall furnish all drawings,
specifications, specific design data, preliminary arrangements and outline
drawings of the Equipment and all other information as required in accordance
with this Contract in sufficient detail to indicate that the Equipment and
fabricated materials to be supplied under this Contract comply with the
Specifications.
9.4 Training. As more fully described in Exhibit O, the Vendor
shall provide to the Owner a training program with respect to each System
(collectively, the "Training"). Promptly upon execution of this Contract, the
Vendor shall establish a training coordinator, whose responsibility shall be to
work with the Owner to ensure that the Owner receives the Training. Such
coordinator (or his or her replacement) shall continue in such assignment until
the receipt by the Owner of all of the Training required to be provided.
9.5 Manuals and Training. The Training and the Documentation
provided in connection herewith, including, without limitation, all
Documentation provided in CD-ROM format, and pursuant to subsections 9.2, 9.3
and 9.4 shall be updated in reasonable quantities at no additional cost to Owner
pursuant to and in accordance with all Product upgrades and/or modifications
applicable to any System and/or any part thereof.
SECTION 10. ACCEPTANCE PROCEDURES
10.1 Acceptance Procedures. Depending upon the specific Products
and Services to be furnished by Vendor, and those tasks for which Owner shall
assume responsibility, the parties, directly or through third-party vendors or
other Subcontractors, as the case may be, shall carry out the following
procedures. Certain of the tests below will apply to purchases of Products and
Services which comprise a System, while certain other tests will apply to tests
for Product and Service purchases for Expansions
(a) Factory Tests Owner may, at Owner's option and cost, be
present at any factory testing conducted by Vendor. Vendor shall give the Owner
ten (10) Business Days advance notice of any such factory testing relating to
the Products or Services furnished by Vendor hereunder. Vendor shall cooperate
with Owner to facilitate Owner's observation of such tests. Regardless of
whether or not Owner observes any factory testing, Vendor agrees to, within a
reasonable period of time in view of the nature and urgency of the request, upon
written request by Owner, provide Owner with copies of all documentation
relating to factory testing of the Product specified by Owner, including without
limitation copies of test procedures, test results and FCC compliance
certifications.
(b) Site Preparation Substantial Completion Upon completion of
all Site Preparation with respect to each Site for which the Owner has issued a
Purchase Order directing the Vendor to proceed with Site Preparation activities,
the Vendor shall issue a Site Preparation Substantial Completion Certificate
("Site Preparation Substantial Completion Certificate") certifying that all Site
Preparation specified in the Purchase Order is substantially complete. Such
certificate shall be accompanied by a Punch List of all
28
29
incomplete items which items shall be completed by the Vendor prior to Final
Acceptance. Vendor shall offer Construction Management, Architectural &
Engineering, Site Civil Construction and Antenna Installation and Testing as
provided for in Exhibit E and at pricing consistent with that set forth in
Exhibit B-7. In the event the Owner performs Site Preparation with respect to a
Site, the Owner shall issue the Site Preparation Substantial Completion
Certificate.
(c) Site Installation and Integration Completion Certificate.
Upon completion of the installation of the BTS and other Products and the
completion of integration activities in accordance with Exhibit F the Vendor
shall issue a Site Installation and Integration Substantial Completion
Certificate certifying that all installation and integration activities
specified in the Purchase Order are substantially complete. Such certificate
shall be accompanied by a Punch List of all incomplete items which items shall
be completed by the Vendor prior to Final Acceptance.
(d) Certificate of Substantial Completion. Upon completion of
Optimization Services and all testing with respect to a System in accordance
with Exhibit G, the Vendor shall issue a Certificate of Substantial Completion,
which shall be in the form of a checklist listing all tests performed and the
results thereof, and shall be accompanied by a Punch List of outstanding items
(the "Certificate of Substantial Completion"). Upon its reasonable satisfaction
that the Certificate of Substantial Completion is correct and complete, the
Owner shall promptly sign the Certificate of Substantial Completion.
(e) "Beta" Tests. Upon written notice to the Vendor, the Owner
shall be entitled, in its sole discretion to conduct beta testing, and in
connection therewith the Owner shall be entitled to add appropriate items to the
Punch List prior to Final Acceptance.
(f) Certificate of Final Acceptance. During the [*] day period
following Substantial Completion (as extended as described below, the "Initial
Period"), the Vendor shall complete all outstanding Punch List items and the
Owner and the Vendor shall monitor the System for outages and compliance with
the Specifications. In event that all Punch List items have been completed
during the Initial Period, all testing specified in Exhibit G has been
satisfactorily completed and there have been no Major Outages, then at the end
of the Initial Period the Vendor shall issue a Certificate of Final Acceptance
certifying the same. Upon its reasonable satisfaction that the Certificate of
Final Acceptance is correct and complete, the Owner shall sign the Certificate
of Final Acceptance. In the event that a Major Outage occurs during the Initial
Period, the Initial Period shall be extended (each, an "Extension Period") as
follows: (i) if a Major Outage occurs on or prior to [*] days after the
commencement of the Initial Period, the Initial Period shall be extended for an
additional [*] days, (ii) if a Major Outage occurs after [*] days but on or
prior to [*] days after the commencement of the Initial Period, the Initial
Period shall be extended for an additional [*] days, and (iii) if a Major Outage
occurs after [*] days but on or prior to [*] days after the commencement of the
Initial Period, the Initial Period shall be extended for an additional [*] days.
In the event a Major Outage occurs during any Extension Period, the Initial
Period shall be further extended by an additional period of [*]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
29
30
Owner shall issue a Certificate of Final Acceptance not later than the end of
the Initial Period (as extended) after receipt of notice of Vendor that it
corrected the problem giving rise to the Major Outage or Major Outages.
Documentation not already delivered to the Owner pursuant to the terms of this
Contract shall be delivered to the Owner within [*] Business Days of Final
Acceptance. With respect to each System, the Owner shall not be required to sign
the Certificate of Final Acceptance until all such documentation has been so
delivered (and Final Acceptance shall not be deemed to have occurred earlier
than the date that is [*] Business Days prior to the date of delivery of such
documentation). In addition to, and without limiting the requirements set forth
in the preceding sentence, the Operating Manuals and the Maintenance and
Instruction Manuals shall be submitted to the Owner in CD-ROM format (when
available) in addition to hard-copy volume format if so requested by the Owner.
10.2 Costs and Expenses. The costs and expenses of complying
with all acceptance procedures set forth above shall be borne by the Vendor,
provided that Owner remains responsible for completing those items identified as
Owner's responsibility in the Exhibits.
SECTION 11. CHANGE ORDERS AND SCHEDULING
11.1 Change Orders. The Owner has the right to request
expansions, other revisions and/or modifications to any Purchase Order or to the
Work ("Changes"), including but not limited to the Specifications, the manner of
performance of the Work or the timing of the completion of the Work. All Changes
shall be subject to the prior written consent of the Vendor. All Changes shall
be documented in a written order ("Change Order") which shall be executed by the
Owner and the Vendor and shall contain any adjustments to pricing, Milestone or
other aspect of the Work as mutually agreed by the parties. The Vendor shall
promptly notify the Owner of any such requested Changes which may materially
affect the operation and/or maintenance of any System or any part thereof. In
the event that the parties cannot agree on a Change Order within fifteen (15)
days of submission of a Change Order by the Owner to the Vendor, the matter
shall then be referred to dispute resolution pursuant to Section 23. Nothing
contained in this subsection is intended to limit the Vendor's right, from time
to time, to make suggestions for modifications to the Work or the
Specifications, provided that in any such event the Owner, in its sole and
absolute discretion pursuant to the terms of this Contract may refuse to make
any such modification or otherwise agree to issue a Change Order incorporating
any such Vendor suggestion.
11.2 Cancellation. Owner may at any time to cancel, in whole or
in part, any Purchase Order or Change Order upon advance written notice to the
Vendor. In the event of such cancellation, the Owner shall pay to the Vendor
cancellation charges in accordance with the Exhibits.
30
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
31
SECTION 12. DISCONTINUED PRODUCTS AND CONTINUING PRODUCT SUPPORT
12.1 Notice of Discontinuation. For a period of [*] for the 5
ESS(R) switch and [*] for all other Products furnished hereunder after the
Effective Date, but in no event less than [*] after the date of shipment, the
Vendor agrees to provide the Owner, or its affiliates as the case may be, not
less than one (1) year notice before the Vendor discontinues a Product
("Discontinued Products") furnished under this Contract. In respect of Products
manufactured by a third party vendor, the notice period may vary. Where the
Vendor offers a product for sale that is equivalent in Form, Fit and Function in
accordance with and pursuant to the Specifications, the notification period may
vary but in no event shall be less than sixty (60) days. In the event of the
foregoing, the Vendor shall continue to furnish Products fully compatible with
the relevant System Elements within the System at such time during the
appropriate [*] and [*] periods referenced above; provided that nothing
herein shall bar the Vendor from discontinuing individual items of Products as
provided in and pursuant to this subsection. In the event that Vendor
discontinues a Product, Vendor will meet with Owner and use reasonable, good
faith efforts to develop a mutually acceptable transition plan that takes into
account the Owner's existing investment in the item scheduled for
discontinuance.
In addition to repairs provided for under any applicable
Warranty, Vendor shall offer repair Services and repair parts in accordance with
Vendor's repair and repair parts practices and terms and conditions then in
effect, for Vendor-manufactured Equipment furnished pursuant to this Contract.
Such repair Services and repair parts shall be available while Vendor is
manufacturing or stocking such Products or repair parts, but in no event less
than [*] for the 5 ESS switch and [*] for all other Products after such
Product's discontinued availability effective date. Vendor may use either the
same or functionally equivalent products or parts which are new, remanufactured,
reconditioned or refurbished in the furnishing of repairs or replacements under
this Contract.
If during the agreed-to support period following the issuance of
notice of discontinuance, Vendor fails to provide repair parts and or repair
Services and a functionally equivalent replacement has not been designated,
Vendor shall so advise Owner, to allow Owner to plan appropriately, and if
Vendor is unable to identify another source of supply for such repair parts or
services, Vendor shall, in addition to any other right or remedy available to
Owner at law or in equity, provide Owner, at no additional charge to Owner, upon
request, with non-exclusive licenses for Product manufacturing to the extent
Vendor can grant such licenses, so that Owner will have sufficient information,
ability and rights to have such Discontinued Products manufactured, or obtain
such repair Service or repair parts from other sources. Such license shall
include appropriate non-disclosure and confidentiality covenants.
12.2 Discontinuation During Warranty Period. If Vendor
discontinues the availability of a Product during that Product's Warranty Period
and Owner is required to purchase a replacement Product to replace the
Discontinued Product in order to maintain
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
31
32
the same functionality of the Discontinued Product in a System, Vendor agrees
to grant Owner an additional [*] discount to be applied against the net price of
all Products required to be purchased by Owner as replacements for such
Discontinued Product, which additional discount shall be applied after the
determination of the lowest price available to Owner pursuant to this Contract,
excluding the application of any Tennessee Swap-Out Credits.
SECTION 13. SOFTWARE; CONFIDENTIAL INFORMATION
13.1 RTU License. Upon delivery of the Software, but subject to
payment of the license fees specified in Exhibit B-5, the Owner is hereby
granted a personal, non-exclusive, fully paid-up, multi-site (capability to move
Software from site to site on prior notice to Vendor) right to use license for
the Software ("RTU License"), to operate the specific Equipment, processor or
product line for which the licenses to use the Software are initially granted,
or temporarily on any comparable replacement if any such Equipment, processor or
product line becomes inoperative. Owner shall use such Software only for its own
internal business operation. The RTU License grants Owner no right to, and Owner
will not, sublicense such Software or modify, decompile, or disassemble Software
furnished as object code to generate corresponding source code provided in each
of the Systems. Except as provided below, no license is granted to Owner to use
the Software outside of the United States.
In the event that Owner wishes to use the Software on associated
equipment outside of the United States or to transfer Software to an affiliate
or third party transferee located outside the United States, Vendor shall not
unreasonably withhold its consent to such use or transfer, provided that Vendor
or the transferee, as the case may be, enters into an appropriate license
agreement with an affiliate of Vendor carrying on business in the territory in
which the Software is to be located, on terms substantially similar to the RTU
License terms set forth herein, provided, however, that Owner acknowledges and
agrees that support and maintenance obligations set forth herein are only
applicable for Software resident on Equipment located within the United States.
Support and maintenance Services offered by Vendor's affiliates differs in
various different territories, and will be subject to the local practices
maintained in such territory.
13.2 Owner's Obligations. The Owner agrees that the Software,
whether or not modified, and all copies thereof made by Owner, shall be treated
as proprietary to the Vendor, its Subcontractors or its suppliers, as
appropriate and the Owner shall:
(a) Utilize the Software solely in conjunction with a System;
provided that the Vendor acknowledges that the Software shall be integrated
across interfaces with systems, equipment and software provided by other
suppliers and customers;
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
32
33
(b) Ensure that all copies of the Software shall, upon any
reproduction by the Owner authorized by the Vendor and whether or not in the
same form or format as such Software, contain the same proprietary,
confidentiality and copyright notices or legends which appear on the Software
provided pursuant hereto; and
(c) Hold secret and not disclose the Software to any person,
except to (i) such of its employees, contractors, agents or affiliates that are
involved in the operation or management of a System and need to have access
thereto to fulfill their duties in such capacity, or (ii) other Persons who need
to use such Software to permit integration of a System with systems and software
of other suppliers and customers; provided that such persons agree, or are
otherwise obligated, to hold secret and not disclose the Software to the same
extent as if they were subject to this Contract, and provided further that if
any such Person is a competitor of Vendor involved in the manufacture of
communications equipment, software or related services, Vendor must approve such
use on a case-by-case basis on commercially reasonable terms and such use shall
be subject to an appropriate non-disclosure agreement.
(d) When and if the Owner determines that it no longer needs the
Software or if the Owner's license is canceled or terminated pursuant to the
terms of this Contract, return all copies of such Software to the Vendor or
follow reasonable written disposition instructions provided by the Vendor. If
the Vendor authorizes disposition by erasure or destruction, the Owner shall
remove from the medium on which Software resides all electronic evidence of the
Software, both original and derived, in such manner that prevents subsequent
recovery of such original or derived Software.
(e) Owner shall not copy Software embodied in firmware and
unless otherwise specifically provided in this Contract, Owner is not granted
any right to modify Software furnished by Vendor under this Contract.
13.3 Backwards Compatibility. The Vendor represents and warrants
(the "Software Backwards Compatibility Warranty") that each Software Maintenance
Release, Software Upgrade and Software Enhancement will be Backwards Compatible.
[***] Notwithstanding the foregoing, the Software Backwards Compatibility
Warranty does not apply to Products developed beyond 3G1X which are developed in
accordance with standards not yet finalized as of the date hereof.
13.4 Transfer and Relocation. (a) In the event the Owner or any
successor to the Owner's title in the Products (i) elects to transfer a Product
to a third party, and where such Product shall remain in place and used for
substantially the same purpose as used by the Owner and where such third party
resides in the United States and is not a direct competitor of the Vendor
involved in the manufacture of communications equipment, software or related
services, or (ii) elects to transfer Products to an affiliate, the Owner may
33
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
34
transfer its RTU License for the Software furnished under this Contract for use
with such Product, without the payment of any additional Software right-to-use
fees by the transferee provided that Annual Maintenance Fees shall continue to
be calculated on the same basis. For example, if the RTU License for the
Software contains usage or per subscriber limits, or the processor to be used by
transferee requires additional memory or hard disk space additional payments or
purchases may be required. The following conditions shall apply to transfers and
relocations pursuant to this subsection 13.4:
(A) The right to use such Software may be transferred only
together with the Products with which the Owner has a
right to use such Software, and such right to use the
Software shall continue to be limited to use with such
Products;
(B) Before any such Software is transferred, the Owner shall
notify the Vendor of such transfer and the transferee
shall have agreed in writing (a copy of which shall be
provided to the Vendor) to keep the Software in
confidence and to corresponding conditions respecting
possession and use of Software as those imposed on the
Owner in this Contract; and
(C) The transferee shall have the same right to Software
warranty and Software maintenance for such Software as
the transferor, provided the transferee continues to pay
the fees, including recurring fees, if any, associated
with such Software warranty or maintenance pursuant to
this Contract.
(b) Except as otherwise provided in this Contract, the Owner or
any successor to the Owner's title in the Products shall have no right to
transfer Software furnished by the Vendor under this Contract without the
consent of the Vendor, which consent shall not be unreasonably withheld. If the
Owner or such successor elects to transfer a Product purchased under this
Contract for which it does not under this Contract have the right to transfer
related Software, the Vendor agrees that upon written request of the transferee
of such Product, or of the Owner or such successor, the Vendor shall not without
reasonable cause fail to grant to the transferee a license to use such Software
with the Products, whether to be located within the United States or elsewhere,
upon payment of a relicensing fee to the Vendor on commercially reasonable terms
acceptable to Vendor.
13.5 Termination and Survival. The rights and obligations of the
Owner under the RTU License shall survive the termination of this Contract,
regardless of the cause of termination provided Owner has met its material
obligations hereunder and has rendered all payments in accordance with this
Contract. In the event that Owner persistently and materially breaches its
confidentiality obligations hereunder with respect to the Software
notwithstanding the fact that Vendor will have provided Owner with prior written
notice describing the alleged material breaches and will have given Owner a
reasonable time, and in no event less than thirty (30) days, to cure any such
breaches, Vendor may terminate Owner's RTU License. In the event that Owner
fails to pay the Annual Release
34
35
Maintenance Fees (other than with respect to any periods for which no payment
for Annual Release Maintenance Fees are due pursuant to this Contract), Vendor
may terminate Owner's right to use the Software to which such fees apply. In no
event other than as set forth in this subsection 13.5 may Vendor terminate
Owner's right to use the Software. Notwithstanding any other provision of this
Contract, if there is a dispute, pending final resolution of such dispute, all
of Owner's rights under this Contract shall continue in full force and effect,
and Vendor will not terminate the RTU License, and so long as Owner continues to
pay Vendor applicable Annual Maintenance Release Fees, Vendor will not
terminate, suspend, interrupt or delay maintenance and support of the Software.
13.6 Access to Source Codes. The Vendor represents and warrants
that as of the date hereof, Vendor has not established a Source Code escrow for
any of its existing customers. In the event that Vendor establishes a Source
Code escrow in the future which applies to any of the Software furnished to
Owner hereunder, Vendor shall add Owner as a beneficiary of such Source Code
escrow, and Owner shall be entitled to receive a copy of the escrowed Source
Code in the event of the occurrence of any of the events set out below. In
addition to the foregoing, the Vendor shall immediately deliver and hereby
grants the Owner a right to access the Source Code and to modify the Software
(the "RTM License") for the maintenance, enhancement and support of those
Products purchased from the Vendor and owned or operated by the Owner under the
following circumstances, provided that any such released Source Code shall be
subject to the confidentiality provisions set forth in this Contract:
(i) if the Vendor becomes insolvent, makes a general
assignment for the benefit of creditors, files a voluntary petition in
bankruptcy or an involuntary petition in bankruptcy is filed against the
Vendor which is not dismissed within sixty (60) days, or suffers or
permits the appointment of a receiver for its business, or its assets
become subject to any proceeding under a bankruptcy or insolvency law,
domestic or foreign, or has liquidated its business, or the Vendor, or a
business unit of the Vendor that is responsible for maintenance of the
Software, ceases doing business without providing for a successor, and
the Owner has reasonable cause to believe that any such event shall
cause the Vendor to be unable to meet its Warranty service or support
requirements hereunder; or
(ii) if the Vendor ceases to maintain or support a
previously supported version of the Software and Owner cannot obtain,
with Vendor's assistance (for example, by providing a third party with
Source Code or by any other appropriate method) the same support
services the Vendor is required to provide under this Contract from
another entity (either working with or independently from Vendor) at a
price that is equal to or less than the prices for such support as
provided herein, or there is a persistent and material failure by Vendor
to provide the Warranty service or support it is required to provide
pursuant to the terms of this Contract.
13.7 Ownership of Intellectual Property. The Vendor shall own
all forms of intellectual property rights (including, but not limited to,
patent, trade secret, copyright and
35
36
mask rights) pertaining to the Software, and shall have the right to file for or
otherwise secure and protect such rights. The foregoing notwithstanding, the
parties understand and agree that from time to time the Owner may devise,
develop or otherwise create ideas or other concepts for services or new products
which are patentable or otherwise capable of receiving protection from
duplication. In such event, the Owner shall have the right to apply for a patent
in accordance with applicable law, provided, however, that notwithstanding this
subsection, the Vendor does not hereby relinquish or release any of its
intellectual property rights.
SECTION 14. SOFTWARE AND EQUIPMENT CHANGES
14.1 Software.
14.1.1 Software Upgrades, Software Maintenance Releases,
Software Enhancements and Combined Releases. During the Contract Term, upon
payment of the Annual Release Maintenance Fees, calculated pursuant to Exhibit
B-5, Owner shall receive all base Software releases and all Software Maintenance
Releases, Software Upgrades, Software Enhancements and Software Combined
Releases applicable to Software for Products for which the Owner has obtained a
RTU License at such times as they become generally available to the Vendor's
customers. Owner shall also be entitled to receive Optional Software Features
upon payment of the appropriate fees determined in accordance with Exhibit B-5.
Owner may elect to purchase such features on a per feature basis, or purchase
annual buy-out rights on a per market basis, permitting Owner to select those
features it wishes to deploy in the relevant market.
14.1.2 Notice. The Vendor shall give the Owner, or cause the
Owner to be given not less than ninety (90) days prior written notice of the
introduction of any Software Enhancement release or any Software Combined
Release or any optional Software release. In addition, in each February and
August of each year during the term of this Contract, the Vendor shall provide,
or cause to be provided, to the Owner a forecast of future Software Enhancement
releases, Software Upgrades, or Software Combined Releases or any optional
Software release, as the case may be, then currently being developed by or on
behalf of the Vendor.
14.1.3 Installation, Testing and Maintenance. The installation
and testing of the Software by the Vendor and the acceptance thereof by the
Owner shall be performed in accordance with the criteria set forth in Exhibit G.
14.1.4 Software Fixes. In the event that any Software
Maintenance Release, Software Upgrade, Software Enhancement or Software Combined
Release supplied by the Vendor during the term of this Contract has the effect
of preventing any System or any part thereof from satisfying, or performing in
accordance with the Specifications or the Exhibits or otherwise adversely
affects the functionality or features of any System or any part thereof, then
the Vendor shall promptly retrofit or take such other corrective action as may
be necessary to ensure that any System or any such affected part, as modified to
include each
36
37
such Software Maintenance Release, Software Upgrade, Software Enhancement or
Software Combined Release, shall satisfy, and perform in accordance with, the
Specifications and the Exhibits and restore all pre-existing functionality and
features as well as provide any new features and functionality provided by any
of the foregoing modifications, in each case without any charge to the Owner
(other than payment of the applicable fees pursuant to the terms of this
Contract). Notwithstanding anything contained herein in this subsection to the
contrary, Owner shall be responsible for the cost of any additional Equipment
required to accommodate additional capacity, memory or processing requirements
necessitated by any new Software feature or Optional Software Feature which
Owner elects to use (provided such use by Owner is optional without losing the
benefit of the Software Maintenance Release or Software Upgrade) which are
contained in any such Software Upgrade, Software Enhancement or Software
Combined Release; provided, however, that Owner shall not be required to pay for
any additional Equipment required to accommodate additional capacity, memory or
processing requirements necessitated by implementation of a required Software
Maintenance Release, whether or not such Software Maintenance Release is issued
as a stand-alone release, or is contained within a Software Upgrade, Software
Enhancement or Software Combined Release.
14.2 Equipment.
14.2.1 Equipment Upgrades. (a) Equipment Upgrades will be
provided to the Owner by the Vendor at no charge to the Owner as provided in
subsection 14.2.1(b) below. Equipment Enhancements must be provided to the Owner
by the Vendor, if requested by the Owner, and the Owner is obligated to make
payment therefor in an amount that is specified on the B Exhibits. If the Vendor
at any time issues an Equipment Upgrade which is combined with any Equipment
Enhancement (collectively, the "Equipment Combined Release") to such Equipment,
the Equipment Combined Release will be provided at no charge to the Owner unless
and until the Owner uses any of the Equipment Enhancements included within the
Equipment Combined Release, provided such use by Owner of such Equipment is
optional without losing the benefit of the Equipment Upgrade.
(b) (i) After a Product has been shipped to the Owner, if the
Vendor issues an Equipment Upgrade or Equipment Enhancement, or where a
modification to correct an error in field documentation is to be introduced, the
Vendor will promptly notify the Owner of such change through the Vendor's design
change management system or another Vendor notification procedure. Each change
notification, whether or not it bears a restrictive legend, will be subject to
the confidentiality obligations provided in subsection 26.18, except that such
information may be reproduced by the Owner for the Owner's use as required
within the System. If the Vendor has engineered, furnished, and installed a
Product which is subject to an Equipment Upgrade, the Vendor will implement such
change, at its sole cost and expense, if it is announced within [*] for the 5
ESS switch and [*] for all other Products from the date of shipment of that
Product, and subject to the reasonable review and acceptance of the Owner at
such times as the Owner reasonably determines that it needs to review such
Vendor decision, by either (A) modifying the Product at the Owner's site; (B)
modifying the Product which the Owner has returned to the Vendor in accordance
with the Vendor's reasonable instructions pursuant to and in
37
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
38
accordance with the terms of this Contract; or (C) replacing the Product
requiring the change with a replacement Product for which such change has
already been implemented. If the Vendor has not engineered the original Product
application and accordingly office records are not available to the Vendor, the
Vendor will provide the generic change information and associated parts for the
Owner's use in implementing such change.
(ii) In any of the instances described in clause (i) above, if
the Vendor and the Owner agree that a Product or part thereof subject to such
change is readily returnable, without incurring any significant time or expense,
the Owner, at its expense, will remove and return such Product or part to the
Vendor's designated facility within the United States and the Vendor, at its
sole expense, will implement such change (or replace it with a Product or part
for which such change has already been implemented) at its facility and return
such changed (or replacement) Product or part at its sole cost and expense to
the Owner's designated location within the United States. Any such
reinstallation of Products which were readily returnable will be performed by
the Owner at its sole expense, provided such reinstallation can be done by Owner
without incurring any significant time or expense. In all other circumstances,
Vendor shall provide such removal, repair and reinstallation Services at its
sole cost and expense.
(iii) If the Owner does not make or permit the Vendor to make an
Equipment Upgrade as stated above within the appropriate [*] or [*] period from
the date of change notification or such other period as the Vendor may agree,
subsequent changes, repairs or replacements affected by the failure to make such
change may, at the Vendor's option, be invoiced to the Owner whether or not such
subsequent change, repair or replacement is covered under the warranty provided
in this Contract for such Product. If requested by the Owner, Equipment Upgrades
announced more than the appropriate [*] or [*] period from the date of shipment
will be implemented at the Owner's expense.
(iv) If the Vendor issues an Equipment Enhancement after a
Product has been shipped to the Owner, the Vendor will promptly notify the Owner
of such change if it is being offered to any of the Vendor's customers. Except
as otherwise set forth above in subsection 14.2(b), when an Equipment
Enhancement is requested by the Owner, the pricing set for such Equipment
Enhancements will be at the Vendor's standard charges subject to the applicable
discounts set forth in the B Exhibits.
(v) All change notifications for Equipment Upgrades and
Equipment Enhancements provided by the Vendor to the Owner pursuant to the terms
of this Contract must contain the following information: (A) a detailed
description of the change; (B) the reason for the change; (C) the effective date
of the change; and (D) the implementation schedule for such change, if
appropriate.
14.2.2 Notice. The Vendor shall give, or shall cause to be given
to, the Owner not less than ninety (90) days prior written notice of the
introduction of any Equipment Enhancement or any Equipment Combined Release. In
addition, in each February and August of each year during the Term of this
Contract, the Vendor shall
38
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
39
provide the Owner with a forecast of future Equipment Enhancements to the
Equipment or Equipment Combined Releases then currently being developed by or on
behalf of the Vendor.
14.2.3 Installation, Testing and Acceptance The Installation and
testing of the Equipment by the Vendor and the acceptance thereof by the Owner
shall be performed in accordance with the Exhibits and pursuant to the
Milestones contained in the Exhibits.
14.2.4 Equipment Fixes. In the event that any Equipment Upgrade
or Equipment Enhancement, directly or indirectly, supplied by the Vendor during
the appropriate [*] or [*] period following the Effective Date or during [*]
period following the date of shipment of such Equipment Upgrade or Equipment
Enhancement, has the effect of preventing any System or any part thereof from
satisfying, or performing in accordance with, the Specifications or otherwise
adversely affects the functionality, interoperability or features of any System,
or any part thereof then the Vendor shall without any charge to the Owner
promptly retrofit or take such other corrective action as may be necessary to
assure that any System or any such affected part, as modified to include each
such Equipment Upgrade and Equipment Enhancement, shall satisfy, and perform in
accordance with, the Specifications and restore all pre-existing functionality
and features as well as provide any features and functionality provided by any
of the foregoing modifications.
14.2.5 Equipment Backwards Compatibility Warranty. The Vendor
represents and warrants (the "Equipment Backwards Compatibility Warranty") that
each New Equipment Release will be Backwards Compatible, provided that it is
implemented within the specified time provided with each New Equipment Release.
[***] Notwithstanding the foregoing, the Equipment Backwards
Compatibility Warranty does not apply to Products developed beyond 3G1X which
are developed in accordance with standards not yet finalized as of the date
hereof.
14.2.6 3G1X. [***]
14.2.7 1.1 ASIC Product. The prices set forth in the B Exhibits
for a BTS and channel elements includes a BTS equipped with the hardware
component for Vendor's "1.1 ASIC Product". Each BTS furnished by Vendor
hereunder will, at no additional charge to Owner beyond the BTS prices set forth
in Exhibit B-1, be equipped
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
39
40
at the time of shipment, or be retrofitted to include after shipment, at
Vendor's sole expense, such hardware component of Vendor's 1.1 ASIC Product.
14.3 Notice of Developments.
14.3.1 Vendor Developments. The Vendor shall provide the Owner,
or cause to be provided to the Owner, through the Owner's chief executive
officer, with reasonable written notice of any Product developments, innovations
and/or technological advances (collectively "Vendor Developments") relevant to
the System simultaneous to giving such notice to any other customer or otherwise
making any such Vendor Development public; provided that the Vendor shall not be
obligated to provide the Owner such notice before any other customer if doing so
would breach any contractual obligation to any other customer, provided further
that any such notice need not include any information originated by another
customer of Vendor which is proprietary to such other customer of Vendor. For
the purposes of this subsection the term "Vendor" includes the Vendor and its
affiliates and subsidiaries.
14.3.2 Participation in Testing. The Owner has the right, but
not the obligation, to witness and/or participate in any initial testing;
provided that any such initial testing of Vendor Developments shall be subject
to (i) scheduling as reasonably determined by the Vendor, (ii) the qualification
that the Owner's System meets the technical requirements for the testing of such
Vendor Development as reasonably determined by the Vendor (or otherwise that the
Owner is willing to update such System to meet such requirements), (iii) the
Owner's acknowledgment that it shall be able to provide the resources necessary
to implement the initial testing for such Vendor Development, and (iv) the Owner
and the Vendor executing a verification office testing agreement that identifies
the scope, terms, pricing, responsibilities and schedule related to the initial
testing of such Vendor Development. The Vendor shall provide the Owner at least
thirty (30) days' prior written notice of its intent to test any such Vendor
Development and upon the Owner's written request the Vendor shall allow the
Owner to participate in such testing upon terms and in a testing environment
reasonably acceptable to the parties at such time. Such rights shall not apply
to a Vendor Development originated by another customer of Vendor which includes
information which is proprietary to such other customer.
14.3.3 Quarterly Notices. Vendor shall make reasonable efforts
to collect and distribute on a quarterly basis a list of new Software bugs,
problems, fixes, etc., provided that Vendor shall not be required to distribute
confidential information of any other customer.
SECTION 15. INTELLECTUAL PROPERTY
15.1 Intellectual Property. Neither Owner nor Vendor shall
publish or use any advertising, sales promotion, press releases or publicity
matters relating to this Contract without the prior written approval of the
other, in accordance with Section 26.13.
40
41
15.2 Infringement. (a) The Vendor agrees that it shall defend,
indemnify and hold harmless, at its own expense, all suits and claims against
the Owner for infringement or violation of any patent, trademark, copyright,
trade secret or other intellectual property rights of any third party
enforceable in the United States or in any other territory where Vendor has
approved the deployment or use of Products under this Contract (collectively,
"Intellectual Property Rights"), covering, or alleged to cover, the Products or
any component thereof. The Vendor agrees that it shall pay all sums, including
without limitation, reasonable attorneys' fees and other costs incurred at
Vendor's written request or authorization, which, in defense of, by final
judgment or decree, or in settlement of any suit or claim to which the Vendor
agrees, may be assessed against, or incurred by, the Owner on account of such
infringement or violation, provided that the Owner shall cooperate in all
reasonable respects with the Vendor and its attorneys in the investigation,
trial and defense of such lawsuit or action and any appeal arising therefrom;
provided, however, that the Owner may, at its own cost, participate in the
investigation, trial and defense of such lawsuit or action and any appeal
arising therefrom. The parties shall cooperate with each other in any
notifications to insurers. If a claim for Losses (a "Claim") is to be made by a
party entitled to indemnification hereunder against the Vendor, the party
claiming such indemnification shall give written notice (a "Claim Notice") to
the Vendor as soon as practicable after the party entitled to indemnification
becomes aware of any fact, condition or event which may give rise to Losses for
which indemnification may be sought under this Agreement, provided, however, no
delay on the part of the Owner in notifying the Vendor shall relieve the Vendor
from any obligation hereunder unless (and then solely to the extent) the Vendor
is thereby materially prejudiced. If any lawsuit or enforcement action is filed
against any party entitled to the benefit of indemnity hereunder, written notice
thereof shall be given to the Vendor as promptly as practicable (and in any
event within fifteen (15) calendar days after the service of the citation or
summons). The Vendor shall be entitled, if it so elects, (i) to defend such
lawsuit or action, (ii) to employ and engage attorneys of its own choice to
handle and defend the same, at the Vendor's cost, risk and expense, and (iii) to
compromise or settle such Claim, which compromise or settlement shall be made
only with the written consent of the Owner (which may not be unreasonably
withheld), unless such compromise or settlement includes an unconditional
release of any claims against the Owner in which event such written consent of
the Owner shall not be required. If the Vendor fails to assume the defense of
such Claim within fifteen (15) calendar days after receipt of the Claim Notice,
the Owner against which such Claim has been asserted will (upon delivering
notice to such effect to the Vendor) have the right to undertake, at the
Vendor's cost and expense, the defense, compromise or settlement of such Claim
on behalf of and for the account and risk of the Vendor. In the event the Owner
assumes the defense of the Claim, the Owner will keep the Vendor reasonably
informed of the progress of any such defense, compromise or settlement. The
Vendor shall be liable for any settlement of any action effected pursuant to and
in accordance with this Agreement and for any final judgment (subject to any
right of appeal), and the Vendor agrees to indemnify and hold harmless the Owner
from and against any Losses by reason of such settlement or judgment.
41
42
(b) The Vendor's obligation under this subsection shall not
extend to alleged infringements or violations that arise because the Products
provided by the Vendor are used in combination with other products furnished by
third parties and where any such combination was not installed, recommended or
approved by the Vendor.
15.3 Vendor's Obligation to Cure. If in any such suit so
defended, all or any part of the Products or any component thereof is held to
constitute an infringement or violation of Intellectual Property Rights of
others and its use is enjoined, or if in respect of any claim of infringement or
violation the Vendor deems it advisable to do so, the Vendor shall at its sole
cost, expense and option take one or more of the following actions: (i) procure
the right to continue the use of the same without interruption for the Owner;
(ii) replace the same with non-infringing Products that meets the Specifications
in accordance with the terms of this Contract; or (iii) modify said Products,
any System or any component thereof so as to be non-infringing, provided that
the Products, any System or any component thereof as modified meets all of the
Specifications. In the event that the Vendor is not able to cure the
infringement pursuant to clause (i), (ii) or (iii) in the immediately preceding
sentence, in addition to the other rights and remedies provided in this Section
15, the Vendor shall refund to the Owner the full purchase price paid by the
Owner for such infringing Product or feature, and the Owner shall be under no
obligation to return to the Vendor such infringing Product or feature regardless
of whether, or by what means, the Owner, on its own or otherwise, subsequently
cures such infringement, unless Owner is directed to do so by court order.
15.4 Vendor's Obligations. The Vendor's obligations under this
Section 15 shall not apply to any infringement or violation of Intellectual
Property Rights caused by unauthorized modification of the Products, any System
or any component thereof by the Owner, or arises from adherence to instructions
to apply Owner's trademark, trade name or other company identification to a
Product, or any infringement caused solely by the Owner's use and maintenance of
the Products other than in accordance with the Specifications, except as
authorized or permitted by the Vendor. The Owner shall indemnify the Vendor
against all liabilities and costs, including reasonable attorneys' fees, for
defense and settlement of any and all claims against the Vendor for
infringements or violations based upon this subsection.
15.5 Liability of Vendor. The Liability of Vendor with respect
to any and all claims, actions, proceedings or suits by third parties alleging
infringement of patents, trademarks, or copyrights or violation of trade secrets
or proprietary rights because of, or in connection with, any items furnished
pursuant to this Contract shall be limited to the specific undertakings
contained in this Section 15.
SECTION 16. DELAY
16.1 Liquidated Damages. The parties agree that damages for
delay are difficult to calculate accurately and not reasonably determinable at
the time of execution of this Contract, and, therefore, agree that liquidated
damages (the "Liquidated Damages")
42
43
shall be paid for non-performance or late performance of the Vendor's
obligations to achieve a Guaranteed Substantial Completion Date for reasons not
otherwise excused by Force Majeure or Owner's failure to satisfy its obligations
set out in this Contact. The parties agree that Liquidated Damages are intended
to compensate Owner for the delayed or late performance by the Vendor and are
not a penalty.
16.2 Delay and Default. In the event the Vendor fails to achieve
(other than as permitted by this Contract) the Substantial Completion of a
System on or before the Guaranteed Substantial Completion Date for such System
or during a ten day cure period following such date, the Vendor shall pay,
weekly in arrears, for the next [*] commencing on the eleventh day after the
Guaranteed Substantial Completion Date, Liquidated Damages to the Owner in an
amount equal to [*] (pro-rated on a daily basis for periods of time less than
one week) of the total amount of all Purchase Orders relating to the System with
respect to which the Vendor has so failed, based on the number of days elapsed
after a ten day cure period following the Guaranteed Substantial Completion Date
and before the achievement of Substantial Completion; provided that in the event
that Substantial Completion is not achieved prior to the expiration of such [*]
period, thereafter Vendor shall pay, weekly in arrears, additional Liquidated
Damages to the Owner in an amount equal to [*] (pro-rated on a daily basis for
periods of time less than one week) of the total amount of all Purchase Orders
relating to the System with respect to which the Vendor has so failed, based on
the number of days elapsed after the [*] plus ten day cure period
following the Guaranteed Substantial Completion Date and before the achievement
of Substantial Completion; provided that in no event shall the amount of
Liquidated Damages so paid in respect of a System exceed [*] of the total amount
of all Purchase Orders relating to the System with respect to which the Vendor
has so failed.
16.3 System Capacity Guarantee. [***]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
43
44
[***]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
44
45
[***]
16.4 Limitation. The foregoing provisions concerning Liquidated
Damages shall not be deemed to limit the amount payable by the Vendor to the
Owner for breach of contract, except for amounts payable on account of delay as
aforesaid, provided, however that the payment of Liquidated Damages shall be
Owner's sole remedy for the delay giving rise to the Vendor's obligation to pay
the Liquidated Damages.
16.5 Early Completion Bonus. With respect to a System, Vendor
shall be entitled to an early completion bonus from the Owner in the event that
Substantial Completion with respect to such System occurs on or prior to the
date that is [*] prior to the Guaranteed Substantial Completion Date for such
System. Such early completion bonus shall be equal to [*] (pro-rated on a daily
basis for periods of time less than one week) of the total amount of all
Purchase Orders relating to such System, based on the number of days that
Substantial Completion occurs prior the date that is [*} prior to the
Guaranteed Substantial Completion Date for such System.
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
45
46
SECTION 17. FORCE MAJEURE
17.1 Excusable Delay. (a) If the performance of this Contract,
or of any obligation hereunder except for the obligations set forth in Section 5
is prevented, restricted or interfered with by reason of fires, breakdown of
plant, labor disputes, embargoes, government ordinances or requirements, civil
or military authorities, acts of God or of the public enemy, acts or omissions
of carriers, inability to obtain necessary materials or services from suppliers,
or other causes beyond the reasonable control of the party whose performance is
affected ("Force Majeure"), then the party affected, upon giving prompt notice
to the other party, shall be excused from such performance on a day-for-day
basis to the extent of such prevention, restriction, or interference (and the
other party shall likewise be excused from performance of its obligations on a
day-for-day basis to the extent such party's obligations relate to the
performance so prevented, restricted or interfered with); provided that the
party so affected shall use reasonable efforts to avoid or remove such cause of
non-performance and both parties shall proceed to perform their obligations with
dispatch whenever such causes are removed or cease.
(b) The party claiming the benefit of excusable delay hereunder
shall (i)promptly notify the other party of the circumstances creating the
failure or delay and provide a statement of the impact of such party failure or
delay and (ii) use reasonable efforts to avoid or remove such causes of
nonperformance, excusable failure or delay. If an event of Force Majeure
prevents the Vendor from performing its obligations under this Contract for a
period exceeding sixty (60) days, the Owner may, upon prior written notice to
the other party, terminate this Contract.
(c) In the event of a Force Majeure which the party claiming
relief for such event has used all best efforts to resolve in accordance with
the terms of this Contract, upon the written request of either party, the other
party shall in good faith negotiate modifications, to the extent reasonable and
necessary, in scheduling and performance criteria in order to reasonably address
the impact of such Force Majeure.
SECTION 18. WARRANTIES
18.1 Equipment and Services Warranty. Vendor warrants that, with
respect to each System, for a period of two (2) years from the date of
Substantial Completion, provided, however that if prior to Final Acceptance a
Major Outage occurs, the two (2) year period shall be extended by the number of
days elapsed between Substantial Completion and the date the Owner signs the
Certificate of Final Acceptance (as so determined, the "Warranty Period"), all
Equipment and Services furnished under this Contract with respect to such System
will be free of Defects and Deficiencies and shall conform to the applicable
portions of the Specifications (the "Equipment and Services Warranty"),
provided, however, that with respect to those Services for which a warranty is
set forth in an Exhibit, the warranty contained in the Exhibit shall supersede
the general Services warranty contained in this Section 18.1. With respect to
third-party manufactured Products which are not a part of a Core System, Vendor
shall furnish such Products only on a pass-through warranty basis;
46
47
provided, however, that Vendor shall identify such Products to Owner before
acceptance of any Purchase Order which includes any such Products. The terms of
the warranty applicable to such Products shall be provided in an addendum to the
Purchase Order. Except as noted in the B Exhibits, all Products referenced in
the B Exhibits qualify as Vendor-warranted Products. The Vendor's obligations
with respect to the Equipment and Services Warranty shall be to attempt first to
repair or replace at no additional cost, any defective Equipment or correct any
deficient Services. If, after using its best efforts to repair or replace such
Product and after consultation with and with the consent of Owner, which consent
shall not be unreasonably withheld, Vendor determines that it is unable to
repair, replace or otherwise correct such defect, Vendor shall provide a credit
or refund based on the original purchase price, and installation charges if
installed by Vendor. If, as a result of the Defect and Deficiency, the Product
fails to operate in accordance with the Specifications which causes the System
to fail to materially operate in accordance with its Specifications, a refund
shall be paid to the Owner on account of the purchase price for the total
System, less a pro-rata discount calculated with regard to the period of time
during the Warranty Period that Owner operated the System in In Revenue Service.
For purposes of calculating such pro rata discount, the period of time the Owner
would have been able to operate the System in In Revenue Service shall be ten
(10) years from Substantial Completion for the 5 ESS switch and seven years from
Substantial Completion for all other Products. In the event that Vendor pays a
refund hereunder, Owner shall return such Products to Vendor at Vendor's sole
cost and expense. The Warranty Period for all Equipment or Services repaired,
replaced or corrected under the Equipment and Services Warranty shall be the
longer of one (1) year from the date of delivery of the repaired or replacement
Equipment or from the completion of the corrected Services, as applicable, or
(ii) or the unexpired term of the Warranty Period. The Warranty Period for
Equipment purchased as spares shall be two (2) years from installation of such
Equipment.
For those Products not readily returnable by Owner, or where Owner
cannot remove and reinstall the Products without incurring significant time and
expense, and where Vendor elects to repair or replace the Product, Vendor shall
repair or replace the Product at Owner's Site. In the event Vendor does the
repair work at Owner's site, Vendor shall be responsible for replacement of
cable and wire Products, and for reasonable Site restoration. If Vendor has
elected to repair or replace a defective Product, and the Product is readily
returnable by Owner without incurring significant work or expense, Owner is
responsible for removing and reinstalling the Products. Products returned for
repair or replacement will be accepted by Vendor only in accordance with its
instructions and procedures for such returns. The transportation expense
associated with returning such Product to Vendor shall be borne by Owner. Vendor
shall pay the cost of transportation of the repaired or replacing Product to the
return destination designated by Owner. Defective or nonconforming Products or
parts which are replaced hereunder shall become Vendor's property. Vendor may
use either the same or functionally equivalent new, remanufactured,
reconditioned or refurbished Products or parts in the furnishing of repairs or
replacements under this Contract, provided that such Products satisfy the
Specifications.
18.2 Expansions Warranty. Vendor warrants that, with respect to
Products and Services constituting Expansions (including Expansions to a System,
or Expansions or
47
48
growth not part of a System, and all other purchased Products) furnished under
this Contract will be free of Defects and Deficiencies and shall conform the
applicable portions of the Specifications (the "Expansions Warranty"). The
warranty period with respect to such Products and Services shall be two (2)
years from the date of installation completion or completion of Services, as the
case may be (the "Expansions Warranty Period"). With respect to third-party
manufactured Products which are not a part of a Core System, Vendor shall
furnish such Products only on a pass-through warranty basis; provided, however,
that Vendor shall identify such Products to Owner before acceptance of any
Purchase Order which includes any such Products. The terms of the warranty
applicable to such Products shall be provided in an addendum to the Purchase
Order. Except as noted in the B Exhibits, all Products referenced in the B
Exhibits qualify as Vendor-warranted Products. The Vendor's obligations with
respect to the Expansions Warranty shall be to attempt first to repair or
replace at no additional cost, any defective Equipment or correct any deficient
Services. If, after using its best efforts to repair or replace such Product and
after consultation with and with the consent of Owner, which consent shall not
be unreasonably withheld, Vendor determines that it is unable to repair, replace
or otherwise correct such defect, Vendor shall provide a credit or refund based
on the original purchase price, and installation charges if installed by Vendor.
The warranty period for all Equipment or Services repaired, replaced or
corrected under the Expansions Warranty shall be the longer of one (1) year from
the date of delivery of the repaired or replacement Equipment or from the
completion of the corrected Services, as applicable, or (ii) or the unexpired
term of the Expansions Warranty Period. The Warranty Period for Equipment
purchased as spares shall be two (2) years from installation of such Equipment.
For those Products not readily returnable by Owner, or where Owner
cannot remove and reinstall the Products without incurring significant time and
expense, and where Vendor elects to repair or replace the Product, Vendor shall
repair or replace the Product at Owner's Site. In the event Vendor does the
repair work at Owner's site, Vendor shall be responsible for replacement of
cable and wire Products, and for reasonable Site restoration. If Vendor has
elected to repair or replace a defective Product, and the Product is readily
returnable by Owner without incurring significant work or expense, Owner is
responsible for removing and reinstalling the Products. Products returned for
repair or replacement will be accepted by Vendor only in accordance with its
instructions and procedures for such returns. The transportation expense
associated with returning such Product to Vendor shall be borne by Owner. Vendor
shall pay the cost of transportation of the repaired or replacing Product to the
return destination designated by Owner. Defective or nonconforming Products or
parts which are replaced hereunder shall become Vendor's property. Vendor may
use either the same or functionally equivalent new, remanufactured,
reconditioned or refurbished Products or parts in the furnishing of repairs or
replacements under this Contract, provided that such Products satisfy the
Specifications.
18.3 Software Warranty. Vendor warrants that, with respect to
each System for the Warranty Period, all Software will be free of Defects and
Deficiencies and shall conform to the applicable portions of the Specifications
(the "Software Warranty"). The Vendor's obligations with respect to the Software
Warranty shall be to attempt first to repair or replace at no additional cost,
any defective Software. If, after using its best efforts to
48
49
repair or replace such Software and after consultation with and with the consent
of Owner, which consent shall not be unreasonably withheld, Vendor determines
that it is unable to repair, replace or otherwise correct such defect, Vendor
shall provide a credit or refund based on the original purchase price, and
installation charges if installed by Vendor. If, as a result of the Defect and
Deficiency, the Software fails to operate in accordance with the Specifications
which causes the System to fail to materially operate in accordance with its
Specifications, a refund shall be paid to Owner on account of the purchase price
for the total System, less a pro rata discount calculated with regard to the
period of time during the Warranty Period that Owner operated the System in In
Revenue Service. For purposes of calculating such pro rata discount, the period
of time the Owner would have been able to operate the System in In Revenue
Service shall be ten (10) years from Substantial Completion for the 5 ESS switch
and seven years from Substantial Completion for all other Products. In the event
that Vendor pays a refund hereunder, Owner shall return such Products to Vendor.
The warranty period for all Software so corrected or replaced under the Software
Warranty shall be the longer of one (1) year from the date of delivery of the
repaired or replacement Software, or (ii) or the unexpired term of the Warranty
Period. Vendor shall be solely responsible for all costs and expenses incurred
by Owner or Vendor in connection with the de-installation, removal and
transportation of defective Software under the Software Warranty and for the
transportation and installation of repaired, corrected or replacement Software,
including without limitation any additional or upgraded Equipment or processing
capability necessary to run or operate such repaired, corrected or replacement
Software. The Warranty Period with respect to Software Maintenance Releases,
Software Upgrades, Software Enhancements and Software Combined Releases shall be
two (2) years from the successful installation of such Software Maintenance
Releases, Software Upgrades, Software Combined Releases and Software
Enhancements.
18.4 [intentionally deleted]
18.5 Year 2000 Warranty. Vendor warrants that, notwithstanding
any other warranty provided to Owner pursuant to this Contract, during the
period commencing on the date that the applicable Software Warranty Period
commences and ending on January 1, 2004, the Software will (a) process calendar
dates falling on or after January 1, 2000, with substantially the same
functionality as such Software processes calendar dates falling on or before
December 31, 1999, and (b) provide substantially the same functionality with
respect to the introduction of records containing dates falling on or after
January 1, 2000, as it provides with respect to the introduction of records
containing dates falling on or before December 31, 1999 (the "Year 2000
Warranty"). All of the foregoing functionality shall be known as "Year 2000
Capability". In the event Owner has or purchases more than one version of
Software, such versions of Software, if they are intended by Vendor to
interoperate, will be compatible and interoperate in such manner as to process
between them, as applicable, date related data correctly as described herein.
All of the foregoing functionality shall be known as "Year 2000
Interoperability". The foregoing sets forth an additional warranted
specification for Software developed by Vendor that Vendor has identified as
having Year 2000 Capability. The failure of such Software to meet such
specification during the Year 2000 Warranty Period shall, to the extent the
Software remains then subject to warranty protection, entitle Owner to the
remedies set out in this section.
49
50
Nothing in the foregoing shall be deemed to make Vendor responsible for the Year
2000 Capability or Year 2000 Interoperability of any third party software
interoperating or intended to interoperate with Software developed by Vendor.
Owner and or the manufacturer or other supplier of such third party software
shall be responsible for such compliance and assuring the ability of such
software to successfully operate while interoperating with Software developed by
Vendor.
18.6 Warranty Claim Procedures. (a) If the Owner claims a breach
of any warranty, it shall notify the Vendor of the claimed breach within a
reasonable time after its determination that a breach has occurred. The Owner
shall allow the Vendor to inspect the Equipment, Software, Services, or the
System, as the case may be, on-site in order to effect the necessary repairs.
(b) The Vendor shall respond to such warranty claims for
warranty Services in accordance with the procedures outlined in Exhibit N.
18.7 Technical Assistance. The Vendor shall maintain a technical
assistance center and shall have technical support available to the Owner in
accordance with the requirements set forth in Exhibit N.
18.8 Scope of Warranties. Unless otherwise stated herein, the
Warranties shall not apply to:
18.8.1 defective conditions or nonconformities to the extent
resulting from the following, if not consistent with applicable
Specifications: unauthorized Owner modifications, misuse, neglect,
accident, abuse, improper wiring, repairing, splicing, alteration,
installation, storage or maintenance failure of Owner to apply
previously applicable Vendor modifications or corrections;
18.8.2 any Equipment, Services or Software damaged by accident
or disaster, including without limitation, fire, flood, wind, water,
lightning or power failure other than to the extent that any such
Equipment, Services or Software should in accordance with the
Specifications be able to withstand any such events; or
18.8.3 non-integral items normally consumed in operation or
which has a normal life inherently shorter than the Warranty Periods
(e.g., fuses, lamps, magnetic tape); or
18.8.4 damages or defects resulting directly from third party
equipment, provided that this shall in no event limit the Vendor's
obligations as to interoperability pursuant to the terms of this
Contract;
18.8.5 Equipment which have had their serial numbers or months
and year of manufacture removed or obliterated by the Owner; or
50
51
18.8.6 failures or deficiencies in BTS performance or System
optimization resulting solely from changed environmental conditions or
unauthorized changes to the System by Owner, or changes not consented to
by Owner including, but not limited to, the growth of trees and other
foliage, the erection of buildings, and interference from third party
radio transmissions not otherwise engineered for by the Vendor;
except when any such damage or defects are made, done or caused by the Vendor or
any of its Subcontractors, their respective agents and employees.
18.9 Third Party Warranties. If the Vendor purchases or
subcontracts for the manufacture of any part of a System or the performance of
any of the Services to be provided hereunder from a third party, the warranties
given to the Vendor by such third party shall inure, to the extent assigned to
the Owner pursuant to this Section 18 or permitted by law, to the benefit of the
Owner, and the Owner shall have the right, at its sole discretion, to enforce
such warranties directly and/or through the Vendor. The warranties of such third
parties shall be in addition to and shall not, unless otherwise expressly stated
herein, be in lieu of any warranties given by the Vendor under this Contract.
18.10 Additional Sites. In the event that under the remedy
provisions of this Section 18 the Vendor is required to provide additional MSC
and/or BTS's requiring additional Sites, the Owner shall be responsible for all
Site Acquisition.
18.11 EXCLUSIVE REMEDIES. THE FOREGOING EQUIPMENT, SERVICES,
SOFTWARE AND EXPANSIONS WARRANTIES AND REMEDIES ARE EXCLUSIVE FOR THE PURPOSES
OF ANY BREACH BY THE VENDOR OF ANY SUCH WARRANTY AND ARE IN LIEU OF ALL OTHER
EXPRESS AND IMPLIED WARRANTIES, INCLUDING BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
SECTION 19. INSURANCE
19.1 Insurance. The Vendor shall maintain insurance in
accordance with the provisions set forth in Exhibit Q.
SECTION 20. INDEMNIFICATION AND LIMITATION OF LIABILITY
20.1 Indemnity. Vendor agrees to indemnify, defend and hold harmless
Owner and its affiliates and their respective directors, officers, employees,
agents, successors and assigns, from Losses and threatened Losses arising from,
in connection with, or based on allegations of, any of the following:
51
52
(a) Vendor's failure to observe or perform any duties or
obligations to Subcontractors or any third parties
within the reasonable contemplation of this Contract;
(b) the death or bodily injury of any agent, employee,
customer, business invitee or any other person caused by
the tortious conduct (including without limitation
negligence, willful misconduct or breach of warranty) or
strict liability of Vendor, any Subcontractor or its or
their respective employees, contractors, agents or
representatives;
(c) the damage, loss or destruction of any real or tangible
personal property caused by the tortious conduct
(including without limitation negligence, willful
misconduct or breach of warranty) or strict liability of
Vendor, any Subcontractor or its or their respective
employees, contractors, agents or representatives; or
(d) any claim, demand, charge, action, cause of action or
other proceeding asserted against Owner but arising out
of or resulting from an act or omission of Vendor, any
Subcontractor or its or their respective employees,
contractors, agents or representatives in its or their
respective capacities as an employer.
20.2 Claim for Losses. If a Claim is to be made by a party
entitled to indemnification hereunder against the Vendor, the party claiming
such indemnification shall give a Claim Notice to the Vendor as soon as
practicable after the party entitled to indemnification becomes aware of any
fact, condition or event which may give rise to Losses for which indemnification
may be sought under this Agreement, provided, however, no delay on the part of
the Owner in notifying the Vendor shall relieve the Vendor from any obligation
hereunder unless (and then solely to the extent) the Vendor is thereby
materially prejudiced. If any lawsuit or enforcement action is filed against any
party entitled to the benefit of indemnity hereunder, written notice thereof
shall be given to the Vendor as promptly as practicable (and in any event within
fifteen (15) calendar days after the service of the citation or summons). The
Vendor shall be entitled, if it so elects, (i) to defend such lawsuit or action,
(ii) to employ and engage attorneys of its own choice to handle and defend the
same, at the Vendor's cost, risk and expense, and (iii) to compromise or settle
such Claim, which compromise or settlement shall be made only with the written
consent of the Owner (which may not be unreasonably withheld), unless such
compromise or settlement includes an unconditional release of any claims against
the Owner in which event such written consent of the Owner shall not be
required. If the Vendor fails to assume the defense of such Claim within fifteen
(15) calendar days after receipt of the Claim Notice, the Owner against which
such Claim has been asserted will (upon delivering notice to such effect to the
Vendor) have the right to undertake, at the Vendor's cost and expense, the
defense, compromise or settlement of such Claim on behalf of and for the account
and risk of the Vendor. In the event the Owner assumes the defense of the Claim,
the Owner will keep the Vendor reasonably informed of the
52
53
progress of any such defense, compromise or settlement. The Vendor shall be
liable for any settlement of any action effected pursuant to and in accordance
with this Agreement and for any final judgment (subject to any right of appeal),
and the Vendor agrees to indemnify and hold harmless the Owner from and against
any Losses by reason of such settlement or judgment.
20.3 Limitation On Liability. THE ENTIRE LIABILITY OF VENDOR FOR
ANY CLAIM, LOSS, DAMAGE OR EXPENSE OF OWNER OR ANY OTHER ENTITY ARISING OUT OF
THIS CONTRACT, OR THE USE OR PERFORMANCE OF ANY PRODUCT OR SERVICE, WHETHER IN
AN ACTION FOR OR ARISING OUT OF BREACH OF CONTRACT OR TORT, INCLUDING
NEGLIGENCE, INDEMNITY OR STRICT LIABILITY, SHALL BE EXPRESSLY SET FORTH HEREIN
AND AS FOLLOWS:
1. FOR INFRINGEMENT, THE REMEDIES SET FORTH IN SECTION 15;
2. FOR THE NON-PERFORMANCE OF PRODUCTS OR SERVICES DURING THE
WARRANTY PERIOD, THE REMEDIES SET FORTH IN THE APPLICABLE CLAUSE
OF SECTION 18;
3. FOR DELAYS ATTRIBUTABLE TO FAILURE TO ACHIEVE A GUARANTEED
SUBSTANTIAL COMPLETION DATE OR FAILURE TO SATISFY THE CAPACITY
GUARANTEE, THE AGGREGATE OF THE DAMAGES WITH RESPECT TO THE
FOREGOING SHALL NOT EXCEED AN AMOUNT EQUAL TO [*] OF THE
AGGREGATE AMOUNTS OF ALL PURCHASE ORDERS WITH RESPECT TO ALL
SYSTEMS, PROVIDED THAT FOR PURPOSES OF QUANTIFYING THE DAMAGES
FOR A FAILURE TO SATISFY THE CAPACITY GUARANTEE, THE ADDITIONAL
EQUIPMENT FURNISHED BY THE VENDOR AT NO CHARGE TO THE OWNER
SHALL BE VALUED AT THE PURCHASE PRICES FOR SUCH EQUIPMENT SET
FORTH IN THIS CONTRACT AND, AS SO VALUED, SHALL BE DEEMED TO BE
DAMAGES FOR PURPOSES OF THIS SUBSECTION AND;
4. EXCEPT AS PROVIDED IN PARAGRAPH 5 BELOW, FOR EVERYTHING OTHER
THAN AS SET FORTH ABOVE, VENDOR'S TOTAL LIABILITY TO THE OWNER,
WHETHER IN CONTRACT OR IN TORT (INCLUDING BREACH OF WARRANTY,
NEGLIGENCE AND STRICT LIABILITY) SHALL BE LIMITED TO AN AMOUNT
EQUAL TO [*] OF THE AGGREGATE AMOUNT OF ALL PURCHASE ORDERS
ISSUED UNDER THIS CONTRACT.
5. THE LIMITATION SET FORTH IN PARAGRAPH 4 ABOVE SHALL NOT APPLY
WITH RESPECT TO (i) CLAIMS OF BREACH OF CONFIDENTIALITY, (ii)
CLAIMS SUBJECT TO INDEMNIFICATION
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
53
54
PURSUANT TO SUBSECTION 20.1 ABOVE OR PATENT INFRINGEMENT
PROVISIONS OF THIS CONTRACT, OR (iii) FAILURE TO COMPLY WITH
APPLICABLE LAWS.
6. NOTWITHSTANDING ANY OTHER PROVISION OF THIS CONTRACT, NEITHER
PARTY, NOR THEIR AFFILIATES NOR THEIR EMPLOYEES, DIRECTORS,
OFFICERS AND SUPPLIERS SHALL BE LIABLE FOR THE OTHER PARTY'S
INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS,
REVENUES OR SAVINGS ARISING OUT OF THIS CONTRACT OR THE USE OR
PERFORMANCE OF ANY PRODUCTS OR SERVICES OR, EXCEPT AS SET FORTH
ABOVE, FOR DAMAGES IN EXCESS OF THE AGGREGATE AMOUNT OF ALL
PAYMENTS MADE TO THE VENDOR HEREUNDER. THIS CLAUSE SHALL SURVIVE
FAILURE OF AN EXCLUSIVE OR LIMITED REMEDY.
SECTION 21. REPRESENTATIONS AND WARRANTIES
21.1 Representations and Warranties of the Parties. The parties
hereby represent and warrant as follows:
21.1.1 Due Organization. Each party represents and warrants to
the other party that the representing party is a corporation duly
incorporated, validly existing and in good standing under the laws of
the State of Delaware and has all requisite corporate power and
authority to own and operate its business and properties and to carry on
its business as such business is now being conducted and is duly
qualified to do business in all jurisdictions in which the transaction
of its business in connection with the performance of its obligations
under this Contract makes such qualification necessary or required.
21.1.2 Due Authorization; Binding Obligation. Each party
represents and warrants to the other party that the representing party
has full corporate power and authority to execute and deliver this
Contract and to perform its obligations hereunder, and the execution,
delivery and performance of this Contract by the representing party have
been duly authorized by all necessary corporate action on the part of
the party; this Contract has been duly executed and delivered by such
party and is the valid and binding obligation of the party enforceable
in accordance with its terms, except as enforcement thereof may be
limited by or with respect to the following: (i) applicable insolvency,
moratorium, bankruptcy, fraudulent conveyance and other similar laws of
general application relating to or affecting the rights and remedies of
creditors; (ii) application of equitable principles (whether enforcement
is sought in proceedings in equity or at law); and (iii) provided the
remedy of specific enforcement or of injunctive relief is subject to the
discretion of the court before which any proceeding therefore may be
brought.
54
55
21.1.3 Non-Contravention. Each party represents and warrants to
the other party that the execution, delivery and performance of this
Contract by the representing party and the consummation of the
transactions contemplated hereby will not contravene its certificate of
incorporation or by-laws and will not conflict with or result in (i) a
breach of or default under any material indenture, mortgage, lease,
agreement, instrument, judgment, decree, order or ruling applicable to
it or by which it or any of its properties is bound or affected, or (ii)
a breach by the representing party of any Applicable Law.
21.1.4 Regulatory Approvals. Vendor represents and warrants to
Owner that all authorizations by, approvals or orders by, consents of,
notices to, filings with or other acts by or in respect of any
Governmental Entity or any other Person required in connection with the
execution, delivery and performance of this Contract by the Vendor have
been obtained or shall be obtained in due course.
21.1.5 Non-Infringement. Vendor represents and warrants to Owner
that to the best of Vendor's knowledge after reasonable investigation,
as of the Effective Date there are no actual claims or threatened or
actual suits in connection with patents or other Intellectual Property
Rights that could materially adversely affect it's the Vendor's ability
to perform its obligations under this Contract.
21.1.7 Requisite Knowledge. Vendor represents and warrants to
Owner that that Vendor has all requisite knowledge, know-how, skill,
expertise and experience to satisfy its obligations in accordance with
the terms of this Contract.
21.1.8 Financial Capacity. Vendor represents and warrants to
Owner that Vendor has the financial, management and manufacturing
capacity and capabilities to satisfy its obligations in a timely manner
in accordance with the terms of this Contract.
SECTION 22. TITLE AND RISK OF LOSS
22.1 Title. Title to Equipment shall pass to the Owner upon
delivery of such Equipment to the location specified in the Exhibits.
22.2 Risk of Loss. Risk of loss or damage of any Products
furnished to the Owner in connection with this Contract shall pass from the
Vendor to the Owner upon the later of (i) delivery of such Products to the
Sites; or, (ii) if Vendor is responsible for Site Preparation, the date of the
Site Preparation Substantial Completion Certificate; provided that during the
period a party has the risk of loss or damage to an item, nothing in this
section shall relieve the other party of responsibility for loss or damage to
the item resulting from the acts or omissions of the other party, its employees,
or agents.
55
56
SECTION 23. DISPUTE RESOLUTION
23.1 Dispute Resolution. In the event any controversy, claim,
dispute, difference or misunderstanding between the Owner and the Vendor arises
out of or relates to this Contract, any term or condition hereof, any of the
Work to be performed hereunder or in connection herewith, each party shall
designate managers to meet and negotiate in good faith in an attempt to amicably
resolve such controversy, claim, dispute, difference or misunderstanding in
writing. Such managers shall meet for this purpose within ten (10) Business
Days, or such other time period mutually agreed to by the parties, after written
notice from either party. If the parties are unable to resolve the controversy,
claim, dispute, difference or misunderstanding through good faith negotiations
within ten (10) Business Days after such meeting or meetings, each party shall,
within five (5) Business Days after the expiration of such ten (10) Business Day
period, prepare a written position statement which summarizes the unresolved
issues and such party's proposed resolution. Such position statement shall be
delivered by the Vendor to the Owner's Chief Executive Officer and by the Owner
to the Vendor's corresponding officer or representative for resolution within
(5) Business Days, or such other time period mutually agreed to by the parties.
23.2 Tolling. All applicable statutes of limitation shall be
tolled to the extent permitted by Applicable Law while the dispute resolution
procedures specified in this Section are pending, and nothing herein shall be
deemed to bar any party from taking such action as the party may reasonably deem
to be required to effectuate such tolling.
SECTION 24. TERMINATION AND EVENTS OF DEFAULT
24.1 Termination Without Cause. The Owner may, at its sole
option, terminate this Contract, in its entirety, for convenience upon ninety
(90) days' prior written notice at any time. Any Purchase Orders issued prior to
any such termination above shall remain in effect and shall be fulfilled to the
extent that such orders are outstanding as of the date of such termination. In
the event that at the time of such termination the aggregate amount of all
Purchase Orders delivered to Vendor under this Contract (the "Aggregate Purchase
Orders") is less than One Hundred Million Dollars ($100,000,000), Owner shall
pay to the Vendor the lesser of (i) the difference between One Hundred Million
Dollars ($100,000,000) and the Aggregate Purchase Orders; or (ii) the aggregate
amounts of the Products and Services furnished by Vendor pursuant to Exhibits
B-2 and B-3 prior to the date of such termination.
24.2 Termination for Cause. The Owner shall have the right to
terminate this Contract in its entirety (except as otherwise set forth in clause
(g) below) without any penalty or payment obligation, except as provided in
subsection 24.5 below, upon the occurrence of any of the events of default (each
a "Vendor Event of Default") as set forth below:
(a) the Vendor (i) files a voluntary petition in bankruptcy or
has an involuntary petition in bankruptcy filed against it that is not
dismissed within sixty
56
57
(60) days of such involuntary filing, (ii) admits the material
allegations of any petition in bankruptcy filed against it, (iii) is
adjudged bankrupt, (iv) is unable generally to pay its debts as they
mature, (v) makes a general assignment for the benefit of its creditors,
or if a receiver is appointed for all or a substantial portion of its
assets and is not discharged within sixty (60) days after his
appointment, or (vi) the Vendor commences any proceeding for relief from
its creditors in any court under any state insolvency statutes; or
(b) the Vendor disregards or violates any Applicable Laws or
Applicable Permits which has a material adverse effect on the business,
financial condition or operations of Owner or on any of its Systems
("Material Adverse Effect"); or
(c) the Vendor allows material Defects and Deficiencies to
exist; or
(d) the Vendor fails to fulfill its obligations with respect to
the satisfaction, discharge or bonding of liens as set forth herein; or
(e) the Vendor abandons or ceases for a period in excess of
thirty (30) days its performance of the Work (except as a result of
Force Majeure or a casualty which is fully covered by insurance or as to
which other provisions reasonably acceptable to the Owner are being
diligently pursued); or
(f) the Vendor assigns or subcontracts Work other than as
provided for in this Contract which has a Material Adverse Effect; or
(g) the Vendor misses the Guaranteed Substantial Completion Date
for any given System by a period in excess of one hundred-fifty (150)
days; provided that in such case the Owner shall have the right, but not
the obligation, to terminate this Contract with respect to only that
System in which such delay occurred; and provided further that such
failure to achieve such date was not caused by (i) a Force Majeure event
and/or (ii) any act or omission of the Owner; or
(h) if an event of Force Majeure prevents the Vendor from
performing its obligations under this Contract for a period exceeding
sixty (60) days, the Owner may, upon prior written notice to the Vendor,
terminate this Contract in accordance with the Force Majeure provisions
above; or
(i) the Vendor otherwise materially breaches any provision of
this Contract.
24.3 Remedies. (a) If any of the Vendor Events of Default
exists, the Owner may, in addition to and without prejudice to any other rights
or remedies of the Owner in this Contract or at law or in equity, terminate this
Contract upon written notice to the Vendor; provided, however, that the Owner
shall have first provided to the Vendor the following periods of notice and
opportunity to cure:
57
58
(i) in the case of a Vendor Event of Default specified
in the foregoing clauses (a) or (b), no notice or opportunity to cure
shall be required from the Owner; and
(ii) in the case of any other Vendor Event of Default,
the Owner shall have provided thirty (30) days' prior written notice,
and the Vendor shall have failed (i) to commence to cure the default
within five (5) Business Days of delivery of such notice, and (ii) to
diligently pursue such cure and remedy the breach entirely.
(b) If the Owner elects to terminate this Contract, the Owner
may, in addition to and without prejudice to any other rights or remedies of the
Owner in this Contract or of law or in equity, do one or more of the following:
(i) require Vendor, at no additional charge to Owner, to
complete or assist others with the completion of all ordered but
unfinished Work, including the sharing with Owner and others all
relevant engineering and design data, procurement data, manufacturing
data, construction and erection data, start-up and testing data,
materials, and Products that shall become part of such unfinished System
and/or the specified Systems, which Vendor would otherwise have been
required to deliver to Owner pursuant to the terms of this Contract but
for the breach, under reasonably appropriate non-disclosure agreements;
or
(ii) direct that the Vendor assign its Subcontractor
agreements to the Owner without any change of price or conditions
therein or penalty or payment therefor.
(c) In the event of any termination of this Contract by Owner in
connection with a Vendor Event of Default, Owner shall have no liability for any
failure to satisfy the Minimum Purchase Commitment prior to such termination.
24.4 Discontinuance of Work. Upon such notification of
termination, the Vendor shall immediately discontinue all of the Work (unless
such notice of termination directs otherwise), and, as more fully set forth in
subsection 24.3(b), deliver to the Owner copies of all data, drawings,
specifications, reports, estimates, summaries, and such other information, and
materials as may have been accumulated by the Vendor in performing the Work,
whether completed or in process, which Vendor would otherwise have been required
to deliver to Owner pursuant to this Contract but for the breach. Furthermore,
the Vendor shall assign, assemble and deliver to the Owner all purchase orders
and Subcontractor agreements requested by the Owner.
24.5 Payments. If the Owner terminates this Contract pursuant to
subsection 24.2, the Vendor shall not be entitled to receive further payment
other than payments due and payable under this Contract and not subject to
dispute prior to such termination (provided that any such disputed amounts shall
be paid by the Owner when and if such dispute is in fact resolved).
Notwithstanding anything herein to the contrary, the Owner may withhold
payments, if any, to the Vendor for the purposes of offset of amounts
58
59
owed to the Owner pursuant to the terms of this Contract until such time as the
exact amount of damages due the Owner from the Vendor is fully determined by a
court of competent jurisdiction.
24.6 Continuing Obligations. Termination of this Contract for
any reason (i) shall not relieve either party of its obligations with respect to
the confidentiality of the Proprietary Information as set forth in subsection
26.18, (ii) shall not relieve either party of any obligation which applies to it
and which expressly or by implication survives termination, and (iii) except as
otherwise provided in any provision of this Contract expressly limiting the
liability of either party, shall not relieve either party of any obligations or
liabilities for loss or damage to the other party arising out of or caused by
acts or omissions of such party prior to the effectiveness of such termination
or arising out of its obligations as to portions of the Work already performed
or of obligations assumed by the Vendor prior to the date of such termination.
24.7 Vendor's Right to Terminate. The Vendor shall have the
option to terminate this Contract without any penalty or payment obligations,
other than undisputed payment obligations outstanding as of the date of any such
termination pursuant to the terms of this Contract if:
(a) the Owner (i) files a voluntary petition in bankruptcy or
has an involuntary petition in bankruptcy filed against it that is not
dismissed within sixty (60) days of such involuntary filing, (ii) admits
the material allegations of any petition in bankruptcy filed against it,
(iii) is adjudged bankrupt, (iv) makes a general assignment for the
benefit of its creditors, or if a receiver is appointed for all or a
substantial portion of its assets and is not discharged within sixty
(60) days after his appointment, or (v) commences any proceeding for
relief from its creditors in any court under any state insolvency
statutes, and any such filing, proceeding, adjudication or assignment as
described herein above shall otherwise materially impair the Owner's
ability to perform its obligations under this Contract; or
(b) the Owner fails to make payments of undisputed amounts due
to the Vendor pursuant to the terms of this Contract which are more than
sixty (60) days overdue, provided that such failure has continued for at
least thirty (30) days after the Vendor has notified the Owner of its
right and intent to so terminate on account of such overdue amount; and
provided, further, that such failure to make undisputed payments to
Vendor shall not arise out of or relate to a termination of or credit
restrictions under the Vendor Financing, or
(c) the Owner materially breaches any provision of this Contract
other than a breach to which Section 24.7(b) is applicable, and after
the Vendor having provided thirty (30) days' prior written notice, the
Owner shall have failed (i) to commence to cure the default within five
(5) Business Days of delivery of such notice, and (ii) to diligently
pursue such cure and remedy the breach entirely.
59
60
24.8 Special Termination Events. (a) Neither the Vendor nor the
Owner shall be obligated to perform under this Contract, except as specifically
provided, in the event that financing for the purpose of acquiring any System
sufficient to cover Owner's current payment obligations hereunder has not been
finalized with the Vendor on terms and conditions reasonably satisfactory to the
Owner. Unless acceptable financing is available, either party may terminate this
Contract without recourse, except as noted below, by notifying the other party
in writing. Further, the parties agree that the delivery and performance
schedules shall be extended by the period of time required to secure acceptable
financing. In the event of a termination of this Contract pursuant to this
subsection the Owner shall remain liable for amounts due to the Vendor for all
Work performed or Products delivered by the Vendor or any of its Subcontractors
pursuant to the specific terms of this Contract which had been directly
delivered to or performed for the Owner and/or any of its facilities or Sites in
accordance with the terms of this Contract. Any amounts owed by the Owner for
Work done or Products delivered by the Vendor during such interim period not
otherwise invoiced to the Owner by the Vendor prior to the termination of such
interim period, shall be invoiced to the Owner by the Vendor within thirty (30)
days. In no event shall the Owner be liable to the Vendor due to a termination
of this Contract pursuant to this subsection for satisfaction of the Minimum
Purchase Commitment or for any of the Vendor's direct or indirect costs or
expenses incurred in connection with any supplies or equipment ordered by the
Vendor or agreements entered into by the Vendor in order to enable it to fulfill
its obligations hereunder or in connection with the establishment of and/or
upgrade to its manufacturing, personnel, engineering, administrative or other
capacities and/or resources in contemplation of or pursuant to its performance
in accordance with the terms of this Contract and any amounts due to the Vendor
pursuant to this subsection shall be limited in all cases to Work actually done
or Products or Services actually delivered to the Owner, its Sites or its
facilities.
(b) If at any time after the Effective Date any material change
shall have occurred in any Applicable Law or in the interpretation thereof by
any Governmental Entity, or there shall be rendered any decision in any judicial
or administrative case or proceeding, in either case which, in the reasonable
opinion of the Owner would make the Owner's use of any part of any System
illegal or would subject the Owner or any of its Affiliates to any material
penalty, other material liability or onerous condition or to any burdensome
regulation by any Governmental Entity or otherwise render the use of such System
economically nonviable, then, with respect to such System, or affected part
thereof, or with respect to all Systems if so affected, the Owner may terminate
this Contract without charge or penalty of any kind; provided that (i) the Owner
gives the Vendor prior written notice of any such change or decision and (ii)
that the Owner uses its reasonable efforts for a reasonable time to reverse or
ameliorate such change or decision to the extent possible or practical prior to
declaring such termination. In the event of a termination pursuant to this
subsection, payment obligations incurred by the Owner for Work actually done or
Products or Services actually delivered by the Vendor prior to such termination
pursuant to this Contract shall be payable by the Owner to the Vendor on the
same terms and subject to the limitations set forth in subsection 24.8(a) above.
60
61
SECTION 25. SUSPENSION
25.1 Owner's Right to Suspend Work. The Owner may at any time
issue a Change Order to the Vendor to suspend all or any part of the Work for
such period of time as the Owner may reasonably determine to be appropriate. Any
such Change Order shall be handled in accordance with the provisions of Section
11 hereof.
SECTION 26. MISCELLANEOUS
26.1 Amendments. The terms and conditions of this Contract may
only be amended by mutually agreed contract amendments. Each amendment shall be
in writing and shall identify the provisions to be changed and the changes to be
made. Contract amendments shall be signed by duly authorized representatives of
each of the Vendor and the Owner.
26.2 Owner Liabilities. Vendor understands and agrees that no
third party shall guarantee or otherwise be in any way liable with respect to
any obligations or liabilities of the Owner or any of its affiliates pursuant to
this Contract.
26.3 Offset. The Vendor hereby waives any right of offset of
amounts owed by the Owner to the Vendor pursuant to the terms of this Contract.
26.4 Assignment. The Owner may assign this Contract, or any part
hereof, to any affiliate of Owner without the Vendor's approval or consent.
Subject to the foregoing and except as otherwise permitted herein, neither this
Contract nor any portion hereof may be assigned by either party without the
express prior written consent of the other party. The Owner may, without the
consent of the Vendor, collaterally assign its rights hereunder (including, but
not limited to, all licenses with respect to the Software) to any or all parties
providing financing for any part of a System for the benefit of the Vendor and
one or more other entities providing financing for any part of a System or
similar arrangement for the benefit of the Vendor and one or more other entities
providing for the financing for any part of a System, in either case, which
arrangement, as the case may be, is reasonably acceptable to the Vendor in
accordance with the terms of the financing documents. If requested by the Owner,
the Vendor shall within seven (7) calendar days of such request provide a
written consent to any such assignment; provided that such consent shall permit
reassignment if the financing parties exercise their remedies under the
documents for such financing subject to reasonable standards as to (i) the
creditworthiness of the assignee and (ii) the fact that the assignee is not at
such time a direct competitor of the Vendor involved in the manufacture of
communications equipment, software or related services. The foregoing rights and
obligations are in addition to those set forth elsewhere in this Contract. Any
attempted assignment in violation of the terms of this Contract shall be null
and void. Subject to the foregoing, this Contract shall bind and inure to the
benefit of the parties to this Contract, their successors and permitted assigns.
61
62
26.5 Notices. Except as otherwise expressly stated herein, all
notices, requests, demands and other communications which are required or may be
given under this Contract shall be in writing and shall be deemed to have been
duly given when received if personally delivered; when transmitted if
transmitted by telecopy, electronic or digital transmission method; the day
after it is sent, if sent for next day delivery to a domestic address by
recognized overnight delivery service; and three (3 ) days after sending, if
sent by certified or registered mail, postage prepaid, return receipt requested.
All notices shall be addressed as follows:
If to the Owner:
CRICKET WIRELESS COMMUNICATIONS, INC.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
With a copy to:
Sr. Vice President, General Counsel
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Vendor:
Lucent Technologies Inc.
0000 XXX Xxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx-Xxx Xxxx or Contract Manager
Telephone: (000) 000-0000
Facsimile: (000)-000-0000
By written notice provided pursuant to this subsection, either party may change
its designated addressee for purposes of giving notices under this Contract.
26.6 Governing Law. This Contract is governed by the laws of the
State of California, without regard to principles of conflict of laws. This
Contract shall be deemed to be made and executed in the State of California.
26.7 Remedies. Subject only to the limitations on liability
contained in Section 20.3, each party shall be entitled to pursue any and all
rights and remedies that are available at law or in equity.
62
63
26.8 Consent to Jurisdiction. Each party to this Contract, by
its execution hereof, (i) hereby irrevocably submits to the exclusive
jurisdiction of the United States District Court located in the Southern
District of California or the state courts of the State of California located in
San Diego, California for the purpose of any action, claim, cause of action or
suit (in contract, tort or otherwise), inquiry, proceeding or investigation
arising out of or based upon this Contract or relating to the subject matter
hereof, (ii) hereby waives, to the extent not prohibited by applicable law, and
agrees not to assert, by way of motion, as a defense or otherwise, in any such
action, any claim that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune from attachment or
execution, that-any such proceeding brought in one of the above-named courts is
improper, or that this Contract or the subject matter hereof may not be enforced
in or by such court, and (iii) hereby agrees not to commence any action, claim,
cause of action or suit (in contract, tort or otherwise), inquiry, proceeding or
investigation arising out of or based upon this Contract or relating to the
subject matter hereof other than before one of the above-named courts nor to
make any motion or take any other action seeking or intending to cause the
transfer or removal of any such action, claim, cause of action or suit (in
contract, tort or otherwise), inquiry, proceeding or investigation to any court
other than one of the above-named courts whether on the grounds of inconvenient
forum or otherwise. Each party hereby consents to service of process in any such
proceeding in any manner permitted by California law, and agrees that service of
process by registered or certified mail, return receipt requested, at its
address specified herein.
26.9 Compliance with Law. The Owner and the Vendor shall (a)
comply with all Applicable Laws in the performance of this Contract, including,
without limitation, the laws and regulations of the United States Department of
Commerce, State Department and the Federal Communications Commission and any
other applicable agency or department.
26.10 Headings. The headings given to the Sections and
subsections herein are inserted only for convenience and are in no way to be
construed as part of this Contract or as a limitation of the scope of the
particular Section or subsection to which the title refers.
26.11 Severability. Whenever possible, each provision of this
Contract shall be interpreted in such a manner as to be effective and valid
under such applicable law, but, if any provision of this Contract shall be held
to be prohibited or invalid in any jurisdiction, the remaining provisions of
this Contract shall remain in full force and effect and such prohibited or
invalid provision shall remain in effect in any jurisdiction in which it is not
prohibited or invalid.
26.12 Waiver. Unless otherwise specifically provided by the
terms of this Contract, no delay or failure to exercise a right resulting from
any breach of this Contract shall impair such right or shall be construed to be
a waiver thereof, but such right may be exercised from time to time as may be
deemed expedient. If any representation, warranty or covenant contained in this
Contract is breached by either party and thereafter waived by the
63
64
other party, such waiver shall be limited to the particular breach so waived and
not be deemed to waive any other breach under this Contract.
26.13 Public Statements and Advertising. (a) Neither party shall
issue any public statement (or any private statement unless required in the
performance of the Work) relating to or in any way disclosing any aspect of the
Work or any System including the scope, the specific terms of this Contract,
extent or value of the Work or any System. Express written consent of the other
party is required prior to the invitation of or permission to any reporter or
journalist to enter upon the System or any part thereof. The Vendor agrees not
to use for publicity purposes any photographs, drawings and/or materials
describing any System without obtaining the prior written consent of the Owner,
which consent shall not be unreasonably withheld. The Owner agrees not to use
for publicity purposes any photographs, drawings and/or materials describing the
Vendor's products and services without obtaining the prior written consent of
the Vendor, which consent shall not be unreasonably withheld. This subsection
shall not prohibit the provision of necessary information to prospective
Subcontractors and the Vendor's or the Owner's personnel, agents or consultants
or other disclosures which are required by Applicable Law, including without
limitation federal and state securities laws and regulations. All other such
public disclosures by a party require the written consent of the other party.
(b) Each party shall submit to the other proposed copies of all
advertising (other than public statements or press releases) wherein the name,
trademark or service xxxx of the other party or its affiliates is mentioned; and
neither party shall publish or use such advertising without the other party's
prior written approval. Such approval shall be granted as promptly as possible
and shall not be unreasonably withheld. The parties acknowledge that the
obtaining of prior written approval for each such use pursuant to this
subsection may be an administrative burden. At the request of either party, the
Owner and the Vendor shall establish mutually acceptable guidelines for the uses
specified therein. Such guidelines shall be subject to change from time to time
at the reasonable request of either party.
26.14 Records and Communications. Procedures for keeping and
distributing orderly and complete records of the Work and its progress are
stated in the Exhibits. The procedures so established shall be followed
throughout the course of the Work unless the Owner and the Vendor mutually agree
in advance in writing to revise the procedures. Procedures for communications
among the Owner and the Vendor are stated in the Exhibits. The procedures so
established shall be followed throughout the course of the Work unless the Owner
and the Vendor mutually agree in advance and in writing to revise such
procedure.
26.15 Ownership of Specifications. The Specifications shall
constitute the Proprietary Information of each party to the extent of each
party's contribution to the Specifications. Neither party shall use those parts
of the Specifications contributed by the other party or any part of the
Proprietary Information of the other party for any purpose other than fulfilling
or exercising their respective rights or obligations under this Agreement.
64
65
26.16 Financing Requirements. The Vendor acknowledges that the
attainment of financing for construction of the System may be subject to
conditions that are customary and appropriate for the providers of such
financing. Therefore, the Vendor agrees to promptly consider any reasonable
amendment to or modification or assignment of this Contract required by such
providers (including, without limitation, any pertinent industrial development
authority or other similar governmental agency issuing bonds for financing of
the System) which do not materially modify the scope of the Vendor's Work in
order to obtain such financing. In the event that any such amendment or
modification materially increases the Vendor's risk or costs hereunder, the
Owner and the Vendor shall negotiate in good faith to adjust pricing matters,
and to equitably adjust such other provisions of this Contract, if any, which
may be affected thereby, to the extent necessary to reflect such increased risk
or costs. In no event shall the Vendor be required to accept any modification or
amendment pursuant to this subsection provide it has a commercially reasonable
basis for such refusal.
26.17 Owner Review, Comment and Approval. To the extent that
various provisions of this Contract provide for the Owner's review, comment,
inspection, evaluation, recommendation or approval, the Owner may at its option
do so in conjunction and/or consultation with the Vendor. To the extent that
this Contract requires the Owner to submit, furnish, provide or deliver to the
Vendor any report, notice, Change Order, request or other items, the Owner may
at its option and upon written notice to the Vendor designate a representative
to submit, furnish, provide or deliver such items as the Owner's agent therefor.
To the extent that various provisions of this Contract provide that the Owner
may order, direct or make requests with respect to performance of the Work or is
provided access to the System sites or any other site, the Owner may at its
option and upon written notice to the Vendor authorize a representative to act
as the Owner's agent therefor. Upon receipt of such notice, the Vendor shall be
entitled to rely upon such authorization until a superseding written notice from
the Owner is received by the Vendor.
26.18 Confidentiality. (a) All information which is identified
as proprietary or confidential by the disclosing party, including without
limitation all oral and written information (including, but not limited to,
determinations or reports by arbitrators pursuant to the terms of this
Contract), disclosed to the other party is deemed to be confidential, restricted
and proprietary to the disclosing party (hereinafter referred to as "Proprietary
Information"). Each party agrees to use the Proprietary Information received
from the other party only for the purpose of this Contract. Except as specified
in this Contract, no other rights, and particularly licenses, to trademarks,
inventions, copyrights, patents, or any other intellectual property rights are
implied or granted under this Contract or by the conveying of Proprietary
Information between the parties. Proprietary Information supplied is not to be
reproduced in any form except as required to accomplish the intent of, and in
accordance with the terms of, this Contract. The receiving party shall provide
the same care to avoid disclosure or unauthorized use of Proprietary Information
as it provides to protect its own similar proprietary information but in no
event shall the receiving party fail to use reasonable care under the
circumstances to avoid disclosure or unauthorized use of Proprietary
Information. All Proprietary Information shall be retained by the receiving
party in a secure place with access limited to only such of the receiving
party's employees,
65
66
subcontractors or agents who need to know such information for purposes of this
Contract and to such third parties as the disclosing party has consented to by
prior written approval. All Proprietary Information, unless otherwise specified
in writing (i) remains the property of the disclosing party, (ii) shall be used
by the receiving party only for the purpose for which it was intended, and (iii)
such Proprietary Information, including all copies of such information, shall be
returned to the disclosing party or destroyed after the receiving party's need
for it has expired or upon request of the disclosing party, and, in any event,
upon termination of this Contract. At the request of the disclosing party, the
receiving party shall furnish a certificate of an officer of the receiving party
certifying that Proprietary Information not returned to disclosing party has
been destroyed. For the purposes hereof, Proprietary Information does not
include information which:
(i) is published or is otherwise in the public domain
through no fault of the receiving party at the time of
any claimed disclosure or unauthorized use by the
receiving party;
(ii) prior to disclosure pursuant to this Contract is
properly within the legitimate possession of the
receiving party as evidenced by reasonable documentation
to the extent applicable;
(iii) subsequent to disclosure pursuant to this Contract is
lawfully received from a third party having rights in
the information without restriction of the third party's
right to disseminate the information and without notice
of any restriction against its further disclosure;
(iv) is independently developed by the receiving party or is
otherwise received through parties who have not had,
either directly or indirectly, access to or knowledge of
such Proprietary Information;
(v) is transmitted to the receiving party after the
disclosing party has received written notice from the
receiving party after termination or expiration of this
Contract that it does not desire to receive further
Proprietary Information;
(vi) is obligated to be produced under order of a court of
competent jurisdiction or other similar requirement of a
Governmental Entity, so long as the party required to
disclose the information provides the other party with
prior notice of such order or requirement and its
cooperation to the extent reasonable in preserving its
confidentiality; or
(vii) the disclosing party agrees in writing is free of such
restrictions.
(b) Because damages may be difficult to ascertain, the parties
agree, without limiting any other rights and remedies specified herein, an
injunction may be sought against the party who has breached or threatened to
breach this subsection. Each party represents and warrants that it has the right
to disclose all Proprietary Information which it has
66
67
disclosed to the other party pursuant to this Contract, and each party agrees to
indemnify and hold harmless the other from all claims by a third party related
to the wrongful disclosure of such third party's proprietary information.
26.19 Entirety of Contract; No Oral Change. This Contract and
the Exhibits and Schedules referenced herein constitute the entire contract
between the parties with respect to the subject matter hereof, and supersede all
proposals, oral or written, all previous negotiations, and all other
communications between the parties with respect to the subject matter hereof. No
modifications, alterations or waivers of any provisions herein contained shall
be binding on the parties hereto unless evidenced in writing signed by duly
authorized representatives of both parties as set forth in this Contract.
26.20 Relationship of the Parties. Nothing in this Contract
shall be deemed to constitute either party a partner, agent or legal
representative of the other party, or to create any fiduciary relationship
between the parties. The Vendor is and shall remain an independent contractor in
the performance of this Contract, maintaining complete control of its personnel,
workers, Subcontractors and operations required for performance of the Work.
This Contract shall not be construed to create any relationship, contractual or
otherwise, between the Owner and any Subcontractor, except to establish Owner as
a third party beneficiary of the Vendor's contacts with Subcontractors as
provided herein.
26.21 Discretion. Notwithstanding anything contained herein to
the contrary, to the extent that various provisions of this Contract call for an
exercise of discretion in making decisions or granting approvals or consents,
the parties shall be required to exercise such discretion, decision or approvals
and in good faith.
26.22 Non-Recourse. No past, present or future limited or
general partner in or of the Owner, no parent or other affiliate of any company
comprising the Owner, and no officer, employee, servant, executive, director,
agent or authorized representative of any of them (each, an "Operative") shall
be liable by virtue of the direct or indirect ownership interest of such
Operative in the Owner for payments due under this Contract or for the
performance of any obligation, or breach of any representation or warranty made
by the Owner hereunder. The sole recourse of the Vendor for satisfaction of the
obligations of the Owner under this Contract shall be against the Owner and the
Owner's assets and not against any Operative or any assets or property of any
such Operative. In the event that a default occurs in connection with such
obligations, no action shall be brought against any such Operative by virtue of
its direct or indirect ownership interest in the Owner.
26.23 Improvements, Inventions and Innovations. All rights in
any improvements, inventions, and innovations made solely by the Owner shall
vest in the Owner, and the Owner and its affiliates shall have the right to
exploit such improvements, inventions, and innovations. All rights in any
improvements, inventions and innovations made solely by the Vendor shall vest in
the Vendor, and the Vendor and its affiliates shall have the right to exploit
such improvements, inventions and innovations. All rights in any improvements,
inventions and innovations made by the substantial contribution of both parties
("Joint Information") shall vest jointly in both parties. Joint Information does
not
67
68
include any underlying information owned by one of the parties prior to
commencement of such joint activities or developed beyond the scope of such
joint activities, including Products and Product information, technical
information or inventions developed prior to the commencement of any joint
activities, developed outside of the scope of such joint activities or developed
solely by either party. The rights of joint ownership to such Joint Information
shall be rights of full non-exclusive worldwide ownership, including rights to
license and transfer. Each party may exploit its rights to the Joint Information
independent of the other and may retain all economic benefits thereof, neither
party shall have any obligation to account to the other for profits derived from
the Joint Information and each party shall have full rights to enforce the Joint
Information intellectual property rights against non-authorized users.
26.24 Attachments and Incorporations. All Schedules and Exhibits
attached hereto, are hereby incorporated by reference herein and made a part of
this Contract with the same force and effect as though set forth in their
entirety herein.
26.25 Conflicts. In the event of any conflict or inconsistency
among the provisions of this Contract and the documents attached hereto and
incorporated herein, such conflict or inconsistency shall be resolved by giving
precedence to this Contract and thereafter to the Exhibits, Schedules and
Specifications.
26.26 References to Certain Sources. Reference to standard
specifications, manuals or codes of any technical society, organization or
association or to the laws or regulations of any Governmental Entity, whether
such reference is specific or by implication, by this Contract, means the latest
standard specification, manual, code, laws or regulations in effect at the time
of such reference, except as may be otherwise specifically agreed to by the
Owner. However, no provision of any reference, standard, specification, manual
or code (whether or not specifically incorporated by reference in this Contract)
shall be effective to change the duties and responsibilities of the Owner or the
Vendor from those set forth in this Contract; provided that nothing contained in
this Contract shall require the Owner or the Vendor to violate then existing and
enforceable Applicable Laws.
26.27 Counterparts. This Contract may be executed by one or more
of the parties to this Contract on any number of separate counterparts, and all
of said counterparts taken together shall be deemed to constitute one and the
same instrument.
26.28 Cooperation. Vendor acknowledges that Owner may have one
or more third party vendors, contractors and other personnel engaged to provide
work, equipment or services to Owner in connection with or related to this
Contract. Vendor agrees to reasonably communicate and cooperate with such third
parties at all times and, at the request of Owner, coordinate Vendor's and
Vendor's Subcontractors' activities hereunder with the activities of such third
parties.
26.29 Survival. Notwithstanding any expiration or termination of
this Contract, the provisions of Sections 2.8, 12, 13, 14, 15, 18, 20 and 26.18
shall continue in full force and effect.
68
69
THE OWNER AND THE VENDOR HAVE READ THIS CONTRACT INCLUDING ALL
SCHEDULES AND EXHIBITS HERETO AND AGREE TO BE BOUND BY ALL THE TERMS AND
CONDITIONS HEREOF AND THEREOF.
IN WITNESS WHEREOF, the parties have executed this Contract as
of the date first above written.
VENDOR:
LUCENT TECHNOLOGIES INC,
a Delaware corporation
By: /s/ XXXXXXX X. MANY
---------------------------------
Name: Xxxxxxx X. Many
Title: 8/12/99
V.P. SALES - WIRELESS
OWNER:
CRICKET WIRELESS COMMUNICATIONS,
INC.,
a Delaware corporation
By: /s/ X.X. XXXXXXX
---------------------------------
Name: X.X. Xxxxxxx
Title: CEO
69
70
EXHIBIT A
TO THE
CRICKET COMMUNICATIONS, INC.
SYSTEM EQUIPMENT PURCHASE AGREEMENT
SYSTEM DESCRIPTION
Lucent Technologies, Inc. shall provide PCS 1900 mhz CDMA equipment, including
MSCs, ECPs, AP's, and base stations for deployment in Cricket Communications,
Inc.'s wireless network in the C through F bands.
Page 1 of 1
71
Exhibit B to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Discount Structure for Cricket Communications
[Twenty-One Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
72
Exhibit B-1 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Flexent BTS Equipment
[Nine Pages of Pricing Lists Deleted Pursuant to Confidential Treatment Request]
73
Exhibit B-2 to the Cricket Communication, Inc. System Equipment Purchase
Agreement
PCS CDMA System for Nashville Discounted Pricing Summary
[Eleven Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
74
Exhibit B-3 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
PCS CDMA System for Chattanooga Discounted Pricing Summary
[Twelve Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
75
Exhibit B-4 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Voice Processing Proposal
Year One: 46,000 Mailboxes (2000) New System Hardware Kit
[Thirty-Nine Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
76
Exhibit B-5 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Annual Release Maintenance Fee (ARMF)
[Text Deleted Pursuant to Confidential Treatment Request]
77
Exhibit B-6 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Software Feature Packages
[One Page of Pricing Information Deleted Pursuant to Confidential Treatment
Request]
78
Exhibit B-7 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Services Prices
[Six Pages of Pricing Information Deleted Pursuant to Confidential Treatment
Request]
79
Exhibit B-8 to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Lucent Technologies
[One Hundred and Six Pages of Pricing Lists Deleted Pursuant to Confidential
Treatment Request]
80
Exhibit C to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Lucent Technologies Proprietary
[Eleven Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
81
Exhibit D to the Cricket Communications, Inc. System Equipment Purchase
Agreement
RF Engineering and Design Pricing
[Seven Pages of Pricing Information Deleted Pursuant to Confidential Treatment
Request]
82
Exhibit E to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Vendor's Agency Plan for Outsourced Material Procurement
[Twenty-Six Pages of Technical Information Text Deleted Pursuant to Confidential
Treatment Request]
83
EXHIBIT F
BTS & MSC INSTALLATION
I. STATEMENT OF WORK
1. GENERAL
The purpose of this section is to describe Owner's and Vendor's
responsibilities for the ordering, scheduling, transport, warehousing,
testing, delivery, installation and acceptance of BTS and or MSC
equipment at one or more sites secured by Owner as part of its RF
Network design for a market. In no case should this document supersede
the terms and conditions of the base contract. Both parties shall use
best efforts to individually and jointly complete activities identified
in the following narrative and matrices to accomplish the installation
of all BTS' and associated materials to insure the timely and efficient
operation of the Owner's network.
2. RESPONSIBILITIES
b. Owner
(1). Prior to install - Owner shall, using a "just-in-time"
delivery philosophy, issue purchase orders for BTS' and MSC' and
related equipment to the Vendor. Owner shall provide Vendor a
copy of the Network Design for review by Vendor and incorporation
into the production design of equipment for the individual site.
Owner shall insure through separate contracts that all local
permits and approvals have been secured for the installation of
Vendor's equipment at a cell site. All Owner provided antennas,
jumper and coax shall be installed and swept prior to or at the
time of BTS' equipment installation. All Owner installed power,
grounding and air conditioning shall be installed prior to or
contemporaneous with the time of MSC/OEM equipment installation
to meet Vendor's written specifications. Power and telco shall
have been ordered and either installed or scheduled for
installation at the site. A ground ring and bar shall be provided
to meet Vendor's written specifications. Access and staging areas
shall be secured for use by Vendor to carry out their
responsibilities.
(2). During install - Owner shall make available technical staff
to monitor installation, review and conduct such operational
tests as may be agreed upon by Owner and Vendor as part of this
installation activity. Owner shall make available, as required,
subcontractors to carry out such modifications to the
positioning, placement or replacement of antennas, positioning,
placement or replacement of existing equipment, cables, coaxial
cable and power distribution systems as may be required by Seller
84
to carry out the installation and optimization of their equipment
at the site required by Vendor to carry out the optimization of
the site.
(3). Post install - Owner shall conduct mutually agreed to tests
and inspections deemed necessary in order to accept the
installation and operation of the site including review of any
and all tests and procedures conducted by Vendor as part of the
installation process.
a. Vendor
(1). Prior to install - Vendor shall schedule the production,
transport, delivery to any warehousing facilities required by
Vendor and delivery to and lifting at the cell site pad in
conformance with Owner's site specifications.
(2). During install - Vendor shall provide technical staff and
materials to carry out the provisioning, transport, lifting,
installation, testing, optimization and acceptance of BTS and
related equipment (bottom jumpers, RFFE's/LNA's, GPS antennas and
coax, power and telco cables to the demarc, etc.) or MSC and
related equipment at the site.
(3). Post install - Vendor shall provide to Owner written results
(or in other format as may be mutually agreed upon) of all
installation and testing conducted on the site together with all
operational parameters set on the equipment during installation,
optimization and integration process for the site.
3. EXECUTION PLAN
Vendor shall develop an execution plan for review and acceptance by
Owner that outlines, in detail; the Scope of Work, Project Team,
Schedule, Reporting Provisions, Quality Control functions and the
Process for Change orders to be utilized both for the overall project
and the installation of the all specified equipment at a cell site. The
execution plan shall be provided by Vendor to Owner and approved by
Owner, in writing, prior to the start of installation.
4. PROJECT TEAM
Vendor shall provide a detailed staffing plan by name, job function,
schedule, contact phone numbers together with a reporting hierarchy for
the teams assigned to BTS installation. The project team shall be
reviewed with and approved by Owner to determine adequacy of numbers
and job categories to carry out the complete project BTS installation
schedule within the mutually agreed upon schedule and price.
Owner shall provide a staffing plan outlining points of contact,
decision making authority and staff availability for the duration of
the installation project.
85
5. SCHEDULE
Vendor shall provide in a mutually agreed to format, both hard copy and
electronic, an installation schedule that includes all agreed upon
project activities, deliverables, timetables, task prerequisites,
interdependencies, staffing, etc.
6. REPORTING PROVISIONS
Vendor shall provide written reports in a mutually agreed to format.
This schedule shall be prepared as a baseline and shall be upgraded
against the baseline not less often than once per week to demonstrate
adherence to the project schedule. In addition, more frequent reports
shall be made by Vendor to keep Owner informed of any problems which
may impact schedule adherence or which may require a change order from
this Scope of Work.
7. CHANGE ORDERS
In the event that site conditions deviate from those represented by
Owner to the Vendor and which may have a significant cost impact,
Vendor shall prepare for review and approval by Owner prior to
implementation of the change, a written change request for Owner's
approval. This request shall outline the assumptions made prior to the
request, the changes found which necessitate the request, the cost or
time deviations resulting from the current conditions and a cost
associated with the request. Owner shall have 24 hours to approve or
deny the request.
II. RESPONSIBILITY MATRIX
See Attached Excel Spreadsheet
III. ACCEPTANCE CRITERIA
Vendor shall provide to Owner its Standard Plan outlining criteria for
acceptance of installation of BTS equipment as complete prior to and
for inclusion in the final contract documents. This Standard Plan
shall, by incorporation, become a part of this agreement and shall
include at a minimum: Verification of Sweep tests, equipment settings,
all serial numbers, end-to-end test results of telephone circuits, all
manuals and documentation for the equipment, serial numbers, etc.
Acceptance of equipment installation by Owner shall not imply
acceptance of equipment performance individually or in the aggregate.
IV. WARRANTIES
Vendor agrees to perform Services in a workmanlike manner and in
accordance with good usage and accepted practices in the community in
which such Services are performed using material free from Defects
except where such material is specified or provided by Owner. If
Services performed by Vendor prove not to be performed in
86
accordance with this Warranty and if Owner notifies Vendor of this
failure within a thirty (30) days period commencing on the date of
completion of the Service, Vendor, at its option, either will correct
all Defects or Deficiencies or render a full or prorated refund or
credit based on the original charge for the Services.
THE FOREGOING SERVICES WARRANTIES ARE IN ADDITION TO THOSE STATED IN
SECTION 18.2 OF THE CONTRACT AND ARE IN LIEU OF ALL OTHER IMPLIED
WARRANTIES INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.
87
Exhibit F
Responsibility Matrix
**pages 4 and 5 have been deleted pursuant to a Confidential Treatment Request
88
Exhibit G to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Network Owner Acceptance
Substantial Completion Reference Documents
[Twenty Pages of Technical Information Text Deleted Pursuant to Confidential
Treatment Request]
89
Exhibit H to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Network Reliability Center Product Description
[Six Pages of Product Description Information Deleted Pursuant to Confidential
Treatment Request]
90
LUCENT TECHNOLOGIES
Xxxx Labs Innovations
AUTOPACE(TM) SYSTEM
PRODUCT DESCRIPTION
INTRODUCTION
The AutoPACE TM System provides performance management and some aspects of
configuration management for Lucent Technologies wireless systems. This software
tool can be used for monitoring and maintaining or improving system performance,
troubleshooting, capacity planning, and, in general, engineering a Lucent
Technologies wireless system to provide peak quality of service. New releases of
the AutoPACE System are issued approximately twice a year to support new ECP and
cell site software releases and to provide new features and capabilities. The
current release is AutoPACE 13.01.
GENERAL BACKGROUND
The AutoPACE System is a second generation tool that has evolved over more than
10 years. Strongly driven by user input, it was developed to enhance and replace
the performance analysis software package introduced in 1987 in response to an
assessment of the needs of AUTOPLEX System operators.
Performance analysis is required to monitor and maintain (or improve) the
quality of service once a system is operational. Performance analysis can
indicate aspects of a system that are not operating at acceptable levels due
either to design deficiencies, hardware/software failures, or the growth of the
system and/or subscriber base.
AUTOPACE SYSTEM BENEFITS
The major benefits of the AutoPACE System are:
- A Graphical User Interface (GUI), implemented under
Microsoft(R)(1) Windows(TM)(2)
- A client-server architecture that supports a common data source
for multiple users
- Single server support for multiple systems and systems with
multiple MSCs
----------
(1) Microsoft is a registered trademark of Microsoft Corporation, Inc.
(2) Windows is a trademark of Microsoft Corporation, Inc.
Exhibit I Lucent Technologies Page 1 of 22
January 1999
91
- Long term data storage in an INFORMIX(R)(3) database on the
AutoPACE server
- Easier analyses through a task-oriented user interface
- Flexible and user-definable busy hour analyses
- Automated report generation via user-defined schedules
- Busy hour or 24 hour data summarization to reduce resource
requirements for long term data storage
- Flexible analysis options, including data trending and
forecasting
- Flexible configuration options
- Integrated interface for data collection from Lucent
Technologies wireless systems.
- 7 day x 24 hour hot line support by Wireless Technical Support
Center
- Professionally produced documentation (hard copy and CD-ROM)
reissued every release and detailed Release Letters
- Dedicated AutoPACE courses included in an integrated wireless
curriculum provided by the Lucent Technologies Customer Training
and Information Products (CTIP) organization
----------
(3) INFORMIX is a registered trademark of INFORMIX Software, Inc.
Exhibit I Lucent Technologies Page 2 of 22
January 1999
92
AUTOPACE SYSTEM FUNCTIONAL CAPABILITIES: AN OVERVIEW
The AutoPACE System provides capabilities in the following functional
categories:
CONFIGURATION MANAGEMENT
AutoPACE System Configuration Management provides reports and analyses of the
translatable parameters that define the configuration of a Lucent Technologies
wireless system. Reports include both pre-defined geographic displays and
pre-defined tabular reports. Also, the AutoPACE System User Definable Report
(UDR) tool allows users to define their own reports of system configuration
parameters. An associated utility can compare configuration parameters at two
different points in time and display the differences. Currently, AutoPACE cannot
be used to modify the configuration of a system.
The AutoPACE database stores the most recent view. of the system configuration
and this is refreshed with a frequency defined by the user (typically once per
day). Configuration Management can report on more than one system as well as
systems with more than one MSC.
TRAFFIC ANALYSIS
AutoPACE System Traffic Analysis can be used for hourly, daily, or longer-term
analyses, including weekly, monthly, or annual reports, limited only by the
amount of data stored by the user. Traffic and performance data for cell sites,
trunks, logical and physical antenna faces, IS-41 inter-system networking and
MSC elements are collected, analyzed, and displayed as user-defined tabular
reports and graphs. Traffic Analysis can report every count provided by the
AUTOPLEX Service Measurement sub-system and the domestic 5ESS Switch DCS.
Virtually all Traffic Analysis reports are user-defined(4). The elements of a
report definition include several aspects, including: the system elements
included in a report, the counts included in a report, the data and time scope
of the report, the details of the presentation of the counts (including busy
hour analysis and data summarization details), and the organization, destination
and appearance of the output.
Traffic data, collected from the OMP as well as the domestic 5ESS Switch DCS on
an hourly basis, can be stored in the AutoPACE database for a period of time
determined by the user-provided storage capacity of the AutoPACE server. Traffic
Analysis can report on more than one system as well as systems with more than
one MSC.
MAINTENANCE MESSAGE ANALYSIS
AutoPACE System Maintenance Message Analysis is used to study Call Processing
Failure (CPF) messages that are generated by the AUTOPLEX System when a call
terminates abnormally. Pre-defined and user-defined reports based on Call
Processing Failure messages can
----------
(4) Currently, AutoPACE pre-defines the contents of 3 reports supporting
performance metrics recommended by Lucent Technologies and several
reports that support capacity planning trending recommend by Lucent
Technologies.
Exhibit I Lucent Technologies Page 3 of 22
January 1999
93
be used to troubleshoot performance problems associated with cell site hardware,
specific mobile units, or terminals associated with a given power class, access
technology, or manufacturer. Maintenance Message Analysis also reports the
frequency with which the various types of Call Processing Failure messages
occur. These counts can be reported directly by the Maintenance Message Analysis
module and can also be included in the Traffic Analysis reports described above.
Call Processing Failure messages are collected in hourly files on the OMP and
transferred to the AutoPACE server where they are loaded into the AutoPACE
database. AutoPACE Maintenance Message Analysis can report on more than one
system as well as systems with more than one MSC.
SPECIAL ENGINEERING STUDIES
AutoPACE System Special Engineering Studies (SES) support four types of
scheduled engineering studies:
- Power Level Measurements (PLM) to analyze RF signal and
impairment measurements
- Voice Channel Selection Activity (VCSA) to report the details of
voice channel selection decisions
- Handoff Matrix (HOM) to report the flow of calls between handoff
neighbors
- RF Call Trace to analyze the signal strengths and digital error
rates received by a test terminal as a function of time
These studies are described in more detail below.
Note that the SES studies themselves are included as standard software in the
MSC and cell generic software and are not part of AutoPACE. However, the
AutoPACE System provides an easy and reliable interface to schedule any of the
SES studies and, after they have executed, AutoPACE can collect the data to
analyze and report it in formats that support troubleshooting.
Exhibit I Lucent Technologies Page 4 of 22
January 1999
94
AUTOPACE SYSTEM GENERAL FEATURES
The following sections describe several general features that significantly
enhance the functional capabilities of the AutoPACE System
USER INTERFACE
Many of the benefits of the AutoPACE System are realized at the Graphical User
Interface (GUI). The AutoPACE System provides a GUI to improve the efficiency,
effectiveness, and overall user-friendliness of its performance analysis
capabilities. The AutoPACE System is a Microsoft Windows application; as such it
shares the ease of use of other Windows applications. Users already familiar
with Windows applications will quickly relate to the AutoPACE System interface.
The AutoPACE System is designed to allow traffic engineers and technicians to
use any of the available capabilities with a minimum of special training.
AutoPACE System reports can be specified to run according to a user-defined
schedule. Moreover, the output is available as either tabular or graphical
reports that can be selected or redefined with just a few keystrokes or clicks
of the mouse. Map reports, which display configuration data based on geography,
provide added insight into the performance of a wireless system. Finally,
On-Line Help is available for efficient and easy access to reliable, up-to-date
information without interrupting the workflow.
AUTOMATION
The AutoPACE System allows a user to specify schedules for automatically
collecting traffic data from one or more AUTOPLEX Systems. Additionally, the
AutoPACE System provides the ability to automate the generation of user-defined
reports. A user can specify when to run a report (for example, on a daily or
other regular basis or as a one time case), which report(s) are to be run, and
the output destination.
SPREADSHEET COMPATIBILITY
The AutoPACE System uses the Microsoft Excel spreadsheet program internally to
output reports (except for map reports). A User Defined Macro capability
provides all the flexibility and power of the spreadsheet to enhance the
analysis of the data. In addition, the AutoPACE System can load data directly
into Microsoft Excel. Thus the use of Excel allows a high degree of
customization and automation by the user, providing additional flexibility for
AutoPACE System users to display high-resolution color plots of primary traffic
data or secondary values calculated from them. For example, the user is able to
choose the axis variable in a plot to study traffic-related dependencies within
a system. Plots can be bar charts, pie charts, line graphs, or any of the other
standard Excel reporting formats.
AUTOPACE SYSTEM DATABASE
Exhibit I Lucent Technologies Page 5 of 22
January 1999
95
All data in the AutoPACE System are stored in a relational database, implemented
using INFORMIX(R)(5) database software. The AutoPACE System database supports
three types of data:
- AUTOPLEX System Call Processing Failure Messages.
The database contains Call Processing Failure Messages collected
from AUTOPLEX System for use by AutoPACE System Maintenance
Message Analysis and reporting capabilities. The database also
supports the generation of counts that summarize the contents of
those messages.
- AUTOPLEX System Configuration Parameters.
The AutoPACE System database contains a copy of configuration
parameters for the AUTOPLEX System, taken from the MSC
Application Database(6) as well as user-supplied data such as
geographic information or network element names.
- AUTOPLEX System Service Measurements.
The AutoPACE System database contains service measurements
collected from AUTOPLEX System and 5ESS Switch DCSs for use by
AutoPACE System traffic analysis and reporting capabilities.
Moreover, the database supports the generation of a variety of
summary data.
The AutoPACE System automatically accesses its database for all applications.
However, to meet special needs, users can directly access the AutoPACE databases
using the appropriate INFORMIX database tools.(7)
Note that the Special Engineering Studies data, used exclusively for
troubleshooting, are not archived in the AutoPACE database.
----------
(5) INFORMIX is a registered trademark of INFORMIX Software, Inc.
(6) The Application Database for the AUTOPLEX System resides on the NBC and
contains both subscriber and system configuration data.
(7) Note that these tools will not be supplied with the AutoPACE System
product- In general, access other than read-only is not recommended.
Exhibit I Lucent Technologies Page 6 of 22
January 1999
96
AUTOPACE SYSTEM CONFIGURATION
ARCHITECTURE
The AutoPACE System incorporates a client-server architecture. The clients do
not contain databases and must access data from a server. A single server is
able to access one or more AUTOPLEX Systems via TCP/IP connections and to
support one or more clients, connected to the server by a local area network
(LAN(8)). This configuration allows multiple AutoPACE System clients to share a
common database. As a result, data are available to all users without wasteful
duplication and without the possibility of inconsistent data. The AutoPACE
System server provides additional capabilities that significantly enhance the
effectiveness and utility of the AutoPACE System, including:
- automatic scheduled data collection
- database management for data storage and administration
- high speed data access via the LAN.
Data can be stored for any length of time required by the user, limited only by
the amount of user-provided disk storage capacity.
AUTOPACE SYSTEM HARDWARE/SOFTWARE PLATFORM
The AutoPACE System client, implemented on a PC as a Microsoft Windows product,
is positioned take advantage of technical innovations in the personal
computing/workstation market. The AutoPACE System server is provided on UNIX
System V Release 4 (Solaris(9)) running on a SUN SPARCStation.
AUTOPACE SYSTEM SWITCH INTERFACE
The AutoPACE System is designed to be used only with Lucent Technologies
wireless systems. An AutoPACE System client interfaces with an AutoPACE System
server over a LAN. The AutoPACE System server, in turn, interfaces with one or
more systems, either through a dial-up WAN or dedicated data lines into a port
on the Operations and Management Platform (OMP).(10)
----------
(8) While not strictly required, a LAN will provide the best performance.
High bandwidth data connections support remote access of the server by a
client.
(9) The currently supported Solaris release numbers can be obtained from
your Lucent Technologies wireless account representative.
(10) Note that the AutoPACE System is not sold as a turnkey product. The
hard-are required to support the tool as well as third party vendor
software (e.g., INFORNUX) must be provided by the customer. However, the
Lucent Technologies Customer Technical Support Organization will provide
support to help identify the specific hardware, software, configuration,
and capacity required for a particular installation.
Exhibit I Lucent Technologies Page 7 of 22
January 1999
97
**Pages eight through twenty-two have been deleted pursuant to a Confidential
Treatment Request.**
Exhibit I Lucent Technologies Page 8 of 22
January 1999
98
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
LUCENT TECHNOLOGIES
AUTOPLEX(R) SYSTEM 1000
OPERATIONS ADMINISTRATION AND MAINTENANCE (OA&M)
FUNCTIONAL OVERVIEW
JULY 27, 1999
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 1 of 24
99
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
1. INTRODUCTION
1.1 OVERVIEW
The AUTOPLEX(R) system 1000 provides a rich set of Operations, Administration
and Maintenance (OA&M) features to monitor, configure, and control an AUTOPLEX
communications network. These features aim to maximize the quality of service
offered to end customers of the system by:
1. Minimizing down time through robust redundancy schemes and fast
automatic recovery from hardware and software faults,
2. Providing a broad set of features to maximize the efficiency of the
operations staff assigned to monitor and control the system, and
3. Supporting a complete set of performance measurements; which enables the
efficient configuration and engineering of the system.
1.2 SCOPE
The features described in this document are currently available, or are under
development for delivery in 1999. This document does not address future product
evolution plans. This document will be updated yearly to reflect new features
that are added to the product.
The focus of this document is OA&M features offered in the Autoplex 1000 System,
including the Access Manager, 5ESS-2000 DCS, Operation Maintenance Platform -
Simplex, Operational Maintenance Platform-FX, and AutoPACE.
1.3 GUIDE TO THE DOCUMENT
This document is written in a layered fashion starting with a high level product
description, leading to OA&M feature descriptions, and finishing with a
discussion of user and system OA&M interfaces.
Section 2 provides an architectural overview of the AUTOPLEX system, identifying
the Network Elements that comprise the system and their associated redundancy
strategies.
Section 3 provides a functional decomposition of the AUTOPLEX OA&M features. The
features are described according the classical Network Management functional
areas:
- Fault Management,
- Performance Management,
- Configuration Management,
- Accounting Management, and
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 2 of 24
100
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
- Security Management.
Section 4 describes the hardware and user interfaces that provide access to the
OA&M features.
Section 5 describes how the OA&M interfaces may be integrated into a network
operations environment.
1.4 GLOSSARY
The official name of this product is the AUTOPLEX System 1000 Cellular
Telecommunications System. Throughout this document the product will be referred
to simply as the "AUTOPLEX system".
AMA Automatic Message Accounting
AMATPS Automatic Message Accounting Teleprocessing System
AP Application Processor
APC Application Processor Cluster
APCC Application Processor Cluster Complex
ASCII American Standard Code for Information Interchange
CDMA Code Division Multiple Access
CDN Call Processing/ Data Base Node
CDR Call Detail Record
CSN Cell Site Node
DLN Direct Link Node
DCI Dual-Serial Channel Computer Interface
DCS Digital Cellular Switch
ECP Executive Cellular Processor (Access Manager)
ECPC Executive Cellular Processor Complex (Access Manager)
EIN Ethernet Interface Node
EML Element Management Layer
EMS Element Management System
FTP File Transfer Protocol
GUI Graphical User Interface
HOM Hand Off Matrix
ICN Inter-Cellular Node
IMS/CNI Inter-processor Message Switch/Common Network Interface
ITU International Telecommunications Union
LAN Local Area Network
MSC Mobile Switching Center
Network Element Processing node in the AUTOPLEX system
NML Network Management Layer
NOCC Network Operations Control Center
NVM Non-Volatile Memory
OA&M Operations, Administration and Maintenance
OFD Operational Fault Detection
OMP Operations and Management Platform
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 3 of 24
101
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
OSI Open System Interconnection
OSS Operations Support System
PLM Power Level Measurements
PPP Point to Point Protocol
PSTN Public Switched Telephone Network
RCS Radio Cluster Server
RC/V Recent Change/Verify
RF Radio Frequency
RPCN Ring Peripheral Controller Node
ROP Receive Only Printer
SCCS Switching Control Center System
SNMP Simple Network Management Protocol
SS7 Signaling System 7
System Administrator Person responsible for Unix administration of AUTOPLEX Network
Elements
TCP/IP Transmission Control Protocol/Internet Protocol
TEA Translations Entry Assistant
Technician Person responsible for day to day maintenance of equipment
TMN Telecommunications Management Network
VCDX Very Compact Digital Exchange
VCSA Voice Channel Selection Activity
WAN Wide Area Network
2. SYSTEM DESCRIPTION
The AUTOPLEX system is comprised of a diverse network of processors required to
support a wireless switching system. Figure 2.0-1 shows the major components
that comprise the AUTOPLEX system architecture. Figure 2.0-1 does not show all
the AUTOPLEX Network Elements and interfaces. More detailed diagrams may be
found later in the document.
[graphic]
FIGURE 2.0-1 AUTOPLEX SYSTEM ARCHITECTURE
The AUTOPLEX system is designed with a high degree of redundancy to provide
reliable services to wireless subscribers. The AUTOPLEX Network Elements are
each designed with a redundancy scheme that is best suited to the service that
they provide. The following subsections defines the role of each of the AUTOPLEX
Network Element and its associated redundancy strategy.
2.1 OPERATIONS AND MANAGEMENT PLATFORM (OMP)
The OMP is an adjunct processor connected to the ECP via a redundant pair of
high speed data links. The OMP is not actively involved in processing wireless
calls. The OMP hosts a wide range of OA&M applications including:
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 4 of 24
102
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
- collecting and storing service measurement data to support
Performance Management,
- collecting special study data to support Performance Management,
- providing a forms based front end for the ECP Recent Change/Verify
(RC/V) application for Configuration Management,
- maintaining log files for AUTOPLEX event reports,
- supporting a near real time billing interface for Accounting
Management,
- storing cell site inventory data for Configuration Management, and
- storing backup software images for the AP and the Flexent cell
products.
The multi-window OMP client terminals (attached to the OMP's Ethernet) provide
access to the OA&M applications for maintaining all Network Elements in the
AUTOPLEX system (ECPC, cell sites and 5ESS-2000 DCS). See section 4.2 for more
details.
The OMP is built on a scalable Sun computing platform. It utilizes UNIX System V
Release 4 (Solaris(R)(1)) and supports open systems networking standards. The
OMP acts as an interface point into the service provider's Wide Area Network
(WAN) for network operations. Operations Support Systems (OSSs) can connect to
the OMP to support network level Fault Management, Performance Management,
Configuration Management, and Accounting Management. See Section 4.3 for more
details on AUTOPLEX interfaces to the OSSs.
[* * *]
2.2 AUTOPACE(R)
The AutoPACE system is an adjunct set of processors (the AutoPACE server, and
multiple AutoPACE client PCs) that monitor and report AUTOPLEX performance data.
The AutoPACE system is designed to be used only with the AUTOPLEX system. Figure
2.6-1 below shows a typical AutoPACE configuration. The AutoPACE server receives
performance data from the OMP and stores it in a data base. The AutoPACE client
PCs execute AutoPACE applications with support from the AutoPACE server.
[graphic]
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted material
has been filed separately with the Securities and Exchange Commission.
---------------------
(1) Solaris is a registered trademark of Sun Microsystems, Inc
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 5 of 24
[*] Certain material (indicated by an asterisk) has been omitted from this
document pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
103
Exhibit J to the Cricket Communications, Inc. System Equipment Purchase
Agreement
FIGURE 2.6-1 TYPICAL AUTOPACE CONFIGURATION
A single AutoPACE server connects to multiple AUTOPLEX systems and supports one
or more AutoPACE client PCs, connected to the server by a Local Area Network
(LAN). The
AutoPACE client applications run Windows(TM) applications on a PC. The AutoPACE
server is based on UNIX System V Release 4 (Solaris(2)) running on a Sun
SPARCStation(R)(3).
** A portion of page six and seven through twenty-four have been deleted
pursuant to a Confidential Treatment Request. **
-------------------
(2) The currently supported Solaris release numbers can be obtained from
your Lucent Technologies wireless account representative.
(3) SPARCstation is a registered trademark of SPARC International, Inc.
APXLIB d13112 -LUCENT TECHNOLOGIES PROPRIETARY- July 27, 1999
Solely for authorized persons having a need to
know pursuant to Company instructions
Page 6 of 24
104
Exhibit K to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Lucent Technologies Network Wireless Systems
[Seven Pages of Pricing Lists Deleted Pursuant to Confidential Treatment
Request]
105
Exhibit L to the Cricket Communications Inc. System Equipment Purchase Agreement
Standard Intervals
[Seven Pages of Technical Information Deleted Pursuant to Confidential Treatment
Request]
106
Exhibit M to the Cricket Communications, Inc. System Equipment Purchase
Agreement
CDMA Enhanced Primary Minicell Overview
[Twelve Pages of Technical Information Deleted Pursuant to Confidential
Treatment Request]
107
EXHIBIT N
TO THE
CRICKET COMMUNICATIONS, INC.
SYSTEM EQUIPMENT PURCHASE AGREEMENT
1.1 HOT-LINE SERVICE
Vendor will provide an "800 Hot-Line" telephone Service for
direct telephone support to Owner in an emergency situation. The
Hot Line telephone number is 0-000-000-0000. This Service will be
available twenty-four (24) hours a day, seven (7) days a week for
Severity Levels 1 and 2 conditions only. Prior to placing the
call to the Hot-Line, the following steps shall have been
completed by Owner with assistance of Vendor when required:
(a) Identification of the condition and its isolation to a
particular component of the system believed to be Vendor's
responsibility.
(b) Collection of sufficient supporting documentation from the
system for inclusion in the trouble report.
(c) Determination that there are no outstanding fixes which
correct the condition.
When a problem is identified as a fix to Seller's infrastructure,
whereas a fix is not in compliance within Seller's
specifications, the Vendor will supply the solution and make it
available to Owner.
1.2 RESPONSE TIME INTERVALS
The Owner due date, is set by default based on the SEVERITY
Field.
If the Owner negotiates a new date with the Vendor, the mutually
agreed date will apply.
TABLE 1 RESPONSE TIME INTERVALS
Severity Calendar Days to Resolve
1 7
2 45
3 90
4 180
Once the solution is found, Vendor will supply it for testing and
use on the failed system.
1.3 NORMAL TROUBLE-REPORTING PROCEDURES
108
Owner requirements and routines for reporting Severity Levels 2,
3 and 4 conditions are as follows:
(a) Owner shall prepare a trouble report, including the
appropriate supporting documentation and forward it to
Vendor at the address provided by Vendor.
(b) Owner may also telephone the Vendor's Customer Wireless
Technical Support Center for answers to general
operational questions about the Software or Equipment
and/or assistance in correcting Severity Level 3 and 4
conditions. The return call will either provide the
requested information, request additional information, or
report on the status of corrective action on the trouble
report.
(c) The calling Owner's personnel shall provide the following
information:
- Caller's name, location, and company
- Call-back telephone number
- System name, location
- Generic issue
- Equipment location, type and serial number
- Nature of question or situation.
1.4 SEVERITY LEVELS / PRIORITY
SEVERITY 1
- Total system failure
- Loss of a major system component
- Loss of emergency capability
- Significant reduction of revenue generating capability
SEVERITY 2
- Loss of system's redundancy
- Notable functional failure of a specific call type
- Notable functional loss of revenue due to a billing error
- Loss of diagnostic functionality
- Loss of reporting functionality
SEVERITY 3
- Intermittent faults
- Marginal functional failure of a specific call type
109
- Marginal functional loss of revenue due to a billing error
- Invalid data
SEVERITY 4
- Any questions regarding documentation
- General informational questions
- Other investigations that are not marked 1, 2 or 3
** The remainder of page two through page five has been deleted pursuant to a
Confidential Treatment Request.**
110
Exhibit O to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Training Description
[Fifteen Pages of Technical Information Deleted Pursuant to Confidential
Treatment Request]
111
Exhibit P to the Cricket Communications, Inc. System Equipment Purchase
Agreement
Lucent Technologies Documentation
[Three Pages of Technical Information Deleted Pursuant to Confidential Treatment
Request]
112
EXHIBIT Q
CRICKET COMMUNICATIONS, INC.
SYSTEM EQUIPMENT PURCHASE AGREEMENT
INSURANCE
Each party shall maintain during the term of this Contract, at its own cost and
expense, carry and maintain at a minimum, the insurance coverage listed below.
If either party is not self-insured, that party shall maintain such coverages
having a "Best's" rating of at least B+XIII. Vendor shall not commence any work
hereunder until each party has fulfilled all insurance requirements herein. Each
party shall require its subcontractors and agents to maintain the same insurance
coverage listed below.
- Workers' Compensation insurance with statutory limits as required in the
state(s) of operation; and providing coverage for either party's employee
entering onto Owner premises, even if not required by statute. Employers'
Liability or "Stop Gap" insurance with limits of not less than $500,000 for
each occurrence.
- Commercial General Liability Insurance covering claims for bodily injury,
death, personal injury or property damage occurring or arising out of the
performance of this Agreement, including coverage for independent
contractor's protection (required if any work will be subcontracted),
premises-operations, products/completed operations and contractual
liability with respect to the liability assumed by either party hereunder.
- The limits of insurance shall be:
- Each Occurrence (Bodily Injury/Property Damage) $1,000,000.00
- General Aggregate Limit (Annual Aggregate) $2,000,000.00
- Products-Completed Operations Limit (Annual Aggregate) $1,000,000.00
- Personal Advertising Injury Limit (Each Occurrence) $1,000,000.00
- Comprehensive Automobile Liability Insurance covering ownership, operation
and maintenance of all owned, non-owned and hired motor vehicles used in
connection with the performance of this Agreement, with limits of at least
$1,000,000 combined single limit for bodily injury and property damage.
The insurance limits required herein may be obtained through any combination of
self-insurance, primary and excess or umbrella liability insurance. Each party
shall furnish the other prior to the start of the work, if requested by the
other party, certificates or adequate proof of the insurance required by this
clause. Each party shall notify the other in writing at least thirty (30) days
prior to cancellation of or any material change in the policy. Notwithstanding
the above, each party shall have the option where permitted by law to
self-insure any or all of the foregoing risks.
Page 1 of 1
