EXHIBIT 10.8
NOTE: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.
FRAME PURCHASE AGREEMENT
FOR OPTO ELECTRONIC COMPONENTS
BETWEEN
AVANEX CORPORATION
AND
ALCATEL
This Agreement is made the 31st day of July 2003, between:
AVANEX CORPORATION, a Delaware corporation having a place of business at 00000
Xxxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of America,
(hereinafter referred to as "Supplier").
and
ALCATEL, a French Company organized and existing under the laws of France,
having its registered office 00 xxx Xx Xxxxxx 00000 Xxxxx Xxxxxx, (hereinafter
"Alcatel") acting on behalf of its controlled companies as defined by Article L
233-1 of the French "Code de Commerce", (hereinafter the "Buyer") represented by
acting as ;
WITNESSETH:
-2-
CONTENTS.
1. Definitions.
2. Scope.
3. Purchase Orders - Logistic -- Minimum Quantities.
4. Place - Date of Delivery.
5. Risk.
6. Price and Payment terms
7. Acceptance And Rejection.
8. Warranty.
9. Reporting And Reviews.
10. Quality
11. Environmental requirements
12. Support.
13. Manufacturing Change.
14. Intellectual Property.
15 Liability.
16. Insurance.
17. Term And Termination.
18. Force Majeure.
19. Invalidity.
20. Waiver.
21. Survival Of Obligations.
-3-
22. Entire Agreement - Amendments.
23. Assignment.
24. Subcontractors.
25. Headings.
26. Hierarchy of documents.
27. Notices.
28. Confidentiality.
29. Applicable Law
30. Business Practices
-4-
WHEREAS
a. Supplier is experienced in the manufacture and supply of Opto
Electronic Components suitable for application in the manufacture of
terrestrial and submarine telecommunication systems equipment.
b. Buyer which is a major manufacturer in terrestrial and submarine
telecommunication systems equipment desires to purchase Opto Electronic
Components.
c. Supplier and Buyer are mutually desirous of entering into this Frame
Agreement for the supply of such Opto Electronic Components
(hereinafter referred to as "Products") by Supplier to Buyer, on the
following terms and conditions of trade and upon Purchase Orders.
NOW IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS. Except as otherwise defined below, initially capitalized
terms used herein shall have the definitions assigned to such terms in
the Share Acquisition and Asset Purchase Agreement or the Supply
Agreement in connection with which this Agreement is entered into by
and between the Parties.
1.1 "Agreement" shall mean this Frame Purchase Agreement and its Exhibits.
1.2 "Delivery" shall mean delivery in accordance with this Agreement.
1.3 "Party" shall mean either Supplier or Buyer.
1.4 "Product" includes the components, standard and custom listed in
Exhibit A1 for terrestrial and A2 for submarine in volume production.
The products under development are excluded from the scope of this
Agreement.
1.5 "Purchase Order" shall mean a Purchase Order from Buyer with reference
to this Agreement or a Purchase Order placed by a Contract Manufacturer
(CM) or a LSP Logistic Service Provider (LSP) in each case as requested
by buyer.
1.6 " Day" shall mean calendar day.
1.7 "Buyer" shall mean any controlled companies of Alcatel as defined in
article L 233-1 of the French "Code de Commerce" as well as their
contract manufacturers (CM) and / or Logistics Service Providers (LSP)
which have accepted in writing to abide by the terms and conditions of
-5-
this Agreement, including but not limited to payment and
confidentiality obligations.
2. SCOPE.
2.1 Supplier hereby agrees to the supply and Buyer agrees to the purchase
of Products, such supply to be on the terms and conditions hereinafter
set forth, for Submarine components, the provision attached in exhibit
D shall have precedent over the terms & conditions of this Agreement.
Supply of Products shall be by way of Purchase Orders placed by Buyer
upon Supplier.
2.2 Products may only be delivered against Purchase Orders issued by Buyer
or its CMs or LSPs as indicated by Buyer. Purchase Orders shall be
placed in writing by either printed Purchase Order or letter and either
posted or transmitted by facsimile, or both, or by EDI when mutually
agreed.
3. PURCHASE ORDERS - LOGISTIC -- MINIMUM QUANTITIES
3.1 Purchase Orders
The Purchase Orders will be confirmed by Supplier [*] ([*]) business days after
the receipt of the Purchase Order for standard Products and not later than [*]
([*]) days for custom Products; provided that supplier's failure to confirm any
such Purchase Order within the forgoing time periods shall be deemed Supplier's
acceptance of the relevant Purchase Order.
3.2 Logistics
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-6-
3.2.1. Supplier and Buyer will agree to put in place collaborative
forecasting and communication programs in order to meet Buyer's
flexibility requirements and Supplier's visibility needs as well as to
reduce delivery lead times.
3.2.2 Unless otherwise agreed between Supplier and Buyer, Buyer shall
have the option of implementing either Option 1 or Option 2 below with
respect to any Product, provided however, that Buyer may not
concurrently order the same Product under Option 1 and Option 2. Option
1 will apply unless Supplier and Buyer execute a logistics agreement,
in which case Buyer and Supplier will implement Option 2.
A. Option 1 No Logistics Agreement.
Purchase Orders will be placed by Buyer. The Purchase Order lead
time is indicated in Exhibit C.
Buyer may cancel - in whole or in part - an accepted order prior
to the agreed delivery date subject to a minimum prior written
notice to Supplier as mentioned in Exhibit C [*] except as set
forth in Exhibit C for custom Products.
Buyer may reschedule a Purchase Order - in whole or in part -
prior to the agreed delivery date subject to a minimum prior
written notice to Supplier as mentioned in Exhibit C [*] except
as set forth in Exhibit C for custom Products.
B. Option 2 Logistics Agreement
Provided a logistic agreement is executed between Supplier and
Buyer regarding the list of concerned Products, the type of
Products (standard or custom as indicated in Exhibit B), the
required buffer stock (if any) per Product, Buyer and Supplier
shall implement the following Option 2, unless Buyer and
Supplier agree to implement other logistics conditions.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-7-
1. Standard Products
- Buyer will provide Supplier with non-binding six (6) month rolling forecasts,
updated on a monthly basis .Such forecast shall represent a good faith
expectation of Buyer's anticipated needs and will be used by Supplier for
manufacturing planning purposes.
The Purchase Order lead time is indicated in Exhibit C. Buyer
may cancel, in whole or in part, purchase orders prior to the
agreed delivery date subject to a minimum prior written notice
to Supplier as mentioned in Exhibit C [*].
Buyer may reschedule, in whole or in part, a Purchase Order
prior to the agreed delivery date subject to a minimum prior
written notice to Supplier as mentioned in Exhibit C [*].
2. Custom Products
Buyer will provide Supplier with non-binding, six (6) month
rolling forecasts, updated on a monthly basis. Such forecast
shall represent a good faith expectation of Buyer's anticipated
needs and will be used by Supplier for manufacturing planning
purposes. The first weeks of any such forecast corresponding to
the manufacturing lead-time (as specified in Exhibit C) shall be
a binding commitment of Buyer to purchase (hereinafter referred
to as the "Demand Plan").
- The Purchase Order lead-time is indicated in Exhibit C.
- Buyer may cancel - in whole or in part - Purchases Order or a
Demand Plan, prior to the agreed delivery date subject to a
minimum prior written notice to Supplier as mentioned in
Exhibit C [*] except as provided in Exhibit C.
- Buyer may reschedule - in whole or in part - a Purchase Order
or a Demand Plan prior to the agreed delivery date subject to
a minimum prior written notice to Supplier as mentioned in
Exhibit C [*] except as provided in Exhibit C.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-8-
- Supplier shall immediately cease to incur expense against the
cancelled or decreased Purchase Order or Demand Plan as of
the date of receipt of Buyer's prior notice as set forth in
Exhibit C.
3.4 Minimum quantities
No minimum quantity will apply to any individual Purchase Order, except as may
be mutually agreed between Supplier and Buyer.
4. PLACE, DATE OF DELIVERY.
The Products shall be delivered as set forth in article 6 below.
Without prejudice to any other rights and remedies, if Supplier's delay exceeds
[*] (other than due to an Event of Force Majeure or Buyer's or its agents acts
or omissions), Buyer may cancel the affected portion of Products [*].
5. TITLE AND RISK OF LOSS.
Title and risk of loss in the Products shall pass to Buyer as set forth in
article 6 below.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-9-
6. PRICE AND PAYMENT TERMS
6.1 Price and delivery
6.1.1. Supplier shall invoice Buyer at the prices set forth in the applicable
Exhibit B. The prices stated in this Exhibit are maximum prices for the
Products ordered for delivery during the relevant time period.
If, at any time, [*], then [*].
The prices set forth in the applicable Exhibit B are stated in Euro
(the "Original Currency").
6.1.2. Supplier shall deliver the Products in accordance with the following
International Chamber of Commerce Incoterms 2000 :
(i) FCA (Supplier's factory), provided that Buyer and Supplier may
mutually agree upon other shipping terms for Products desired by Buyer
in territories other than:
EU
CANADA
CHINA
USA
(ii) Title to and risk of loss in the Products pass to Buyer upon
delivery of Products to Buyer under Section 6.1.2(i) above.
6.2 Payments terms
6.2.1 Payment shall be made in the Original Currency, unless otherwise agreed
by Supplier and Buyer.
In this later case, the exchange rule will be as follows: if during
three (3) consecutive months the average exchange rate varies by more
than [*] percent ([*]%) Buyer shall notify Supplier before the 10th of
the month of the variation (M). The new exchange rate will be
implemented for the Purchase Orders placed from the first day of the
following month (M+1) and for deliveries starting the first day of M+2.
Ex rate 1 Euro = 1 USD
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-10-
6.2.2 Payment shall be made within [*] after the date of supplier invoice,
invoice being made not sooner than the date of shipment, unless
otherwise agreed between Buyer and Supplier.
7. ACCEPTANCE AND REJECTION.
7.1 Supplier shall use commercially reasonable efforts to provide Buyer
with reasonable assistance and information at Buyer's sole cost and
expenses, that Buyer may reasonably request in performing Buyer's test
under Section 7.5 below.
7.2 Buyer shall have [*] after the date of receipt of each shipment of
product by Supplier to Buyer under Section 6 above to inspect the
products for any patent defect such as non conformity in quantity or
type of Product as set forth in the relevant Purchase Order. In the
event that any shipment contains any such defect, Buyer shall have the
right to reject the affected portion of the Products with respect to
such Purchase Order.
7.3 Failure by Buyer to provide written notice of rejection within [*] of
the date of receipt with respect to any shipment or part thereof in
accordance with Section 7.1 above, shall be deemed Buyer's acceptance
of the relevant shipment, or portion thereof, not subject to its
written notice of rejection. Such acceptance shall not impair the
warranties set forth in this Agreement.
7.4 Supplier agrees to promptly replace any non-conforming shipment or part
thereof under section 7.2 above.
7.5 Buyer shall have the right to screen and test the ordered Products in
order to retain such items it can accept.
7.6 Buyer shall notify Supplier of any hidden or epidemic failure rates
within [*] after the date the hidden or epidemic failure becomes
apparent by Buyer.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-11-
7.7 Supplier shall notify Buyer within [*] if the date the hidden or
epidemic failure becomes apparent and which Supplier is aware of in the
relevant Product.
8. WARRANTY.
Supplier warrants that the Products to be provided under this Agreement are new.
Supplier warrants that the Products shall meet the applicable specifications and
shall be free from defects resulting from faulty design, materials or
workmanship [*] from the date of delivery to Buyer under Section 6.1.2 above.
The returned material will be only accepted upon RMA procedure, RMA number being
given within no more than [*].
Supplier's sole obligation under this warranty shall be to [*].
This warranty shall not apply, inter alia, to defects or deterioration in
Products caused by or attributable to (i) utilization otherwise than in
accordance with instructions furnished by Supplier, or (ii) improper maintenance
and/or storage, or (iii) Products modification not provided for by Supplier.
THE FOREGOING WARRANTY SETS FORTH THE ENTIRE LIABILITY AND OBLIGATIONS OF
SUPPLIER, SUPPLIER AFFILIATED COMPANIES AND THEIR RESPECTIVE SUPPLIERS FOR
DEFECTS OR DEFICIENCIES IN THE PRODUCTS, WHETHER BASED ON BREACH OF WARRANTY, OR
OTHERWISE. THE WARRANTIES SET FORTH OR LIMITED HEREIN ARE THE SOLE AND EXCLUSIVE
WARRANTIES AND ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS, IMPLIED, STATUTORY
OR OTHERWISE, INCLUDING WARRANTIES OF NONINFRINGEMENT, FITNESS FOR PARTICULAR
PURPOSE AND MERCHANTABILITY, ACCURACY OR TITLE. TO THE EXTENT AN IMPLIED
WARRANTY CANNOT BE EXCLUDED, SUCH WARRANTY IS LIMITED IN DURATION TO THE
WARRANTY PERIOD.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-12-
9. REPORTING AND REVIEWS.
Unless otherwise agreed, Supplier and Buyer will review on a quarterly basis
Supplier and the Buyer's performance under this Agreement. Such reviews shall
include, but not be limited to:
9.1. Supplier's performance in respect of quality, on-time deliveries, price
levels and lead times;
9.2. If applicable, Buyer's performance in respect of notifying Rolling
Forecasts and placing subsequent Purchase Orders.
9.3. opportunities to enhance specifications for performance improvement.
9.4. Buyer and Supplier each appoint contract coordinators as indicated in
Exhibit B.
9.5. Length of any Demand Plan, to the extent a six (6) month, rolling
forecast is insufficient to permit Supplier to meet delivery, volume or
pricing commitments agreed to with respect to Products under such
Demand Plan.
10. Quality
10.1 Quality Certification
Supplier is responsible for utilizing processes, in the supply of the
products and services covered in this Agreement, that are certified
to ISO 9000 or planned to be certified ISO 9000 with a specified
timeframe. Alcatel reserves the right to invoke the requirement for
TL 9000 registration with a mutually specified timeframe for
compliance.
10.2 Quality Requirements
Supplier is responsible for insuring that products furnished
hereunder by Supplier have undergone or have been subject to
Supplier's quality assurance and quality control activities and
procedures, which may include performance measurements, testing,
quality process reviews or inspections. Supplier's quality management
system shall be capable of early and prompt detection of actual or
potential and foreseeable material deficiencies, trends or conditions
which could result in unsatisfactory quality, and for timely and
effective corrective action.
Supplier is responsible for insuring that his suppliers and
subcontractors maintain a quality system that supports the ISO 9000
quality system requirements. The Supplier shall not appoint any
subcontractor to carry out all or part of its obligations hereunder
without having previously informed the Buyer.
-13-
Buyer is entitled to conduct audits at Supplier's factories including
its subcontractors' factories with, not less than, five (5) business
days prior notice to Supplier. Types of audits that may be conducted
include, but are not limited to, quality system audits, product
specific audits, and process audits, provided that (i) Buyer may only
conduct any such audit no more than twice during any twelve month
period, (ii) the duration of such audit shall not exceed five (5)
business days; and (iii) all costs and expenses related to such audit
shall be borne exclusively by Buyer.
Nothing contained herein will diminish Supplier's obligation to
deliver defect-free material, under any warranty, or any other
provision of this Agreement.
Upon Buyer's request, Supplier shall provide Buyer with a certificate
of conformance and/or test results and quality records with respect
to Supplier's quality and/or ISO obligations under this Article 10.
In addition, Supplier is responsible for complying with additional
quality requirements as designated by any local agreements between
Supplier and Buyer, as mutually agreed between the Parties.
11. ENVIRONMENTAL REQUIREMENTS.
Supplier is responsible for complying with industry standards regarding
environmental care as well as with the specific standards required per
Supplier's region.
[*]
More specifically, Supplier is responsible for compliance with the substances
and product end of live European regulations.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-14-
In addition, Supplier is responsible for complying with additional environmental
standards as designated by any local agreements between Supplier and Buyer.
12. SUPPORT.
12.1 Supplier shall on a commercially reasonable basis, provide repair
services and replacement parts for the Products, until the earlier of
[*].
12.2 For as long as Buyer [*], Supplier will [*].
12.3 If for any reason during the term of this Agreement, Supplier intends
to cease manufacturing or supplying Products conforming to the then
current specification, Supplier shall give Buyer at least [*] prior
written notice of its intention to cease manufacturing or supplying the
Products in order for Buyer, at its option, to place an all last time
buy. The delivery of such an all last time buy shall take place within
[*] of the date of Supplier's notice of discontinuation.
13. CHANGES.
13.1 Either Supplier or Buyer may request variations to any part of this
Agreement, any Specifications, the obligations contained within this
Agreement. All such requests must be made in writing.
13.2 The Party receiving such a request shall promptly (within no more than
thirty (30) days) advise the other Party in writing of the effects of
the proposed change upon the terms of this Agreement and the Products,
in the event the proposed variation be implemented.
13.3 The Party receiving the request shall also promptly (within no more
than thirty (30) days) advise the other Party whether or not it wishes
to proceed with the proposed variation.
13.4 Until such time as any variation is formally agreed in writing and
signed by an authorized representative of each Party, Supplier shall
continue to perform and be paid as if such variation had not been
requested or recommended.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-15-
13.5 Notwithstanding the foregoing, if Supplier intends to change the
manufacturing process or construction of the Products ("Manufacturing
Change"), for example in order to solve essential products or costs
problems, Supplier shall notify Buyer of any such change. If the
Manufacturing Change involves a change of manufacturing location or a
major construction or process change, such Manufacturing Change shall
require Buyer's written consent before it is implemented.
14. INTELLECTUAL PROPERTY
Supplier shall (i) defend or settle, at its option and expense, any claim of
infringement against Buyer alleging that the Product furnished under this
Agreement constitutes an infringement of any patent, copyright or trademark or
any other Intellectual Property rights of the third party introducing such
claim, (ii) reimburse Buyer for all damages and costs awarded in such proceeding
or settlement against Buyer and actually paid by Buyer; provided that Supplier
must be notified promptly in writing of any matter giving rise to possible claim
under this section and must be given the control and direction in the defense
and/or settlement of such claim, with counsel of Supplier's choice at Supplier's
sole expense.
If said Product, or any part thereof, is held to constitute an infringement in
such suit, and the making, use and/or sale of said Product or part is enjoined,
or said suit is settled on the basis of an undertaking to terminate such making,
use and/or sale of said Product as is alleged to constitute an infringement,
Supplier shall at its own expense and own choice, either (i) procure for Buyer
the right to continue using such Product; or (ii) send non-infringing
replacement Product; or (iii) modify said Product so that it becomes
non-infringing; or (iv) refund (the amount Buyer is required to refund to
Buyer's customer for the sale of the infringing product/Price Buyer received for
the Product from such customer) multiplied by the price paid by Buyer to
Supplier for such Product.
Supplier shall not be liable to Buyer under this section, if the infringement
proceeding or claim involves Products made, provided or modified by Supplier in
compliance with the requirements or specification of Buyer; or arises from (i) a
use for which the Product was not designated, or (ii) an alteration or
modification of the Product in question made by other than by Supplier or a
combination or use of that Product with another product which alteration,
modification or combination has caused the infringement action.
The sale of any Product by Supplier shall not in any way confer upon Buyer, any
license under any patent claims of Supplier covering combination of Said Product
with other devices or elements, or the process or method of making such Products
or under any other intellectual property right of Supplier except the right to
use and resell the Products supplied hereunder.
-16-
The foregoing states the sole and exclusive remedy of Buyer and the entire
liability of Supplier for infringement of any intellectual property rights
arising out of this Agreement. In no event will the liability of Supplier under
this Section 14 exceed the total purchase price paid by Buyer to Supplier for
the affected products.
15. LIABILITY.
15.1 Neither Supplier nor the Buyer shall be liable to the other for any
special, indirect, incidental or consequential damages of any kind in
contract or in tort including but not limited to loss of use, data,
profit, income, business, anticipated savings, reputation as well as
financing costs or increase in operating costs.
15.2 Alcatel shall not be held liable for the performance or
non-performance or otherwise of any Purchase Orders of a Buyer and
will not have any liability for damages resulting from any act or
omission of a Buyer. Each Buyer will remain fully liable for all acts
or omissions under its Purchase Order and will not be liable for any
acts or omission under any other Purchase Orders.
16. INSURANCE.
16.1 Insurance
Supplier will keep its business and properties insured at all times in
accordance with Supplier's then current insurance policies for its business and
properties involved in similar transactions as under this Agreement.
-17-
During the term of this Agreement, all insurance must be maintained with
reputable insurers having a Standards and Poor's rating or Best's rating of [*]
in such amounts and with such limits and deductibles usually carried by persons
engaged in the same or similar business, but in any case, shall comply with the
Minimum Insurance Requirements detailed in this section.
Supplier shall be responsible for the payment of any deductible applicable under
the insurance policies indicated in this section.
Buyer shall be named as additional insured on the General Liability
insurance policies. Such policies should contain a "Cross Liability"
provision.
Supplier will provide to Buyer, upon Buyer's request with
certificates of insurance, confirming that Supplier is compliant with
its obligations under this clause. Supplier will provide Buyer with
certificates of insurance at each renewal.
Supplier will notify Buyer of any changes in terms, conditions and
termination of such policies not less than 15 days after notification
from the insurer.
Minimum Insurance Requirements
Without limiting its liability under this contract,
Supplier will have to arrange the following insurance policies:
General and Product liability - Minimum sum insured of USA$[*] per
occurrence. This policy shall be in an occurrence basis.
Compulsory insurance (such as auto, workers' compensation, etc.)
16.2 Risk Management
Supplier will use commercially reasonable efforts to maintain
appropriate risk management programs on a site by site basis.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-18-
Supplier will have loss prevention inspections to be carried out at
Supplier's production premises at least once per year, at Supplier's
costs, by a specialized engineering consultant (independent or of his
property insurer) and will address a copy of the complete loss
prevention and underwriting report to Supplier and Buyer. This report
should in particular comprise an estimate for the downtime and
scenario in case of a maximum foreseeable loss.
16.3 Survival
The provisions of this section shall survive the expiration of the
term or sooner termination of this Agreement for a period of one (1)
year thereafter.
17. TERM AND TERMINATION.
This Agreement shall remain effective as of the Share Acquisition Closing as
such term is defined in the Share Acquisition and Asset Purchase Agreement (the
"Effective Date") for a period of three (3) years and shall thereafter be
automatically renewed for successive periods of one (1) year, unless a ninety
(90) days prior written notice of non-renewal is served by either party to the
other.
(i) Exhibits A, B and C will only apply to any purchase orders placed by Buyer
to Seller or, by the contract manufacturers or logistic service providers, from
January 1, 2003 until December 2003 as well as to purchase orders already placed
for delivery of the Products from January 1, 2003 until December 31, 2003; and
(ii) Alcatel and Supplier will agree upon new Exhibits A, B and C for each
subsequent year no later than December 31 of each year.
(iii) If Alcatel and Supplier do not agree on new Exhibits A, B and C by
December 31 of each year, the Exhibits A, B and C from the prior year will apply
until the parties agree on new Exhibits A, B and C.
17.1 Supplier or Buyer may terminate any Purchase Order immediately by
notice in writing to the other Party if:
17.1.1 the other Party commits any material breach or
persistent breach of any of the provisions of the
Purchase Order that is not remedied within 30
(thirty) days of written notification by the other
Party; or
17.1.2 in the limits authorized by law: an encumbrance takes
possession or a receiver or an administrative
receiver or administrator is appointed over any of
the property or assets
-19-
of the other Party; or the other Party makes any
voluntary arrangement with its creditors or becomes
subject to an administration order; or the other
Party goes into liquidation (except for the purposes
of amalgamation, reconstruction or other
reorganization and in such manner that the company
resulting from the reorganization effectively agrees
to be bound by or to assume the obligations imposed
on that Party under this Agreement) or either Party
ceases to carry on business.
18. FORCE MAJEURE.
18.1 Neither Supplier nor a Buyer shall be liable hereunder to the other
for any loss, injury, delay or damage suffered or incurred by the
other Party due to fire, storm, explosion, acts of God, war,
supervening legislation, governmental or other regulations and
directions, shortages of necessary equipment, materials, labor caused
by third party strikes, or any other cause beyond the reasonable
control of either Party which could not be prevented and foreseen
("Force Majeure") and any failure or delay by either Party in the
performance of any of its obligations under this Agreement due to any
of the foregoing causes shall not be considered a breach of this
Agreement and shall not give rise to any liability.
18.2 Should the delivery of any of the Products be directly delayed by
force majeure, the time for delivery of those Products so delayed
shall be extended by Buyer (provided that Supplier shall have first
given Buyer prompt written notice after Supplier becoming aware of
such cause) for a reasonable period having regards to the effect of
the delaying cause upon the manufacture of the Products and Buyer's
intended use of the Products delayed. However, Supplier shall do
everything practicable to remedy any delay.
18.3 In the event that a circumstance of force majeure continues for a
period of 6 (six) weeks then the Party not subject to force majeure
shall have the right to terminate the uncompleted portion of those
Purchase Orders so affected at no cost or liability to itself.
19. INVALIDITY.
Should any part of this Agreement be declared invalid and, or, unenforceable for
any reason whatsoever, such part shall be deemed to be severed from this
Agreement, and replaced with a valid and enforceable provision which reflects
the original intention of the Parties to the maximum extent permitted under law
and the remaining portion of this Agreement shall not be prejudiced and shall
continue in full force and effect.
-20-
20. WAIVER.
No delay, neglect or forbearance by either Party in enforcing against the other
any term or condition of this Agreement shall be, or be deemed to be, a waiver,
nor shall it in any way prejudice any right of that Party under this Agreement.
21. SURVIVAL OF OBLIGATIONS.
Notwithstanding termination of this Agreement, the Clauses detailed below shall
remain in full force and effect: Law, Headings, Intellectual Property, Support,
Warranty, Quality Assurance, Liability, Invalidity, Waiver, Survival Of
Obligations, Whole Agreement, Assignment, Subcontractors, intellectual property.
22. ENTIRE AGREEMENT, AMENDMENTS.
22.1 This Agreement, as implemented by Purchase Orders is the sole and
complete statement of the obligations of the Parties as to the sale
and purchase of Products and supersedes all previous agreements and
understandings between the Parties relating to the Products, and may
not be modified except by an instrument in writing signed by the duly
authorized representatives of the Parties. This Agreement may not be
modified by the general sale or purchase conditions of either Party.
22.2 Any purported variation and/or addition to this Agreement shall be
agreed in writing and signed by authorized signatories on behalf of
both Parties.
23. ASSIGNMENT.
After prior written information to the other Party, either Buyer or Supplier may
assign the Agreement or any Contract to any other Buyer or affiliated company as
defined on the front page of the Agreement.
24. SUBCONTRACTORS.
[*] Supplier shall be free to appoint any subcontractor to carry out all or part
of its obligations but only after notice to Buyer; provided that such
subcontractors
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-21-
agree in advance in writing to abide by confidentiality obligations set forth in
this Agreement. Notwithstanding the foregoing, Supplier shall remain directly
and solely liable to Buyer for any acts or omissions of any such subcontractor
performing obligations on behalf of Supplier hereunder, including but not
limited to the confidentiality obligations.
25. HEADINGS.
Headings in this Agreement are for convenience and shall not be used in the
interpretation or construction of this Agreement.
26. HIERARCHY OF DOCUMENTS.
In case of any discrepancy or ambiguity between the Agreement and a Purchase
Order, the Agreement shall prevail over the Purchase Order and all other
documents related thereto.
27. NOTICES.
27.1 Any notice, consent or communications required to be given or served
hereunder shall be given or served by sending it by facsimile and
confirming by first class mail to:
In the case of Supplier:
Avanex Corporation
00000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000, XXX
Attention: Chief Executive Officer
Fax: 000-000-0000
In the case of Buyer:
Alcatel
00, xxx Xx Xxxxxx
00000, Xxxxx, Xxxxxx
Attention: General Counsel
Fax No.: 000-000-0000-0000
or such other address as may be given in writing from time to time by
either Party.
27.2 Any notice, consent or communication so sent shall be deemed to have
been given or served on the second business day following the day of
sending.
-22-
28. CONFIDENTIALITY
28.1 Both for the duration of this Agreement and after termination or
completion of this Agreement the Parties hereto shall keep the
contents of this Agreement confidential and shall maintain the
confidentiality of all information provided or made available to each
by the other and shall use it only for the fulfillment of their
respective obligations under this Agreement. Information covered by
this provision includes, without limitation, information disclosed
orally or in writing and information stored on disc or any other
medium. Notwithstanding the foregoing, either Party shall be entitled
to disclose both the existence and terms of this Agreement to (i)
attorneys, accountants, and similar agents of a Party which are bound
by non-use and non-disclosure obligations and (ii) other third
parties, bound in writing to non-use and non-disclosure obligations,
in connection with a merger, acquisition, investment round or similar
corporate reorganization or capitalization of a Party.
28.2 The above shall not apply to any information to the extent that such
information:
28.2.1 is or becomes freely available to the public without
breach of an obligation of confidentiality hereunder;
or
28.2.2 lawfully received by the receiving Party from a third
Party without breach of obligation or confidence; or
28.2.3 can be shown to have been in the lawful possession of
the receiving Party prior to receipt from the
disclosing Party or to have been developed by the
receiving Party independently of receipt from the
disclosing Party; or
28.2.4 is required by order of the Court to be disclosed;
28.3 Subject to Confidentiality and notwithstanding termination of this
Agreement the obligations of confidentiality contained hereunder
shall continue to subsist for a period of 5 (five) years from the
date of this Agreement.
-23-
29. APPLICABLE LAW - SETTLEMENT OF DISPUTES
This Agreement shall be governed by the laws of France. Any dispute arising out
of this Agreement shall be finally settled under the Rules of Conciliation and
Arbitration of the International Chamber of Commerce by three (3) arbitrators
appointed in accordance with said Rules, in New York City, New York. The
arbitration, agreements, evidence and any other materials used by either Party
in the course of making their case before such arbitrators will be in the
English language
30. BUSINESS PRACTICES.
Supplier recognized having been made fully acquainted with Alcatel statement of
Business Practices dated March 11th, 2003 (as may be updated from time to time)
xxxx://xxx.xxxxxxx.xxx and undertakes to apply the principles set out therein
with respect to the performance of this Agreement, in particular with reference
to non-discrimination of employees, combating bribery of domestic and foreign
public officials, protection of international human rights and environmental
responsibility. Supplier recognizes that violation of such principles which
constitute a breach of any applicable laws, rules, judgments or orders or
similar legally imposed requirements to which Buyer and Supplier are subject
shall be deemed a breach of this contract.
-24-
Executed in two original copies
For Alcatel: For Avanex Corporation:
Name Name
AL Scaillierez Xxxxxxx Xxxxxxxx
Acting as Acting as
Buyer Supplier
Signature Signature
/s/ AL SCAILLIEREZ /s/ XXXXXXX XXXXXXXX
Date 31/07/03 Date 7/31/03
-25-
EXHIBIT A
PRICES - PRODUCTS -
-26-
EXHIBIT A1 -- Terrestrial
2003
ALCATEL CODE A. OPTRONICS PN FAMILY DESCRIPTION CURRENCY PRICE NOTE
--------------------------------------------------------------------------------------------------------
1AB071630007 3CN00431KW A 1915 LMI [*] EUR [*]
1AB091410001 3CN00001AA A 1901 OFA [*] EUR [*]
1AB091420001 3CN00001AB A 1901 OFA [*] EUR [*]
1AB091420003 3CN00066AA A 1901 OFA [*] EUR [*]
1AB091420004 3CN00077AA A 1901 OFA [*] EUR [*]
1AB1390900X 3CN00149XX A 1916 LMM [*] EUR [*]
1AB1391000X 3CN00397XX A 1916 LMM [*] EUR [*]
1AB141790001 3CN00294AA A 1925 OFA [*] EUR [*]
1AB144310001 3CN 00207 FC A 1948 PLI [*] EUR [*]
1AB144310004 3CN 00207 FT A 0000 XXX [*] EUR [*]
1AB157300001 3CN 00328 AB A 1926 SDH [*] USD [*]
1AB157320003 3CN 00336 BB A 1926 SDH [*] USD [*]
1AB157320005 3CN 00336 DM A 1926 SDH [*] EUR [*]
1AB157320010 3CN00582AM A 1926 SDH [*] EUR [*]
1AB165030001 3CN 00000 XX A 1926 OFA [*] EUR [*]
1AB165030002 3CN00402AB A 1936 OFA [*] EUR [*]
1AB165030005 3CN00365AA A 1926 OFA [*] EUR [*]
1AB165030006 3CN00604AA A 1901 0AM [*] EUR [*]
1AB165030007 3CN00605AA A 1901 0AM [*] EUR [*]
1AB165570003 3CN00390AA A 1906 OFA [*] EUR [*]
1AB165570004 3CN00389AA A 1906 OFA [*] EUR [*]
1AB165570005 3CN00391AA A 1906 OFA [*] EUR [*]
1AB1660900xx 3CN00505XX A 1901 RBF [*] EUR [*]
155-2659-0xx FBG-xxx-R95-S0.15- A 1901 RBF [*] USD [*]
A01
1AB1714300xx 3CN 00624 XX A 1926 SDH [*] EUR [*]
1AB174720001 3CN00465AA A 1907 OFA [*] EUR [*]
1AB175880001 3CN00395AB A 1948 MPM [*] EUR [*]
1AB18212000X 3CN00744XX A 1926 SDH [*] EUR [*]
1AB186390001 3CN00392AA A 1907 OFA [*] EUR [*]
999197619 3CN00638XX A 1965 SDH [*] EUR [*]
999197742 3CN00593AA A 1901 0AM [*] EUR [*]
999197743 3CN00594AA A 1901 0AM [*] EUR [*]
1AB146670001 3CN00299KW A 1915 LMI [*] EUR [*]
1AB157300002 3CN00328AM A 1926 SDH [*] EUR [*]
999... 3CN00532AA A 1964 TRX [*] EUR [*]
3AL79498XXXX 3CN00625XX A 1964 SDH [*] EUR [*]
3AL79515AA 3CN00626AA A 1964 SDH [*] EUR [*]
487166267 3CN00573AA A 1964 SDH [*] EUR [*]
487166269 3CN00574AA A 1964 SDH [*] EUR [*]
487166268 3CN00755AA A 1964 SDH [*] EUR [*]
487156949 3CN00756AA A 1964 SDH [*] EUR [*]
999197804 3CN00652AX A 1964 MRX [*] EUR [*]
999... TBD A 1915 LMM [*] EUR [*]
99919782X 3CN0079OXX A 1935 TLS [*] EUR [*]
999197750 3CN00702AG A 1921 OAC [*] EUR [*]
999197802 3CN00703AG A 1926 OAC [*] EUR [*]
999... 3CN00704AG A 1926 OAC [*] EUR [*]
1AB189320001-24 3CN00746AX A 1908 AWC [*] EUR [*]
1AB189330001-12 3CN00747AX A 1910 AWC [*] EUR [*]
1AB189350001-12 3CN00748AX A 1912 AWC [*] EUR [*]
1AB1417100X 3CN00643XX A 1905 LMI [*] USD [*]
1AB146670004 3CN00299LW A 1915 LMI [*] USD [*]
1AB159410001 3CN00321AB A 1915 LMM [*] USD [*]
1AB1639400xx 3CN00410XX A 1905 LMI [*] USD [*]
EXHIBIT A2 - SUBMARINE (**)
1AB1700470 3CN00488XX A 1905 LMI [*] EUR [*] (**)
1AB1515900 3CN00490XX A 1905 LMI [*] EUR [*] (**)
1AB156030002 3CN00366AA A 1901 OFA [*] EUR [*] (**)
1AB156030001 3CN00363AA A 1901 OFA [*] EUR [*] (**)
1AB169210001 3CN00476AA A 1901 OFA [*] EUR [*] (**)
1AB186310001 3CN00670AB A 1901 OFA [*] EUR [*] (**)
1AB170480003 3CN00537AA A 1901 OFA [*] EUR [*] (**)
1AB162580003 3CN00352TB A 1948 FBG [*] EUR [*] (**)
29 CLS 0000 8AAC 3CN00067AA A 1948 PLM [*] EUR [*] (**)
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
-27-
EXHIBIT B
STANDARD AND CUSTOM PRODUCTS
-28-
SEE CLASSIFICATION IN STANDARD AND CUSTOM IN EXHIBIT C2
-29-
EXHIBIT C
LOGISTICS CONDITIONS
1. DEFINITION OF PRODUCTS TYPES
"Standard Products" shall mean Products that are in Supplier's
catalogue and have multiple buyers, and Buyer is not the primary
purchaser of such Products.
"Custom Products" shall mean products for which Buyers are the primary
users.
Each Product is identified as Standard or Custom in Exhibit B.
2. OPTION 1 (NO LOGISTICS AGREEMENT)
2.1 Purchase Order lead-time Except as otherwise specified in Exhibit C1:
For Standard Products, the Purchase Order lead-time is [*]
For Custom Products, the Purchase Order lead time is [*]
2.2 Cancellation
The minimum prior written notice for cancellation of a Purchase Order
is [*] for Standard Products and for Custom Products.
2.3 Rescheduling
The minimum prior written notice for rescheduling of a Purchase Order
is [*] for Standard Products and for Custom Products. No Purchase Order
may be rescheduled (i) more than [*] and more than [*] after the
original scheduled delivery date.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
30
3. OPTION 2 (WITH LOGISTICS AGREEMENT)
3.1 Standard Products:
(a) the Purchase Order lead-time is [*] except as otherwise specified
in Exhibit C2.
(b) the minimum prior written notice for cancellation of a Purchase
Order is [*].
(c) the minimum prior written notice for rescheduling is [*]. No
Purchase Order may be rescheduled (i) more than [*] and more than
[*] after the original scheduled delivery date.
3.2 Custom Products
(a) the manufacturing lead-time is [*] except as otherwise specified in
Exhibit C2.
(b) the Purchase Order lead-time is [*] except as otherwise specified
in Exhibit C2.
(c) the minimum prior written notice for cancellation of a Purchase
Order is [*].
(d) the minimum prior written notice for rescheduling is [*]. No
Purchase Order may be rescheduled (i) more than [*] and more than
[*] after the original scheduled delivery date.
4. [*]
When agreed between Supplier and Buyer, [*].
The [*] shall be in accordance with the [*].
In case of [*],[*] will [*] accordingly.
5. CANCELLATION AND RESCHEDULING LIABILITIES.
The following terms apply to Custom Products only in Option 1 and
Option 2.
5.1 Rescheduling
5.1.1 Definitions:
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
31
"EXCESS RAW MATERIAL" means raw materials in Supplier's inventory or
under Supplier's purchase orders that cannot be cancelled that were
purchased in quantities to support no more than the manufacturing
lead-time of Buyer's Purchase Orders and/or Demand Plan and for which
the latest Purchase Orders and/or Demand Plan does not show full
consumption in any Products within the next [*].
"EXCESS WIP" means work in process in Supplier's inventory that was
started in production workshop to support Buyer's Purchase Orders
and/or Demand Plan (WIP will not exceed the lowest of [*]) and for
which the latest Purchase Orders and/or Demand Plan does not show full
consumption in any Products within the next [*].
"EXCESS FINISHED GOODS" means finished products in Supplier's inventory
that was completed to support Buyer's Purchase Orders and/or Demand
Plan (Finished Goods inventory will not exceed the lowest of [*]) and
for which the latest Purchase Orders and/or Demand Plan does not show
full consumption within the next [*].
5.1.2 Liabilities
Supplier shall notify Buyer on a monthly basis of the existence of any
potential Excess Raw Materials, Excess WIP and Excess Finished Goods.
When the no full consumption occurs, after respectively [*] for Excess
Raw Materials, [*] for Excess WIP and [*] for Excess Finished Goods
then,
(i) for Excess Raw Materials and Excess WIP, [*] shall have the
option to (a) [*]or (b) [*]. [*] shall notify [*] of [*]'s
choice at least [*] before the no full consumption occurs and
shall pay for the amount due within [*] after the date of
[*]'s
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
32
invoice, such date not being sooner than [*].
(ii) For Excess Finished Goods, [*] shall [*].
(iii) Liabilities set forth in (i) and (ii) shall be subject to [*].
5.2 Cancellation
5.2.1 Definition
"OBSOLETE RAW MATERIALS" means raw materials in Supplier's inventory or
under Supplier's purchase orders that cannot be cancelled that were
purchased to support no more than the manufacturing lead-time of
Buyer's Purchase Orders and/or Demand Plan and for which the latest
Purchase Orders and/or Demand Plan shows no consumption in any Product
within the [*].
"OBSOLETE WIP" means work in process in Supplier's inventory that was
started in production workshop to support Buyer's Purchase Orders
and/or Demand Plan (WIP will not exceed the lowest of [*] or [*]) and
for which the latest Purchase Orders and/or Demand Plan shows no
consumption within the next [*].
"OBSOLETE FINISHED GOODS" means finished products in Supplier's
inventory that was completed to support Buyer's Purchase Orders and/or
Demand Plan (Finished Good inventory will not exceed the lowest of [*]
or [*]) and for which the latest Purchase Orders and/or Demand Plan
shows no consumption within the next [*].
5.2.2 Liability.
Supplier shall notify Buyer on a monthly basis of the existence of any
Obsolete Raw Materials, Obsolete WIP and Obsolete Finished Goods, and
shall provide Buyer with an invoice for the following amounts, which
invoice shall be paid within [*] after the date of the invoice:
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
33
1. Obsolete Raw Materials. [*].
2. Obsolete WIP. [*].
3. Obsolete Finished Goods. [*].
The liabilities set forth above shall be subject to Buyer's audit of
such costs.
Notwithstanding the foregoing, Buyer shall be liable for the purchase
price for Purchase Orders cancelled in less time than the cancellation
period.
5.3 Mitigation.
Supplier will use its commercially reasonable efforts to mitigate
Buyer's liability for Excess and Obsolete parts, including, without
limitation, canceling component orders, rescheduling component orders,
or selling components and using the components for other Supplier
products, when Supplier cannot sell, cancel or reschedule.
5.4 Long lead-time Components [*].
On a monthly basis, Supplier shall notify Buyer of components that
Supplier recommends should be purchased in excess of [*] of Buyer's
demand. Supplier shall not purchase such components without Buyer's
consent. If Buyer consents to such purchase, Buyer acknowledges that
Buyer may have liability for such components as either Excess Raw
Materials or Obsolete Raw Material. Supplier shall not be required to
fill orders for Products if such components are not available because
Buyer did not consent to the acquisition of such components by
Supplier.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
34
Exhibit C2, product in Option 2
EXHIBIT C2 CUSTOM PRODUCTS
PO MFG.
LEAD- LEAD- OF WHICH WIP
ALCATEL CODE A. OPTRONICS PN FAMILY DESCRIPTION TIME TIME LEAD-TIME COMMENT
---------------------------------------------------------------------------------------------------------------------------------
1AB144310001 3CN 00207FC A 0000 XXX [*] 2 [*] [*] [*]
1AB144310004 3CN 00207FT A 0000 XXX [*] 4 [*] [*]
1AB1417100X 3CN00643XX A 1905 LMI [*] 4 [*] [*]
1AB159410001 3CN00321AB A 1915 LMM [*] 4 [*] [*]
1AB1639400xx 3CN00410XX A 1905 LMI [*] 4 [*] [*]
1AB1700470 3CN00488XX A 1905 LMI [*] 6 [*] [*]
1AB1515900 3CN00490XX A 1905 LMI [*] 6 [*] [*]
1AB144310003 3CN00207BD A 0000 XXX [*] 6 [*] [*]
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
35
Exhibit C2, product in Option 2
EXHIBIT C2 CUSTOM PRODUCTS
PO MFG.
LEAD- LEAD- OF WHICH WIP
ALCATEL CODE A. OPTRONICS PN FAMILY DESCRIPTION TIME TIME LEAD-TIME COMMENT
----------------------------------------------------------------------------------------------------------------------------------
1AB071630007 3CN00431KW A 1915 LMI [*] 2 [*][ [*] [*]
1AB091410001 3CN00001AA A 1901 OFA [*] 2 [*] [*] [*]
1AB141790001 3CN00294AA A 1925 OFA [*] 2 [*] [*] [*]
1AB157320005 3CN 00336 DM A 1926 SDH [*] 2 [*] [*] [*]
1AB157320010 3CN00582AM A 1926 SDH [*] 2 [*] [*] [*]
1AB165030001 3CN 00000 XX A 1926 OFA [*] 2 [*] [*] [*]
1AB165030006 3CN00604AA A 1901 0AM [*] 2 [*] [*] [*]
1AB165030007 3CN00605AA A 1901 0AM [*] 2 [*] [*] [*]
1AB1714300xx 3CN 00624 XX A 1926 SDH [*] 2 [*] [*]
1AB091420001 3CN00001AB A 1901 OFA [*] 4 [*] [*]
1AB091420003 3CN00066AA A 1901 OFA [*] 4 [*] [*]
1AB091420004 3CN00077AA A 1901 OFA [*] 4 [*] [*]
1AB1390900X 3CN00149XX A 1916 LMM [*] 4 [*] [*]
1AB1391000X 3CN00397XX A 1916 LMM [*] 4 [*] [*]
1AB157300001 3CN 00328 AB A 1926 SDH [*] 4 [*] [*]
1AB157320003 3CN 00336 BB A 1926 SDH [*] 4 [*] [*]
1AB165030002 3CN00402AB A 1936 OFA [*] 4 [*] [*]
1AB165030005 3CN00365AA A 1926 OFA [*] 4 [*] [*]
1AB165570003 3CN00390AA A 1906 OFA [*] 4 [*] [*]
1AB165570004 3CN00389AA A 1906 OFA [*] 4 [*] [*]
1AB165570005 3CN00391AA A 1906 OFA [*] 4 [*] [*]
1AB1660900xx 3CN00505XX A 1901 RBF [*] 4 [*] [*]
155-2659-0xx FBG-xxxR95-S0.15-A01 A 1901 RBF [*] 4 [*] [*]
1AB174720001 3CN00465AA A 1907 OFA [*] 4 [*] [*]
1AB175880001 3CN00395AB A 1948 MPM [*] 4 [*] [*]
1AB18212000X 3CN00744XX A 1926 SDH [*] 4 [*] [*]
1AB186390001 3CN00392AA A 1907 OFA [*] 4 [*] [*]
999197619 3CN00638XX A 1965 SDH [*] 4 [*] [*]
999197742 3CN00593AA A 1901 0AM [*] 4 [*] [*]
999197743 3CN00594AA A 1901 0AM [*] 4 [*] [*]
1AB146670001 3CN00299KW A 1915 LMI [*] 4 [*] [*]
1AB157300002 3CN00328AM A 1926 SDH [*] 4 [*] [*]
999... 3CN00532AA A 1964 TRX [*] 4 [*] [*]
3AL79498XXXX 3CN00625XX A 1964 SDH [*] 4 [*] [*]
3AL79515AA 3CN00626AA A 1964 SDH [*] 4 [*] [*]
487166267 3CN00573AA A 1964 SDH [*] 4 [*] [*]
487166269 3CN00574AA A 1964 SDH [*] 4 [*] [*]
487166268 3CN00755AA A 1964 SDH [*] 4 [*] [*]
487156949 3CN00756AA A 1964 SDH [*] 4 [*] [*]
999197804 3CN00652AX A 1964 MRX [*] 4 [*] [*]
999... TBD A 1915 LMM [*] 4 [*] [*]
999197750 3CN00702AG A 1921 OAC [*] 4 [*] [*]
999197802 3CN00703AG A 1926 OAC [*] 4 [*] [*]
999... 3CN00704AG A 1926 OAC [*] 4 [*] [*]
1AB189320001-24 3CN00746AX A 1908 AWC [*] 4 [*] [*]
1AB189330001-12 3CN00747AX A 1910 AWC [*] 4 [*] [*]
1AB189350001-12 3CN00748AX A 1912 AWC [*] 4 [*] [*]
1AB146670004 3CN00299LW A 1915 LMI [*] 4 [*] [*]
1AB156030002 3CN00366AA A 1901 OFA [*] 6 [*] [*]
1AB156030001 3CN00363AA A 1901 OFA [*] 6 [*] [*]
1AB169210001 3CN00476AA A 1901 OFA [*] 6 [*] [*]
1AB186310001 3CN00670AB A 1901 OFA [*] 6 [*] [*]
1AB170480003 3CN00537AA A 1901 OFA [*] 6 [*] [*]
1AB162580003 3CN00352TB A 1948 FBG [*] 6 [*] [*]
29 CLS 0000 8AAC 3CN00067AA A 1948 PLM [*] 6 [*] [*]
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
36
EXHIBIT D
SPECIFIC CLAUSES FOR SUBMARINE COMPONENTS
I. CONTENTS.
I. Contents
II. Scope
1. Support
2. Access To Premises
3. Component Technical Data
4. Late Delivery
5. Warranty
6. Latent Defects
7. Survival of Obligations
8. Term and Termination
II. SCOPE
For Submarine Products, the following clauses shall take precedence over the
equivalent terms in the Frame Purchase Agreement.
1. SUPPORT.
1.1 Supplier shall provide support services, supplies and replacements for
the Products for the term of the Warranty (clause 5.1 below) and for a
period of [*] thereafter.
1.2 For as long as Buyer or its customers have use of the products,
Supplier will provide technical support and advice in respect of the
design of the Products, such services shall be provided subject to an
agreement based on reasonable commercial practices.
1.3 Supplier shall give written notice to Buyer if for any reason beyond
the term of Support (clause 1.1 above) it intends to cease
manufacturing or supplying identical or fully compatible Products. The
notice period shall not be less than [*], and Buyer may place an all
time last buy for any required Products during the [*] of the notice
period. Alternatively, Supplier will provide all drawings and data to
enable Buyer to source or manufacture the Products elsewhere.
2. ACCESS TO PREMISES.
2.1 Buyer and its customer(s) or subcontractor(s) shall be permitted to
enter Supplier's premises for a specifically stated purpose in
connection with this Agreement, at all reasonable times.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
37
2.2 Buyer and its customer(s) or subcontractor(s) shall be entitled to
inspect the Products during manufacture, processing, test and storage
and also to audit Supplier's design and manufacturing process and
procedures and quality control process and procedures at Supplier's
site manufacturing the Products, subject to the provisions of Access To
Premises (clause 2).
2.3 Such inspection or audit, or failure to inspect or audit shall not
constitute acceptance or rejection of the Products by Buyer I and does
not relieve either Party of any of its obligations hereunder.
2.4 Supplier shall ensure that its subcontractors include a provision to
permit Buyer and its customer(s) or subcontractor(s) to enter the
Supplier's subcontractors' premises on terms similar to Access To
Premises (clauses 2.1 and 2.2 above)
3. COMPONENT TECHNICAL DATA
Any data created in the course of a Life Test and/or Qualification programme
paid for by Buyer or any other activity paid for by Buyer, shall be the sole
property of Buyer. The use of such data will be subject of Confidentiality.
4. LATE DELIVERY
4.1 Delivery of the Products shall be in accordance with the agreed
delivery schedule or at least in accordance with lead-time subject to
the agreed capacity. Without prejudice to its other rights and remedies
hereunder, Buyer reserves the right to instruct Supplier to take any
practical action to remedy any delay in delivery.
4.2 Subject always to the terms of Force Majeure (as defined elsewhere in
this Agreement), in the event that any action or default by Supplier
causes any delay In the delivery of the Products, Buyer shall have the
right to:
4.2.1 [*]; and
4.2.2 Should the period of delay exceed [*] then Buyer shall have the
additional right to cancel the relevant Purchase Order or any part
thereof, at no cost or liability to Buyer.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
38
4.2.3 In the event of cancellation pursuant to Late Delivery (clause 4.2.2
above), Buyer shall have the right to obtain Products similar to the
Products from an Buyer alternative vendor, [*].
4.3 Any delay in Delivery, for which Buyer may apply such remedies detailed
in the Agreement, will be measured against the agreed delivery
schedule.
5 WARRANTY.
5.1 Supplier warrants to Buyer that for a period of [*] from the Delivery
date, the Products will conform to the Specification and be free from
defects in design, workmanship or materials. The foregoing warranty
shall be subject to the exclusions and limitations of liability set
forth in Section 8 of the Frame Purchase Agreement.
5.2 In the event that during the warranty period the Products fail to
conform to the warranty under Section 5.1, Supplier shall [*] returned
to Supplier in accordance with Supplier's RMA procedure. Following such
replacement, the warranty period (clause 5.1 above) with respect to
such Product shall be) the balance of the warranty period with respect
to such Product.
5.3 [*].
a) [*];
b) [*]; or
c) [*].
Pricing for the Products shall take into account [*].
5.4 Replacement Products, over and above those held in stock for warranty
replacements, shall be provided within the agreed lead- time for the
Products, subject to the agreed capacity. If such replacement is not
made within such period then Buyer may invoke Late Delivery (clause 4
above).
5.5 Supplier undertakes to retain and replenish such stock of Products
during the term of this Agreement. At the end of the warranty period
for the Products stated in Warranty (clause 5.1 above), [*].
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
39
6 LATENT DEFECTS.
6.1 For the duration of the warranty period (clause 5.1 above) and for a
period of [*] thereafter, Supplier will make all reasonable efforts to
assist Buyer [*] in studying and reviewing any failures that appear to
indicate the existence of a latent defect in the Products.
6.2 If such review indicates that more than [*] of the Products delivered
have failed or are likely to fail during the service life, on account
of the same failure mechanism, then Supplier undertakes to supply to
Buyer [*] replacement Products for the full quantity of the affected
Product lots delivered to Buyer, save those Products that the Supplier
can reasonably demonstrate within a lot, are not subject to such
failure mechanism; provided that, for those affected Products which
have been already installed by Buyer, another alternative may be agreed
upon between the Parties such as but not limited to a warranty
extension or an implementation by Supplier of an additional warranty
stock, unless the final customer of the Buyer requires replacement.
7 SURVIVAL OF OBLIGATIONS.
In Addition to section 21 of the Frame Agreement, the clauses with the
following Schedule D headings shall also survive termination of this
Agreement: Support, Component Technical Data, Warranty, Latent Defects.
8 TERM AND TERMINATION
Regarding submarine Products only the notice period of non-renewal
referred to in Section 17 of the Frame Agreement will be [*].
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
40
APPENDIX - SUBMARINE COMPONENTS
Note that terrestrial requirements are already included in the main file.
Submarine pumps and GFFs are currently obsolete, but the warranty, etc. still
applies. GFFs are unique by contract.
MATERIAL MATERIAL DESCRIPTION
---------------------------------------
29CFL00301xxx [*]
29CFL00301HAC [*]
29CFL00501HAA [*]
29CFL00501HAQ [*]
29CLS00009xxx [*]
29CLS00009ACA [*]
29CLS00009ACB [*]
29CLS00009ACC [*]
29CLS00009ACD [*]
29CLS00009ACE [*]
29CLS00009ACF [*]
29CLS00009ACG [*]
29CLS00009ADA [*]
29CLS00009ADB [*]
29CLS00009ADC [*]
29CLS00009ADD [*]
29CLS00009ADE [*]
29CLS00009ADF [*]
29CLS00009ADG [*]
29CLS00009BAA [*]
29CLS00009BAC [*]
29CLS00009BAD [*]
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
41
