NETRO THE WIRELESS ATM COMPANY ------------------------------------------------ -------------------------------- MANUFACTURING AGREEMENT

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Exhibit 10.9

XXXXX
THE WIRELESS ATM COMPANY
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MANUFACTURING AGREEMENT

BETWEEN

SOLECTRON CALIFORNIA CORPORATION

AND

XXXXX CORPORATION

DATED: MAY 31, 1998

TABLE OF CONTENTS

1. PERIOD OF AGREEMENT................................................. Page 1

2. PRODUCTS, PRICES & QUANTITIES ...................................... Page 1
2.1 Products to be Produced ............................................ Page 1
2.2 Product Definition ................................................. Page 1
2.3 Cost Reduction ..................................................... Page 1
2.4 European Manufacturing ............................................. Page 2
2.5 Pricing Model ...................................................... Page 2

3. PROGRESS REVIEWS & DOCUMENTATION ................................... Page 2
3.1 Progress Reviews ................................................... Page 2
3.2 Document Submittals & Approvals .................................... Page 3
3.3 Other Information .................................................. Page 3

4. PRODUCT ORDERING ................................................... PAGE 3
4.1 Forecast ........................................................... Page 3
4.2 Purchase Orders .................................................... Page 3
4.3 Quantity & Delivery Changes ........................................ Page 3
4.3 Stocking ........................................................... Page 4
4.5 Material Procurement ............................................... Page 4
4.6 New Products ....................................................... Page 4
4.7 Bar Code Shipping and Receiving Labels ............................. Page 4
4.8 Electronic Data Interchange (EDI) .................................. Page 4

5. TEST EQUIPMENT, TOOLING & SPACE .................................... PAGE 5

6. GENERAL TERMS & CONDITIONS ......................................... PAGE 5
6.1 Specification Changes .............................................. Page 5
6.2 Approved Vendor Lists (AVL) ........................................ Page 5
6.3 Xxxxx Supplied Components .......................................... Page 5

7. ACCEPTANCE & INSPECTION ............................................ PAGE 6

8. SHIPMENT & DELIVERY ................................................ PAGE 6
8.1 On-Time Delivery ................................................... Page 6
8.2 Early/Late Delivery ................................................ Page 6
8.3 Payments ........................................................... Page 7
8.4 Data ............................................................... Page 7
8.5 Quality Information ................................................ Page 7

9. CUSTOMER FOCUS TEAM AND PROGRAM MANAGER ............................ PAGE 7
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XXXXX
THE WIRELESS ATM COMPANY

10. TERMINATION ...................................................... PAGE 8

11. WARRANTY ......................................................... PAGE 8

12. INTELLECTUAL PROPERTY/NON-COMPETITION ............................ PAGE 9
12.1 Intellectual Property ............................................ Page 9
12.2 Confidentiality .................................................. Page 9
12.3 Publicity ........................................................ Page 9
12.4 Exclusivity ...................................................... Page 9
12.5 Non-Competition .................................................. Page 9
12.6 Escrow ........................................................... Page 9

13. MISCELLANEOUS .................................................... PAGE 10
13.1 Language & Currency .............................................. Page 10
13.2 Laws of California, USA .......................................... Page 10
13.3 Arbitration ...................................................... Page 10
13.4 Defaults ......................................................... Page 10
13.5 Assignment ....................................................... Page 10
13.6 Force Majeure .................................................... Page 10
13.7 Precedence ....................................................... Page 10
13.8 Limitation of Liability .......................................... Page 11
13.9 Notice ........................................................... Page 11
13.10 Right of Entry ................................................... Page 11

APPENDIX "A" PRODUCTS

APPENDIX "B" QUALITY

APPENDIX "C" STATEMENT OF WORK

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MANUFACTURING AGREEMENT [XXXXX LOGO]

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1. PERIOD OF AGREEMENT

This agreement is entered into as of May 31, 1998 between Solectron California
Corporation whose principal place of business is located at 000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxx 00000 (Supplier) and Xxxxx Corporation whose principal
place of business is located at 0000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, XX 00000
(Netro). This contract shall begin on the date of signing of the Agreement, and
shall terminate thirty-six (36) months from that date unless terminated or
renewed per other terms of the Agreement. Contract renewal discussions will
begin at least six (6) months in advance of the contract termination date. It is
the intent of the parties that this Agreement shall prevail over the terms and
conditions of any purchase order, acknowledgment form or other instrument.

2. PRODUCTS, PRICES & QUANTITIES.

2.1 PRODUCTS TO BE PRODUCED. Supplier agrees to supply to Xxxxx throughout the
term of this Agreement, any mix of the items listed in Appendix "A" at the
prices agreed to in writing by the parties. Other Products may be added to
Appendix "A" once Xxxxx and Supplier have reached written agreement.

2.2 PRODUCT DEFINITION. At the start of this Agreement, Supplier shall produce
the Products defined in Appendix "A" exactly to the drawings, specifications,
and documentation provided by Xxxxx and agreed to in writing by Supplier unless
otherwise approved in writing by Xxxxx. Only the suppliers shown on the Approved
Vendor List ("AVL") provided by Xxxxx shall be utilized for the initial
procurement of materials. Supplier shall have the right to submit revisions to
Xxxxx to the AVL and Xxxx of Material ("BOM") so that cost reductions shall be
achieved. Such revisions may include, but not be limited to design changes,
manufacturing technology improvements, development of new vendors, etc. All such
changes submitted by Supplier shall be approved in writing by Xxxxx, prior to
implementation of the changes and Xxxxx shall have the unlimited right to use
such changes, in any way it deems appropriate and at its sole discretion.

2.3 COST REDUCTION. Supplier shall implement an ongoing cost reduction program
(including material and productivity improvements) that will target an
annualized cost reduction of a minimum of [***] per cent ([***]) per Quarter for
Appendix "A" Products. Each cost reduction year will start at the signing of the
Agreement and continue until the anniversary date of the Agreement, then a new
cost reduction year will start. Xxxxx will support this cost reduction effort
and will work closely with Supplier to achieve the targeted results. Changes to
meet the cost reduction goals will be mutually agreed to in terms of
implementation timing, effect on inventories, value of the cost reduction,
overall total cost savings, etc. Supplier shall retain the savings of Supplier
generated cost reductions within the quarter that they occur and will be
reflected in the quoted Product costs at the quarterly progress review meeting,
then such savings shall revert fully to Xxxxx. Cost reductions developed solely
by Xxxxx shall be fully retained by Xxxxx. Each cost reduction activity
associated with material or design changes will be authorized by a Xxxxx
generated and approved Engineering Change Order (ECO). The ECO will document the
initiator of the cost reduction, i.e., Xxxxx or Supplier, and the change in the
Product cost to Xxxxx resulting from the cost reduction. Cost reductions may
include but not be limited to reductions in Supplier margins, labor rates,
overheads, G & A's, etc. as driven by efficiency improvements, volumes or total
revenues. At each quarterly progress review meeting, a summary of cost reduction
activities and results will be presented by Supplier.

[***] CONFIDENTIAL TREATMENT REQUESTED

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MANUFACTURING AGREEMENT [XXXXX]
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2.4 EUROPEAN MANUFACTURING: Supplier agrees that in the future, and at Xxxxx'x
direction, Xxxxx Products may be required to be produced and delivered from a
manufacturing facility in the European Union (EU). Supplier agrees that such a
facility will be available for production and delivery of Xxxxx Products within
six (6) months after notification by Xxxxx that such production is required.
Transfer of Products to the EU facility will be the responsibility of Supplier
and at the cost of Supplier. Xxxxx reserves the right to approve the facility
for production prior to start of manufacturing of Netrol Products. Such approval
will not be unreasonably withheld or delayed. Should Xxxxx require Supplier to
undertake export activity on behalf of Xxxxx, Xxxxx agrees to submit requested
export information to Supplier pursuant to Solectron Guidelines for
Customer-Driven Export Shipments.

2.5 PRICING MODEL. Selling price to Xxxxx shall be based on the actual [***],
multiplied by a [***], plus the [***], plus the [***] times the [***], plus the
[***] times the [***] all multiplied [***], [***] rate. The MUF, ALR, TLR, ICT
ad PSG&A factors shall apply to all Products in Appendix "A" and shall vary
according to the chart shown below.

Purchased Quantity of Units By Month

0-500 501-1000 1001-5000 5001-10000
----- -------- --------- ----------

MAT'L UPLIFT FACTOR (MUF): [***] [***] [***] [***]
PROFIT, SG&A (PSG&A): [***] [***] [***] [***]
ASSY LAB RATE/HOUR (ALR): [***] [***] [***] [***]
TEST LAB RATE/HOUR (TLR): [***] [***] [***] [***]
ICT LAB RATE/HOUR (ICT): [***] [***] [***] [***]
XXXX OF MATERIAL COSTS (BOM):- as quoted
ALL LABOR HOURS :- as quoted

[***]=SELLING PRICE TO XXXXX

The Selling Price to Xxxxx shall be as quoted or otherwise agreed in writing by
Xxxxx and Supplier, upon issuance by Xxxxx of the initial purchase order for the
Product(s). The Selling Price shall be reviewed at the quarterly progress review
meetings. Product pricing factors for each quarter will be determined by the
average monthly run rate of Product units in the last month of the prior quarter
and sixty (60) days of purchase orders outstanding. Material cost and labor
hours requires a separate detailed line item analysis and will be reviewed by
the parties at the quarterly progress review meetings.

3. PROGRESS REVIEWS & DOCUMENTATION

3.1 PROGRESS REVIEWS. Periodic progress reviews will be held between Xxxxx and
Supplier, as a minimum, on a quarterly basis. Meetings shall be held at a
mutually acceptable time and location and will include but not be limited to
quality and delivery performance, inventory plans, cost reduction program plans
and status, market and product forecasts, design change issues, costed xxxx of
materials, labor cost data, etc. Agendas shall be prepared and mutually agreed
to at least two (2) weeks in advance of such meetings.

[***] CONFIDENTIAL TREATMENT REQUESTED

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MANUFACTURING AGREEMENT THE WIRELESS ATM COMPANY
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5.2 DOCUMENT SUBMITTALS & APPROVALS. Documentation prepared either by Xxxxx or
Supplier and submitted to the other shall be approved, disapproved or
conditionally approved within ten (10) working days of such submittal.
Disapproval's or Conditional Approval's shall include a detailed description of
the unsatisfactory areas and provide suggestions as to how such conditions can
be corrected.

3.3 OTHER INFORMATION. Xxxxx may require other schedules, submittals and
information from time to time from Supplier and vice versa. These requirements
may be included as an Appendix to this Agreement or requested in writing from
Xxxxx or Supplier.

4. PRODUCT ORDERING

4.1 FORECAST. Xxxxx will provide a six (6) month rolling shipment forecast each
month and a twelve (12) month shipment forecast each quarter. These forecasts
shall be by item part number and shall include anticipated delivery date,
quantity to be delivered, etc. and are non-binding best estimates of Xxxxx'x
future needs. However, if Xxxxx falls short of this goal by the end of the term
of this Agreement, or cancels this Agreement, there shall be no xxxx-backs or
other retroactive price increases associated with the shortfall or cancellation.

4.2 PURCHASE ORDERS. Xxxxx'x initial purchase order for each Product shall be
for sixty (60) days of Product shipments which will set forth the ordered
types, quantities & required delivery dates of the Products to be produced. Each
month, Xxxxx will release an additional thirty (30) days of Product, which will
be, to the extent possible, based on the forecasts provided above. Upon receipt
and acceptance of Xxxxx'x purchase order or material release, Supplier will be
obligated to sell and deliver the Products in accordance with the quantities
and delivery dates specified by the purchase orders or releases. Purchase order
releases will be provided to Supplier by Xxxxx within ten (10) working days
after the end of each calendar month.

4.3 QUANTITY & DELIVERY CHARGES. Purchase orders for existing Products can
deviate from forecast or purchase order as follows:

a. Within 30 Days - plus or minus [***]
b. Between 31 and 60 Days - plus or minus [***]
c. More than 60 Days - plus or minus [***]

where the total charge for the quarter is plus or minus [***] per cent [***].
Any change requested by Xxxxx beyond the allowable increase/decrease shall be
handled by Supplier on a reasonable commercial efforts basis subject to material
availability, capacity availability and agreed upon Product testing
requirements. If the volume exceeds [***] Product units per month, Xxxxx and
Supplier agree to review these percentages at the quarterly progress review
meetings and adjust them to then current business requirements. Should Xxxxx
insist on keeping this high degree of flexibility for unit volumes exceeding
[***] per month the parties will negotiate in good faith a reasonable carrying
charge for such excess inventory.

From time to time, Xxxxx may request Supplier to carry or have on order certain
strategic components, subassemblies, or assemblies (collectively "Strategic
Materials") at higher levels than required in this clause. In this case, Netro
would be responsible for the carrying cost of Strategic Materials.

[***] CONFIDENTIAL TREATMENT REQUESTED

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Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)
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MANUFACTURING AGREEMENT THE WIRELESS ATM COMPANY
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4.4 STOCKING. In order to satisfy any potential need for a sudden increase in
Product quantities or for replacement of any returned Products, Supplier agrees
to ship to Xxxxx, within fifteen (15) calendar days (plus the time needed for
environmental screenings and other mutually agreed upon Product testing) of a
written request, a minimum of [***] percent [***] of the average monthly product
requirements as calculated from the six (6) month rolling forecast. The
replenishment period of any inventory shipped pursuant to this Section shall be
then applicable component material lead time.

4.5 MATERIAL PROCUREMENT. Supplier is authorized to purchase materials required
to provide Products ordered in writing by Xxxxx; Strategic Materials as
requested by Xxxxx; and long lead time materials agreed to by Xxxxx on a Long
Lead Authorization Form. The parties will work together on a best efforts basis
to reduce material leadtimes. Xxxxx realizes its financial responsibility for
material purchased on behalf of Xxxxx. In the event of a cancellation of a
Purchase Order or revision of Long Lead Authorization, or excess material
created by an engineering change, or revision of Strategic Materials quantities
requested by Xxxxx, Xxxxx agrees to compensate Supplier for reasonable costs
associated with the cancellation for Products and material inventory and
Strategic Materials purchased per the terms of the Agreement and to fill Xxxxx'x
purchase orders as follows: (i) the contract price of all finished Products in
Supplier's possession, (ii) the burdened cost of material inventory and/or labor
whether in raw form or work in process, and not returnable to the vendor or
usable for other customers, (iii) the burdened cost of material on order which
cannot be canceled, and (iv) any actual vendor cancellation charges incurred
with respect to material re-allocation, customer cancellations or returns to the
vendor. Supplier shall undertake best efforts to cancel all applicable component
purchase orders and reduce component inventory through return for credit
programs or allocate components for alternate programs if applicable. Xxxxx will
pay the mutually agreed upon cancellation charges, if any, within thirty (30)
days of receipt of invoice. Xxxxx shall have the right to any or all material
received by or paid for by Xxxxx under this clause.

4.6 NEW PRODUCTS. Xxxxx, from time to time, expects to introduce new products
that may obsolete or modify the Products specified on Exhibit "A". When such
introductions are made, Xxxxx and Supplier will work together to determine
whether the new products or product modifications can be produced economically
by Supplier and whether Supplier is capable of producing such products. Xxxxx
shall have the sole responsibility for making such a determination. If Supplier
is chosen to produce the new or modified products, Xxxxx and Supplier will
mutually develop new product introduction plans for the products being
transferred to Supplier. Such plans will include space and equipment
availability, utilization of existing inventory, etc. New Products will be
entered on Appendix "A" by contract modification.

4.7 BAR CODE SHIPPING AND RECEIVING LABELS. Supplier shall place Xxxxx'x
specified bar code labels on all shipping packages and containers for the
material shipped under this Agreement. Xxxxx may change such specification upon
written notice to Supplier and Supplier shall comply with such changes.

4.8 ELECTRONIC DATA INTERCHANGE (EDI). Supplier shall assist Xxxxx in
implementing an EDI system that is compliant with EDI requirements of Xxxxx'x
customers in a mutually agreed to scope and timetable.

[***] CONFIDENTIAL TREATMENT REQUESTED

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Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)
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TEST EQUIPMENT, TOOLING & SPACE.

Supplier will provide all functional test equipment required to fully test the
Products being produced. Xxxxx will supply the functional test software codes
to run the test equipment providing that the equipment architecture is
identical to that used by Xxxxx. Should any special software or third party
licenses or approvals be required to operate the equipment to support
functional testing in the Supplier's facility, Supplier shall take whatever
commercially reasonable steps are necessary to obtain such licenses or
approvals and any costs associated with obtaining or using the licenses or
approvals shall be borne by Supplier. All other fixtures and tooling unique to
Xxxxx, required to produce and test the products and subassemblies shall be
provided by Supplier. Xxxxx and Supplier shall determine what tests are
required and this equipment will be capable of fully testing the Products and
ensuring that they meet the requirements and specifications. Supplier is
responsible to calibrate test equipment on a periodic basis. Xxxxx will have the
option to approve the test equipment architecture prior to use in testing the
Products. Supplier will archive such documentation so that it is easily
reproduced and will make it available to Xxxxx if the Supplier cancels this
Agreement without cause. Supplier will allocate sufficient floor space in its
facilities to meet the capacity requirements projected by Xxxxx in the twelve
(12) month forecast.

6. GENERAL TERMS & CONDITIONS.

6.1 SPECIFICATION CHANGES. Xxxxx or Supplier may, from time to time, request
changes to the Products shown in Appendix "A" by delivering to the other party
a fully approved Engineering Change Order (ECO) or reasonable facsimile as used
by Supplier's internal documentation system. Sufficient documentation will be
included in the change, to effectively support an investigation of the impact
of the engineering change. The proposed change will be fully evaluated within
ten (10) working days of receipt and an effective change date shall be mutually
agreed to by Xxxxx and Supplier. Any ECO changes deemed to be "Critical" by
either Xxxxx or Supplier shall be immediately brought to the attention of the
other party, by written notification, and such ECO changes will be mutually
evaluated and completed within two (2) working days of such notification. If
any such implemented change causes an increase or decrease in the price of, or
time required for the delivery of material or performance of work under this
Agreement, an equitable adjustment shall be made in the Contract Price and/or
the delivery dates. Xxxxx has final design approval on all Products, changes to
Products, and modifications to Products.

6.2 APPROVED VENDOR LISTS (AVL). Xxxxx will provide to Supplier an AVL which
specifies the materials to be used in building the Products listed in Appendix
"A". Supplier will manufacture the Products using components obtained from the
approved vendors. Any deviations must be approved, in writing, by Xxxxx in
advance of use. Xxxxx will from time to time update the AVL and any such
changes will be immediately given in writing or electronically to Supplier.

6.3 XXXXX SUPPLIED COMPONENTS. Initial quantities of materials that Xxxxx has
in stock or on firm order for manufacture of the Products on Appendix "A", will
be purchased by Supplier at a mutually agreed upon price. Xxxxx may also choose
to supply certain critical components to Supplier on an ongoing basis. Xxxxx
supplied materials and components shall be included in the Selling Price to
Netro (PAR 2.5) at the BOM cost times a xxxx up factor of [***].

[***] CONFIDENTIAL TREATMENT REQUESTED

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Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)
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7. ACCEPTANCE & INSPECTION.

The basis for acceptance of the Products on this order shall be full conformance
to the drawings, specifications and test criteria as stated on Xxxxx'x
documentation provided to Supplier. Supplier will satisfactorily meet a minimum
of IPC610 Class II quality standard for all Products. Xxxxx or its customers
may elect to source inspect Products and/or test data and results before
delivery from Supplier. Xxxxx must accompany Xxxxx customers while at Supplier's
facilities. Supplier will provide reasonable space for the source inspector.
Supplier will provide Xxxxx five (5) working days advance notice of Product
availability for source inspection and Xxxxx agrees to source inspect said
Products within five (5) working days after such notification. When Xxxxx elects
to perform source inspection at Supplier's facility, final acceptance shall
occur at the time of source inspector's acceptance of Product, provided however,
that the mere review by Xxxxx of performance data, test results and
manufacturing processes and consultation with Supplier's employees by Xxxxx
regarding such information shall not be deemed to be a Source Inspection
hereunder. Xxxxx may elect to inspect delivered Products one hundred per cent
(100%) or on a sampling basis. Any lot failing to meet the mutually agreed upon
sample inspection lot rejection criteria may be returned to Supplier for one
hundred per cent (100%) inspection, at Supplier's expense, if so desired by
Xxxxx. Xxxxx will notify Supplier of rejection of any Products in writing
within two (2) working days after rejection. Supplier may elect to have the
Products returned to them for evaluation, or with Xxxxx'x concurrence, have
Xxxxx repair the Product at Supplier's pre-approved cost. Any Products returned
to Supplier shall be handled per Supplier's Returned Material Authorization
procedure. Products returned to Supplier for evaluation and/or repair shall be
repaired or replaced by Supplier within ten (10) working days of receipt unless
required by Xxxxx to meet Xxxxx'x monthly shipment commitments. In that event,
the Supplier will utilize available resources, including finished goods
inventory, overtime labor, etc. to expedite and complete the timely delivery of
Products at Supplier's expense.

8. SHIPMENT & DELIVERY.

8.1 ON-TIME DELIVERY. Supplier agrees to deliver Products on-time per its
committed delivery dates as stated on Xxxxx'x Purchase Order and agreed to by
Suppliers acknowledgment of said Purchase Order. On-time delivery is defined to
be plus or minus two (2) calendar days from the committed delivery dates.
On-time delivery point is Supplier's dock. The FOB point will be Supplier's
facility. Shipping is to be by normal transportation methods, unless otherwise
requested by Xxxxx. Xxxxx, in the future, may require Supplier to ship directly
to end users of the Products. These shipments will be FOB Supplier's facility.

8.2 EARLY/LATE DELIVERY. Early Delivery is defined as three (3) or more days in
advance of scheduled delivery date. Xxxxx at its option can refuse to accept
early delivery and if Xxxxx chooses to accept early delivery, such acceptance
must be in writing. Late delivery is defined as being three (3) or more working
days later than the scheduled and acknowledged delivery date at the applicable
dock as stated in the appropriate purchase order. If Supplier fails to make
deliveries at the specified time and such failure is caused by Supplier,
Supplier will, at no additional cost to Xxxxx, employ accelerated measures such
as material expediting fees, premium transportation costs, or labor overtime
required to meet the specified delivery schedule or minimize the lateness of
deliveries. If despite such measures and in the event late delivery is solely
attributed to Supplier, Supplier shall, after a grace period of ten (10)
business days, incur a liquidated damage fee for late delivery of one percent
(1%) of the Product selling price for each full week units are late after the
grace period. These liquidated damages shall be capped at seven percent (7%) of
the price of the late units. Netro may terminate the Purchase Order (or this

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Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)
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Agreement in accordance with Section 13.4) should the limit of seven percent
(7%) be reached. The foregoing is Xxxxx'x sole remedy for delayed or
non-delivery of Products.

8.3 PAYMENTS. Unless otherwise agreed to in writing, payments for Products
shipped will be Net 30 days after date of invoice which shall not be before
date of shipment. Xxxxx will bear all applicable sales and use taxes or provide
resale certificates as needed.

8.4 DATA. With each shipment, data sheets shall be included that show the
actual test results from the functional or acceptance tests completed on the
Products. Test results shall be provided by serial number for each Product in
the shipment and shall include the data and be in the format agreed upon by the
parties. In addition, Supplier shall provide data on a weekly basis showing
overall yield for the Products being shipped including its major subassemblies.
This data shall include a Pareto breakdown that shows the causes of the yield
losses. Format and content of this weekly data shall be as agreed upon by the
parties. Analysis of the root cause of the defects and the action taken to
prevent recurrence shall be provided by Supplier at Xxxxx'x request. Similar
data shall be maintained and transmitted to Xxxxx for all Products returned to
Supplier for repair or replacement.

8.5 QUALITY INFORMATION. Supplier shall supply Xxxxx and its customers with
quality information on a reasonable and timely basis as described in Appendix
"B" Quality.

CUSTOMER FOCUS TEAM AND PROGRAM MANAGER.

Supplier shall provide a dedicated Customer Focus Team (CFT) to Xxxxx at
Supplier's expense. In addition, Supplier shall provide a Program Manager to
oversee Supplier's CFT. When requested by Xxxxx, the CFT will assist Xxxxx to
improve the quality, cost structure and ease of manufacture of the Products,
in defining the equipment requirements, in defining critical parameters to
quantify certain critical aspects of the design and manufacturing process in
order to control and improve the quality level of the Products, and in
selecting and qualifying cost effective component suppliers. The parties shall
mutually agree upon the evolution of the resource skill set and location of the
CFT members during the various phases of the Products life cycles. Supplier will
use best efforts to ensure the CFT will include individuals with skills deemed
critical by Xxxxx for Supplier to be successful in manufacturing the Products.

The CFT will provide mutually agreed upon assistance including, but not limited
to, (i) optimizing Product and process design, (ii) facilities preparation for
the Pilot line whether at Xxxxx or Supplier, (iii) documenting and
characterizing the pilot manufacturing process, (iv) defining and documenting a
manufacturing quality system which will ensure that the Products complies with
customer specifications, (v) developing failure analysis and rework procedures
and related documentation, (vi) performing failure analysis activities, (vii)
selecting and qualifying the vendor base, (viii) reducing Product cost
(material, labor, and overhead), (ix) improving Product quality levels in
preparation for mass production, and (x) developing packaging specifications
for incoming materials and components, materials and components that are
internally utilized in the manufacturing process, and finished Product.)
Supplier will also assist Xxxxx by performing HALT (highly accelerated life
tests) for the Products mutually agreed to.

The parties have drafted a Statement of Work, the current version of which is
attached as Appendix "C" Statement of Work. The parties expect to update this
periodically.

MANUFACTURING AGREEMENT
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10. TERMINATION.

Either party shall have the right to cancel this Agreement without cause by
providing ninety (90) days written notice to the other party. Supplier will be
entitled to reimbursement for reasonable costs associated with termination
without cause by Xxxxx or with cause by Supplier (as provided in Section 13.4),
but shall not be entitled to reimbursement if this Agreement is canceled
without cause by the Supplier or with cause (as provided in Section 13.4) by
Xxxxx. Reasonable costs may include the contract price of all finished Products
on hand, the cost of material inventory (including handling charges and value
add) whether in raw form or work in process, the cost of material on order
(including charges) which can not be canceled, and any vendor cancellation
charges incurred with respect to material canceled or returned to the vendor.
The Supplier will use reasonable commercial efforts to mitigate these
cancellation and restocking charges through negotiation with suppliers and
utilization of materials in Supplier's other customer's products. Xxxxx shall
have the right to any or all material received by or paid for by Xxxxx under
this clause. In the event of a termination request by Supplier without cause,
Xxxxx shall receive no less than ninety (90) days written notice to place a last
buy for forecasted deliveries up to (6) months inclusive of the 90 days written
notice and Supplier will provide documentation for tooling and fixtures to Xxxxx
as requested.

11. WARRANTY.

Supplier warrants that the units of Product supplied under this Agreement will
meet the mutually agreed upon specifications in effect at the time of
manufacture and be free from defects in Supplier supplied material and
workmanship for a period of [***] from the date of manufacture. Parts not
meeting the specifications shall be returned to Supplier for replacement, repair
or credit. Supplier will return all units determined by Supplier to be warranty
defectives within ten (10) working days of receipt. The repair work will be
warranted for a period of [***] from the date of repair or for the original
warranty date, whichever is longer. Repair of out of warranty returns will be
negotiated between Xxxxx and Supplier. Supplier will provide corrective and
preventive action for all in warranty materials identified as not meeting
specifications. Replacement, repair or credit of warranty repairs constitutes
Xxxxx'x sole remedies against Supplier for breach of warranty claims. Out-of
Warranty Products returned to Supplier for repair shall be evaluated and the
cost to repair the unit determined. Within five (5) business days of receipt of
Product Supplier will notify Xxxxx of the estimated repair cost and will await
written authorization from Xxxxx before starting work. Out-of-warranty repairs
will be completed and returned to Xxxxx or end customer within fifteen (15) days
of receipt of start work authorization subject to material availability.
Products that have been subjected to abuse, misuse, accident, alteration,
neglect or unauthorized repair will be handled the same as an Out-of-warranty
repair.

THE WARRANTIES CONTAINED IN THIS SECTION ARE IN LIEU OF, AND SUPPLIER EXPRESSLY
DISCLAIMS AND XXXXX WAIVES ALL OTHER REPRESENTATIONS AND WARRANTIES, EXPRESS,
IMPLIED, STATUTORY OR ARISING BY COURSE OF DEALING OR PERFORMANCE, CUSTOM,
USAGE IN THE TRADE OR OTHERWISE, INCLUDING WITHOUT LIMITATION THE IMPLIED
WARRANTIES OF MERCHANTABILITY, TITLE AND FITNESS FOR A PARTICULAR USE.

[***] CONFIDENTIAL TREATMENT REQUESTED

-------------------------------------------------------------------------------
Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)

8
12
MANUFACTURING AGREEMENT NETRO
THE WIRELESS ATM COMPANY
--------------------------------------------------------------------------------
12. INTELLECTUAL PROPERTY/NON-COMPETITION.

12.1 INTELLECTUAL PROPERTY. All intellectual property and rights to the Product
designs developed by Xxxxx or Supplier during the course of this agreement, and
all related derivative products and improvements shall be the sole (100%)
property of Xxxxx. Xxxxx retain the intellectual rights to the Xxxxx Products
and derivatives of the Products, circuits and sub-assemblies. Supplier will not
use Xxxxx proprietary technology in any products for other customers. All
documentation provided by Xxxxx regarding Xxxxx Products shall be returned to
Xxxxx at the conclusion of this contract. All documentation made by Supplier of
Xxxxx'x bills of materials, assembly instructions, and test processes and
procedures and enhancements thereof shall be returned to Xxxxx at the conclusion
of this contract. Supplier manufacturing processes and supplier developed
manufacturing documentation are proprietary technology and/or trade secrets of
Supplier and Xxxxx will not be provided this documentation.

12.2 CONFIDENTIALITY. Xxxxx and Supplier acknowledge that the terms of the Non
Disclosure Agreement (NDA) signed between the parties are in full force and
effect during the term of this Agreement, any extensions or modifications to
this Agreement and to the date stated on the NDA, whichever is longer.

12.3 PUBLICITY. All material relating to this Agreement which is intended for
publication in any form, including but not limited to the relationship between
Xxxxx and Supplier, must be approved in writing by both parties before any such
publication can be made.

12.4 EXCLUSIVITY. Supplier shall manufacture the Products which are subject to
this Agreement exclusively for Xxxxx and shall not publicize such
relationships in any form including any contents of this Agreement (except to
auditors and to comply with the Supplier's legal obligations) without written
approval from Xxxxx which will not be unreasonably withheld or delayed. The
Product which is subject to the provisions of this section shall also include
all subassemblies utilized in the Product and their derivatives. Xxxxx
proprietary information shall not be conveyed in any form to any other party.

12.5 NON-COMPETITION. Supplier shall not compete with Xxxxx, directly or
indirectly, by using Xxxxx'x intellectual property for any purpose not
authorized by this Agreement during the term of this and any follow-on Agreement
and for a period of [***] after termination of this Agreement. Supplier will not
manufacture products which are competitive with Xxxxx Products in the same
building in which Xxxxx Products are manufactured. In addition, Supplier's
employees who are assigned to the CFT, and the Program Manager assigned by
Solectron to oversee the CFT, will not be assigned by Supplier to work on any
product which is competitive with Xxxxx Products prior to November 30, 1999
unless otherwise agreed in writing by the parties. For the purposes of this
section 12.5 Xxxxx Products are defined as point to multi-point radios in the
10-40 gigahertz frequency range.

12.6 ESCROW. If requested by Xxxxx for escrow and contingent licenses
requirements, supplier agrees to provide any available documentation for
manufacturing processes related to Xxxxx products, but in no event will Supplier
be expected to supply its own proprietary information.

[***] CONFIDENTIAL TREATMENT REQUESTED

--------------------------------------------------------------------------------
Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)

9
13
MANUFACTURING AGREEMENT NETRO
THE WIRELESS ATM COMPANY
-------------------------------------------------------------------------------
13. MISCELLANEOUS.

13.1 LANGUAGE & CURRENCY. All correspondence, transactions and documents
transmitted between Xxxxx and Supplier shall be in the English language. All
prices quoted and payments made shall be in US Dollars.

13.2 LAWS OF CALIFORNIA, USA. This Agreement shall be construed, interpreted
and enforced in accordance with the law of the State of California, USA.

13.3 ARBITRATION. Any controversy or claim arising out of this contract, shall
be settled by arbitration in San Jose, California in accordance with the Rules
of the American Arbitration Association, and any judgment or award rendered by
the arbitrator(s) may be entered in any court having jurisdiction thereof. The
parties agree that any arbitration shall be commenced within thirty (30) days of
the controversy or claim.

13.4 DEFAULTS. Either Xxxxx or Supplier may, by written notice to the other
party, terminate this Agreement and all or any of the privileges granted herein,
(1) if the other party defaults in any payment to the terminating party called
for in this Agreement and such fault continues unremedied for a period of thirty
days after the date of delivery of written notice, or (2) if the other party
defaults in the performance by it of any other material term or condition (e.g.
quality), or of any purchase order issued pursuant to this Agreement, and such
default continues unremedied for a period of thirty days after the date of
delivery of written notice. The effective date of termination will not be
before the expiration of any applicable cure period provided for herein. In the
case of late or non-delivery, the right to terminate this Agreement will be
available only after the liquidated damages cap in Section 8.2 is reached.
Either party may immediately terminate this Agreement if the other party files
for bankruptcy, is adjudicated bankrupt, has a receiver appointed for it, or
becomes involvement.

13.5 ASSIGNMENT. This Agreement may be assigned to any parent, affiliate,
successor or subsidiary corporation, company or division. Otherwise this
Agreement may not be assigned by either party without the prior written consent
of the other party, which shall not be unreasonably withheld.

13.6 FORCE MAJEURE. Neither party shall be liable to the other for any delay
or failure in the performance of its obligations and responsibilities hereunder
if such delay or failure is caused by any fires, floods, strikes, work
stoppages, accidents, wars (declared or undeclared), acts of God, acts of any
Government agency or authority, epidemics, quarantine restrictions, freight
embargoes, public disorders, riots or any other cause beyond the fault or
control of the defaulting party. Each party shall use its best efforts to
mitigate the impact of this clause. Supplier's liability for loss or damage to
Xxxxx'x material in Supplier's possession or control shall not be modified by
this clause. When a party's delay or nonperformance continues for a period of
at least fifteen (15) days, the other party may terminate, at no charge, any
open purchase orders under the Agreement.

13.7 PRECEDENCE. It is the intent of the parties that this Agreement and its
addenda shall prevail over the terms and conditions of any purchase order,
acknowledgement form or other instrument. This Agreement may be executed in one
or more counterparts, each of which will be deemed the original, but all of
which will constitute but one and the same document. The parties agree this
Agreement and its addenda may not be modified except in writing signed by both
parties.

--------------------------------------------------------------------------------
Xxxxx Corporation 0000 Xxxxx Xxxxx Xxxxxx Xxx Xxxx Xxxxxxxxxx 00000
408.216.1500 000.000.0000 (Fax)

14
MANUFACTURING AGREEMENT [NETRO LOGO]
THE WIRELESS ATM COMPANY
--------------------------------------------------------------------------------

3.8 Limitation of Liability

IN NO EVENT, WHETHER AS A RESULT OF BREACH OF CONTRACT, WARRANTY, OR TORT
(INCLUDING NEGLIGENCE), STRICT LIABILITY, PRODUCT LIABILITY, OR OTHERWISE,
SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL, INCIDENTAL,
CONSEQUENTIAL, EXEMPLARY DAMAGES OF ANY KIND WHETHER OR NOT EITHER PARTY
WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

13.9 NOTICE. If notice is required, it shall be in writing, and sent by
personal delivery, facsimile, etc. and addressed to the party at the address
appearing below.

If no Xxxxx Corporation: If to Solectron California Corporation:
Xxxxx Corporation Solectron California Corporation
0000 Xxxxx Xxxxx Xxxxxx 000 Xxxxxxxxx Xxxxx, Xxxxxxxx 0
Xxx Xxxx, XX 00000 Xxxxxxxx, XX 00000
ATTN: Vice President Operations ATTN: Corporate Legal Department

13.10 RIGHT OF ENTRY. Upon reasonable notice each party shall have the right
to enter the premises of the other party during normal business hours with
respect to the performance of this Agreement including an inspection or a
Quality Review, subject to all plant rules and regulations, security
regulations and procedures as applicable. From time to time and with
reasonable notice, Xxxxx may request Supplier to allow visitors of Xxxxx to
tour the Supplier's facilities that are building Product for Xxxxx.
Acceptance of such requests shall not be unreasonably withheld by Supplier.

XXXXX CORPORATION SOLECTRON CALIFORNIA CORPORATION

/s/ Xxxxxx Xxx-Xxxxxx 5/29/98 /s/ Solectron California Corp. 5/29/89
--------------------- --------- ------------------------------ ---------
Approved By: Date: Approved By: Date:

--------------------------------------------------------------------------------

15
APPENDIX A PRODUCTS

-------------------------------------------------------------------------------------------------
Description Model Number Part Number
-------------------------------------------------------------------------------------------------

NAS-2 with ATM/FR Engine AM-NA-2010X 13558-0001
NAS-2 without ATM/FR Engine AM-NA-2011X TBD
NAS-2 with 18E1: no ATM AM-NA-2012X 13549-0001
120-75 ohm connector board n/a 11572-0000

SAS 2 E1 SAS-E-1001-XX 12618-0000
SAS 2 T1 SAS-F-1001-XX TBD
SAS 2 T1 w/ethernet SAS-E-1002-XX 13765-0000
SAS 2 T1 w/ethernet SAS-F-1002-XX 13329-0000
SAS-2 2 E1 with daughter bd, enet SAS-E-1002-XX TBD October
SAS-2 2 T1 with daughter bd, enet SAS-F-1002-XX TBD December
SAS-2 2 E1 with ASIC XXX XXX Q4
SAS-2 2 T1 with ASIC XXX XXX Q1'99
Ruggedized SAS ETSI RSS-E-1002-XX TBD October
NAU (SAS w/o modem) NAU-E-1004-XX TBD October
SAS 4 E1 SAS-E-1004-XX XXX Xxxxxxxx
XXX 0 X0, X.00 XXX-X-0000-XX TBD December
RJ45 to BNC adapter card n/a 13157-0000

SRU 39 GHz TBD, Assorted Bands TBD, Assorted Bands, Dec
SRU 39 GHz - SL Package TBD, Assorted Bands TBD, Assorted Bands, Dec
SRU 26 GHz Bnd2, Vert, ETSI SRU-E-2802-XX 13685-0002
SRU 00 XXx - Xxx0 XX Xxxxxxx XXX-X-0000-XX 00000-0000
SRU 00 XXx Xxx0, Xxxx, XXXX XXX-X-0000-XX 00000-0000
SRU 00 XXx - Xxx0 XX Xxxxxxx XXX-X-0000-XX 00000-0000
SRU 00 XXx Xxx0, Xxxx, XXX SRU-F-2402-XX 13680-0002
SRU 24 GHz - SL Package SRU-F-2412-XX 13496-0002
SRU 00 XXx Xxx 0 XXX-X-0000-XX 00000-0000

XXX 39 GHz TBD, Assorted Bands TBD, Assorted Bands
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-2601-XX 13688-0001
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-2603-XX 13686-0003
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-2611-XX 13686-0005
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-2613-XX 12851-0006
XXX 00 XXx, Xxx 0, 00 deg, FCC BRU-F-2401-XX 13681-0001
XXX 00 XXx, Xxx 0, 00 deg, FCC BRU-F-2411-XX 13681-0005
XXX 00 XXx, Xxx 0, 00 deg, FCC BRU-F-2431-XX 13681-0009
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-1001-XX 13883-0001
XXX 00 XXx, Xxx 0, 00 deg, ETSI BRU-E-1011-XX TBD, October

BMU E1, ETSI BMU-E-2000-XX 13763-0000
BMU T1, FCC BMU-F-2000-XX 13837-0000
BMU EI Access Shelf (card), ETSI BMU-E-1000-XX TBD, October

BSC, ETSI or FCC BSC-E-2000-XX/BSC-F-2000-XX 12877-0000
BSC back card BSC-X-1001-XX, part of -2000-XX 13260-0000
BSC, ETSI or FCC ASIC XXX XXX, October
BSU - BSC front card, 2 channel BSU-E-2000-XX TBD, October
BSU - BSC front card, 4 channel BSU-E-4000-XX TBD, October
BSC, 4 Channel, ETSI BSC-E-4000-XX TBD, October
BSC, 4 Channel, FCC BSC-F-4000-XX TBD, December

AM2000 00 XXx XX Xxx 0 XX-XX-0000X 13687-0003
AM2000 26 GHz SL Bnd 4 AM-RU-2018X 13687-0004

NOTE: Subassemblies and PCA's related to these part numbers are included even
though they are not specifically called out in this table. Product list subject
to change.

CONFIDENTIAL

16
APPENDIX B QUALITY

(A) Supplier commits to ensure that all manufacturing, and design operations,
including any key sub-contractor, or contract manufacturing suppliers, which
contribute to the design, development, production, delivery and service of
material are ISO 9000 registered by an accredited Registrar by one year
after first purchase order is placed by Xxxxx.

(B) Supplier commits to having a continuous improvement program in place which
will allow it to attain and maintain "acceptable" ratings (or equivalent) on
all quality system elements as periodically performed by Xxxxx. An
"acceptable" element is defined as one where the quality system meets the
"general intent" of the quality system and is fully deployed to maintain the
quality system and product quality. No significant deficiencies encountered
that would jeopardize the quality system, and product quality and/or
reliability.

(C) Supplier commits to establish key quality control (qc) verification points
throughout the manufacturing process. These verification points should be
located in-process as well as after MATERIAL has completed all manufacturing
operations. The scope of these qc verification points shall be validated
through visual or mechanical inspections and/or tests, and with the use of
statistically valid sampling plans, that MATERIAL conforms to Supplier's
manufacturing, product and process specifications, standards of acceptable
workmanship, as well as other specifications which may be provided by Xxxxx.
Xxxxx reserves the right to review these qc points and make suggestions for
improvement. Supplier commits to address these suggestions through the
implementation of appropriate corrective actions.

(D) Supplier commits to establish an end of the line Quality Assurance product
audit on material by three (3) months after first purchase order. The focus
of this audit shall be to replicate user application of MATERIAL as
specified by Xxxxx'x customer. Test and examination of MATERIAL under the
quality audit shall be at a system level, and shall include but is not
limited to:

a) Exercising said MATERIAL over the full spectrum of temperature
ranges over which MATERIAL is designed to operate.

b) Full operation of MATERIAL over a period of time not less than 72
hours.

c) A system for continuous monitoring of all primary product functions
and fault detection of the MATERIAL while under this test.

Supplier shall continuously review customer return data to ensure that the
scope of the product quality assurance audit function includes the
requirement(s)/condition(s) under which the return failed.

17
Supplier shall perform a detailed failure mode analysis of all MATERIAL
found defective through the quality assurance audit in line with the
requirements and process outlined in paragraph F.

Supplier agrees to provide to Xxxxx on a monthly basis, results of the
quality assurance product audit in a format specified by Xxxxx.

(E) Supplier commits to establishing a program of tracking monthly, quarterly,
and annual return rates for the product manufactured under this contract.
The Supplier agrees to update and report on returns on a quarterly basis
to Xxxxx.

(F) Supplier commits to establishing a system for tracking and analysis all
MATERIAL returned by Xxxxx to it, as well as any MATERIAL failures which
occur through Xxxxx'x end of the line quality assurance audit. For all
MATERIAL in the above two categories, supplier shall perform a failure
mode analysis, which at a minimum will be down to the component level.
Component level failure modes will be recorded, and failed components
found defective will be accumulated for the purpose of determining
repetitive occurrences.

Material shall be considered defective if it fails to meet the warranty
specifications under this Agreement (including performance and appearance
Specifications) or if during customer testing, installation, or use, the
MATERIAL fails to operate as expected or specified.

If the analysis of a return is found to be within the specifications of
this agreement (i.e., a no trouble found condition), then Supplier shall
track these no trouble found conditions and notify Xxxxx of said findings
at a minimum of a monthly interval, so that appropriate investigative
measures may be taken to determine the root cause.

(G) If the return rate is found to exceed a mutually agreed to acceptable rate
or repetitive occurrences are observed with regard to component level
failures then the supplier shall provide a written Corrective Action
Report to Xxxxx, explaining in detail the nature of the problem detected,
and the step(s) Supplier proposes to correct the problem. As part of the
plan to correct the problem, it is agreed that the Supplier shall:

a) Incorporate the remedy in affected MATERIAL.

b) Ship all subsequent MATERIAL incorporating the required
modification correcting the problem at no additional charge to
Xxxxx; and

c) Create a mutually agreed to plan to address the scope of
correction and the proper course of actions to be taken by
Supplier and Xxxxx.

2
18
Supplier and Xxxxx shall mutually agree in writing as to the
implementation schedule of the corrective action plan. Supplier agrees to
use its best efforts to implement the plan in accordance with the agreed
upon schedule. It is also agreed that the Xxxxx shall be entitled to
postpone at no charge to Xxxxx, further deliveries of orders until such
time as the remedy is implemented consistent with this Article.

(H) As part of a program of continuous improvement, Supplier agrees to
establish annually, improvement goals for a series of key quality
objectives. These goals should include, but are not limited to a)
customer return rates, b) Quality Assurance product quality audit defect
rates, c) final system test yields. Supplier agrees to track these goals
on a monthly basis, and to commit the resources necessary for the
attainment of these goals.

3
19
(I) The following paragraph summarizes the requirements for providing data and
information to Xxxxx as per paragraphs A through H.

-------------------------------------------------------------------
REF. DATA REQUIRED FREQUENCY
PAR.
#
-------------------------------------------------------------------
A Corrective Action As dictated by
Response to Assessment
Assessment
-------------------------------------------------------------------
B ISO Registration When requested by
copies Xxxxx
-------------------------------------------------------------------
C Corrective Action As dictated by the audit
response to Xxxxx'x
audit of QC practices
-------------------------------------------------------------------
D Quality Assurance Monthly
Results
-------------------------------------------------------------------
E Monthly Return Rate Quarterly
data
-------------------------------------------------------------------
E Annual Return Rate Monthly
Summary Results
-------------------------------------------------------------------
F "No trouble founds" Monthly
summary data on
customer returns
-------------------------------------------------------------------
G Corrective Action As dictated by Supplier's
Report data on repetitive
component level failure
mode analysis (FMA) on
customer returns
-------------------------------------------------------------------
G Corrective Action If return rates exceed
Report pre-established
thresholds
-------------------------------------------------------------------
H Quality Improvement Annually
Goals
-------------------------------------------------------------------

(J) As used in this Paragraph, the term "Epidemic Failure" means a specific
product failure affecting 10 percent (10%) or more of a specific Product
then under warranty, which is a direct result of a defect in Supplier
workmanship. In the event of an Epidemic Failure, Supplier will perform root
cause analysis of the failure and cooperate with Xxxxx to implement remedial
actions necessary to correct the failure mode. Furthermore, without limiting
its warranty obligations, Supplier will reimburse Xxxxx for any and all
standard freight and labor charges of replacing the affected

4
20
Xxxxx for any and all standard freight and labor charges of replacing the
affected Product already shipped by Xxxxx and in the field, provided such
charges do not exceed [***] percent [***] of the total cost paid by Xxxxx to
Supplier for the affected Products.

Supplier shall have no liability or responsibility under this Paragraph for any
losses or damages to the extent that any such Epidemic Failure claims are the
result of (i) Supplier's compliance with Xxxxx supplied specifications and
manufacturing processes; (ii) the negligence of Xxxxx or any other person
providing goods or services in connection with the design, development,
production and distribution of the Product (with the exception of Supplier
assembly of the Product); (iii) modification or alteration of the Product by a
party other than Supplier; (iv) incorrect installation or incorporation of the
Product by a party other than Supplier; (v) defects in Xxxxx'x products or any
components supplied by a third party thereof.

[***] CONFIDENTIAL TREATMENT REQUESTED

5
21
APPENDIX C

STATEMENT OF WORK

OBJECTIVE: Xxxxx will help Solectron acquire high-frequency RF expertise, with
the goal of becoming proficient in manufacturing radio products within 6 to 9
months. Solectron will help Xxxxx put processes in place that will facilitate
future product transitions, as well as prepare for volume ramp of Xxxxx'x
product line.

SCOPE OF WORK

Solectron shall make itself familiar with Xxxxx'x products, primarily by
residing on-site to learn and document processes and technology. The objective
is to fully understand the design, test and manufacturing of the Xxxxx'x product
line. Listed below are the major points that need to be addressed going forward.

1. This phase will review the following areas:

1.1 Xxxxx'x design, test and manufacturing process flow

1.2 Xxxxx'x test plans and procedures, Failure diagnostics/analysis
methodologies, cycle time, calibration procedure and cycle time, test
cycle time, and yield data.

2. ESS requirements (HALT, etc.)
Solectron shall work with Xxxxx to prepare and compile:
2.1 Test plans
2.2 Test Procedures
2.3 Define failure criteria at the component, board and system level
2.4 And provide/participate for the design inputs as a result of 2.1-2.3.

3. ICT opportunities

STC shall work with Xxxxx to determine which assemblies are candidates for ICT.
Xxxxx to provide schematics for all assemblies quoted.

4. Failure analysis/isolation/detection

There shall be three levels of failure isolation/detection, based on
criticality:
4.1 Level three (board/box level failures that occur during normal
manufacturing operations)
4.2 Level two - component level failures which may be due to:
4.2.1 Faulty/Bad component
4.2.2 Design related failures (Derating factors, out of spec, etc.)
4.2.3 Process related failures (IR reflow, shorts/opens, solder, etc.)
4.3 Level one (Failure has been isolated to a component, cross sectioning
may be required to determine the cause of the failure to be performed
either at Solectron or at Solectron's supplier using Solectron's
leverage)

1
22
5. RF functional Test

Short term, Solectron will work with Xxxxx to streamline current test process to
increase efficiency and throughput. Longer term, the focus would move towards:

5.1 Cost/Trade off analysis on the level of automation
5.2 Automation implementation based outcome of 5.1 above
5.3 Increase test coverage at the box level
5.4 Determine proper amount of time for testing

6. Training methodology

6.1 The Solectron project will work with Xxxxx to understand their testing
methodology and put forward a training plan for Solectron's operators.
6.2 Based on the outcome in 6.1, adequate training for Solectron's
operators/technicians/engineers will be provided.
6.3 The Solectron project team will work to enhance the on-going RF
training provided presently for the operators, technicians and
engineers working at Solectron, to ensure a strong RF pool of
resources to draw from in future.

7. Hiring of RF engineers/technicians:

Due to increasing demand for manufacturing and testing RF products, Solectron is
in the process of recruiting additional RF/Microwave/Wireless engineers and
technicians. There are several openings within the Milpitas campus. The
Solectron Technical Center has solidly positioned its RF capabilities by
establishing several business relationships with RF consulting firms in US for
outsourcing of consulting engineering services if an when necessary. Solectron
is currently staffed for the manufacturing of PCB's from Xxxxx, but will hire
(or transfer) resources for the radio production.

8. Reliability

Solectron shall implement a reliability and qualification program plan in
collaboration with Xxxxx. This plan will encompass both component and system
level testing in an attempt to help Xxxxx with its design for reliability, yield
analysis and improvement, IQC, reduction/elimination of burn-in time, review/
audit of supplier's reliability, qualification and screening procedures,
utilization of derating factors, and worst case scenario analysis. Xxxxx will
identify critical component list for Solectron.

9. Source Inspection

Solectron to help perform source inspection, qualification, incoming test and
quality control for the critical RF components. Xxxxx to identify critical
component list for Solectron.

2
23
10. Documentation

Solectron to assist in documenting the manufacturing process. This would include
adding more detail to current documents, rev control, visual aids, etc.

11. Cost Reduction Efforts

Solectron feels there are opportunities for future cost reduction, illustrated
in the following examples (but not limited to):

- Automation of current test stations
- Design future platforms to be similar, with configuration done at the
very end of the manufacturing process (i.e. choosing frequency range)
- Reduction of ESS testing (by going to sampling, etc.)

PROJECT TEAM

The following people from Solectron will form the main team dedicated to Xxxxx,
whose main purpose will be to understand the transition requirements that will
lead to full production of the radio product.

- Xxxxx Le, RF Training Manager
- Xxx Xxxxx, RF Test Engineer
- Xxxx Xxxxxx, Manufacturing Program Manager
- Xxxxxx Xxxxxxx-Xxxx, RF Engineering Manager
- Xxxxxxx Xxxxx, RF Process Engineer
- Xxxxxxx Xxxxxx, Process Engineer
- Xxxxx Xxxxxxxxxxxx, Materials Manager

This team also has the ability to bring in backup support from the attached
resource list, as needed for functional area.

3
24
GETTING STARTED

Solectron will use the following steps (defined per the attached timeline) in
the approach to each assembly in order to cover the areas necessary for
manufacturing.

ASSESSMENT FOR MANUFACTURING - CHECKLIST FOR PCB ONLY (1 WEEK)

Assumptions - Board only to start
- Functional test will be duplicated per current methodology

Assessment Team - Xxxxx Micada
- Xxxxxxx Xxxxxx
- Xxxxx Xxxx

- Component type and specification per assembly
- identify whether or not the assembly is candidate for ICT
- Current yield (average)
- If functional test, what are equipment requirements
- Is there manual adjustment required during functional test
- Identify special parts handling (i.e., hand loading of PTH components)
- Level of workmanship required (i.e., IPC, etc.)
- Identify components subject to BABT
- ESS test plan and procedures
- Material inventory status and on-order status
- Other unique facility requirements

QUOTATION (3 WEEKS FOR FULL TURNKEY QUOTES)

Assumption - All assemblies are well documented (per below), and Solectron will
work closely with Xxxxx to bring up EDI capabilities for data transfer.

- Full turnkey quote for new assemblies takes 3 weeks
- Following documents are needed to begin quote process
- Theory of operations
- Schematic
- BOM and AVL for all components
- Assembly drawing
- Functional test plan, procedures and times
- Fab drawing
- ESS test plan, procedures and times
- Sample board (non-functional)

25
QUOTE REVIEW (1 WEEK)

o This time is used for Xxxxx to review for approval
o Solectron to clarify any open items

MATERIAL TRANSFER (4 WEEKS)

Listed below are the normal steps in transitioning inventory management to
Solectron:

o Ensure documentation is accurate (i.e. BOM rev levels, etc.)
o Take physical inventory of on-hand materials
o Put Letter of Authorization in place for Solectron to procure long lead
items
o Review open PO report by component
o Solectron loads forecast demand from Xxxxx (BOM, AVL, etc.)
o Solectron begins purchasing on-hand inventory (per ABC policy) to support
fcst.
x Xxxxx issues Letter of Authorization to vendors to allow Solectron to
take over outstanding PO's issued by Xxxxx
o Solectron continues to place new PO's to support future demand

ICT TEST DEVELOPMENT (6 WEEKS)

This time is required to develop and build the test fixtures for in-circuit
test. Xxxxx to provide known good boards for development effort.

FUNCTIONAL TEST DEVELOPMENT (8 WEEKS)

Assumption -- Solectron initially will duplicate Xxxxx test stations and
procedures. In future, Solectron will make suggestions to increase productivity
(throughput) of the functional test stations to support higher volumes. Upon
signing of the contract, Solectron will order the equipment needed to support
production.

PCB TOOLING (2 WEEKS)

o This time used for manufacture of fixtures required.

MPI DEVELOPMENT (1 WEEK)

o Process instructions used in manufacturing

ASSEMBLY PILOT RUN (1 WEEK)

o Used to validate production
o Quantity TBD

ASSEMBLY TEST (POST PILOT -- 1 WEEK)

o Includes both functional and ESS depending on requirements

5
26
TEST SUPPORT TEAMS

Test Team (Digital) -- Xxxxx Xxxx
-- Xxxx Xxx

Test Team (RTF) -- Xxxxxxx Xxxxx
-- Xxx Xxxxx
-- Xxxxx Le
-- Xxxxxx Xxxxxxx-Xxxx

6
27

TIMELINE FOR PRODUCTION OF XXXXX 26 GHZ SRU

[***] - Solectron team moves on-site at Xxxxx
- Assess current manufacturing and test processes
- Document the assembly and test process
- Order Equipment [***] (Contract Dependent)
- Assess capacity required for next 12 months
- Begin engineering training
- Begin component engineering (IQC, reliability, etc.)
- Begin material transfer process
- Begin test development/duplication
- Identify ESS xxxxxxxx to be used for production
- Formulate labor plan for operators and technicians
- Put quality plan in place with measurable goals
- Prove out SMT lines with consignment runs - first article
approval
- Identify RF assemblers and technicians and start training at
Xxxxx
- Agree on quality and performance metrics - provide daily, weekly,
monthly as determined by Xxxxx-Solectron
- Identify RF components for IQA (Xxxxx)
- Develop plan for HALT testing for reliability

[***] - Complete material transfer from Xxxxx
- Preliminary cost reduction plan and realistic targets
- Complete ICT fixture development
- Begin turnkey production of boards
- Set up quality metrics feedback system
- Implement IQA plan for RF components
- Implement HALT testing
- Continue RF training; Document training
- Continue document assembly and test process
- Begin work on improving production yields

[***] - Begin set up of test equipment
- Begin ICT test of boards
- Monitor yields - improvement plan
- Continue RF training; Document training
- Continue document assembly and test process

[***] - Complete set up of equipment for test stations
- Continue RF training; Document training
- Continue document assembly and test process
- Monitor yields - improvement plan
- Complete material transition of mechanical components

[***] - Complete set up of equipment for radio test
- Continue RF training; Document training

[***] CONFIDENTIAL TREATMENT REQUESTED

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- Complete document assembly and test process
- Monitor yields - improvement plan

[***] - Complete RF training for technicians
- Pilot build and test of radio products
- Complete troubleshooting, rework training, and documentation
- Monitor yields - improvement plan

[***] - Continue work on improving production yields
- OOB (out of box) failures should be at least as good as Xxxxx'x
yields should be at least as good as Xxxxx'x by [***]
- Continue to improve quality metrics/feedback at all stations
- Begin ramp to volume
- Assess next 12 months capacity looking forward (at each quarterly
meeting)
- Begin plan for test automation
- Get ready for full system Integration and test - TBD by Xxxxx and
Solectron

Next Level of Detail - Month 1

- Labor Plan (Xxxxx Xxxxxx/Xxxxxx Xxxxx)
- Material Plan (Xxxxx Xxxxxxx/Xxxxx Xxxxxxxxxxxx)
- Test Plan (Xxxx Xx/Xxxxxx)
- EDI Feasibility (Xxxx Xxxxx/Taka)
- Program Manager Defined (Xxxxx Xxxxxxx/TBD)
- Calendar Determined - daily?, weekly, monthly, quarterly
- SOW for other products (SAS, BSC, BMU)
- Project Teams Assigned (wk 1)

Issues

- Manpower (RF trained)
- Acquisition of Equipment
- Contract Signature

[***] CONFIDENTIAL TREATMENT REQUESTED

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Table of Contents

NETRO THE WIRELESS ATM COMPANY ------------------------------------------------ -------------------------------- MANUFACTURING AGREEMENT

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