MANUFACTURING SERVICES AGREEMENT
BETWEEN
JABIL CIRCUIT, INC
AND
DIGITAL LIGHTWAVE, INC.
JBL011 Manufacturing Services Agreement
Page #
INDEX
SECTION 1 DEFINITIONS PAGE 4
SECTION 2 LIST OF SCHEDULES PAGE 7
SECTION 3 BUILD SCHEDULE FORECASTS PAGE 7
SECTION 4 MANUFACTURING SERVICES PAGE 7
4.1 Testing.
4.2 Packaging and Shipping.
4.3 Items to be Supplied by Digital.
4.4 Items to be Supplied by Jabil.
4.5 Digital Inspection.
4.6 Materials Procurement.
4.7 Product Acceptance.
SECTION 5 WARRANTY & RMA PROCEDURE PAGE 8
5.1 Jabil Warranty.
5.2 Repair or Replacement of Defective Product .
5.3 Limitation of Warranty.
5.4 ECO Upgrade.
SECTION 6 LIMITATION OF DAMAGES PAGE 9
SECTION 7 DELIVERY, RISK OF LOSS AND PAYMENT TERMS PAGE 9
7.1 Payment.
7.2 Taxes.
SECTION 8 COMPLIANCE WITH LAWS PAGE 10
SECTION 9 DESIGN SERVICES PAGE 10
10
SECTION 10 CHANGE ORDERS, RESCHEDULING AND CANCELLATION PAGE 10
10.1 Changes to Manufacturing Services, Packaging and
Shipping Specifications and Test Procedures.
10.2 Production Increases.
10.3 Product Configuration Changes and Engineering Changes.
10.4 Treatment of Obsolete/End-of-Life Material.
10.5 Rescheduled Delivery and Cancellation of Orders.
10.6 Duty to Mitigate Costs.
SECTION 11 TERM PAGE 13
SECTION 12 TERMINATION PAGE 13
12.1 Termination for Convenience.
12.2 Termination for Cause.
12.3 Termination for Bankruptcy/Insolvency.
12.4 Termination Consequences.
SECTION 13 CONFIDENTIALITY PAGE 14
13.1 Confidentiality Obligations.
13.2 Employees, Agents and Representatives.
13.3 Term and Enforcement.
13.4 Return of Proprietary Information and Technology.
SECTION 14 INTELLECTUAL PROPERTY RIGHTS; ASSIGNMENT PAGE 15
14.1 Jabil Existing Intellectual Property.
14.2 Jabil Created Intellectual Property.
SECTION 15 MANUFACTURING RIGHTS PAGE 15
SECTION 16 INDEMNIFICATION ____________________________ PAGE 16
SECTION 17 RELATIONSHIP OF PARTIES PAGE 16
SECTION 18 INSURANCE PAGE 16
SECTION 19 PUBLICITY PAGE 17
XXXXXXX 00 XXXXX XXXXXXX PAGE 17
SECTION 21 MISCELLANEOUS PAGE 17
21.1 Notices.
21.2 Amendment.
21.3 Partial Invalidity.
21.4 Monies.
21.5 Entire Agreement.
21.6 Binding Effect.
21.7 Waiver.
21.8 Captions.
21.9 Section References.
21.10 Business Day.
21.11 Dispute Resolution.
21.12 Counterparts.
21.13 Governing Law and Jurisdiction.
MANUFACTURING SERVICES AGREEMENT
This Manufacturing Agreement ("Agreement") is entered into by and between
Jabil Circuit, Inc., a Delaware corporation ("Jabil"), having offices at 10560
0xx Xxxxxx Xxxxx Xx. Xxxxxxxxxx, Xxxxxxx 00000, and Digital Lightwave, Inc., a
Delaware corporation ("Digital"), having its principal place of business at
00000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx. Jabil and Digital are referred to
herein as "Party" or "Parties".
RECITALS
A. Jabil is in the business of designing, developing, manufacturing,
testing, configuring, assembling, packaging and shipping electronic assemblies
and systems.
B. Digital is in the business of designing, developing, distributing,
marketing and selling products containing electronic assemblies and systems.
C. Whereas, the Parties desire that Jabil manufacture, test,
configure, assemble, package and/or ship certain electronic assemblies and
systems pursuant to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:
TERMS
1 DEFINITIONS. In addition to terms defined elsewhere in this Agreement,
the capitalized terms set forth below shall have the following meaning:
1.1 "AFFILIATE" means with respect to a Person, any other Person
which directly or indirectly controls, or is controlled by,
or is under common control with, the specified Person or is
an officer, director or 10% or more shareholder of the
specified Person. For purposes of the preceding sentence,
"control" of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of
the management or policies of such Person, or direct or
indirect ownership (beneficially or of record) of, or the
direct or indirect power to vote, 5% or more of the
outstanding shares of any class of capital stock of such
Person (or in the case of a Person that is not a corporation,
5% or more of any class of equity interest)
1.2 "BOX BUILD(S)" means the box builds identified as such in
Schedule 1.
1.3 "BUFFER STOCK" means finished goods PCBA inventory owned and
paid for by Digital in a location within Jabil.
1.4 "BUILD SCHEDULE" means a manufacturing schedule provided to
Jabil by Digital in writing which specifies the Product to be
manufactured, including the quantity of each Product, its
description and part number, shipping instructions and
requested delivery date.
1.5 "BUILD SCHEDULE FORECAST" means the monthly forecast provided
to Jabil by Digital, in writing, of quantity requirements of
each Product that Digital anticipates requiring during the
next twelve (12) month period.
1.6 "COMMERCIALLY REASONABLE EFFORTS" means those efforts that
would be deemed both commercially practicable and reasonably
financially prudent after having taken into account all
relevant commercial considerations. "Relevant commercial
considerations" shall be deemed to include, without
limitation, (1) all pertinent facts and circumstances; (2)
financial costs; (3) resource availability and impact; (4)
probability of success; and (5) other commercial
practicalities.
1.7 "DIGITAL" shall be defined to include any Digital Subsidiary.
1.8 "DIGITAL BOX BUILD SPECIFICATIONS" means the specifications
set forth in Schedule 1 related to Box Builds.
1.9 "COMPONENTS SUPPLIED BY DIGITAL" means those components or
materials that Digital provides, directly or indirectly, to
Jabil to be incorporated into the Product.
1.10 "EDI" shall mean electronic data interchange.
1.11 "EFFECTIVE DATE" shall mean the date upon which the terms and
conditions of this Agreement shall become effective by and
between the Parties. The Parties have agreed that the
Effective Date of this Agreement shall be the 30 day of
December, 2001.
1.12 "FEE AND PRICE SCHEDULE" shall mean the prices and fees set
forth Schedule 1.
1.13 "FOB" shall mean the shipper must at its own expense and risk
transport the goods to the place of destination.
1.14 "INCLUDING" shall be defined to have the meaning "including,
without limitation."
1.15 "IN WRITING" shall mean written documents, EDI with phone
confirmation, verified faxes and successfully transmitted e-
mails.
1.16 "JABIL CIRCUIT, INC." AND "JABIL" shall be defined to include
any Jabil Subsidiary.
1.17 "JABIL CREATED INTELLECTUAL PROPERTY" means any discoveries,
inventions, technical information, procedures, manufacturing
or other processes, software, firmware, technology, know-how
or other intellectual property rights created, developed or
reduced to practice by or for Jabil in (i) performing
services related to any Product provided pursuant to this
Agreement, or (ii) which is otherwise embodied within the
Manufacturing Services or any other work provided pursuant to
this Agreement.
1.18 "JABIL EXISTING INTELLECTUAL PROPERTY" means any discoveries,
inventions, technical information, procedures, manufacturing
or other processes, software, firmware, technology, know-how
or other intellectual property rights owned, developed or
obtained by Jabil outside of this Agreement or known by Jabil
prior to the execution of this Agreement that are used by
Jabil in creating, or are embodied within, any Product, the
Manufacturing Services or other work performed under this
Agreement.
1.19 "JABIL INTELLECTUAL PROPERTY" shall mean both Jabil Created
Intellectual Property and Jabil Existing Intellectual
Property, collectively.
1.20 "JABIL MANUFACTURING PROCESS" means Jabil's process employed
to manufacture, test, configure and assemble Product
manufactured for Digital pursuant to the terms of this
Agreement.
1.21 "LEAD-TIME" means the mutually agreed upon minimum amount of
time in advance of shipment that Jabil must receive a Build
Schedule in order to deliver Product by the requested
delivery date.
1.22 "LOANED EQUIPMENT" means capital equipment (including tools)
which is loaned to Jabil by or on behalf of Digital to be
used by Jabil to perform the Manufacturing Services and
includes all equipment, tools and fixtures purchased
specifically for Digital, by Jabil upon Digital's written
approval, to perform the Manufacturing Services and that are
paid for in full by the Digital.
1.23 "MANUFACTURING DESIGN REVIEW SERVICES" means the following
services: (a) design for manufacturability (i.e., those
services provided by Jabil where Jabil reviews the current
design of a Product and provides to Digital information
regarding methods to make the Product manufacturable and more
cost-effective), (b) manufacturing design test support, (c)
computer assisted design, (d) test development services, and
(e) volume production and advanced packaging technologies,
all as specified and approved by Digital and agreed to by
Jabil.
1.24 "MANUFACTURING SERVICES" means the services performed by
Jabil hereunder which shall include but not be limited to
manufacturing, testing, Manufacturing Design Review Services,
configuring, assembling, packaging and/or shipping of the
Product, all in accordance with the Specifications.
1.25 "NRE COSTS" shall consist of expenses incurred by Jabil under
this Agreement, including testing, fixturing and tooling and
other out-of-pocket costs.
1.26 "PACKAGING AND SHIPPING SPECIFICATIONS" shall mean packaging
and shipping specifications set forth in Schedule 1 and
otherwise supplied and/or approved by Digital
1.27 "PCBA(S)" shall mean the printed circuit boards assemblies as
identified as such in Schedule 1.
1.28 "PERSON" means any corporation, business entity, natural
person, firm, joint venture, limited or general partnership,
limited liability entity, limited liability partnership,
trust, unincorporated organization, association, government,
or any department or agency of any government.
1.29 "PRODUCT(S)" means the product(s) manufactured and assembled
by Jabil on behalf of Digital under this Agreement as
identified in Schedule 1 (or any subsequent Schedule 1
prepared for any product to be manufactured hereunder)
including any updates, renewals, modifications or amendments
thereto mutually agreed in writing by the parties.
1.30 "PROPRIETARY INFORMATION AND TECHNOLOGY" means software,
firmware, hardware, technology and know-how and other
proprietary information or intellectual property embodied
therein that is known, owned or licensed by and proprietary
to either Party and not generally available to the public,
including plans, analyses, trade secrets, patent rights,
copyrights, trademarks, inventions, fees and pricing
information, operating procedures, procedure manuals,
processes, methods, computer applications, programs and
designs, and any processed or collected data. The failure to
label any of the foregoing as "confidential" or "proprietary"
shall not mean it is not Proprietary Information and
Technology.
1.31 "SPECIFICATIONS" means the specifications set forth in
Schedule 1. Specifications may be amended from time to time
by amendments in the form of written engineering change
orders executed and agreed to by both Parties.
1.32 "SOW" shall mean the statement of work for each Product set
forth in any Schedule 1 as amended in writing from time to
time upon mutual agreement of the Parties.
1.33 "SUBSIDIARY(IES)" means any corporation, partnership, joint
venture, limited liability entity, trust, association or
other business entity of which a Party or one or more of its
Subsidiaries, owns or controls more than 50% of the voting
power for the election of directors, managers, partners,
trustees or similar parties.
1.34 "SUPPLIERS DESIGNATED BY DIGITAL" shall mean suppliers
designated, specified or approved in writing by Digital.
1.35 "TEST PROCEDURES" shall mean testing specifications,
standards, procedures and parameters set forth in Schedule 1
and otherwise supplied or approved in writing by Digital.
1.36 "UNIQUE COMPONENTS" means those non-standard components or
materials procured exclusively for incorporation into the
Product.
2 LIST OF SCHEDULES. This Agreement includes the following Schedules for
each Product to be manufactured hereunder, which are hereby incorporated
herein and made a part of this Agreement:
Schedule 1 - Statement of Work
3 BUILD SCHEDULE FORECASTS. Within ten (10) business days following the
execution of this Agreement, Digital shall provide Jabil with a Build
Schedule Forecast. This will include three ( 3 ) months of PO coverage ,
and nine ( 9 ) months rolling Build Schedule Forecast. The Build Schedule
Forecast shall be updated by Digital, in writing, on at least a monthly
basis. Any rescheduling or cancellation of the orders set forth in a
Build Schedule Forecast shall be subject to the terms set forth in
Section 10.5.
4 MANUFACTURING SERVICES. Jabil will manufacture the Product in accordance
with the Specifications and any applicable Build Schedules. Jabil will
reply to each proposed Build Schedule that is submitted in accordance
with the terms of this Agreement by notifying Digital of its acceptance
or rejection within Three (3) business days of receipt of any proposed
Build Schedule. In the event of Jabil's rejection of a proposed Build
Schedule, Jabil's notice of rejection will specify the basis for such
rejection. Jabil will provide Manufacturing Design Review Services for
the Products set forth in Schedule 1 subject to appropriate fee and cost
adjustments. Digital shall be solely responsible for the sufficiency and
adequacy of the Specifications and shall hold Jabil harmless for any
claim arising therefrom.
4.1 TESTING. Jabil will test the Product in accordance with the
Test Procedures. Digital shall be solely responsible for the
sufficiency and adequacy of the Test Procedures and shall
hold Jabil harmless for any claim arising therefrom.
4.2 PACKAGING AND SHIPPING. Jabil will package and ship the
Product in accordance with the Packaging and Shipping
Specifications. Digital shall be solely responsible for the
sufficiency and adequacy of the Packaging and Shipping
Specifications and shall hold Jabil harmless for any claim
arising therefrom.
4.3 ITEMS TO BE SUPPLIED BY DIGITAL. Digital shall supply to
Jabil, according to the terms and conditions specified
herein, Digital Proprietary Information and Technology and,
if applicable, the Loaned Equipment, Components Supplied by
Digital and Unique Components determined by the mutual
agreement of the Parties hereto to be necessary for Jabil to
perform the Manufacturing Services. Digital will also provide
to Jabil all Specifications, Test Procedures, Packaging and
Shipping Specifications, Product design drawings, approved
vendor listings, material component descriptions (including
approved substitutions), manufacturing process requirements,
and any other specifications determined by the mutual
agreement of the Parties hereto to be necessary for Jabil to
perform the Manufacturing Services. Digital shall be solely
responsible for delay in delivery, defects and enforcement of
warranties related to the Loaned Equipment, Components
Supplied by Digital and any Unique Components, and shall hold
Jabil harmless for any claim arising therefrom. The Parties
will use Commercially Reasonable Efforts to resolve any
issues regarding the foregoing and to accommodate each others
business needs.
4.4 ITEMS TO BE SUPPLIED BY JABIL. Jabil will employ the Jabil
Manufacturing Process, any required manufacturing technology,
manufacturing capacity, labor, transportation logistics,
systems and facilities necessary for Jabil to perform the
Manufacturing Services including, without limitation, the
configuration and assembly of any Product manufactured for
Digital pursuant to the terms of this Agreement.
4.5 DIGITAL INSPECTION. Digital shall have the right, upon
reasonable advance notice, during normal business hours and
at its expense to inspect, review, monitor and oversee the
Manufacturing Services, provided that such inspection shall
not disrupt Jabil's normal business operations. Digital
shall cause each of its employees, agents and representatives
who have access to Jabil's facilities, to maintain, preserve
and protect all Proprietary Information and Technology of
Jabil and the confidential or proprietary information and
technology of Jabil's other customers, in accordance with the
provisions of Section 13.
4.6 MATERIALS PROCUREMENT. Jabil will use Commercially Reasonable
Efforts to procure components, in accordance with Digital's
approved vendor list, necessary to fulfill mutually agreed
upon Build Schedules. Digital shall be responsible for the
performance of suppliers and quality of the components.
4.7 PRODUCT ACCEPTANCE. Digital shall evaluate each Product to
determine if it conforms in all material respects to the
Specifications. Digital shall give Jabil written notice of
any rejection of a Product within ten (10) business days
following Digital's receipt of such Product ("Acceptance
Period"). Such written notice of rejection of a Product for
failure to materially conform to the Specifications shall
include a detailed and complete description of Digital's
basis for asserting that the Product does not materially
conform to the Specifications ("Specification Notice"). If
Digital fails to provide such Specification Notice to Jabil
within the Acceptance Period, such Product shall be deemed
accepted by Digital. If Jabil disputes the basis for
rejection set forth in a Specification Notice, it shall
provide written notice of the same to Digital within ten (10)
business days following receipt of the Specification Notice
("Notice of Disputed Defect"). Any such dispute shall be
resolved by the Parties in accordance with the provisions of
Section 21.11. Any specified times for delivery of such
Products set forth herein shall be tolled during the dispute
resolution procedure set forth above. If Jabil does not
dispute the basis for rejection set forth in a Specification
Notice, Jabil shall follow its standard RMA procedure as set
forth in Section 5.2 herein. The acceptance procedures set
forth in this Section 4.7 shall apply to any redelivered
Product.
1 WARRANTY & RMA PROCEDURE.
1.1 JABIL WARRANTY. Jabil warrants (i) that it will manufacture
the Product in accordance with IPC -610-Rev C, Class 2
and,(ii) that at the time of manufacture and for a period of
one year thereafter ("Warranty Period") the Product will
conform, in all material respects, to the Specifications and
Digital Box Build Specifications (if applicable) . This
warranty is extended to, and may only be enforced by,
Digital.
1.2 REPAIR OR REPLACEMENT OF DEFECTIVE PRODUCT. In accordance
with Jabil's standard return material authorization process
and procedure ("RMA"), Jabil will either repair or replace,
in its sole discretion, any Product that contains a defect
caused by a breach of the warranty set forth in this Section
5 provided that the Product is received within thirty (30)
days following the end of any applicable Warranty Period
("RMA Product"). If Digital desires to return a Product
based on a claim of breach of the warranty set forth in this
Section 5, Digital shall request an RMA number from Jabil.
Digital shall then consign the alleged defective Product, FOB
Jabil's designated repair facility, and specify the Jabil
assigned RMA number. Jabil will analyze any such RMA Product
and, if a breach of warranty is found ("Defect"), then Jabil
will repair or replace the RMA Product within twenty (20)
business days of receipt by Jabil of the RMA Product and all
required associated documentation. In the event a Defect is
found, Jabil will reimburse Digital for the reasonable cost
of transporting the RMA Product to Jabil's designated repair
facility and Jabil will deliver the repaired RMA Product or
its replacement, FOB Digital's designated destination. If no
such Defect is found, Digital shall reimburse Jabil for all
fees, costs and expenses incurred to analyze and, if
requested by Digital, repair or replace the non-Defective RMA
Product and Digital shall bear responsibility for all
transportation costs to and from Jabil's designated repair
facility.
1.3 LIMITATION OF WARRANTY. THE REMEDY SET FORTH IN SECTION 5.2
SHALL CONSTITUTE DIGITAL'S SOLE AND EXCLUSIVE REMEDY FOR A
BREACH OF THE WARRANTY MADE BY JABIL HEREIN. THE WARRANTY SET
FORTH IN THIS SECTION 5 IS IN LIEU OF, AND JABIL EXPRESSLY
DISCLAIMS, AND DIGITAL EXPRESSLY WAIVES, ALL OTHER WARRANTIES
AND REPRESENTATIONS OF ANY KIND WHATSOEVER WHETHER EXPRESS,
IMPLIED, STATUTORY, ARISING BY COURSE OF DEALING OR
PERFORMANCE, CUSTOM, USAGE IN THE TRADE OR OTHERWISE,
INCLUDING ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE OR INFRINGEMENT OR MISAPPROPRIATION OF ANY
RIGHT, TITLE OR INTEREST OF DIGITAL OR ANY THIRD PARTY.
DIGITAL UNDERSTANDS AND AGREES THAT IT SHALL HAVE FULL AND
EXCLUSIVE LIABILITY WITH RESPECT TO ANY PRODUCT, WHETHER FOR
PRODUCT DESIGN LIABILITY, PRODUCT LIABILITY, DAMAGE TO PERSON
OR PROPERTY AND/OR INFRINGEMENT OR MISAPPROPRIATION OF THIRD
PARTY RIGHTS, (EXCEPT FOR JABIL'S INDEMNIFICATION OBLIGATIONS
PURSUANT TO SECTION 16.2). NO ORAL OR WRITTEN STATEMENT OR
REPRESENTATION BY JABIL, ITS AGENTS OR EMPLOYEES SHALL
CONSTITUTE OR CREATE A WARRANTY OR EXPAND THE SCOPE OF ANY
WARRANTY HEREUNDER.
JABIL'S WARRANTY SHALL NOT APPLY TO ANY PRODUCT JABIL DETERMINES TO HAVE BEEN
SUBJECTED TO TESTING OTHER THAN TESTING FOR SPECIFIED ELECTRICAL
CHARACTERISTICS OR TO OPERATING AND/OR ENVIRONMENTAL CONDITIONS IN EXCESS OF
THE MAXIMUM VALUES ESTABLISHED IN APPLICABLE SPECIFICATIONS, OR TO HAVE BEEN
THE SUBJECT OF MISHANDLING, ACCIDENT, MISUSE, NEGLECT, IMPROPER TESTING,
IMPROPER OR UNAUTHORIZED REPAIR, UNAUTHORIZED OR UNAPPROVED ALTERATION, DAMAGE,
ASSEMBLY, PROCESSING OR ANY OTHER INAPPROPRIATE OR UNAUTHORIZED ACTION OR
INACTION THAT ALTERS PHYSICAL OR ELECTRICAL PROPERTIES. THIS WARRANTY SHALL
NOT APPLY TO ANY DEFECT IN THE PRODUCT CAUSED BY OR ARISING FROM ANY DRAWING,
DESIGN, SPECIFICATION, PROCESS, TESTING OR OTHER PROCEDURE, ADJUSTMENT OR
MODIFICATION SUPPLIED AND/OR APPROVED BY DIGITAL.
1.4 ECO UPGRADE. RMAs for engineering change order (ECO)
upgrades will also be subject to the RMA process. Jabil will
analyze the ECO and provide a per unit upgrade cost and
expected completion and delivery date.
2 LIMITATION OF DAMAGES
EXCEPT WITH REGARD TO ANY INDEMNITIES SET FORTH HEREIN, UNDER NO CIRCUMSTANCES
SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR TO ANY OTHER PERSON OR
ENTITY UNDER ANY CONTRACT, TORT, STRICT LIABILITY, NEGLIGENCE, OR OTHER LEGAL
OR EQUITABLE CLAIM OR THEORY FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR
INDIRECT DAMAGES, LOSS OF GOODWILL OR BUSINESS PROFITS (EXCEPT WITH RESPECT TO
DIGITAL'S OBLIGATIONS IN SECTION 10.5.1) , LOST REVENUE, WORK STOPPAGE, DATA
LOSS, COMPUTER FAILURE OR MALFUNCTION, OR FOR ANY AND ALL OTHER DAMAGES, LOSS,
OR EXEMPLARY OR PUNITIVE DAMAGES, WHETHER SUCH PARTY WAS INFORMED OR WAS AWARE
OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE. THE FOREGOING SHALL NOT EXCLUDE OR
LIMIT EITHER PARTY'S LIABILITY FOR DEATH OR PERSONAL INJURY RESULTING FROM ITS
NEGLIGENCE TO THE EXTENT THAT SUCH LIABILITY CANNOT BY LAW BE LIMITED OR
EXCLUDED.
3 DELIVERY, RISK OF LOSS AND PAYMENT TERMS. For purposes of this Agreement
delivery shall be FOB Jabil's facility and deemed to have occurred, and
all risk of loss shall be transferred to Digital, when Product (or any
other items) are tendered to the carrier approved by Digital. The Fee and
Price Schedule will be reviewed by the Parties on a quarterly basis and,
subject to agreement by Digital, will be revised consistent with
increases or decreases in materials, components, equipment and other
costs and expenses applicable to the manufacture of the Product.
3.1 PAYMENT. Digital shall pay Jabil all monies, when due,
including all NRE Costs associated with this Agreement,
provided, however, that such NRE Costs were approved in
advance by Digital or set forth in a Statement of Work
executed by both Parties. All Jabil invoices shall
reference Digital's correct purchase order number. Upon
receipt of Jabil's invoice, Digital shall reconcile such
invoice with any relevant packing slips (if applicable), and
timely remit payment to Jabil. ; Payment of all amounts set
forth in any invoices shall be net thirty (30) days from the
date of the invoice by Digital. Payment to Jabil shall be in
U.S. dollars and in immediately available funds. Any
equipment, tooling, component, material or other goods or
property purchased by Jabil in order to perform its
obligations under this Agreement shall become the property of
Digital once Jabil is reimbursed for the NRE Costs associated
therewith. Jabil shall invoice Digital for actual
outstanding NRE Costs and other monies due at monthly
intervals (or such other intervals as the Parties may agree)
during the term of this Agreement and upon cancellation,
termination or expiration of this Agreement. Jabil shall
request advance written approval from Digital should resource
requirements, and thereby NRE Costs, increase relative to
estimated NRE Costs initially agreed by the Parties. Upon
such request, Jabil shall provide to Digital reasonably
detailed supporting documentation and/or descriptions of the
NRE Costs for which Jabil seeks reimbursement. Digital shall
not be obligated to pay any NRE Costs which it did not
approve in advance.
Late payment amounts exceeding 40 days of sales outstanding will result in a
daily interest carrying charge of 0.05566% for the amount exceeding 40 days.
3.2 TAXES. Digital shall be responsible for all federal, state
and local sales, use, excise and other taxes (except taxes
based on Jabil's income ), all delivery, shipping, and
transportation charges and all foreign agent or brokerage
fees, document fees, custom charges and duties arising from
Jabil's delivery of services or Products to Digital.
1 IMPORT AND EXPORT AND COMPLIANCE WITH LAWS. Digital shall be
responsible for obtaining any required import or export licenses
necessary for Jabil to ship Product, including certificates of origin,
manufacturer's affidavits, and U.S. Federal Communications Commission's
identifier, if applicable and any other licenses required under US or
foreign law. Digital agrees that it shall not export, re-export, resell
or transfer, or otherwise require Jabil to ship or deliver any Product,
assembly, component or any technical data or software which violate any
export controls or limitations imposed by the United States or any other
governmental authority, or to any country for which an export license or
other governmental approval is required at the time of export without
first obtaining all necessary licenses and approvals and paying all
duties and fees. Digital shall provide Jabil with all licenses,
certifications, approvals and authorizations in order to permit Jabil to
comply with all import and export laws, rules and regulations for the
shipment and delivery of the Product. Digital shall also be responsible
for complying with any legislation or regulations governing the
importation of the Product into the country of destination and for
payment of any duties thereon. Both Parties shall otherwise comply with
all laws, ordinances, regulations and codes relating to this Agreement
that are applicable to such Parties.
1 DESIGN SERVICES. In the event that the Parties agree that Jabil will
provide design services, other than and in addition to the Manufacturing
Design Review Services for Digital, the terms and conditions of such
services shall be set forth in a mutually agreed upon design services
agreement prior to the commencement of any design services.
1 CHANGE ORDERS, RESCHEDULING AND CANCELLATION.
1.1 CHANGES TO MANUFACTURING SERVICES, PACKAGING AND SHIPPING
SPECIFICATIONS AND TEST PROCEDURES. Digital may, in writing,
request a change to the Manufacturing Services, Packaging and
Shipping Specifications and Test Procedures at any time.
Jabil will analyze the requested change and provide Digital
with an assessment of the effect that the requested change
will have on cost, manufacturing, scheduling, delivery and
implementation. Digital will be responsible for all costs
associated with any mutually agreed upon changes. Any such
change shall be documented in a written change order and
shall become effective only upon mutual written agreement of
both Parties to the terms and conditions of such change
order, including changes in time required for performance,
cost and applicable delivery schedules.
1.2 PRODUCTION INCREASES. Digital may, in writing; request
increases in production volume of Product for an outstanding
Build Schedule at any time. Jabil will analyze the request
and determine if it can meet the requested increase within
the required Lead-time. If Jabil can satisfy the requested
increase it will provide Digital with a new Build Schedule
setting forth the expected delivery date of the changed
order. If Jabil is unable to satisfy or comply with
Digital's requested increase in production volume within the
requested time frame for delivery, Jabil will provide the
reasons preventing Jabil from satisfying the requested
increase within five (5) business days after receipt of
Digital's request. Any such change shall be documented in a
written change order and shall become effective only upon
mutual written agreement of both Parties to the terms and
conditions of such change order, including changes in time
required for performance, cost and applicable delivery
schedules.
1.3 PRODUCT CONFIGURATION CHANGES AND ENGINEERING CHANGES.
Digital may request configuration or engineering changes to
Product in writing at any time. Jabil will analyze the
request and determine if it can meet the requested changes
within the required Lead-time. If Jabil can satisfy the
requested change it will provide Digital within five (5)
business days after receipt of the configuration or
engineering request notice, a notice of acceptance of the
requested changes along with any additional costs and
expected changes to delivery schedules. If Jabil is unable
to satisfy or comply with Digital's requested changes within
the requested time frame for delivery, Jabil will provide the
reasons preventing Jabil from satisfying these requested
changes within five (5) business days after receipt of
Digital's request. Any such change(s) shall be documented in
writing and shall become effective only upon mutual written
agreement of both Parties of the terms and conditions of such
change, including changes in time required for performance,
cost and applicable delivery schedules.
1.4 TREATMENT OF OBSOLETE/END-OF-LIFE MATERIAL. Upon receiving
notice from Digital that any Product, component or assembly
has become obsolete or has reached end-of-life, Jabil will,
within a reasonable period after receiving such notice,
provide Digital with an analysis of Digital's liability to
Jabil for components and materials on hand or on order to
manufacture such Product. Digital's liability shall include
the price of finished Product and Jabil's costs (including
cancellation fees and charges), plus applicable margin, of
work in progress, safety stock components and materials and
components and materials on hand or on order within
applicable Lead-times. Jabil will use its Commercially
Reasonable Efforts to minimize such costs by taking the
following steps:
{circle}As soon as is commercially practical reduce or cancel component and
material orders to the extent contractually permitted.
{circle}Return all components and materials to the extent contractually
permitted.
{circle}Make all Commercially Reasonable Efforts to sell components and
materials to third parties.
{circle}Assist Digital to determine whether current work in progress should be
completed scrapped or shipped "as is".
1.1 RESCHEDULED DELIVERY AND CANCELLATION OF ORDERS. Digital may
request Jabil to reschedule the delivery date for Product(s)
and cancel pending orders in accordance with this Section
10.5. Reschedules and cancellations may result in revised
product pricing. The charges to Digital for deferring or
accelerating delivery of an order (rescheduled) or
cancellation of an order are as follows:
10.5.1 Rescheduled Delivery. Digital can reschedule
specific orders contained in Build Schedules or on individual purchase orders
within 30 days of scheduled delivery without additional cost to Digital if such
specific orders can be fulfilled from Buffer Stock PCBA inventory at the time
of rescheduling of such specific orders. Digital rescheduling orders within 30
days that cannot be fulfilled from Buffer Stock PCBA inventory at the time of
rescheduling of such specific orders will require Digital to reimburse Jabil
for all labor cost, lost profits and operating cost incurred as a result of
rescheduling orders. Any rescheduling of orders 30 days beyond original
delivery dates will be considered a cancellation of orders and be subject to
Section 10.5.2. In the event a rescheduling is considered a cancellation, the
number of days prior to the delivery date for purposes of Section 10.5.2 below
shall be computed with respect to the original delivery date of the order.
10.5.2 Cancellation of Orders. If Digital cancels an
order, Digital shall reimburse Jabil for the
actual out-of-pocket costs incurred by Jabil that
were incurred as a result of the cancelled order
and not subject to reassignment or other
mitigation are as follows:
Days prior to
Delivery Date
0~30 days
{circle}100% of all materials costs including
but not limited to, restocking fees,
cancellation fees, non-cancellable non-
returnable material fees and costs,
corporate charges and finance costs,
relating to order cancellation.
{circle}100% of fixed costs including but not
limited to, equipment and building
expenses.
{circle}100% of variable costs including but
not limited to, direct labor and material
handling expenses.
31~60 days
{circle}100% of all Unique Components costs
including but not limited to, restocking
fees, cancellation fees, non-cancellable
non-returnable material fees and costs,
corporate charges and finance costs,
relating to order cancellation, for
material within individual component lead
times.
{circle}75% of fixed costs including but not
limited to, equipment and building
expenses.
{circle}0% of variable costs including but not
limited to, direct labor and material
handling expenses.
61~90 days
{circle}100% of all Unique Components costs
including but not limited to, restocking
fees, cancellation fees, non-cancellable
non-returnable material fees and costs,
corporate charges and finance cost,
relating to order cancellation, for
material within individual component lead
times.
{circle}50% of fixed costs including but not
limited to, equipment and building
expenses.
{circle}0% of variable costs including but not
limited to, direct labor and material
handling expenses.
Greater than 90 days
{circle}100% of all Unique Components costs
including but not limited to, restocking
fees, cancellation fees, non-cancellable
non-returnable material fees and costs,
corporate charges and finance costs,
relating to order cancellation, for
material within individual component lead
times.
{circle}0% of fixed costs including but not
limited to, equipment and building
expenses.
{circle}0% of variable costs including but not
limited to, direct labor and material
handling expenses.
1.1 TERMINATION CHARGES. Upon termination, expiration or
cancellation of this Agreement for any reason, Jabil shall
submit to Digital Jabil's invoices for
termination/cancellation charges within (a) 60 days from the
effective date of such termination, expiration or
cancellation for materials and component costs and applicable
margin and (b) 60 days after the end of the 6 month period
following termination, expiration or cancellation for the
depreciation expense on idle equipment. Jabil's invoice for
such charges shall be based upon costs incurred by Jabil up
to the date of termination, expiration or cancellation
("Termination Effective Date") and shall also include the
following: (i) costs accrued after the Termination Effective
Date but resulting from such termination, expiration or
cancellation; (ii) applicable margin in all cases and (iii)
the depreciation expense, except in the event of termination
due to Jabil's default hereunder, on all equipment used to
manufacture Product that remains idle due to such
termination, expiration or cancellation for up to six months
from the date of the Termination Effective Date in accordance
with U.S. generally accepted accounting principles. Jabil
will provide to Digital all information necessary to confirm
the costs, expenses, applicable margin and depreciation
expenses on idle equipment sustained by Jabil due to
termination, expiration or cancellation. To the extent that
Jabil cannot mitigate its costs as set forth in Section 10.7
below, upon cancellation, expiration or termination for any
reason, Digital's obligation shall be to pay the charges
claimed by Jabil as follows:
10.6.1The applicable price for the Product of which Jabil has
completed manufacture prior to the Termination Effective Date pursuant to an
issued Build Schedule for which payment has not been made;
10.6.2Reimbursements for material acquisition costs, components,
subassemblies and work-in-process at the time of Termination Effective Date
which were purchased or ordered pursuant to issued Build Schedules or Build
Schedule Forecasts plus applicable margin;
10.6.3Jabil's reasonable cancellation costs incurred for
components, materials and subcontracted items that Jabil had on order on behalf
of Digital on the Termination Effective Date pursuant to issued Build Schedules
or Build Schedule Forecasts plus applicable margin;
10.6.4Except in the event of termination due to Jabil's default
hereunder, depreciation on equipment idle up to six months after the
Termination Effective Date; and
10.6.5Jabil's cost of equipment or tooling purchased by Jabil
specifically for the manufacture, test, design, or packaging of Product and any
other services rendered or costs incurred by Jabil under this Agreement. All
goods for which Digital shall have paid 100% of Jabil's incurred cost or more
shall be held by Jabil for Didital's account and Digital may arrange for its
acquisition of them on AS-IS, WHERE-IS basis.
1.2 DUTY TO MITIGATE COSTS. Both Parties shall, in good faith,
undertake reasonable measures to mitigate the costs of
termination, expiration, or cancellation. Jabil shall make
Commercially Reasonable Efforts to cancel all applicable
component and material purchase orders and reduce component
inventory through return for credit programs or allocate such
components and materials for alternate Digital programs if
applicable, or other customer orders provided the same can be
used within thirty (30) days of the termination date.
1 TERM. The term of this Agreement shall begin on the Effective Date and
shall continue for a period of one (1) year thereafter and be subject to
automatic renewal for additional one (1) year terms unless either Party
provides the other with written notice of non-renewal not less than
ninety (90) days prior to the end of the current term. Notwithstanding
the foregoing, Sections 4.1, 4.2, 4.3, 4.6, 5, 6, 7, 8, 10.4, 10.5, 10.6,
10.7, 11, 12.4, 13, 14, 15, 16, 17, 19 and 21 herein shall survive the
expiration, cancellation or termination of this Agreement.
1 TERMINATION. This Agreement may be terminated as follows:
1.1 TERMINATION FOR CONVENIENCE. This Agreement may be
terminated at any time upon the mutual written consent of the
Parties or upon the date for termination set forth in a
written notice given by one Party to the other not less than
ninety (90) days prior to such date.
1.2 TERMINATION FOR CAUSE. Either Party may terminate this
Agreement based on the material breach by the other Party of
the terms of this Agreement, provided that the Party alleged
to be in material breach receives written notice setting
forth the nature of the breach at least thirty (30) days
prior to the intended termination date. During such time the
Party in material breach may cure the alleged breach and if
such breach is cured within such thirty (30) day period, no
termination will occur and this Agreement will continue in
accordance with its terms. If such breach shall not have
been cured, termination shall occur upon the termination date
set forth in such notice.
1.3 TERMINATION FOR BANKRUPTCY/INSOLVENCY. Upon the happening of
any of the following events with respect to a Party, this
Agreement may be terminated immediately:
1.3.1 The appointment of a receiver or custodian to
take possession of any or all of the assets of a
Party, or should a Party make an assignment for
the benefit of creditors, or should there be an
attachment, execution, or other judicial seizure
of all or a substantial portion of a Party's
assets, and such attachment, execution or seizure
is not discharged within thirty (30) days.
1.3.2 A Party becomes a debtor, either voluntarily or
involuntarily, under Title 11 of the United
States Code or any other similar law and, in the
case of an involuntary proceeding, such
proceeding is not dismissed within thirty (30)
days of the date of filing.
1.3.3 The dissolution or termination of the existence
of a Party whether voluntarily, by operation of
law or otherwise.
1.4 TERMINATION CONSEQUENCES. If this Agreement is terminated
for any reason, Digital shall not be excused from performing
its obligations under this Agreement with respect to payment
of all monies then-due Jabil hereunder including fees, costs
and expenses incurred by Jabil, up to and including the
Termination Effective Date.
2 CONFIDENTIALITY.
2.1 CONFIDENTIALITY OBLIGATIONS In order to protect both Parties'
Proprietary Information and Technology the Parties agree that
each Party shall use the same degree of care, but no less
than a reasonable degree of care, as such Party uses with
respect to its own similar information to protect the
Proprietary Information and Technology of the other Party and
to prevent any use of the other Party's Proprietary
Information and Technology other than for the purposes of
this Agreement. This Section 13 imposes no obligation upon a
Party with respect to the other Party's Proprietary
Information and Technology which (a) was known to such Party
before receipt from the disclosing Party; (b) is or becomes
publicly available through no fault of the receiving Party;
(c) is rightfully received by the receiving Party from a
third party without a duty of confidentiality; (d) is
independently developed by the receiving Party without a
breach of this Agreement; (e) is disclosed by the receiving
Party with the disclosing Party's prior written approval or
(f) is disclosed by the disclosing Party to a third party
without imposing a duty of confidentiality on the third
party. If a Party is required by a government body or court
of law to disclose Proprietary Information and Technology,
then such Party agrees to give the other Party reasonable
advance notice so that the other Party may seek a protective
order or otherwise contest the disclosure.
2.2 EMPLOYEES, AGENTS AND REPRESENTATIVES. Each Party represents
and warrants to the other that it has adopted policies and
procedures with respect to the receipt and disclosure of
confidential or proprietary information, such as the
Proprietary Information and Technology, with its employees,
agents and representatives. Each Party shall use
Commercially Reasonable Efforts to cause each of its
employees, agents and representatives to maintain and protect
the confidentiality of the other Party's Proprietary
Information and Technology.
2.3 TERM AND ENFORCEMENT. The confidentiality obligation set
forth in this Agreement shall be observed during the term of
the Agreement and for a period of three (3) years following
the termination of this Agreement. Each Party acknowledges
that a breach of any of the terms of this Section 13 may
cause the non-breaching Party irreparable damage, for which
the award of damages would not be adequate compensation.
Consequently, the non-breaching Party may institute an action
to enjoin the breaching Party from any and all acts in
violation of those provisions, which remedy shall be
cumulative and not exclusive, and shall be in addition to any
other relief to which the non-breaching Party may be entitled
at law or in equity. Such remedy shall not be subject to the
arbitration provisions set forth in Section 21.11.
2.4 RETURN OF PROPRIETARY INFORMATION AND TECHNOLOGY. Upon the
termination, cancellation or expiration of this Agreement all
Proprietary Information and Technology shall, upon written
request, be returned to the respective Party, or at the
respective Party's discretion, destroyed by the receiving
Party; provided, however, that Digital shall have the right
to retain all Jabil Existing Intellectual Property licensed
by Jabil to Digital pursuant to the terms of the license
granted in Section 14.1.
3 INTELLECTUAL PROPERTY RIGHTS; ASSIGNMENT.
3.1 JABIL EXISTING INTELLECTUAL PROPERTY. Jabil shall retain all
right, title and ownership to any Jabil Existing Intellectual
Property that is incorporated into any Product that is
prepared as part of the Manufacturing Services or as part of
any other work provided pursuant to this Agreement or any
other related agreement executed by the Parties.
Upon full payment of all monies due and owing under this Agreement, Jabil
shall grant to Digital a worldwide, non-exclusive, fully paid-up, royalty free
right and license to use, sell, and distribute the Jabil Existing Intellectual
Property only insofar as is required for Digital to use, sell or distribute the
Product provided as part of the Manufacturing Services performed by Jabil
pursuant to this Agreement.
3.2 JABIL CREATED INTELLECTUAL PROPERTY. Jabil shall retain all
right, title and ownership to any Jabil Created Intellectual
Property that is incorporated into any Product that is
prepared as part of the Manufacturing Services or into any
other work provided pursuant to this Agreement or any other
related agreement executed by the Parties. Upon full payment
of all monies due and owing under this Agreement, Jabil shall
assign to Digital all right, title and interest in and to the
Jabil Created Intellectual Property upon delivery of Product
to Digital incorporating such Jabil Created Intellectual
Property. Digital hereby grants to Jabil a worldwide, non-
exclusive, fully paid-up, royalty-free right and license in
and to the Product and the Jabil Created Intellectual
Property.
4 MANUFACTURING RIGHTS. In consideration of the transfer by Jabil of the
rights to the Jabil Intellectual Property, Digital grants Jabil exclusive
manufacturing rights for one hundred percent (100%) of the Products
listed in Schedule 1. These manufacturing rights shall remain exclusive
for the term of this Agreement unless the Parties mutually agree that the
term of manufacturing exclusivity shall be for a shorter period
specifically set forth in any other related agreement executed by the
Parties. In the event that manufacturing is subsequently transferred to
a third party, Digital and Jabil shall mutually agree upon the terms and
conditions of such transfer, and use Commercially Reasonable Efforts to
facilitate such transfer. Digital grants Jabil the first right of refusal
to exclusive manufacturing rights for one hundred percent (100%) of
Digital's products not listed in Schedule 1 that contain any Jabil
Intellectual Property, and/or any Digital product containing a
"derivative" of the Jabil Intellectual Property. For the purposes of
this Agreement, a derivative is defined as "a design that is based in
full or in part on the Jabil Intellectual Property". These manufacturing
rights shall remain exclusive for the term of this Agreement.
5 INDEMNIFICATION.
16.1 DIGITAL WARRANTY AND INDEMNIFICATION. Digital represents and
warrants that it has conducted, and will conduct, all patent, trademark and
copyright searches necessary to identify and evaluate any potential
infringement claims with respect to the Product. Except to the extent that
Digital is entitled to indemnification from Jabil as provided in Section 16.2
below, Digital agrees to indemnify, defend and hold Jabil and its employees,
Subsidiaries, Affiliates, successors and assigns harmless from and against all
claims, damages, losses, costs and expenses, including attorneys' fees, arising
from any third party claims asserted against Jabil and its employees,
Subsidiaries, Affiliates, successors and assigns, that are based in part or in
whole on any of the following: (a) Specifications, Digital Proprietary
Information and Technology, any Product, or any information, technology and
processes supplied and/or approved by Digital or otherwise required by Digital
of Jabil; and (b) that any item in subsection (a) infringes or violates any
patent, copyright or other intellectual property right of a third party, and
(c) design or product liability alleging that any item in subsection (a) has
caused or will in the future cause damages of any kind.
16.2 INDEMNIFICATION BY JABIL. Jabil agrees to indemnify, defend and
hold Digital and its employees, Subsidiaries, Affiliates, successors and
assigns harmless from and against all claims, damages, losses, costs and
expenses, including attorneys' fees, arising from any third party claims
asserted against Digital and its employees, Subsidiaries, Affiliates,
successors and assigns, solely arising out of or resulting from: (a) the
methods and processes utilized by Jabil in the provision of the Manufacturing
Services under this Agreement, that are not essential to Jabil's compliance
with the Specifications, and (b) that any item in subsection (a) infringes or
violates any patent, copyright or other intellectual property right of a third
party.
16.3 INDEMNIFICATION PROCEDURES. Promptly after receipt by an
indemnified party of a notice of any third party claim or the commencement of
any action, such indemnified party must: (a) notify the indemnifying party in
writing of any such claim; (b) provide the indemnifying Party with reasonable
assistance to settle or defend such claim, at the indemnifying party's own
expense; and (c) grant to the indemnifying party the right to control the
defense and/or settlement of such claim, at the indemnifying party's own
expense; provided, however, that: (i) the failure to so notify, provide
assistance and grant authority and control shall only relieve the indemnifying
party of its obligation to the indemnified party to the extent that the
indemnifying party is prejudiced thereby; (ii) the indemnifying party shall
not, without the indemnified party's consent (such consent not to be
unreasonably withheld or delayed), agree to any settlement which: (x) makes any
admission on behalf of the indemnified party; or (y) consents to any injunction
against the indemnified party (except an injunction relating solely to the
indemnified party's continued use of any infringing Jabil Intellectual Property
or the Propriety Information and Technology of either party); and (iii) the
indemnified party shall have the right, at its expense, to participate in any
legal proceeding to contest and defend a claim and to be represented by legal
counsel of its choosing, but shall have no right to settle a claim without the
indemnifying party's written consent, provided that if such counsel is
necessary because of a conflict of interest between the Parties or their
counsel or because the indemnifying party does not assume control of the
defense of a claim for which the indemnifying party is obligated to indemnify
the other Party hereunder, the indemnifying party shall bear such expense.
6 RELATIONSHIP OF PARTIES. Jabil shall perform its obligations hereunder as
an independent contractor. Nothing contained herein shall be construed
to imply a partnership or joint venture relationship between the Parties.
The Parties shall not be entitled to create any obligations on behalf of
the other Party, except as expressly contemplated by this Agreement. The
Parties will not enter into any contracts with third parties in the name
of the other Party without the prior written consent of the other Party.
7 INSURANCE. Each Party will keep its business and properties insured at
all times against such risks for which insurance is usually maintained by
reasonably prudent Persons engaged in a similar business (including
insurance for force majeure events and other hazards, and insurance
against liability on account of damage to Persons or property and
insurance under all applicable xxxxxxx'x compensation laws). The
insurance maintained shall be in such monies and with such limits and
deductibles usually carried by Persons engaged in the same or a similar
business. Jabil shall maintain insurance coverage on any Buffer Stock
owned by Digital while on Jabil's premises in an amount equal to the
replacement value of such Buffer Stock.
8 PUBLICITY. Without the consent of the other Party, neither Party shall
refer to this Agreement in any publicity or advertising or disclose to
any third party any of the terms of this Agreement. Notwithstanding the
foregoing neither Party will be prevented from, at any time, furnishing
any information to any governmental or regulatory authority which it is
by law, regulation, rule or other legal process obligated to disclose or
to its attorneys and accountants. A Party may disclose the existence of
this Agreement and its terms to its suppliers, customers and others only
to the extent necessary to perform its obligations and enforce its rights
hereunder.
9 FORCE MAJEURE. Neither Party will be liable for any delay in performing,
or for failing to perform, its obligations under this Agreement (other
than the payment of money) resulting from any cause beyond its reasonable
control including, acts of God; blackouts; power failures; inclement
weather; fire; explosions; floods; hurricanes; tornadoes; earthquakes;
epidemics; strikes; work stoppages; labor, component or material
shortages; slow-downs; industrial disputes; sabotage; accidents;
destruction of production facilities; riots or civil disturbances; acts
of government or governmental agencies, including changes in law or
regulations that materially and adversely impact the Party; provided that
the Party affected by such event promptly notifies (in no event more than
ten (10) business days of discovery of the event) the other Party of the
event. If the delays caused by the force majeure conditions are not
cured within sixty (60) days of the force majeure event, then either
Party may immediately terminate this Agreement. Termination of this
Agreement pursuant to this Section 20 shall not affect Digital's
obligation to pay Jabil, as set forth herein.
10 MISCELLANEOUS.
10.1 NOTICES. All notices, demands and other communications made
hereunder shall be in writing and shall be given either by
personal delivery, by nationally recognized overnight courier
(with charges prepaid), by facsimile or EDI (with telephone
confirmation) addressed to the respective Parties at the
following addresses:
Notice to Jabil: Jabil Circuit, Inc.
00000 0xx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Facsimile: ( )
Attn:
with a copy to: Jabil Circuit, Inc.
00000 0xx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attn: General Counsel
Notice to Digital:Digital Lightwave, Inc.
00000 Xxxxxxxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxx
Facsimile:( )
Attn:
with a copy to:
Attn:
10.2 AMENDMENT. No course of dealing between the Parties hereto
shall be effective to amend, modify, or change any provision
of this Agreement. This Agreement may not be amended,
modified, or changed in any respect except by an agreement in
writing signed by the Party against whom such change is to be
enforced. The Parties may, subject to the provisions of this
Section 21.2, from time to time, enter into supplemental
written agreements for the purpose of adding any provisions
to this Agreement or changing in any manner the rights and
obligations of the Parties under this Agreement or any
Schedule hereto. Any such supplemental written agreement
executed by the Parties shall be binding upon the Parties.
10.3 PARTIAL INVALIDITY. Whenever possible, each provision of
this Agreement shall be interpreted in such a way as to be
effective and valid under applicable law. If a provision is
prohibited by or invalid under applicable law, it shall be
ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
10.4 MONIES. All references to monies in this Agreement shall be
deemed to mean lawful monies of the United States of America.
10.5 ENTIRE AGREEMENT. This Agreement, the Schedules and any
addenda attached hereto or referenced herein, constitute the
complete and exclusive statement of the agreement of the
Parties with respect to the subject matter of this Agreement,
and replace and supersede all prior agreements and
negotiations by and between the Parties. Each Party
acknowledges and agrees that no agreements, representations,
warranties or collateral promises or inducements have been
made by any Party to this Agreement except as expressly set
forth herein or in the Schedules and any addenda attached
hereto or referenced herein, and that it has not relied upon
any other agreement or document, or any verbal statement or
act in executing this Agreement. These acknowledgments and
agreements are contractual and not mere recitals. In the
event of any inconsistency between the provisions of this
Agreement and any Schedule and any addenda attached hereto or
referenced herein, the provisions of this Agreement shall
prevail unless expressly stipulated otherwise, in writing
executed by the Parties. Pre-printed language on each Party's
forms, including purchase orders, shall not constitute part
of this Agreement and shall be deemed unenforceable.
10.6 ASSIGNMENT; BINDING EFFECT. This Agreement shall be binding
on the Parties and their successors and permitted assigns;
provided, however, that neither Party shall assign, delegate
or transfer, in whole or in part, this Agreement or any of
its rights or obligations arising hereunder without the prior
written consent of the other Party. Any purported assignment
without such consent shall be null and void. Notwithstanding
the foregoing, Jabil shall have the right to assign its
rights to receive monies hereunder without the prior written
consent of Digital.
10.7 WAIVER. Waiver by either Party of any breach of any
provision of this Agreement shall not be considered as or
constitute a continuing waiver or a waiver of any other
breach of the same or any other provision of this Agreement.
10.8 CAPTIONS. The captions contained in this Agreement are
inserted only as a matter of convenience or reference and in
no way define, limit, extend or describe the scope of this
Agreement or the intent of any of its provisions.
10.9 SECTION REFERENCES. All references to Sections or Schedules
shall be deemed to be references to Sections of this
Agreement and Schedules attached to this Agreement, except to
the extent that any such reference specifically refers to
another document. All references to Sections shall be deemed
to also refer to all subsections of such Sections, if any.
10.10 BUSINESS DAY. If any time period set forth in this Agreement
expires upon a Saturday, Sunday or U.S. national, legal or
bank holiday, such period shall be extended to and through
the next succeeding business day.
10.11 DISPUTE RESOLUTION
10.11.1The Parties shall use good faith efforts to
resolve disputes, within twenty (20) business
days of notice of such dispute. Such efforts
shall include escalation of such dispute to the
corporate officer level of each Party.
10.11.2If the Parties cannot resolve any such dispute
within said twenty (20) business day period, the
matter shall be submitted to arbitration for
resolution. Arbitration will be initiated by
filing a demand at the Tampa, Florida regional
office of the American Arbitration Association
("AAA").
10.11.3Disputes will be heard and determined by a panel
of three arbitrators. Each Party will appoint one
arbitrator to serve on the panel. A third neutral
arbitrator will be appointed by the AAA. All
arbitrators must have significant experience in
resolving disputes involving electronic
manufacturing and design services.
10.11.4Within fifteen (15) business days following the
selection of the arbitrators, the Parties shall
present their claims to the arbitrators for
determination. Within ten (10) business days of
the presentation of the claims of the Parties to
the arbitrators, the arbitrators shall issue a
written opinion. To the extent the matters in
dispute are provided for in whole or in part in
this Agreement, the arbitrator shall be bound to
follow such provisions to the extent applicable,
including any limitation of remedies. In the
absence of fraud, gross misconduct or an error in
law appearing on the face of the determination,
order or award issued by the arbitrator, the
written decision of the arbitrator shall be final
and binding upon the Parties. The prevailing
Party in the arbitration proceeding shall be
entitled to recover its reasonable attorneys'
fees, costs and expenses including travel-related
expenses. Notwithstanding the foregoing, either
Party may seek equitable remedies in any court of
competent jurisdiction to protect its
intellectual property rights or Proprietary
Information and Technology.
10.12 COUNTERPARTS. This Agreement may be executed by facsimile and
delivered in one or more counterparts, each of which shall be
deemed to be an original and all of which, taken together,
shall be deemed to be one agreement.
10.13 GOVERNING LAW AND JURISDICTION. This Agreement and the
interpretation of its terms shall be governed by the laws of
the State of Florida, without application of conflicts of law
principles. The provisions of the United Nations Convention
on Contracts for the International Sale of Goods shall not
apply to this Agreement.
10.14 ATTORNEYS' FEES AND COSTS. In the event that attorneys' fees
or other costs are incurred to enforce payment or performance
of any obligation, agreement or covenant between the Parties
or to establish damages for the breach of any obligation,
agreement or covenant under this Agreement, or to obtain any
other appropriate relief under this Agreement, whether by way
of prosecution or defense, the prevailing Party shall be
entitled to recover from the other Party its reasonable
attorneys' fees and costs, including any appellate fees and
the costs, fees and expenses incurred to enforce or collect
such judgment or award and any other relief granted.
10.15 CONSTRUCTION. Since both Parties have engaged in the drafting
of this Agreement, no presumption of construction against any
Party shall apply.
10.16 OTHER DOCUMENTS. The Parties shall take all such actions and
execute all such documents that may be necessary to carry out
the purposes of this Agreement, whether or not specifically
provided for in this Agreement.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
JBL011 Manufacturing Services Agreement
Page #
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives.
DIGITAL LIGHTWAVE, INC. JABIL CIRCUIT, INC.
By: \s\ XXXXX X XXXXX By: \s\ XXXX XXXX
Signature Signature
Name: Xxxxx X. Xxxxx Name: Xxxx Xxxx
(Print) (Print)
Title:EVP Operations Title:Business Unit Manager
JBL011 Manufacturing Services Agreement
Page #
SCHEDULE 1
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN JABIL AND DIGITAL
STATEMENT OF WORK
{circle}PRODUCT DESCRIPTION:
{circle}SPECIFICATIONS:
{circle}NRE COSTS:
{circle}COMPONENTS AND MATERIALS REQUIREMENTS:
{circle}TEST PROCEDURES:
{circle}PACKAGING AND SHIPPING SPECIFICATIONS:
{circle}SUPPLIERS DESIGNATED BY DIGITAL:
JBL011 Manufacturing Services Agreement
Page #
