*Certain portions of this Exhibit have been omitted where indicated by an "*"
pursuant to a request for confidential treatment, and the omitted portions have
been separately filed with the Commission.
Exhibit 10.5
NETWORK PRODUCTS PURCHASE AGREEMENT
Northern Telecom Inc., a Delaware corporation having offices at 0000 Xxxxxxxx
Xxxx., Xxxxxxxxxx, XX, 00000 ("Nortel") and Focal Communications Corporation, a
Delaware corporation, having its principal offices and place of business at 000
X. Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000 ("Buyer") agree as follows:
1. SCOPE
1.1 Certain terms used in this Agreement shall be defined as set
forth in Exhibit A.
1.2 The terms and conditions of this Agreement shall apply to the
purchase by Buyer and the sale by Nortel of Equipment and
Services and the licensing of Software furnished in connection
with such Equipment. The terms and conditions contained in a
Product Attachment shall modify and/or supplement the other
terms and conditions of this Agreement, only with respect to
the Product Line and Services described in the Product
Attachment, subject to Section 18.6 herein.
1.3 All Products and Services obtained by Buyer pursuant to this
Agreement shall be obtained by Buyer solely for initial use by
Buyer in its internal business to provide services available
through its networks, and not as stock in trade or inventory
which is intended for resale by Buyer to any third party as
new and unused material. All such Products shall be installed
in the United States.
2. TERM
2.1 This Agreement shall be in effect during the period that any
Product Attachment is in effect. Each Product Attachment shall
be in effect during its Product Attachment Term. This
Agreement or any part thereof may be terminated in accordance
with the express provisions of this Agreement concerning
termination or by written agreement of the parties.
2.2 The termination of this Agreement or any part thereof shall
not affect the obligations of either party thereunder which
have not been fully performed with respect to any accepted
Order, unless such Order is expressly terminated in accordance
with this Agreement or by written agreement of the parties.
3. ORDERING
All purchases pursuant to this Agreement shall be made by means of
Orders issued from time to time by Buyer and accepted by Nortel in
writing within fifteen (15) days. Otherwise, any such Order shall be
deemed to be void. Should Nortel not accept an Order, Nortel shall
advise the Buyer in writing of the reason or reasons that the Order was
not accepted and shall
provide the Buyer the opportunity to correct the Order so that it may
be accepted by Nortel. All Orders shall reference this Agreement and
the applicable Product Attachment and shall be governed solely by the
terms and conditions set forth herein as modified and/or supplemented
pursuant to Section 1.2 by the terms and conditions of any applicable
Product Attachments.
4. PRICES
4.1 The prices, charges, and fees applicable to Orders shall be
set forth in the appropriate Product Attachments and may be
revised in accordance with the provisions stated therein.
Buyer shall pay transportation charges, including insurance,
in accordance with the applicable Product Attachment.
4.2 Until the total of all prices, charges and fees for Products
and related Services furnished hereunder shall have been paid
to Nortel, Buyer shall cooperate with Nortel in perfecting
Nortel's purchase money security interest in such Products and
Buyer shall promptly execute all documents and take all
actions required by Nortel in connection therewith. Unless
otherwise agreed in writing Buyer shall not sell, lease or
otherwise transfer such Products or any portion thereof or
allow any liens or encumbrances to attach to such Products or
any portion thereof prior to payment in full to Nortel of the
total of all such prices, charges, and fees.
5. TERMS OF PAYMENT
5.1 The amounts payable for Products and/or Services may be
invoiced by Nortel to Buyer in accordance with the applicable
Product Attachments. All amounts payable and properly invoiced
pursuant to this Agreement shall be paid by Buyer to Nortel
within thirty (30) days from the date of Nortel's invoice in
accordance with the payment instructions contained in such
invoice.
5.2 Overdue payments, excluding those which are the subject of a
good faith dispute, shall be subject to interest charges,
calculated daily commencing on the 31st day after the date of
the invoice, at one and one half percent (11/2%) per month or
such lesser rate as may be the maximum permissible rate under
applicable law.
6. TAXES
Buyer shall at Nortel's direction promptly pay to Nortel or pay
directly to the applicable government or taxing authority, if requested
by Nortel, all taxes and charges, including, without limitation,
penalties and interest, which may be imposed by any federal, state, or
local governmental or taxing authority arising hereunder, such as, but
not limited to all such taxes and charges relating to the purchase,
license, ownership, possession, use, operation and/or relocation of any
Equipment, Software, or Services furnished by Seller pursuant to
2
this Agreement, excluding, however, all taxes computed upon the net
income of Nortel. Buyer's obligations pursuant to this Section 6 shall
survive any termination of this Agreement.
7. RISK OF LOSS, TITLE
7.1 Risk of loss or damage to Products shall pass to Buyer upon
delivery to the loading dock at the installation site or other
delivery location specified by Buyer in its Order, and Buyer
shall keep such Products fully insured for the total amount
then due Nortel for such Products. Nortel shall bear the risk
of loss or damage to the Products if the loss or damages is
the result of Nortel's negligence or willful misconduct.
7.2 Good title to Equipment furnished hereunder which shall be
free and clear of all liens and encumbrances shall vest in
Buyer upon full payment by Buyer of the total prices, charges
and fees payable by Buyer for such Equipment and any related
Software or Services furnished by Nortel in connection with
such Equipment.
7.3 Buyer shall receive a license to use Software subject to the
terms set forth in Exhibit B.
8. TESTING, TURNOVER AND ACCEPTANCE
8.1 If Nortel installs any Products furnished hereunder, the
rights and obligations of the parties with respect to testing,
turnover and acceptance of such Products shall be as set forth
in the applicable Product Attachment.
8.2 If Nortel does not install Products furnished hereunder,
Nortel shall prior to delivery of the Products perform such
factory tests as Nortel determines to be appropriate in order
to confirm that such Products shall be in accordance with the
applicable Specifications. Buyer shall be deemed to have
accepted the Products upon completion of such tests.
8.3 In the event that Buyer places Products into
revenue-generating service, such Products shall be deemed to
have been accepted by Buyer without limitation or restriction.
8.4 Acceptance of the Products by Buyer shall not constitute a
waiver by Buyer of its rights under the Warranty provisions
set forth in Exhibit D of this Agreement.
9. DISCLAIMERS OF WARRANTIES AND REMEDIES
THE WARRANTIES AND REMEDIES SET FORTH IN EXHIBIT D AND IN ANY
PRODUCT ATTACHMENT CONSTITUTE THE ONLY WARRANTIES OF
3
NORTEL WITH RESPECT TO THE PRODUCTS AND SERVICES AND BUYER'S
EXCLUSIVE REMEDIES IN THE EVENT SUCH WARRANTIES ARE
BREACHED. THEY ARE IN LIEU OF ALL OTHER WARRANTIES WRITTEN OR
ORAL. STATUTORY, EXPRESS OR IMPLIED. INCLUDING WITHOUT
LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. NORTEL SHALL NOT BE LIABLE FOR ANY
INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY NATURE
WHATSOEVER. BEFORE OR AFTER THE PLACING OF ANY PRODUCT INTO
SERVICE.
10. LIABILITY FOR BODILY INJURY, PROPERTY DAMAGE AND PATENT
INFRINGEMENT
10.1 A party hereto shall defend the other party against any suit,
claim, or proceeding brought against the other party for
direct damages due to bodily injuries (including death) or
damage to tangible property which allegedly result from the
negligence or willful misconduct of the defending party in the
performance of this Agreement. The defending party shall pay
all litigation costs, reasonable attorney's fees, settlement
payments and such direct damages awarded or resulting from any
such suit, claim or proceeding.
10.2 Nortel shall defend Buyer against any suit, claim or
proceeding brought against Buyer alleging that any Products,
excluding Vendor Items, furnished hereunder infringe any
United States patent. Nortel shall pay all litigation costs,
reasonable attorney's fees, settlement payments and any
damages awarded or resulting from any such suit, claim or
proceeding. With respect to Vendor Items, Nortel shall assign
any rights with respect to infringement of U.S. patents
granted to Nortel by the supplier of such Vendor Items to the
extent of Nortel's right to do so.
10.3 The party entitled to defense pursuant to Section 10.1 or 10.2
shall promptly advise the party required to provide such
defense of the applicable suit, claim, or proceeding and shall
cooperate with such party in the defense or settlement
thereof. The party required to provide such defense shall have
sole control of the defense of the applicable suit, claim, or
proceeding and of all negotiations for its settlement or
compromise.
10.4 If an injunction is obtained against Buyer's use of any
Products as a result of any suit, claim, or proceeding
described in Section 10.2, Nortel shall at Nortel's option use
its reasonable efforts to either:
10.4.1 procure for Buyer the right to continue using the
portions of the Products enjoined from use; or
4
10.4.2 within a reasonable time, replace or modify the same
with equivalent or better Products so that Buyer's
use is not subject to any such injunction.
10.5 If Nortel cannot perform under Section 10.4.1 or 10.4.2, Buyer
shall have the right to return the infringing Products to
Nortel upon written notice to Nortel, and in the event of such
return, neither party shall have any further liabilities or
obligations under this Agreement on account of such
infringement or return, except Nortel shall refund the
depreciated value of such Products carried on Buyer's books at
the time of such return, less any outstanding monies due
Nortel hereunder.
10.6 The obligations of Nortel hereunder with respect to any suit,
claim, or proceeding described in Section 10.2 shall not apply
with respect to Products which are (a) manufactured or
supplied by Nortel in accordance with any design or any
special instruction furnished by Buyer, (b) used by Buyer in a
manner or for a purpose not contemplated by this Agreement,
(c) located by Buyer outside the United States, or (d) used by
Buyer in combination with other products not provided by
Nortel, including, without limitation, any software developed
solely by Buyer through the permitted use of Products
furnished hereunder, provided the infringement arises from
such combination or the use thereof. Buyer shall indemnify and
hold Nortel harmless against any loss, cost, expense, damage,
settlement or other liability, including, but not limited to,
attorneys' fees, which may be incurred by Nortel with respect
to any suit, claim, or proceeding described in this Section
10.6.
10.7 Notwithstanding the above, Nortel shall have no obligation or
liability with regard to any patent infringement suit, claim,
or proceeding that may be made or brought against Buyer (i)
alleging that method of use claims in such patent are
infringed by any service offering and/or by any use by Buyer
of Products furnished hereunder to make such service offering
available or (ii) resulting in a settlement payment, or award
of damages, or accounting of profits, where such settlement,
award, or accounting is based on the revenues or profits
earned or other value obtained by Buyer from its use of such
Products and/or is based on the lost revenues or profits of
third parties arising from Buyer's use of such Products.
10.8 If Nortel determines that any Products are or may become the
subject of a suit, claim, or proceeding as described in
Section 10.7, Nortel may provide Buyer with notice to that
effect. Nortel shall have no liability to Buyer pursuant to
Section 10.2,10.4, or 10.5 with respect to Buyer's use of such
Products which occurs subsequent to such notice. In addition
to its obligations pursuant to Section 10.3, if Buyer becomes
aware that any Products may become the subject of any such
suit, claim, or proceeding before receiving any such notice
from Nortel, Buyer shall provide Nortel with notice to that
effect.
5
10.9 After receipt of notice from Nortel pursuant to Section 10.8,
Buyer shall have the option to return to Nortel the applicable
Products identified in such notice and Nortel shall refund the
depreciated value (as carried on the books of Buyer) of the
returned Products to Buyer as more fully set forth in Section
10.5.
10.10 The provisions of Sections 10.2 through 10.9 state the entire
liability of Nortel and its suppliers and the exclusive remedy
of Buyer with respect to any suits, claims, or proceedings of
the nature described in Section 10.2.
10.11 Each party's respective obligations pursuant to this Section
shall survive any termination of this Agreement.
11. REMEDIES AND LIMITATION OF LIABILITY
11.1 Nortel shall have the right to suspend its performance by
written notice to Buyer and forthwith remove and take
possession of all Products that shall have been delivered to
Buyer, if, prior to payment to Nortel of any amounts due
pursuant to this Agreement with respect to such Products,
Buyer shall (a) become insolvent or bankrupt or cease, be
unable, or admit in writing its inability, to pay all debts as
they mature, or make a general assignment for the benefit of,
or enter into any arrangement with, creditors, (b) authorize,
apply for, or consent to the appointment of, a receiver,
trustee, or liquidator of all or a substantial part of its
assets or have proceedings seeking such appointment commenced
against it which are not terminated within ninety (90) days of
such commencement, or (c) file a voluntary petition under any
bankruptcy or insolvency law or under the reorganization or
arrangement provisions of the United States Bankruptcy Code or
any similar law of any jurisdiction or have proceedings under
any such law instituted against it which are not terminated
within ninety (90) days of such commencement.
11.2 In the event of any material breach of this Agreement which
shall continue for thirty (30) or more days after written
notice of such breach (including a reasonably detailed
statement of the nature of such breach) shall have been given
to the breaching party by the aggrieved party, the aggrieved
party shall be entitled at its option to avail itself of any
and all remedies available at law or equity, except as
otherwise provided in this Agreement.
11.3 Nothing contained in Section 11.2 or elsewhere in this
Agreement shall make Nortel liable for any incidental,
indirect, consequential or special damages of any nature
whatsoever for any breach of this Agreement whether the claims
for such damages arise in tort, contract, or otherwise, or
shall increase the liability of Nortel under Section 9 or 10
or Exhibit D beyond that prescribed therein.
6
11.4 Nortel shall not be liable for any additional costs, expenses,
losses or damages resulting from errors, acts or omissions of
Buyer, including, but not limited to, inaccuracy,
incompleteness or untimeliness in the provision of information
by Buyer to Nortel or fulfillment by Buyer of any of its
obligations under this Agreement.
11.5 Any action for breach of this Agreement or to enforce any
right hereunder shall be commenced within two (2) years after
the cause of action accrues or it shall be deemed waived and
barred, except any action for nonpayment by Buyer of any
prices, charges, or fees payable hereunder may be brought by
Nortel at any time permitted by applicable law.
11.6 The limitations on Nortel's liability and other obligations
set forth in Sections 9,10, and 11 shall survive any
termination of this Agreement.
12. FORCE MAJEURE
If the performance by a party of any of its obligations under this
Agreement shall be interfered with by reason of any circumstances
beyond the reasonable control of that party, including without
limitation, unavailability of supplies or sources of energy, power
failure, breakdown of machinery, or labor difficulties, including
without limitation, strikes, slowdowns, picketing or boycotts, then
that party shall be excused from such performance for a period equal to
the delay resulting from the applicable circumstances and such
additional period as may be reasonably necessary to allow that party to
resume its performance. With respect to labor difficulties as described
above, a party shall not be obligated to accede to any demands being
made by employees or other personnel.
13. CONFIDENTIAL INFORMATION
13.1 Each party which receives the other party's Confidential
Information shall use reasonable care to hold such
Confidential Information in confidence and not disclose such
Confidential Information to anyone other than to its employees
and employees of its affiliates with a need to know. A party
that receives the other party's Confidential Information shall
not reproduce such Confidential Information, except to the
extent reasonably required for the performance of its
obligations pursuant to this Agreement and in connection with
any permitted use of such Confidential Information.
13.2 Buyer shall take reasonable care to use Nortel's Confidential
Information only for study, operating, or maintenance purposes
in connection with Buyer's use of Products furnished by Nortel
pursuant to this Agreement.
13.3 Nortel shall take reasonable care to use Buyer's Confidential
Information only to perform Nortel's obligations to provide
Products and/or Services to Buyer, provided
7
Nortel may use any of Buyer's Confidential Information for the
development, manufacture, marketing and maintenance of new
products and/or services and/or changes or modifications to
the existing Products and/or Services, which Nortel may, in
either case, provide to third parties without restriction.
13.4 The obligations of either party pursuant to this Section 13
shall not extend to any Confidential Information which
recipient can demonstrate through written documentation was
already known to the recipient prior to its disclosure to the
recipient, was known or generally available to the public at
the time of disclosure to the recipient, becomes known or
generally available to the public (other than by act of the
recipient) subsequent to its disclosure to the recipient, is
disclosed or made available in writing to the recipient by a
third party having a bona fide right to do so, or is required
to be disclosed by process of law, provided that the recipient
shall notify the disclosing party promptly upon any request or
demand for such disclosure.
13.5 The parties' obligations pursuant to this Section 13 shall
survive any termination of this Agreement.
14. BUYER'S RESPONSIBILITIES
14.1 All sites at which the Products shall be delivered or
installed shall be prepared by Buyer in accordance with
Nortel's standards, including, without limitation,
environmental requirements.
14.2 Buyer shall provide Nortel-designated personnel access to the
Products during the times deemed necessary by Nortel to
install, maintain and service the Products in accordance with
Nortel's obligations. Nortel personnel shall comply with
Buyer's reasonable site and security regulations, provided
Nortel receives written notice of any such regulations
reasonably in advance of the arrival of Nortel's personnel at
the site.
14.3 Buyer shall provide reasonable working space and facilities,
including heat, light, ventilation, telephones, electrical
current, trash removal and other necessary utilities for use
by Nortel-designated maintenance personnel, and adequate
secure storage space, if required by Nortel, for Products and
materials. Buyer shall also provide adequate security for the
Products while on Buyer's site.
14.4 Buyer shall obtain all necessary governmental permits
applicable to Buyer in connection with the installation,
operation, and maintenance of Products furnished hereunder,
excluding any applicable permits required in the normal course
of Nortel's doing business.
8
14.5 Any information which Nortel reasonably requests from Buyer
and which is necessary for Nortel to properly install or
maintain the Products shall be provided by Buyer to Nortel in
a timely fashion and in a form reasonably specified by Nortel.
15. HAZARDOUS MATERIALS
15.1 Prior to issuing any Order for Services to be performed at
Buyer's facilities, Buyer shall identify and notify Nortel in
writing of the existence of all Hazardous Materials which
Nortel may encounter during the performance of such Services,
including, without limitation, any Hazardous Materials
contained within any equipment to be removed by Nortel.
15.2 If Buyer breaches its obligations pursuant to Section 15.1,
(a) Nortel may discontinue the performance of the appropriate
Services until all the applicable Hazardous Materials have
been removed or abated to Nortel's satisfaction by Buyer at
Buyer's sole expense, and (b) Buyer shall defend, indemnify
and hold Nortel harmless from any and all damages, claims,
losses, liabilities and expenses, including, without
limitation, attorneys' fees, which arise out of Buyer's breach
of such obligations. Buyer's obligations pursuant to this
Section 15.2 shall survive any termination of this Agreement.
16. SUBCONTRACTING
Nortel may subcontract any of its obligations under this Agreement, but
no such subcontract shall relieve Nortel of primary responsibility for
performance of its obligations.
17. REGULATORY COMPLIANCE
In the event of any change in the Specifications or Nortel's
manufacturing or delivery processes for any Products as a result of the
imposition of requirements by any government, Nortel may upon notice to
Buyer, increase its prices, charges and fees to cover the added costs
and expenses directly incurred by Nortel as a result of such change.
18. GENERAL
18.1 If any of the provisions of this Agreement shall be invalid or
unenforceable under applicable law and a party deems such
provisions to be material, that party may terminate this
Agreement upon notice to the other party. Otherwise, such
invalidity or unenforceability shall not invalidate or render
this Agreement unenforceable, but this Agreement shall be
construed as if not containing the particular invalid or
unenforceable provision and the rights and obligations of the
parties shall be construed and enforced accordingly.
9
18.2 A party shall not release without the prior written approval
of the other party any advertising or other publicity relating
to this Agreement wherein such other party may reasonably be
identified. In addition each party shall take reasonable
precautions to keep the existence and the contents of this
Agreement confidential so long as this Agreement remains in
effect *________________________________.
18.3 The construction, interpretation and performance of this
Agreement shall be governed by the laws of the State of North
Carolina, except for its rules with respect to the conflict of
laws.
18.4 Neither party may assign or transfer this Agreement or any of
its rights hereunder without the prior written consent of the
other party, such consent not to be unreasonably withheld,
except Buyer's consent shall not be required for any
assignment or transfer by Nortel (a) to any Affiliate of all
or any part of this Agreement or of Nortel's rights hereunder,
or (b) to any third party of Nortel's right to receive any
monies which may become due to Nortel pursuant to this
Agreement.
18.5 Notices and other communications shall be transmitted in
writing by certified United States Mail, postage prepaid,
return receipt requested, by guaranteed overnight delivery, or
by facsimile addressed to the parties as follows:
To Buyer: Focal Communications Corporation
000 X. Xxxxxxxxxx Xx. Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Executive Vice President
Facsimile: (000) 000-0000
To Nortel: Northern Telecom Inc.
0000 Xxxxxxxx Xxxx.
Xxxxxxxxxx,XX 00000
Attention: General Manager, Carrier
Networks Facsimile: (000) 000-0000
In addition, notices submitted by Buyer to Nortel specific to
any Product Attachment shall be delivered to the address
stated in the applicable Product Attachment along with a copy
submitted to Nortel at the address stated above.
Any notice or communication sent under this Agreement shall be
deemed given upon receipt, as evidenced by the United States
Postal Service return receipt Mail if given by certified
United States Mail, on the following business day if sent by
guaranteed overnight delivery, or on the transmission date if
given by facsimile during the receiving party's normal
business hours.
10
The address information listed for a party in this Section or
any Product Attachment may be changed from time to time by
that party by giving notice to the other as provided above.
18.6 In the event of a conflict between the provisions of this
Agreement which are not contained in a Product Attachment and
the provisions of a Product Attachment, the provisions of the
Product Attachment shall prevail with respect to the Product
Line and Services described in that Product Attachment.
18.7 All headings used herein are for index and reference purposes
only, and shall not be given any substantive effect. This
Agreement has been created jointly by the parties, and no rule
of construction requiring interpretation against the drafter
of this Agreement shall apply in its interpretation.
18.8 Buyer shall not export any technical data received from Nortel
pursuant to this Agreement, or release any such technical data
with the knowledge or intent that such technical data will be
exported or transmitted to any country or to foreign nationals
of any country, except in accordance with applicable U.S. law
concerning the exporting of such technical data. Buyer shall
obtain all authorizations from the U.S. government in
accordance with applicable law prior to exporting or
transmitting any such technical data as described above.
18.9 Any changes to this Agreement may only be effected if agreed
upon in writing by duly authorized representatives of the
parties hereto. No agency, partnership, joint venture, or
other similar business relationship shall be or is created by
this Agreement.
11
18.10 This Agreement, including all Product Attachments and Exhibits
constitutes the entire agreement of the parties with respect
to the subject matter hereof.
NORTHERN TELECOM INC. FOCAL COMMUNICATIONS
CORPORATION
By: /s/ Xxxxxx Xxxx By: /s/ Xxxx Xxxxxxxx
-------------------------------- -------------------------------
(Signature) (Signature)
Name: Xxxxxx Xxxx Name: Xxxx Xxxxxxxx
-------------------------------- ----------------------------
(Print) (Print)
Title: V.P. and General Manager Title: Executive Vice President
-------------------------------- ----------------------------
Date: January 21, 1997 Date: January 17, 1997
-------------------------------- ----------------------------
12
EXHIBIT A
DEFINITIONS
As used in the Agreement (as defined below), the following initially capitalized
terms shall have the following meanings:
"Affiliate" shall mean Nortel's parent corporation, Northern Telecom Limited and
any corporation controlled directly or indirectly by Northern Telecom Limited
through the ownership or control of shares or other securities in such
corporation.
"Agreement" shall mean the Agreement to which this Exhibit is attached, and all
Exhibits and Product Attachments.
"Confidential Information" shall mean all information, including, without
limitation, specifications, drawings, documentation, know-how and pricing
information, of every kind or description which may be disclosed by either party
or an Affiliate to the other party in connection with this Agreement, provided
the disclosing party shall clearly xxxx any such information which is disclosed
in writing as the confidential property of the disclosing party and the
disclosing party shall identify the confidential nature of any such information
which it orally discloses at the time of such disclosure and shall provide a
written summary of the orally disclosed information to the recipient within
fifteen (15) days of such disclosure.
"Equipment" shall mean the hardware listed or otherwise identified in, or
pursuant to, any Product Attachment.
"Exhibits" shall mean Exhibits A, B, C, and D attached hereto, and any
additional Exhibits which Nortel and Buyer subsequently agree in writing shall
be incorporated into, and made a part of the Agreement by reference.
"Hazardous Materials" shall mean any pollutants or dangerous, toxic or hazardous
substances (including, without limitation, asbestos) as defined in, or pursuant
to, the OSHA Hazard Communication Standard (29 CFR Part 1910, Subpart Z), the
Resource Conservation and Recovery Act of 1976 (42 USC Section 6901, et seq.),
the Toxic Substances Control Act (15 USC Section 2601, et seq.), the
Comprehensive Environmental Response Compensation and Liability Act (42 USC
Section 9601, et seq.), and any other federal, state or local environmental law,
ordinance, rule or regulation.
"Order" shall mean a written purchase order issued by Buyer to Nortel. Each
Order shall specify on the face of the Order the types and quantities of
Products and/or Services to be furnished by Nortel pursuant to the Order, the
applicable prices, charges and/or fees with respect to such Products and/or
Services, Buyer's facility to which the Products are to be delivered, the
delivery and/or completion schedule, and any other information which may be
required to be included in an Order in accordance with the provisions of this
Agreement.
"Product Attachments" shall mean any Product Attachments which the parties agree
in writing shall be incorporated into, and made a part of, this Agreement.
"Product Attachment Term" shall mean the period specified in a Product
Attachment during which that Product Attachment shall be in effect.
"Product Line" shall mean the Products described in and which may be furnished
pursuant to a specific Product Attachment.
"Products" shall mean any Equipment and/or Software which may be provided under
this Agreement.
"Services" shall mean all services listed or otherwise identified in, or
pursuant to, any Product Attachment which may be purchased from or provided by
Nortel and which are associated with the Product Line described in that Product
Attachment.
"Software" shall mean (a) programs in machine-readable code or firmware which
(i) are owned by, or licensed to, Nortel or any of its Affiliates, (ii) reside
in Equipment memories, tapes, disks or other media, and (iii) provide basic
logic operating instructions and user-related application instructions, and (b)
documentation associated with any such programs which may be furnished by Nortel
to Buyer from time to time.
"Specifications" shall mean, with respect to any Product Line, the
specifications identified in the applicable Product Attachment, provided Nortel
shall have the right at its sole discretion to modify, change or amend such
specifications at any time.
"Third Party Software Vendor" shall mean any supplier of programs contained in
the Software which is not an Affiliate.
"Vendor Items" shall mean, with respect to a Product Line, those portions of the
Product which are identified in the applicable Product Attachment as Vendor
Items.
"Warranty Period" shall mean, with respect to a Product Line, the Warranty
Period specified in the applicable Product Attachment.
2
EXHIBIT B
SOFTWARE LICENSE
1. Buyer acknowledges that the Software may contain programs which have
been supplied by, and are proprietary to, Third Party Software Vendors.
In addition to the terms and conditions herein, Buyer shall abide by
any additional terms and conditions provided by Nortel to Buyer with
respect to any Software provided by any Third Party Software Vendor.
2. Upon Buyer's payment to Nortel of the applicable fees with respect to
any Software furnished to Buyer pursuant to this Agreement, Buyer shall
be granted a personal, non-exclusive, paid-up license to use the
version of the Software furnished to Buyer only in conjunction with
Buyer's use of the Equipment with respect to which such Software was
furnished for the life of that Equipment as it may be repaired or
modified. Buyer shall be granted no title or ownership rights to the
Software, which rights shall remain in Nortel or its suppliers.
3. As a condition precedent to this license and to the supply of Software
by Nortel pursuant to the Agreement, Nortel requires Buyer to give
proper assurances to Nortel for the protection of the Software.
Accordingly, all Software supplied by Nortel under or in implementation
of the Agreement shall be treated by Buyer as the exclusive property,
and as proprietary and a TRADE SECRET, of Nortel and/or its suppliers,
as appropriate, and Buyer shall: a) hold the Software, including,
without limitation, any methods or concepts utilized therein in
confidence for the benefit of Nortel and/or its suppliers, as
appropriate; b) not provide or make the Software available to any
person except to its employees on a 'need to know' basis; c) not
reproduce, copy, or modify the Software in whole or in part except as
authorized by Nortel; d) not attempt to decompile, reverse engineer,
disassemble, reverse translate, or in any other manner decode the
Software; e) issue adequate instructions to all persons, and take all
actions reasonably necessary to satisfy Buyer's obligations under this
license; and f) forthwith return to Nortel, or with Nortel's consent
destroy, any magnetic tape, disc, semiconductor device or other memory
device or system and/or documentation or other material, including, but
not limited to all printed material furnished by Nortel to Buyer which
shall be replaced, modified or updated.
4. The obligations of Buyer hereunder shall not extend to any information
or data relating to the Software which is now available to the general
public or becomes available by reason of acts or failures to act not
attributable to Buyer.
5. Buyer shall not assign this license or sublicense any rights herein
granted to any other party without Nortel's prior written consent.
6. Buyer shall indemnify and hold Nortel and its suppliers, as
appropriate, harmless from any loss or damage resulting from a breach
of this Exhibit B. The obligations of Buyer under this Exhibit B shall
survive the termination of the Agreement and shall continue if the
Software is removed from service.
EXHIBIT C
STORAGE
If Buyer notifies Nortel prior to the scheduled shipment date of Products that
Buyer does not wish to receive such Products on the date agreed by the parties,
or the installation site or other delivery location is not prepared in
sufficient time for Nortel to make delivery in accordance with such date, or
Buyer fails to take delivery of any portion of such Products, Nortel may place
the applicable Products in storage. In that event Buyer shall be liable for all
additional costs thereby incurred by Nortel. Delivery by Nortel of any Products
to a storage location as provided above shall be deemed to constitute delivery
of the Products to Buyer for purposes of this Agreement, including, without
limitation, provisions for payment, invoicing, passage of risk of loss, and
commencement of the Warranty Period.
EXHIBIT D
LIMITED WARRANTS AND REMEDIES
1. Nortel warrants that the Equipment supplied hereunder will under normal
use and service be free from defective material and faulty workmanship
and will conform to the applicable Specifications for the Warranty
Period specified in the Product Attachment with respect to such
Equipment. The foregoing warranty shall not apply to items normally
consumed in operation, such as, but not limited to, lamps and fuses or
to Vendor Items. Any installation Services performed by Nortel with
respect to such Equipment shall be free from defects in workmanship for
the Warranty Period set forth in the applicable Product Attachment.
2. Nortel's sole obligation and Buyer's exclusive remedy under the
warranty set forth in Section 1 above shall be limited to the
replacement or repair, at Nortel's option and expense, of the defective
Equipment, or correction of the defective installation Services.
Replacement Equipment may be new or reconditioned at Nortel's option.
3. Nortel warrants that any Software licensed by Nortel to Buyer under
this Agreement shall function during the Warranty Period of the
Equipment with respect to which such Software is furnished without any
material, service affecting nonconformance to the applicable
Specifications, provided that Buyer shall have paid all Software
support fees specified in the applicable Product Attachment. If the
Software fails to so function, Buyer's sole remedy and Nortel's sole
obligation under this warranty is for Nortel to correct such failure
through, at Nortel's option, the replacement or modification of the
Software or such other actions as Nortel reasonably determines to be
appropriate.
4. Unless otherwise stated in a Product Attachment, (a) Nortel's
warranties in Section 3 above shall only apply to the portion of the
Software actually developed by Nortel or its Affiliates, (b) all other
Software shall be provided by Nortel "AS IS", (c) Nortel shall assign
to Buyer on a nonexclusive basis any warranty on such other Software
provided to Nortel by the developer of such other Software to the
extent of Nortel's legal right to do so.
5. The obligations and remedies set forth in Sections 1, 2, and 3 above
shall be conditional upon: the Equipment not having been altered or
repaired, the Software not having been modified, and the Products not
having been installed outside the United States; any defect or
nonconformance not being the result of mishandling, abuse, misuse,
improper storage, improper performance of installation, other services,
maintenance or operation by other than Nortel (including use in
conjunction with any product which is incompatible with the applicable
Equipment or Software or of inferior performance), and/or any error,
act, or omission of Buyer described in Section 11.4; the Product not
having been damaged by fire, explosion, power failure, power surge, or
other power irregularity, lightning, failure to comply with all
applicable environmental requirements for the Products specified by
Nortel or any other applicable supplier, such as but not limited to
temperature or humidity ranges,
or any act of God, nature or public enemy; and written notice of the
defect having been given to Nortel within the applicable Warranty
Period.
6. The performance by Nortel of any of its obligations described in
Section 2 or 3 of this Exhibit D shall not extend the applicable
Warranty Period except to the extent specified in the applicable
Product Attachment.
7. Upon expiration of the applicable Warranty Period for Equipment
furnished hereunder, repair and replacement Service for such Equipment
shall be available to Buyer from Nortel in accordance with Nortel's
then-current terms, conditions and prices. Such repair and replacement
Service and notice of any discontinuance of such repair and replacement
Service shall be available for a minimum period set forth in the
Product Attachment applicable to such Equipment. This provision shall
survive the expiration of this Agreement.
8. Unless Nortel elects to repair or replace defective Equipment at
Buyer's facility, all Equipment to be repaired or replaced, whether in
or out of warranty, shall be packed by Buyer in accordance with
Nortel's instructions stated in the applicable Product Attachment and
shipped at Buyer's expense and risk of loss to a location designated by
Nortel. Replacement Equipment shall be returned to Buyer at Nortel's
expense and risk of loss. Buyer shall ship the defective Equipment to
Nortel within thirty (30) days of receipt of the replacement Equipment.
In the event Nortel fails to receive such defective Equipment within
such thirty (30) day period, Nortel shall invoice Buyer for the
replacement Equipment at the then current price in effect therefor.
9. With respect to any Vendor Item furnished by Nortel to Buyer pursuant
to this Agreement, Nortel shall assign to Buyer on a nonexclusive basis
any warranty granted by the party that supplied such Vendor Item to
Nortel to the extent of Nortel's right to do so.
10. Neither Nortel nor Nortel's suppliers, as appropriate, shall have any
responsibility for warranties offered by Buyer to any of its customers.
Buyer shall indemnify Nortel and Nortel's suppliers, as appropriate,
with respect thereto.
2
PRODUCT ATTACHMENT
CARRIER NETWORKS PRODUCTS
Northern Telecom Inc. ("Nortel") and Focal Communications Corporation ("Buyer")
agree as follows:
1. INCORPORATION BY REFERENCE
This Product Attachment shall be incorporated into and made a part of
Network Products Purchase Agreement No. JRD0197FCC between Nortel and
Buyer.
2. DEFINITIONS
For purposes of this Product Attachment:
"Acceptance Criteria" shall mean, with respect to any Products
installed by Nortel hereunder, the standards and specifications
contained in the Nortel Installation Manuals which are applicable to
such Products.
"Equipment" shall mean the equipment listed in Schedule A.
"Extension" shall mean Equipment and/or Software which Nortel engineers
and installs and which is added to an Initial System after the Turnover
Date of the Initial System.
"Initial System" shall mean the Equipment and Software which is
included in any configuration identified in Schedule A as an "Initial
System."
"Installation Site" shall mean Buyer's facility identified in an Order
to which the applicable Products identified in such Order shall be
delivered or at which the applicable Services, if any, are to be
performed, respectively.
"Merchandise" shall mean any Equipment which is not part of a System
and with respect to which no engineering or installation Services shall
be provided by Nortel.
"Product Attachment Term" shall mean the period which shall commence on
the date this Product Attachment is executed by the latter of the
parties and shall expire thirty six (36) months thereafter.
"Services" shall mean the services described in Schedule B.
"Software" shall mean the software listed in Schedule A.
"Specifications" shall mean with respect to any Products furnished
hereunder, the specifications published by Nortel which Nortel
identifies as its standard performance specifications for such Products
as of the date of Buyer's Order for such Products.
"System" shall mean any Initial System or Extension.
"Turnover Date" shall mean, with respect to any Products installed by
Nortel hereunder, the date on which Nortel provides the Turnover Notice
to Buyer pursuant to Section 8.a. of this Product Attachment.
"Warranty Period" shall mean, with respect to:
(a) Any System, the period which shall commence upon the Turnover
Date with respect to such System and shall expire twelve (12)
months thereafter,
(b) Merchandise, the period which shall commence upon the date of
shipment with respect to such Merchandise by Nortel to Buyer
and shall expire ninety (90) days thereafter,
(c) Installation Services involving any System, the period which
shall commence upon the Turnover Date with respect to such
System and shall expire twelve (12) months thereafter,
(d) Equipment which is repaired or replaced pursuant to Nortel's
obligations under Exhibit D to the Agreement, the period
commencing five (5) days after (i) shipment of the replacement
Equipment to Buyer or (ii) completion of the repair at the
Installation Site of the applicable Equipment and which shall
expire on the later of ninety (90) days thereafter or the last
day of the original Warranty Period with respect to the
Equipment which was repaired or replaced, and
(e) Software which was corrected pursuant to Nortel's obligations
under Exhibit D to the Agreement, the period commencing upon
delivery of the corrected Software by Nortel to Buyer and
expiring on the later of ninety (90) days thereafter or the
last day of the original Warranty Period with respect to such
Software.
3. SCOPE
a. Buyer shall during the Product Attachment Term issue Orders for a
minimum of *_______ DMS-500 Initial Systems as described in Schedule A
for delivery and installation in Buyer's facilities designated by
Buyer. Buyer may during the Product Attachment Term issue Orders for
additional DMS-500 Initial Systems and Extensions as described in
Schedule A for delivery and installation in Buyer's facilities. Buyer
shall pay the prices, fees and charges set forth in Schedule A for the
Initial Systems and the Extensions in accordance with Section 7 of this
Product Attachment.
2
b. During the Product Attachment Term Buyer shall purchase from Nortel
*_____________ "Class 4" and "Class 5" switches (as those terms are
used in the telecommunications industry), except that Buyer shall be
relieved of its obligation to purchase *______________ "Class 4" and
"Class 5" switches in the event the Buyer acquires a company through
a merger or acquisition and which, at the time of the merger or
acquisition, operates for "Class 4" and "Class 5" switches not
manufactured by Nortel.
c. In the event Nortel fails, through no fault other than its own, to
effect turnover of an Initial System within *___________________
following the date that Buyer approves in writing the floor plans
prepared by Nortel for installation of the applicable Initial System,
or the date that Buyer agrees in writing to the final hardware
configuration for the applicable Initial systems (that date being the
same date on which Buyer signs the completed Customer Information
("CI")), whichever occurs later, then Nortel shall pay Buyer, as
liquidated damages and not as a penalty, and as Buyer's sole and
exclusive remedy, the amount of *________________ per day for each day
that Turnover is delayed beyond such *_________________ day. In no
event shall Nortel's liability under this clause exceed *__________ for
each Initial System ordered by Buyer pursuant to Section 3a above.
4. SCHEDULES
The following Schedules which are attached hereto are an integral part
of the Product Attachment and are incorporated herein by reference:
Schedule A - Products, Prices, and Fees
Schedule B - Services and Charges
Schedule C - Delivery
Schedule D - Documentation
5. ORDERING
With respect to Section 3, ORDERING of the Agreement the following
additional terms shall apply:
a. Buyer shall identify in each Order for Products whether the Products
constitute an Initial System, Extension, or Merchandise. All Orders for
Merchandise and/or any Services other than engineering and installation
Services provided by Nortel in connection with an Order for an Initial
System and/or an Extension shall be subject to written agreement of
Buyer and Nortel on the applicable prices, charges and fees with
respect thereto as required pursuant to Section 6, PRICING, of this
Product Attachment.
b. Notwithstanding Exhibit C to the Agreement, Buyer may by written notice
to Nortel cancel without charge any Order for Products and/or Services
prior to the delivery date of the applicable Products set forth in such
Order or the agreed date for the commencement by Nortel of the
applicable Services ("Service Commencement Date"), except that if Buyer
cancels such Order within six (6) weeks or less of any such date, a
cancellation fee of *___________ of the aggregate price of all Products
and/or Services included in such cancelled Order shall be payable by
Buyer. Nortel may invoice such amount upon receipt of Buyer's notice of
cancellation of the Order.
c. Notwithstanding Exhibit C to the Agreement, Buyer may by written notice
to Nortel not less than six (6) weeks prior to the delivery date of any
Products set forth in an Order and/or the Service Commencement Date of
the applicable Services, delay the delivery date of such Products
and/or the Service Commencement Date of such Services for a period
which shall not exceed ninety (90) days from the date such Products
were originally scheduled to be delivered or ninety (90) days from the
Service Commencement Date, subject to the availability from Nortel of
the applicable Products and/or Services after such period of delay.
3
d. Except as set forth in Sections 5.b. and 5.c. of this Product
Attachment, any change to an Order after Nortel's acceptance of such
Order shall require written agreement of Nortel and Buyer upon a
written change to the Order ("Change Order") which shall reference the
original Order and be executed by the parties. No such changes shall be
implemented until the applicable Change Order has been executed by the
parties.
e. With respect to each Order for Products which is accepted by Nortel,
Buyer may make a written request at least ninety (90) days prior to the
scheduled shipment date of such Products for a change ("Change")
consisting of certain addition(s) or deletion(s) to such Products.
After receipt of such request, Nortel shall submit a Job Change Order
("JCO") to Buyer for Buyer's approval with respect to the requested
Change. Each JCO shall state whether the requested Change shall
increase or decrease the Price and/or time required by Nortel for any
aspect of its performance under the Agreement with respect to such
Order. Buyer shall accept or reject the JCO in writing within ten (10)
days of receipt thereof. Failure of the Buyer to accept or reject the
JCO in writing as described above shall be deemed a rejection of the
JCO by Buyer. In the event an accepted JCO involves the return to
Nortel of any Equipment which shall have been previously delivered to
Buyer, Nortel may invoice and Buyer shall pay the transportation costs
and Nortel's then-current restocking charge for the returned Equipment,
such restocking charge shall not exceed *____________ of the list price
for the returned Equipment.
f. Any increase or decrease in the Price with respect to an Order
hereunder which is occasioned by an accepted JCO shall be added to or
subtracted from, as applicable, the amount of the last payment due
pursuant to Section 6 with respect to such Order.
g. If Buyer rejects a proposed JCO, then the rights and obligations of the
parties with respect to the applicable Order shall not be subject to
Buyer's requested Changes. Nortel shall be entitled to an extension of
the dates for performance of its obligations with respect to the
applicable Order as a result of any delays in such performance which
result from the foregoing.
6. PRICING
With respect to Section 4, PRICES of the Agreement, the following
additional terms shall apply:
a. The prices set forth in Schedule A with respect to any Initial System
and/or Extension shall be in effect for the Product Attachment Term.
The prices listed in Schedule A shall apply to any Order for an Initial
System and/or an Extension listed in Schedule A which shall be received
by Nortel during the Product Attachment Term, provided that the
delivery date for such Initial System and/or Extension as set forth in
the applicable Order shall be not more than one hundred twenty (120)
days after Nortel's acceptance of such Orders.
4
b. The prices for Equipment, the fees for the right to use the Software,
prices for any Merchandise, and charges for any Services, other than
engineering and installation Services provided with any Initial System
and/or an Extension shall be as subsequently agreed in writing by
Nortel and Buyer.
c. Shipment of the Product shall be F. O. B. the Installation Site
7. TERMS OF PAYMENT
With respect to Section 5, TERMS OF PAYMENT, the following additional
terms shall apply:
a. With respect to each Initial System and/or Extension furnished
hereunder by Nortel to Buyer the price listed in Schedule A shall be
invoiced by Nortel in accordance with the following schedule:
(i) Twenty percent (20%) of such price may be invoiced upon
Nortel's acceptance of the Order for such Initial System
and/or Extension,
(ii) Fifty percent (50%) of such price may be invoiced on the date
of shipment by Nortel to Buyer of the switch component of such
Initial System and/or the Equipment of such Extension,
(iii) Twenty percent (20%) of such price may be invoiced on the
Turnover Date of such Initial System and/or Extension, and
(iv) Ten percent (10%) of such price may be invoiced on the date of
Acceptance of such Initial System and/or Extension.
b. Except as may be otherwise agreed in writing by the parties Nortel's
prices for Merchandise and charges for any Services determined in
accordance with Section 6.b. above may be respectively invoiced upon
delivery of such Merchandise and upon performance of such Services by
Nortel.
8. TESTING, TURNOVER, AND ACCEPTANCE
Pursuant to Section 8.1 of the Agreement, the rights and obligations of
the parties with respect to testing, turnover and acceptance of any
Products furnished hereunder and installed by Nortel shall be as
follows:
a. Nortel shall provide Buyer with five (5) days written notice prior to
commencing final commissioning and testing of any Products installed by
Nortel. Buyer shall cause an authorized representative of Buyer to be
present at the applicable Installation Site to witness such final
commissioning and testing, provided that in the event such
representative fails to
5
be present for any reason, Nortel shall not be required to delay
performance of such final commissioning and testing. In connection with
the final commissioning and testing of such Products, Nortel shall test
the Products for conformity with the applicable Acceptance Criteria.
When such tests have been successfully completed, Nortel shall provide
Buyer with written notice ("Turnover Notice") that the applicable
Products meet such Acceptance Criteria and are ready for Buyer's
testing for compliance with such Acceptance Criteria. Buyer shall
promptly complete and return to Nortel Buyer's acknowledgment of
receipt of such Turnover Notice.
b. Following the Turnover Date, Buyer may test the applicable Products for
compliance with the Acceptance Criteria using the tests and test
procedures contained in Nortel's Installation Manuals with respect to
such Products. Within thirty (30) days following the Turnover Date of
the applicable Products, Buyer shall notify Nortel either that Buyer
has accepted such Products in writing using Nortel's standard
Acceptance Notice form or that Buyer has not accepted such Products in
which case Buyer shall also provide Nortel with a written notice
("Notice of Deficiency") which shall provide in reasonable detail the
manner in which Buyer asserts that the Products failed to meet the
Acceptance Criteria. With respect to any such details with which Nortel
agrees, Nortel shall promptly proceed to take appropriate corrective
action and following correction, Buyer may retest the Products in
accordance with this Section. Buyer shall accept the Products in
writing without delay when the tests pursuant to this Section indicate
that the Products comply with the Acceptance Criteria.
c. With respect to any points of disagreement between Nortel and Buyer
concerning any Notice of Deficiency which are not resolved by Nortel
and Buyer within twenty (20) days after the effective date of the
Notice of Deficiency, Buyer, at its option, may waive any rights it may
have on account of any such points of disagreement, or require that the
disputed points be resolved by arbitration.
d. Buyer shall notify Nortel in writing of its election pursuant to
Section 8.c. not later than twenty (20) days after the effective date
of the Notice of Deficiency, if any, given to Nortel by Buyer. Such
twenty (20) day period may be extended by mutual agreement in writing
signed by the parties. Upon expiration of such twenty (20) day period,
or any extension mutually agreed to by the parties, unless Buyer has
notified Nortel to the contrary, Buyer shall be deemed to have elected
to waive its right with respect to any points of disagreement then
existing between it and Nortel with respect to such Notice of
Deficiency.
e. If Buyer makes timely election to require arbitration of such disputed
points, the arbitrator shall be chosen by mutual agreement. If the
parties cannot agree upon an arbitrator within three (3) days of
Buyer's election to arbitrate, each party shall within three (3) days
thereafter select an independent and an unaffiliated person to be an
arbitrator. These two (2) persons selected shall select a third person,
independent and unaffiliated with either party, as a third arbitrator.
The arbitration shall be conducted in accordance with the Rules of the
American Arbitration Association, provided, however that the
Arbitrator(s) shall be empowered to
6
reduce the Prices of Products only to the extent that the Arbitrator(s)
find that the benefit of Buyer's bargain has been reduced. The
Arbitrator(s) shall not have any authority to grant partial or total
rescission unless the Arbitrator(s) determine that (i) Buyer has not
substantially received the benefit of its bargain; and (ii) money
damages will not provide an adequate remedy. Judgment upon the award
rendered by the Arbitrator(s) may be entered in any Court of competent
jurisdiction.
f. For purposes of this Product Attachment, "Acceptance" of the applicable
Products shall occur upon the earliest of the following and Buyer shall
upon request sign Nortel's Acceptance Notice confirming such
Acceptance:
(i) The date on which Buyer accepts such Products pursuant to
Section 8.b. of this Product Attachment;
(ii) The failure of Buyer to provide Nortel with any notice
required by Section 8.b. of this Product Attachment, with
respect to such Products;
(iii) Use by Buyer of such Products or any portion thereof in
revenue producing service at any time; or
(iv) Waiver by Buyer of its rights pursuant to Section 8.c. or 8.d.
g. Acceptance by Buyer of such Products pursuant to Section 8.f. of this
Product Attachment above shall not be withheld or postponed due to:
(i) Deficiencies of such Products resulting from causes not
attributable to Nortel, such as, but not limited to (A)
inaccuracy of information provided by Buyer, (B) inadequacy or
deficiencies of any materials, facilities or services provided
directly or indirectly by Buyer and tested in conjunction with
the applicable Products, or (C) spurious outputs from adjacent
material; or
(ii) Minor deficiencies or shortages with respect to such Products
which are attributable to Nortel, but of a nature that do not
prevent full and efficient operation of the Products.
h. With respect to any deficiencies of the type described in Section
8.g.(i), Nortel shall at Buyer's request and expense assist Buyer in
the elimination or minimization of any such deficiencies. With respect
to any deficiencies or shortages as described in the Section 8.g.(ii),
Nortel shall, at Nortel's expense, take prompt and effective action to
correct any such deficiencies or shortages.
i. In the event Buyer's Acceptance of any Products is withheld or
postponed due to any deficiencies of the type described in Section
8.g.(i), Nortel shall invoice and Buyer shall pay
7
Nortel's charges and reasonable expenses incurred by Nortel associated
with Nortel's investigation of the reasons for Buyer's withholding or
postponement of such Acceptance.
9. WARRANTIES AND REMEDIES
With respect to Exhibit D, LIMITED WARRANTIES AND REMEDIES, the
following additional terms shall apply:
a. Except as set forth in Section 9.b. below, Nortel shall in performance
of its obligations under Section 2 of Exhibit D to the Agreement, (i)
ship replacement Equipment or complete the repair within fifteen (15)
days of Nortel's receipt of the Equipment to be replaced or repaired,
and (ii) commence the correction of the applicable installation
Services within fifteen (15) days of receipt of notice from Buyer
pursuant to Section 5 of Exhibit D to the Agreement.
b. For emergency warranty service situations involving the Equipment,
Nortel shall during the applicable Warranty Period use all reasonable
efforts to ship replacement Equipment within twenty-four (24) hours of
notification of the applicable warranty defect by Buyer pursuant to
Section 5 of Exhibit D to the Agreement, provided that Buyer shall have
requested such emergency service. Nortel may invoice Buyer and Buyer
shall pay Nortel's surcharge for emergency warranty services, such
surcharge shall not exceed *____________________. If Nortel determines
that due to the particular circumstances, onsite technical assistance
is necessary, Nortel shall use all reasonable efforts to dispatch
emergency service personnel to the applicable Installation Site within
twenty-four (24) hours of receipt of notice from Buyer as described
above.
c. All Products to be repaired or replaced, both within and outside of the
applicable Warranty Period, shall be packed by Buyer in accordance with
Nortel's then current instructions.
d. No later than ninety (90) days prior to the expiration of the Warranty
Period with respect to any Initial System, Nortel shall offer to Buyer
post-warranty support by means of an extended service plan or other
terms, provided that neither party shall have any obligation with
respect thereto except as may be agreed upon in writing by the parties.
Should Nortel fail to provide such notice of offering a post-warranty
support, Buyer shall have sixty (60) days after expiration of the
Warranty Period, in which to purchase such post-warranty support.
10. NOTICES
Pursuant to Section 18.5 of the Agreement, any notices by Buyer to
Nortel which are specific to this Product Attachment shall be delivered
to the following address:
8
Northern Telecom Inc.
0000 Xxxxxxxx Xxxx.
Xxxxxxxxxx, Xxxxx 00000-0000
Attn: Vice President, Carrier Networks
11. ADDITIONAL TERMS
The following additional terms shall apply to the Agreement:
a. With respect to Section 14, BUYER'S RESPONSIBILITIES, the following
additional terms shall apply:
(i) Buyer shall be responsible for ordering and coordinating with
each applicable local telephone company the installation of
all central office trunks and test trunks and Buyer shall be
responsible for all utility charges associated with the
installation, testing, operation and maintenance of Products
furnished hereunder, including, but not limited to, all
applicable charges for such central office trunks, test trunks
and any tie lines.
b. Nortel shall provide documentation with respect to the Products in
accordance with Schedule D to this Product Attachment.
c. In consideration of Buyer's commitment under Section 3, Nortel hereby
grants Buyer *___________ worth of credits (each, a "Credit"). Each
Credit shall have a value of One Dollar ($1.00). Buyer may use the
credits any time during the Product Attachment Term. *________________
of the *________________ worth of credits may be used for the purchase
of ClusterVision services, a module of the LaserGuided Marketing
services, as those services are described and priced in Nortel
publication number 5004.15/09-96 titled "LaserGuided Marketing
ClusterVision Price List". The remaining *_______________ of the
*______________ worth of credits may be used during the Product
Attachment Term to purchase Total Network Solution services, as those
services are generally described and priced in Nortel's proposal dated
January 13, 1997, which proposal shall be subject to revision. The
purchase of those services shall be covered by a separate agreement,
the terms and conditions of which shall be mutually agreed upon. The
Credits may not be redeemed for cash or used for the purchase of any
other products or services, and Buyer shall not be entitled to any
refund for any Credits not used prior to the expiration of the Product
Attachment Term.
d. In the event Nortel decides to discontinue the manufacture of any
Schedule A Products during the period of seven (7) years following the
Turnover Date of each Initial System Ordered under this Product
Attachment, then Nortel shall give Buyer written notice of such intent
at least twelve (12) months prior to the date of such discontinuance.
Buyer may, during
9
the twelve month period following noticaftion, order and Nortel shall
deliver as much of such Schedule A Products as Buyer needs at the then
current prices and/or license fees. Nothing herein shall be construed
to require Nortel to continue to manufacture any Schedule A Products.
NORTHERN TELECOM INC. FOCAL COMMUNICATIONS
CORPORATION
By: /s/ Xxxxxx Xxxx By: /s/ Xxxx Xxxxxxxx
-------------------------------- -------------------------------
(Signature) (Signature)
Name: Xxxxxx Xxxx Name: Xxxx Xxxxxxxx
-------------------------------- ----------------------------
(Print) (Print)
Title: V.P. and General Manager Title: Executive Vice President
-------------------------------- ----------------------------
Date: January 21, 1997 Date: January 17, 1997
-------------------------------- ----------------------------
10
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 1
PRODUCT ATTACHMENT
S/DMS ACCESSNODE PRODUCTS
Northern Telecom Inc. ("Nortel") and Focal Communications Corporation ("Buyer")
agree as follows:
NOW, THEREFORE Buyer and Nortel agree as follows:
1. INCORPORATION BY REFERENCE
This Product Attachment shall be incorporated into and made a part
of Network Products Purchase Agreement No. JRD0197FCC between
Nortel and Buyer.
2. DEFINITIONS
For purposes of this Product Attachment:
"Equipment" shall mean the equipment listed in Schedule A.
"Product Attachment Term" shall mean the period which shall
commence on the date this Product Attachment is executed by the
latter of the parties and shall expire December 31, 2000.
"Services" shall mean the services described in Schedule B.
"Software" shall mean the software listed in Schedule A.
"Specifications" shall mean Nortel's standard published
performance specifications for the Products.
"Warranty Period" shall mean *_______ months from the date of
shipment stamped on the Equipment or, if the date of shipment is
not marked on the Equipment, *______ months from the date of
manufacture. In the event Nortel performs installation Services,
the Equipment warranty shall be *______ months from the date of
acceptance as set forth in Section 7 herein.
3. SCHEDULES
The following Schedules which are attached hereto are an integral
part of the Product Attachment and are incorporated herein by
reference:
Schedule A - Products, Prices, and Fees
Schedule B - Services and Charges
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 2
Schedule C - Delivery Intervals
Schedule D - Forecast
4. ORDERING
4.1 All Orders shall specify the Products required and the
Services, Nortel is to perform, if any.
4.2 Any change to the original Order initiated by Buyer
after Nortel's acceptance of the Order and any
resulting adjustments to prices, schedule and/or other
requirements of the Order shall be negotiated, mutually
agreed upon and subsequently detailed in a written
change to the Order ("Change Order"), referencing the
original Order and executed by authorized
representatives of Buyer and Nortel. The adjustment of
the Order prices for Products and charges for any
Services, as applicable, in a Change Order shall be
established on the basis of Nortel's then current
merchandise prices for such Products and/or charges for
Services. In the event that the Change Order affects
work already performed, the adjustment of the Order
price shall include reasonable charges incurred by
Nortel related to such work. No such changes shall be
performed until a Change Order has been executed by
Nortel and Buyer as described above.
5. PRICING
5.1 During the Product Attachment Term, Pricing for
Equipment and Software shall be as set forth in
Schedule A.
5.2 The prices for engineering, installation and/or system
line-up and testing ("SLAT") Services performed by
Nortel with respect to an accepted Order shall be as
quoted by Nortel and agreed to by Buyer prior to
issuance of the applicable Order.
5.3 Nortel will prepay freight charges and the cost of any
insurance requested by Buyer and invoice Buyer for
these items at Nortel's actual cost. These charges will
appear as separate line items on Nortel's invoice.
6. TERMS OF PAYMENT
Nortel shall invoice Buyer for the price of the Products as well as
any prepaid freight and insurance charges upon shipment of the
Products. Any Services provided hereunder shall be invoiced to
Buyer upon Nortel's completion of such Services.
7. TESTING, TURNOVER AND ACCEPTANCE
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 3
7.1 When Nortel installs the Products, Buyer's acceptance
of the Products and Services shall take place, or be
deemed to have taken place, upon completion by Nortel
of installation and SLAT Services in accordance with
Nortel's standard procedures and practices, as
evidenced by the acceptance test results showing that
the Products meet and perform in accordance with the
applicable Specifications. Upon such acceptance, Nortel
shall provide Buyer with a turnover notice to be
acknowledged in writing by Buyer. By providing the
turnover notice, Nortel certifies that the Products
meet and perform in accordance with the applicable
Specifications. Acceptance of the Products shall not be
withheld or postponed due to:
a) deficiencies of the Products or any other product with
which such Products are used or operated, resulting
from causes not attributable to Nortel, such as but not
limited to (i) inaccuracy of information provided by
Buyer, (ii) inadequacy or deficiencies of product,
facilities or services provided by Buyer or a third
party and tested in conjunction with the Products, or
(iii) other conditions, external to the Products
provided by Nortel, which are beyond limits specified
herein and are used by Nortel in performance
calculations and spurious outputs from adjacent
product. Nortel shall, however, at Buyer's expense,
assist Buyer in the elimination or minimization of such
deficiencies; or
b) minor deficiencies or shortages, attributable to
Nortel, of a nature that do not prevent full and
efficient commercial operation of the Products. Nortel
shall, however, at its expense, take prompt and
effective action to correct any such deficiencies or
shortages.
7.2 The effort associated with Nortel's investigation of
any deficiencies not attributable to Nortel shall be
billed to Buyer.
8. WARRANTIES AND REMEDIES
8.1 The repair or replacement of Equipment and the
correction of defective installation Services shall be
warranted for a period of *___ days or the remainder of
the original Warranty Period whichever is longer.
8.2 Nortel shall provide Buyer with repair and replacement
service for a minimum period of seven (7) years from
the commencement date of this Product Attachment,
subject to the condition that should Nortel discontinue
manufacture or repair of the Product or portions
thereof prior to the expiration of such seven (7) year
period (such right of discontinuance being expressly
reserved by Nortel), Nortel shall provide Buyer with a
twelve (12) month prior written notice of any
discontinuance so as to enable Buyer to
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 4
place an order for its requirements or to enter into
any other mutually satisfactory agreement with Nortel
prior to such discontinuance. This provision shall
survive the expiration of this Product Attachment.
9. NOTICES
Pursuant to Section 18.5 of the Agreement, any notices by Buyer to
Nortel which are specific to this Product Attachment shall be
delivered to the following address:
Northern Telecom Inc.
0000 Xxxxxxxx Xxxxxxx, Xxxxx X
Xxxxxxxxxx, Xxxxxxx 00000-0000
Attn: Vice President and General Manager,
Access Networks
10. ADDITIONAL TERMS
10.1 Nortel may, from time to time, issue updates to the
Software and, upon Buyer's payment of applicable Right
to Use Fees or Software License Fees, if any, shall
license these updates to Buyer. Nortel shall classify
such updates as either: 1) Incremental Software
Upgrades ("ISUs"), designed to correct any
nonconformance to the applicable Software
specifications or 2) enhancements which will provide
additional features ("Enhancements"). Updates to
Software, classified as ISUs by Nortel, will be
provided at no cost to Buyer. Notwithstanding the
foregoing, ISUs and Enhancements shall not include the
cost of any associated hardware that may be required to
update such ISUs. Updates classified as Enhancements,
which will be used by Buyer in its operations shall be
made available to Buyer on a billable basis. In the
event Nortel determines that the update includes both
ISUs and Enhancements which will be used by Buyer in
its operations, such update shall be made available to
Buyer. If Buyer elects to receive the update, Nortel
shall invoice Buyer only for the amount determined by
Nortel to be attributed to the Enhancements contained
in such update.
10.2 In order to allow Nortel to meet its delivery
requirements, Buyer shall issue a forecast showing the
specific types and quantities of Products to be
released and the dates such Products will be released
throughout the Product Attachment Term. Buyer shall
update such forecasts quarterly with each forecast
stating the specific types of Products and quantities
of Products to be released during the next quarter. The
initial forecast shall be as set forth in Schedule D.
In the event Buyer does not meet its obligation to
update its forecast quarterly, then Nortel shall not be
obligated to meet its forecasted delivery intervals as
stated in Schedule C.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 5
Nortel's only obligation regarding such delivery
intervals shall be to meet delivery dates set forth in
an accepted Order. If Nortel, prior to acceptance of an
Order, advises Buyer that it cannot meet a delivery
date shown in an Order, both parties will negotiate a
revised date prior to acceptance of the Order by
Nortel. The installation and SLAT intervals applicable
to an Order will be quoted by Nortel and agreed to by
Buyer and Nortel prior to issuance of such Order.
10.3 If Nortel is providing Buyer with installation
Services, Buyer shall be responsible for having all
installation sites ready on time and in accordance with
Nortel's requirements. Buyer shall be responsible for
any expense incurred by Nortel as a result of Buyer's
failure to meet the foregoing obligations.
11. EXCLUSIVITY
During the Product Attachment Term, Buyer shall purchase from
Nortel *_________________ digital loop carriers ("DLCs") or
*__________ of Products, whichever is less. Buyer shall be relieved
of its obligation to purchase its requirements for DLCs from Nortel
in the event Buyer acquires a company through a merger or
acquisition and which, at the time of the merger or acquisition,
operates DLCs not manufactured by Nortel.
12. HOST DIGITAL TERMINALS
12.1 Buyer shall issue an Order for a voice module ("Voice
Module") and host digital terminal ("HDT") in
accordance with Section 4, ORDERING, and the pricing
set forth in Schedule A. *____________________ Each HDT
supports up to fourteen (14) Voice Modules in the AN14
Software release therefore, 70% full shall equal ten
(10) Voice Modules interfacing the HDT. For the AN16
Software release, the HDT supports up to twenty-eight
(28) Voice Modules therefore, 70% full shall equal
twenty (20) Voice Modules interfacing the HDT. The
most recently ordered HDT shall be seventy percent
(70%) of full capacity and HDTs previously ordered
shall be one hundred percent (100%) of full capacity
before additional HDTs may be ordered by Buyer.
12.2 One week after Buyer's acceptance of the HDT and
AccessNode Express as described in Section 7, TESTING,
TURNOVER, AND ACCEPTANCE, Nortel shall provide an
instructor for one (1) on-site training course for a
maximum of ten (10) people on AccessNode Express, at no
charge, for each new metropolitan area where a Nortel
switch with an AccessNode Express is deployed by Buyer.
Nortel shall be responsible for travel and living
expenses of the course instructor and Buyer shall be
responsible for travel and living expenses of course
attendees.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
PAGE 6
NORTHERN TELECOM INC. FOCAL COMMUNICATIONS
CORPORATION
By: /s/ Xxxxxx Xxxx By: /s/ Xxxx X. Xxxxxxxx
--------------------------- ----------------------------
Signature Signature
Name: Xxxxxx Xxxx Name: Xxxx X. Xxxxxxxx
--------------------------- ----------------------------
Print Print
Title: V.P. Marketing Title: E.V.P. - C.O.O.
--------------------------- ----------------------------
Date: February 20, 1998 Date: February 17, 1998
--------------------------- ----------------------------
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE A
PAGE 1 OF 1
PRODUCTS, PRICING AND FEES
SECTION
1 Pricing for Stock Models
2 Merchandise List
* FIFTEEN PAGES REGARDING PRICING AND
MERCHANDISE LISTINGS ARE SUBJECT TO
FOCAL'S CONFIDENTIALITY REQUEST AND
HAVE BEEN OMITTED FROM THIS FILING
AGREEMENT NO. JRD0971FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B
PAGE 1 OF 1
SERVICES AND CHARGES
SECTION
1 Repair/Replacement Procedures
2 Equipment Support
3 Training
4 Service Charges
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 1 OF 7
REPAIR/REPLACEMENT PROCEDURES
1. GENERAL
Nortel's Replacement-Repair Service Center located in Nashville,
Tennessee, handles all repairs for Broadband/AccessNode Equipment.
Broadband/AccessNode Equipment processed through Nortel is
typically handled on a "Replacement-Repair" basis.
2. REPAIR SERVICES - EQUIPMENT
2.1 Normal Replacement Intervals
Normally, Nortel will ship a replacement unit within
thirty (30) calendar days after receipt of a defective
unit.
2.2 On-Site Repair
The nature of some Equipment may make it more feasible
to effect the repairs on the Buyer's premises. These
arrangements will be made through the Nortel's Global
Product Support ("GPS") group serving the Buyer's area.
2.3 Emergency Replacement
Defective Equipment vital to the call processing
ability of a system qualifies for emergency service.
This service is not intended to take the place of
normal replacement service. Emergency replacement will
be provided under the following conditions:
a. The last spare circuit pack has been used
to replace a defective pack in a system and
all similar packs in the system are
carrying live traffic.
b. Nortel's ETAS group advises that an
emergency situation exists and certain
Equipment is required to correct the
situation.
Nortel provides emergency replacement Equipment (new,
repaired, or functionally equivalent) at the service
charges set forth in Section 4 of this Schedule within
twenty-four (24) hours of a verbal request from the
Buyer. This service is available twenty-four (24) hours
a day, including holidays. Upon receiving verbal
request, a replacement unit will be shipped to the
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 2 OF 7
Buyer. Written confirmation of the verbal request must
be forwarded to Nortel within three (3) working days
of the verbal request for replacement. To request
emergency replacement service, phone 0-000-000-0000,
option 8 or 1-800- 423-9658.
2.4 Upgrade to a Later Vintage Level
If requested by the Buyer, an upgrade may be applied to
a Buyer's unit submitted to Nortel for repair, provided
that the Equipment is upgradeable to the requested
vintage. Typically, the Buyer will be billed at normal
repair prices for this service. The Buyer shall make
prior arrangements with the appropriate service center
to obtain this service.
2.5 Vendor Products (OEM)
The repair of most OEM equipment can be coordinated
through the Replacement-Repair Service Center in
Nashville, Tennessee. Upon receipt from the Buyer of
defective OEM equipment, Nortel will arrange the repair
and return of these units by the OEM vendor.
3. SOFTWARE SERVICE
3.1 New Software Updates
New Software Updates will be introduced via Nortel's
established Product Change Notice (PCN) routine. At
least sixty (60) days prior to field introduction,
notification of these changes will be provided to Buyer
by Nortel in writing.
3.2 Software Updates
Software updates can be performed in-service on the
system without site visits. The policy for
compatibility over time is that a single step
in-service update will be supported for a period of two
(2) years from the general availability date of the
product release. Upgrading a system to the most recent
update from a product release beyond the two (2) year
window may involve an intermediate step (i.e.,
upgrading the system to an intermediate update) and the
purchase by Buyer of additional Equipment.
3.3 Software Update Fees
Updates which are classified as Enhancements by Nortel
will be made available to Buyer at a price determined
by Nortel at the time such Software
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 3 OF 7
Update is offered to Buyer. Updates which are
classified as ISUs by Nortel will be provided at no
cost to the Buyer. Notwithstanding the foregoing, ISUs
and Enhancements shall not include the cost of any
associated hardware that may be required.
4. BUYER PROCEDURE FOR REPLACEMENT-REPAIR SERVICE
Two types of Replacement-Repair services are offered to Buyer:
a. Direct mail-in Replacement-Repair
b. Advance Authorization Replacement-Repair
Buyer may have Replacement-Repair service
pre-authorized and initiated within Nortel by a
telephone call to Nortel's Replacement Repair Service
Center.
The decision on which procedure to use is the Buyer's. (Emergency
service is handled as Advance Authorization Replacement-Repair
only). Regardless of the procedure selected, certain guidelines as
prescribed below are to be followed.
4.1 Direct Mail-In Procedure for Replacement-Repair
a. For each defective unit, failure tags
should be completed and attached to the
Equipment.
b. Two copies of Nortel's mail-in form, or an
equivalent form approved by Nortel, should
be completed and enclosed with each
shipment.
c. The following data must be provided on the mail-in
form:
o Buyer's shipping address and phone number to
contact in case of a shipping discrepancy;
o Buyer's billing address, billing contact, and
phone number;
o Buyer's Order number and authorization;
o Shipping instructions;
o Unit identification (Nortel Product Engineering
Code);
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 4 OF 7
o Quantity of units;
o Date shipped.
d. Defective units are to be packaged for
shipment following the procedures outlined
in Section 4.3 and shipped to Nortel in
accordance with Section 4.4.
e. Defective units are to be shipped to:
Northern Telecom Nashville Service Center
917 Air Park Center Drive, Dock F
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Repair and Return
Any discrepancy in the above procedure will be brought
to the attention of the Buyer upon Nortel's receipt of
the defective Equipment.
Buyer's inquiries related to Direct Mail-In service
must reference the Buyer's Order number.
4.2 Advance Authorization Procedure for Replacement-Repair
a. Upon Buyer's identification of defective
units, Nortel's Replacement-Repair Service
Center can be contacted as follows:
o Monday through Friday, excepting
holidays, from 7:00 am to 6:00 pm,
central standard time, telephone
0-000-000-0000, option 8 or
0-000-000-0000. The call will be received
directly by a Customer Service
Representative.
b. The following information must be provided
by the Buyer when calling:
o Buyer's ship to address;
o Buyer's billing address;
o Buyer's Purchase Order number and authorization
number;
o Urgency of request (normal or emergency);
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 5 OF 7
o Shipping instructions;
o Unit identification (Nortel Product Engineer
Code);
o Quantity of units.
c. A unique repair order identification number
will be issued by Nortel's
Replacement-Repair Service Center for each
order. Please reference this number on all
inquiries.
d. Failure tags should be completed and
attached to each defective unit.
e. Defective units are to be packaged and
shipped in accordance with the procedures
outlined in the following Sections. The
repair order identification number should
be clearly marked on the outside of cartons
and on all paperwork.
4.3 Packaging
Defective Equipment should be packaged in anti-static
containers, preferably of standardized design for
circuit packs. (Buyer shall consult with Nortel's
Customer Service Representative for information on
approved containers.)
Note: Neither bubble pack nor Styrofoam chips
should be used as packaging material. Use
of such material may generate static
electricity which could severely damage a
circuit pack. Use of this material may, at
Nortel's discretion, result in shipments
being refused and/or warranties being
voided.
Failure tags should be completed and attached to each
unit. Each unit should be wrapped individually.
Note: Failure tags should be attached to the
lock latch of a circuit pack. Please do
not attach the tag to any component on
the circuit pack as this could result in
damage to the Equipment.
A copy of the packing list should be placed inside each
box to further ensure proper receipt of a multiple box
shipment.
4.4 Basic Shipping Procedure
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 6 OF 7
a. Buyer shall bear risk of loss and damage on
shipments to Nortel. Nortel shall bear risk
of loss or damage on shipments to Buyer.
b. The Mail-In Form or a packing list (where
advance authorization is required) must be
included. The following information is
required by Nortel:
o Repair order identification (if advance
authorization replace-ment-repair service
is used);
o Buyer's Order number;
o Buyer's name, ship to address, and
telephone number to contact in case of a
shipping discrepancy;
o Buyer's xxxx-to address, contact person,
and telephone number;
o Date shipped;
o Unit identification (Nortel's Product
Engineering Code);
o Quantity shipped.
Note: Failure to provide the above
information could result in a delay
in processing the Order.
c. Buyer shall select an appropriate carrier
based upon the weight and size of shipment.
4.5 Shipping Costs
a. In Warranty and Out of Warranty
1. Buyer shall return defective
Equipment to Nortel prepaid.
2. Nortel shall ship the
replacement Equipment to Buyer
prepaid using an appropriate
surface carrier. Arrangements
can be made for air shipments
at Buyer's expense.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 1
PAGE 7 OF 7
4.6 Unrepairable Equipment
a. In Warranty
In the event Equipment under warranty is
returned to Nortel and is judged by
Nortel to be beyond repair due to faulty
material or workmanship, Nortel will
replace the defective Equipment with a
new, repaired, or functionally equivalent
unit at no cost to Buyer.
b. Out of Warranty
In the event Equipment not covered by
warranty is returned to Nortel and is
judged by Nortel to be beyond repair, it
will be returned to the Buyer. Nortel
will replace the defective Equipment at
Buyer's request, and invoice the Buyer at
the then current price for such new
Equipment.
4.7 Non-Return of Defective Units - Buyer Responsibility
When Nortel has shipped a replacement unit to Buyer
after verbal notification of a defective unit, Buyer is
responsible for returning the associated defective
Equipment to Nortel within thirty (30) calendar days of
the shipping date of its replacement. If Buyer's
defective Equipment is not received within such thirty
(30) calendar day period, Buyer shall be invoiced the
then current price of new Equipment plus fifteen
percent (15%). Consequently, an open Purchase Order
number must be provided by the Buyer when obtaining a
Return Authorization number.
5. BUYER PROCEDURE FOR SOFTWARE UPDATES
Software updates are to be handled via the normal Advanced
Authorization Procedure as set forth in Section 4.2. The Basic
Shipping procedure contained in Section 4.4 shall be followed
except that the Software license(s) shall be returned to Nortel
via registered mail.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 2
PAGE 1 OF 5
EQUIPMENT/SOFTWARE SUPPORT
1. WARRANTY SUPPORT
1.1 Remote (off-site) Assistance
Technical support offered at no charge to Buyer during
the Warranty Period includes Remote (off-site)
assistance to Buyer's trained personnel in resolving
Equipment and Software operational and compatibility
problems.
Remote (off-site) assistance consists of one or more of
the following:
a. Over-the-phone consultations and guidance at
0-000-000-0000.
b. Interrogation and analysis of systems over
data lines from Nortel's service facility.
c. Other activity directly related to problem
resolution, where Nortel travel is not
involved.
If after investigation, Nortel determines that the
problem was caused by equipment, software, or
conditions not attributable to Nortel then such
technical assistance shall be billable to Buyer in
accordance with Nortel's current rates and procedures
as set forth in Section 3 of this Schedule.
Calls to Nortel's service facilities during Nortel's
off-hours shall be limited to Equipment or Software
failures directly affecting service that Buyer could
not resolve by following standard troubleshooting
procedures, covered by NTPs.
1.2 Local (on-site) Assistance
Local (on-site) assistance by Nortel field engineers is
also available as part of the warranty support. To
qualify for Local (on-site) assistance without charge,
the following efforts must have been exhausted prior to
the field trip:
a. Buyer has determined that the Equipment or Software
is the source of the problem; and
b. Buyer was unable to resolve the problem by
using standard troubleshooting procedures
covered by applicable NTP's; and
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 2
PAGE 2 OF 5
c. Nortel 's engineer could not resolve the
problem remotely with full cooperation of
Buyer's personnel.
Local on-site assistance, provided at Buyer's request,
that does not meet above requirements is billable in
accordance with Nortel's current rates and procedures
as set forth in Section 3 of this Schedule. If after
investigation, Nortel determines that the need for
Local (on-site) assistance was not caused by the
Equipment, Software nor conditions attributable to
Nortel then, such technical assistance and associated
travel and living expenses shall be billable to Buyer
at Nortel's current rates and procedures as set forth
in Section 3 of this Schedule.
The following types of assistance fall outside the
scope of warranty support and are billable;
a. Local (on-site) assistance with system
verification and pre-service testing, where
required by the Buyer.
b. Local (on-site) assistance for Software
upgrades, where required by the Buyer.
c. Analysis to determine origins of the fault
and resolution of technical problems
associated with equipment or software not
furnished by Nortel.
d. Non-emergency calls for technical
assistance during Service Center off-hours.
e. Consultation in excess of 1/2 hour on
matters that are adequately covered by
standard documentation and/or for which
training programs are available, including
Software upgrades.
2. OUT-OF-WARRANTY SUPPORT
Technical assistance as set forth in Section 1 of this Schedule is
available for out-of-warranty Equipment and is billable at the
current rates and procedures as set forth in Section 1 of this
Schedule.
3. TECHNICAL SERVICE RATES
All billable technical services are billed at hourly rate plus
expenses as defined herein.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 2
PAGE 3 OF 5
Billable expenses include travel, meals and lodging costs for
Nortel's service representatives, long distance telephone and data
link charges and other costs which are directly related to the
service effort. These expenses shall be augmented by fifteen
percent (15%) handling and administration charge.
For Local (on-site) assistance service, both work and travel time
are included and charged as applicable. Minimum charge for Local
(on-site) assistance service is eight (8) hours plus expenses.
Minimum charge for Remote assistance service shall be one (1) hour,
billable according to the rate structure listed below.
The following standard rates are in effect for these procedures:
i) REGULAR WORKING HOURS (STD) - * ______
ii) OVERTIME 1 RATE (XXX) - * ______
iii) OVERTIME 2 RATE (OT2) - *
______
Buyer's Local Time 00000 0800 16:30 2400
Midnight 8:00 a.m. 4:30 p.m. Midnight
-------------------- ---------------- --------------- ------------- ---------------
MON-FRI OT1 STD OT1
---------------------------------------------------------------------------------------
SAT OT1 OT1
---------------------------------------------------------------------------------------
SUN/HOLIDAYS OT2
---------------------------------------------------------------------------------------
NOTE: Nortel observed holidays are. New Year's Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and the day after,
and Christmas week.
The telephone number for the Broadband Technical Support Group is as follows:
Non-Emergency Support: 1-800-ASK XXXX (1-800-27~8726)
Emergency Support: 1-800ASK ETAS (1-800-27~3827)
4. TECHNICAL PROBLEM RESOLUTION OBJECTIVES
As different types of problems require different levels of
reaction, a Nortel Priority Classification system is set up to
establish a relationship between the reported problems and
appropriate level of reaction and resolution. The Priority System
is based upon problem's direct or potential effect upon subscriber
service. Each reported problem is assigned priority rating
accordingly.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 2
PAGE 4 OF 5
The Priority System has five levels:
E1 - Emergency: Severe Degradation or Outage
E2 - Emergency: Potential Degradation or Xxxxxx
X0 - Xxx-Xxxxxxxxx: Xxxxxxx-Xxxxxxxxx Xxxxxxx
X0 - Xxx-Xxxxxxxxx: Intermittently Service Affecting
NS - Non-Service Affecting Problem
The resolution objective for E1 or E2 Emergency classification is
immediate and continuous assistance until the service level is
restored to pre-incident operation. For assistance in such E1 or E2
Emergency, please call 0-000-000-0000. The resolution objective for
non-emergency condition is to provide a status response in two (2)
weeks and solution to the problem in four (4) weeks for S1
Classification or eight (8) weeks for S2. The resolution objective
for non-service affecting condition is to provide a status response
in six (6) weeks and a fix, if applicable, will be scheduled for
future standard hardware, software or documentation update or
revision.
THESE OBJECTIVES DO NOT CONSTITUTE CONTRACTUAL OBLIGATION UPON
NORTEL, BUT ARE GENERALLY IN SUPPORT OF THE TERMS AND CONDITIONS OF
THIS AGREEMENT. NORTEL RESERVES THE RIGHT TO EXERCISE JUDGMENT ON
THE ECONOMIC OR STRATEGIC BENEFITS OF EXECUTING ACTIONS ON ALL
REPORTED OR ANTICIPATED PROBLEMS. THIS MAY RESULT IN AN ACTION
DIFFERENT FROM THOSE DESCRIBED. IN SUCH CASE, THE CUSTOMER WILL BE
INFORMED.
The following is a detailed description of priority ratings:
E1 - Emergency: Severe Degradation or Outage
i) System ceased call processing
ii) 10% or more subscribers out of service;
iii) 50% or more trunk circuits out of service;
E2 - Emergency: Potential Degradation or Outage
i) Redundant Common Equipment inoperable
ii) 20% or more trunk circuits out of service;
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 2
PAGE 5 OF 5
S1 - Service Affecting Problem
i) Problems directly and continuously affecting
subscriber service, not
specified under X0 xx X0;
ii) Problems that will seriously impair service after
in-service date;
S2 - Intermittently Service Affecting Problem
i) Software and hardware faults that only
intermittently affect service;
ii) Documentation errors that result or lead to service
impairments;
iii)Problems where operating company can show
significant impact upon plant and traffic
operations;
NS - Non-Service Affecting Problem
i) Service analysis, operational
measurements, or system related
documentation inaccuracies that do not
affect call processing or revenue
collection capabilities;
ii) Non-service affecting software inconsistencies;
iii)Loss of test facilities for which manual
procedures or alternate test equipment can
be readily substituted.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 3
PAGE 1 OF 2
TRAINING
The Nortel training program offers Buyer courses for all S/DMS AccessNode
Product covered by this Agreement at Nortel's then current charge for such
courses.
"In-house" courses are given at training facilities located at Nortel's Regional
Training Centers. Fully equipped with captive systems covered in the course
offering, the student gains extensive "hands-on" experience at the Nortel
training facilities. Courses may also be given at a customer's "on-site"
location where appropriate facilities and equipment are available. Nortel
recommends students attending "In-house" courses when possible as "on-site"
courses generally do not offer as effective a presentation environment and also
limits "hands-on" experience.
All courses offer students with standard training material presented by
qualified instructors. Maintenance courses cover an explanation of the
transmission principles involved, installation, operation, maintenance
(including fault locate procedures for trouble-shooting equipment and circuit
replacement), and a thorough review of Nortel's product documentation (NTP's).
For scheduling of courses, determining presentation locations, and availability
of seats, please contact Nortel's Training Coordinator in Raleigh, North
Carolina at (000) 000-0000.
"IN-HOUSE" TRAINING
Courses are offered at the Nortel Regional Training Center located in Raleigh,
North Carolina.
"In-house" training courses normally accommodate up to eight (8) students with
seats filled on a "first come/first served" basis. Courses may be subject to
rescheduling if a minimum class size is not met.
Course charges are per student for each course with travel and living expenses
paid by Buyer. Nortel will provide information on local accommodations.
Nortel will confirm in writing the course dates for each student. After
confirmation, cancellation requires at least two (2) weeks notice prior to
course commencement.
"ON-SITE" TRAINING
Many of the training courses may be conducted at the Buyer's facilities
"on-site". Two (2) months advance notice is required to schedule these courses
with Buyer providing access to working equipment. Buyer also provides all test
equipment for training. Nortel can arrange for test equipment to be available at
additional charges of up to $2000 if Buyer does not have all requisite
equipment.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 3
PAGE 2 OF 2
Charges for "on-site" training are on a per-course basis with a maximum of ten
(10) students to attend such courses unless otherwise stated. The course fee
does not cover the instructor's travel and living expenses. If Buyer cannot
provide suitable training facilities including audio/visual equipment, charges
for such equipment incurred by Nortel will be billed to the Buyer.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE B, SECTION 4
PAGE 1 OF 1
SERVICE CHARGES
1. REPAIR/REPLACEMENT - EQUIPMENT
IN-WARRANTY* OUT-OF-WARRANTY*
------------ ----------------
Normal Service No charge Standard unit charges
(30 days) per current price list
Emergency Service (24 hours)
1. Requested 8:00 AM- $50 surcharge $50 surcharge
6:00 PM EST weekdays per unit per unit plus standard
unit charges per
current price list
2. Requested weekends, $100 surcharge $100 surcharge per unit
holidays, and weekdays per unit plus standard unit charges
6:01 PM - 7:59 AM EST per current price list
*Maximum charge is $250 for items on the same Order requiring emergency service.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE C
PAGE 1 OF 1
DELIVERY INTERVALS
PRODUCT FORECASTED UNFORECASTED
------- ---------- ------------
S/DMS AccessNode * *
------------- -------------------
Notes:
1. All After Receipt of Order ("AROCHEM") intervals are based on
standard type Product.
AGREEMENT NO. JRD0197FCC
ACCESSNODE PRODUCT ATTACHMENT
SCHEDULE D
PAGE 1 OF 1
FORECAST
TO BE PROVIDED BY CUSTOMER
