3COM
VBN APPLICATION SERVICE PROVIDER
MASTER PURCHASE SALES AGREEMENT
for Destinations in the United States and Canada
between
3COM CORPORATION
and
MDU COMMUNICATIONS INTERNATIONAL, INC.
(CUSTOMER)
Effective Date: May 16, 2000
Contract #: C12096
LIST OF EXHIBITS
Exhibit Al - Volume Discount Schedule for
Destinations in the United States and
Canada
Exhibit A2 - Visitor Based Networking Price List
Exhibit B - U.S. Export/Re-Export Requirements
Exhibit C - Mutual Nondisclosure Agreement
Exhibit 0 - Business to Business Internet Commerce
Agreement
Exhibit E - Customer Qualification Questionnaire
Exhibit F - Participating Affiliates
i
3COM
VEN APPLICATION SERVICE PROVIDER
MASTER PURCHASE SALES AGREEMENT
This Agreement is made on May 15, 2000 ("Effective Date") between:
3Com Corporation ("3Com") and MDU Communications International, Inc.
0000 Xxxxxxxx Xxxxx 108-11951 Xxxxxxxxxxx Xxx
X.X. Xxx 00000
Xxxxx Xxxxx, XX 00000-0000 Xxxxxxxx, XX Xxxxxx X0X 0X0
(000) 000-0000 (000) 000-0000
FAX (000) 000-0000 (000) 000-0000
Attn: Sales Contract Administrator Attn: Xxxx X. Xxxxxxxxx
M/S 1404
3COM CORPORATION CUSTOMER: MDU COMMUNICATIONS
INTERNATIONAL, INC.
Signature: /s/ Xxxx Xxxxxx Signature: /s/ Xxxxxxx Xxxxxx
Printed Xxxx Xxxxxx Printed: Xxxxxxx Xxxxxx
Title SALES CONTROLLER Title: President & CEO
Date: 5/16/2000 Date: 5/16/2000
3COM VBN APPLICATION SERVICE PROVIDER
MASTER PURCHASE SALES AGREEMENT
INDEX
Signature Page
RECITALS
TERMS AND CONDITIONS
1 SCOPE
2 TERM
3 TERMINATION
3.1 TERMINATION FOR CONVENIENCE
3.2 TERMINATION FOR CAUSE
3.3 OBLIGATIONS UPON TERMINATION OR EXPIRATION
4 End-User Software License
5 Payment Terms and Review
6 Discounts
7 Discount Review
8 Security Interest and Reservation of Title
8.1 SECURITY INTEREST (FOR PRODUCTS DELIVERED WITHIN THE UNITED
STATES)
8.2 RESERVATION OF TITLE (FOR PRODUCTS DELIVERED OUTSIDE THE
UNITED STATES)
9 Price Changes
10 Standard Order Procedure
11 Change Orders and Cancellation
12 Booking Window and Rescheduling
13 Delivery
14 Taxes and Duties
15 Export Control Regulations
16 Warranties
16.1 HARDWARE WARRANTY
16.2 SOFTWARE WARRANTY
16.3 YEAR 2000 WARRANTY
16.4 OBTAINING WARRANTY SERVICE
16.5 WARRANTIES EXCLUSIVE
17 Non-Warranty Repair Service
18 Patent and Copyright Indemnity
19 Limitation of Liability
20 Product Changes
21 Confidentiality and Publicity
22 General
22.1 PARTICIPATION BY AFFILIATES
22.2 ENTIRE AGREEMENT
22.3 FORCE MAJEURE
22.4 NOTICES
22.5 WAIVER
22.6 SEVERABILITY
22.7 ASSIGNMENT
22.8 PHOTOCOPY OF ORIGINAL
22.9 DISPUTE RESOLUTION
22.10 GOVERNING LAW
22.11 ATTORNEY'S FEES
22.12 CHOICE OF LANGUAGE
22.13 UNITED STATES GOVERNMENT END USERS
23 Leasing
3COM VBN APPLICATION SERVICE PROVIDER
MASTER PURCHASE SALES AGREEMENT
RECITALS
A. 3Com develops, manufactures, and sells or licenses certain
hardware and software products under the 3Com(R) trademark, as described in
its Buyer's Guide, available on the 3Com web site at
xxxx://xxx.0xxx.xxx/xxxxxxxx/xxxxx.xxxx. Products available for sale or
licensing to Customer are designated in the current applicable Price List,
available on the 3Com Web site xxxx://xx.0xxx.xxx (password information to be
provided by 3Com after execution of this Agreement) and incorporated herein
by reference. The Products must be purchased for Customer's Infrastructure
(purchase for providing services to Customer's subscribers and customers).
B. By this Agreement the parties have set forth the following
conditions under which Customer will purchase from 3Com.
The following terms shall have a defined meaning as used in this
Agreement:
"Customer" means the entity named on page (ii) who, for the purposes
of this Agreement, is a purchaser or licensee of computer products who
acquires such products for its own internal use rather than for distribution
or resale. "Customer" includes the Affiliates of Customer, as defined in
Subsection 22.1 - Participation by Affiliates, below.
"Hardware" means those networking Products and similar equipment and
also including options, accessories and attachments to such Products and
equipment, as described in the 3Com Price List. Hardware includes as a
component thereof any media fixedly embedded therein such that it is not
normally replaced except for maintenance and repair. Hardware may include in
its meaning, depending upon context, a system or systems consisting of
tangible equipment and Software.
"3Com" means 3Com Corporation, a Delaware corporation with its
principal place of business located at the address shown on page ii.
"Products" includes both Hardware and Software, unless a particular
usage indicates otherwise.
"Software" means those Products described in the 3Com Price List
that are computer programs in object code form.
"Spares" means individual spare parts and spares kits used to repair
Products. Spares may be new or refurbished.
TERMS AND CONDITIONS
The parties agree as follows:
1 SCOPE
3Com will accept electronic purchase orders from Customer for
Products listed in 3Com's current applicable Price List under the terms of
this Agreement, for shipment by 3Com from the United States, or as otherwise
agreed, to destinations in the United States or Canada. If Customer also
requires that orders be shipped to countries in Latin America; from 3Com's
European Customer Account Management (ECAM) department in the United Kingdom
to locations in Europe, the Middle East, and Africa; or from 3Com's Asian
Customer Account
1
Management (ACAM) department in Singapore to locations in Asia and the
Pacific Rim, then the multi-region version of this Agreement must be executed.
Customer's purchases of 3Com Products either directly from 3Com, its
authorized resellers, or its authorized distributor's value-added resellers
(collectively referred to as "resellers") will be counted toward Customer's
volume commitment, provided Customer substantiates all purchases through
resellers, as described in Section 7 - Discount Review, below. This Agreement
does not set the prices or discounts at which Customer may purchase Products
from a reseller.
This Agreement does not cover, and 3Com will not accept purchase
orders under this Agreement for, products of Palm, Inc., a subsidiary of 3Com.
2 TERM
This Agreement shall become effective on Effective Date and shall
continue for a period of one (1) year, and will automatically be extended for
additional one-year terms thereafter unless one party gives at least thirty
(30) days notice to the other party prior to the expiration of the current
term of its intention that the Agreement expire at the end of its current
term. The discount matrix shown on Exhibit A1, attached hereto and
incorporated herein by reference, is subject to change at each annual
anniversary of this Agreement. If 3Com chooses to change the discount matrix,
3Com will provide written notice to Customer at least forty-five (45) days
prior to an annual anniversary. If Customer objects in writing to the new
discount matrix prior to the anniversary, this Agreement will terminate on
the upcoming anniversary. Otherwise, the new discount matrix will become
effective on the anniversary and remain in effect until changed at a
subsequent anniversary using the same procedure.
The volume discounts set forth in Exhibit A1 - Volume Discount
Schedule for Destinations in the United States and Canada - apply to all
Products included in 3Com's Price List for the United States and Canada,
except for those listed in Exhibit A2 - Visitor Based Networking Price list -
which supersede the Volume Discounts for the designated time period. If the
Products in Exhibit A2 expire, the Volume Discounts in Exhibit A1 then apply.
After the initial term, if 3Com wishes to change any provisions of
this Agreement to conform to its then-current practices, 3Com shall give
Customer notice at least forty-five (45) days prior to an annual anniversary.
If Customer objects in writing to the changed provisions, this Agreement will
terminate on the upcoming anniversary, unless the parties are still engaging
in good faith negotiations regarding any changed provisions, in which case
the Agreement will be automatically extended for up to ninety (90) days or
until the parties reach agreement or determine that agreement is
unattainable. If Customer does not object, the new provisions will become
effective on the anniversary and remain in effect until changed at a
subsequent anniversary using the same procedure.
3 TERMINATION
3.1 TERMINATION FOR CONVENIENCE. Either party may terminate this
Agreement, at will, at any time, with or without cause, by written notice to
the other given not less than sixty (60) days prior to the effective date of
such notice. In no event shall either party be liable for termination of this
Agreement pursuant to this Subsection.
3.2 TERMINATION FOR CAUSE. Either party shall have the right to
terminate this Agreement for cause if the other party:
(a) fails to perform any material term or condition of this
Agreement, and does not remedy the failure within thirty (30) days after
receipt of written notice of such default given by the non-defaulting party;
or
(b) becomes insolvent, files or has filed against it a petition
under applicable bankruptcy or insolvency laws which is not dismissed within
ninety (90) days, proposes any dissolution, composition or financial
reorganization with creditors, makes an assignment for the benefit of
creditors, or if a receiver, trustee, custodian or similar agent is appointed
or takes possession with respect to any property or business of the
defaulting party.
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3.3 OBLIGATIONS UPON TERMINATION OR EXPIRATION. The termination or
expiration of this Agreement shall in no way relieve either party from its
obligations to pay the other party any sums accrued hereunder prior to such
termination or expiration or affect the limitation of liability. The
obligations identified in the United States Government End Users and Export
Control Regulations clauses shall survive indefinitely. Other obligations
which shall survive for a period of five (5) years from the termination or
expiration of this Agreement include: security interest and reservation of
title; taxes and duties; and patent and copyright indemnity provisions set
forth herein. All warranties and confidentiality provisions shall remain in
effect for their stated duration.
4 END-USER SOFTWARE LICENSE AGREEMENT
Software is subject to an End-User License Agreement. If there is
any inconsistency between this Agreement and the End User License Agreement,
this Agreement will prevail. By its terms, such End-User License Agreement
prohibits unauthorized copying. Customer agrees to abide by the terms of the
License Agreement.
5 PAYMENT TERMS AND REVIEW
Standard payment terms are net thirty (30) days after issuance of
the invoice. The invoice is issued upon shipment. Customer must give 3Com
written notice of any discrepancies among the purchase order, the invoice,
and the Products received, within thirty (30) days after receipt of the
Products or the invoice, whichever occurs later. If there is any dispute as
to a part of a shipment, Customer will pay for the undisputed part of that
shipment. 3Com reserves the right to charge Customer interest on any
delinquent balance. This interest is computed on a daily basis for each day
that the payment is delinquent, at the lesser of eighteen percent (18%) per
year or the maximum rate permitted by law. 3Com reserves the right to refuse
shipment to Customer if Customer is delinquent in making payments to 3Com.
All payments to 3Com shall be in U.S. dollars, free of any restrictions and
less any Withholding Tax (defined in Section 14, Taxes and Duties, below).
Credit limits and payment terms decisions are made, at 3Com's sole
discretion, by an analysis of Customer's current and historical financial
information, bank references, trade references, payment practices, etc.
Customer must provide current financial information to 3Com on an annual
basis, or more frequently if so requested. In the event an adequate credit
limit cannot be granted or until initial credit approval is given, deliveries
will be made only on a cash-in-advance or irrevocable letter of credit basis.
In the event Customer's average days to pay is in excess of
contracted payment terms, Customer will be provided with a written warning of
3Com's intent to adjust Customer's discount thirty (30) days from Customer's
receipt of the warning letter if payment practices do not immediately conform
to the contracted payment terms. In the event Customer continues to pay late
in spite of the warning, Customer's discount structure will be reduced by
one-half (1/2) point for each fifteen (15) days by which the average days to
pay is later than the current contracted payment terms. In no event will
authorized payment terms exceed net sixty (60) days. Conversely, consistent
with 3Com's discount structure being related to payment practices Customer's
discount structure will be increased by one-half (1/2) point for each fifteen
(is) day period reduction from current contracted payment terms that Customer
agrees to. Such discount changes will apply to all orders received following
notice of such change. Payment terms are not changed for individual purchase
orders.
6 DISCOUNTS
The list prices for the Products, as set forth from time to time in
3Com's applicable Price List, are used in computation of prices charged to
Customer by 3Com. The volume discounts set forth in Exhibit A1 - Volume
Discount Schedule for Destinations in the United States and Canada - apply to
all Products included in 3Com's Price List for the United States and Canada,
except for those listed in Exhibit A2 - Visitor Based Networking Price list -
which supersede the Volume Discounts for the designated time period. If the
Products in Exhibit A2 expire, the Volume Discounts in Exhibit Al then apply.
3Com shall have the right, in its sole discretion, to add or delete
Non-Discountable Products from, and to change discount categories in, the
then-current applicable Price List, upon giving at least thirty (30) days
written notice.
3
7 DISCOUNT REVIEW
Every six (6) months 3Com will monitor and adjust Customer's
discount level in accordance with the volume purchase commitment associated
with the discount levels as shown in the applicable Volume Discount Schedule.
Customer must request that one hundred percent (100%) of the volume purchase
commitment be shipped by the end of the first year of this Agreement. During
each subsequent year of this Agreement, Customer must request that forty-five
percent (45%) of the annual volume purchase commitment be shipped during the
first six months, and one hundred percent (100%) by the end of the year. 3Com
will not require Customer to purchase Products it does not want, and will not
charge Customer for Products that were not purchased. In order to aggregate
reseller sales toward Customer's volume commitment, Customer must provide
proof of all such purchases by submitting a photocopy of the resellers'
invoices, not later than five (5) business days before the six (6) and twelve
(12) month anniversary dates of this Agreement. Upon request, 3Com will
provide Customer with information pertaining to orders issued to date and
Customer's discount status. In the event Customer fails to meet or exceeds
the volume purchase commitment specified in the applicable Volume Discount
Schedule, 3Com will adjust the discounts to conform to the actual volume
purchase level.
Discount levels (based upon volume purchased) will be adjusted only
at the end of the sixth, twelfth, eighteenth months, and every six months
thereafter, to become effective for purchase orders received after the
discount change.
8 SECURITY INTEREST AND RESERVATION OF TITLE
8.1 SECURITY INTEREST (FOR PRODUCTS DELIVERED WITHIN THE UNITED
STATES). Customer hereby grants to 3Com a purchase money security interest
covering each shipment of Products made hereunder (and any proceeds thereof)
in the amount of 3Com's invoice for such shipment until payment in full is
received by 3Com. (A purchase money security interest only applies to the
3Com Products purchased by Customer and the proceeds from the sale of such
Products by Customer.) Customer agrees to sign and execute any and all
documents as required by 3Com to perfect such security interest.
8.2 RESERVATION OF TITLE (FOR PRODUCTS DELIVERED OUTSIDE THE
UNITED STATES). Subject to Section 23, "Leasing," if applicable, in order to
ensure that 3Com is paid for all Products sold or licensed to Customer, 3Com
reserves title in the Products until Customer pays 3Com in full for the
Products, at which time title in the Products shall pass to Customer (except
that in the case of Software, only title to the media shall pass).
9 PRICE CHANGES
3Com may increase the prices of Products set forth in its Price List
by written notice to Customer not less than thirty (30) days prior to the
effective date of such increase. The "effective date" is the date of
announcement of the new price to the general public. Orders issued by
Customer prior to the effective date will be invoiced at the prior lower
price provided the shipments are scheduled to ship within sixty (60) days of
the effective date. All orders issued after the effective date, or those in
the backlog which are scheduled to ship sixty (60) days or more after the
effective date shall be subject to the price increase.
3Com may decrease the prices of Products set forth in its Price List
by written notice to Customer at any time. A price decrease will apply to all
Customer orders in the 3Com backlog on the notification date of such
decrease, and to all orders issued after the notification date.
10 STANDARD ORDER PROCEDURE
Customer must place orders for Products by submitting Purchase
Orders electronically to 3Com, according to and only after executing the
Business Internet Commerce Agreement, attached as Exhibit D. The Purchase
Order must reference this Agreement and state the 3Com Product number,
quantity, applicable price, requested delivery date, xxxx to and ship to
addresses, special shipping instructions (if any), partial/no partials
allowed and any special order handling instructions. There is a two hundred
fifty dollar ($250) minimum order amount, except in the case of Spares.
Delivery date requested must be no less than five (5) business days after
3Com's receipt of the purchase order. Orders shall be subject to written
acceptance by 3Com and
4
delivery schedules established in accordance with Product availability and
Customer's credit status. 3Com will make reasonable efforts to expedite
delivery of an "ASAP order" subject to Product availability, but is not
obligated to make such delivery on an expedited basis. Any additional charges
incurred due to expediting will be borne by Customer.
Although Customer may use its standard purchase order and other
forms, and 3Com may use its standard order acknowledgement and invoice and
other forms, the terms and conditions of this Agreement will prevail over
Customer's and 3Com's forms and any inconsistent, conflicting or different
terms in such form will be of no effect.
Purchase Orders for Products should be submitted to one of the
following locations. Ordering locations may be changed from time to time.
Customer should check with its 3Com Sales Representative to ensure orders are
sent to the correct location.
(for customers located in the North Central Region)
3Com Corporation.
Attn: Order Management
0000 Xxxx Xxxx
Xxxxxxx Xxxxxxx, Xxxxxxxx 00000
X.X.X.
FAX: (000)000-0000
TOLL-FREE PHONE: (000) 0XXXXXX {(000) 000-0000)
(for customers located in the Texas and the Western regions)
3Com Corporation
Attn: Order Management
X.X. Xxx 00000
Xxxxx Xxxxx, Xxxxxxxxxx 00000-0000
X.X.X.
FAX: (000) 000-0000
TOLL-FREE PHONE: (000) 0XXXXXX {(000) 000-0000)
(for customers located in the Northeastern, South Central, Federal and
Canada regions)
3Com Corporation
Attn: Order Management
0Xxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
X.X.X.
FAX: (000) 000-0000
TOLL-FREE PHONE: (000) 0XXXXXX {(000) 000-0000}
11 CHANGE ORDERS AND CANCELLATION
Any and all changes to Customer's purchase orders must be provided
by either facsimile or e-mail notice (not by EDI), whichever method was used
for submitting the original purchase order. If the original purchase order
was submitted by EDI, the change order must be submitted by facsimile or
e-mail. Any change order increasing the purchase will be accepted by 3Com if
it can satisfy the additional requirement from available capacity and the
dollars added are within the authorized credit limit.
If Customer cancels any portion or all of an order, it shall be
assessed a charge equal to a percentage of the net price of the cancelled
Products, according to the following schedule:
Cancellation notice received prior to earlier of scheduled or actual
shipment date
Cancellation Charge
Standard Products Configured Products
60 days or more No charge No charge
59-30 days No charge 5%
29-6 days No charge 10%
5 days or less 5% 15%
5
"Standard Product" shall mean Product which is listed in the Scorn
Price List and sold off-the-shelf with no additional work done to the Product
prior to shipment.
"Configured Product" shall mean Product which is either (i) Standard
Product into which other Standard Products have been loaded/inserted or (ii)
Standard Product that is set up for operation prior to being shipped to
Customer.
If 3Com is unable to meet the delivery schedule, it shall provide
notice as soon as it is reasonably aware of the situation. If 3Com fails to
ship on scheduled ship date, Customer may reschedule or cancel at no charge.
No Product may be returned except under warranty or for repair or
due to shipment error by 3Com.
12 BOOKING WINDOW AND RESCHEDULING
The standard booking window is sixty (60) days from the date of
order acknowledgement. This may be extended to one hundred twenty (120) days
with the prior approval in writing from 3Com's Regional Sales Manager, and
beyond one hundred twenty (120) days with the prior written approval of the
Distribution Services Group Director or if required due to product
unavailability. The number of reschedules permitted within the booking window
is unlimited. A shipment requested to be delayed beyond the booking window
will be cancelled and the cancellation charge will be assessed.
13 DELIVERY
Subject to Section 23, "Leasing," if applicable, Products will be
shipped Free Carrier (FCA) (Incoterms 2000), 3Com's shipping dock, freight
collect (i.e., prepaid by Customer or charged to Customer's account with the
carrier). Title and risk of loss shall pass to Customer upon delivery to the
first common carrier, except that shipments to destinations outside of the
United States are subject to Subsection 8.2 - Reservation of Title, above.
Customer xxxx pay all costs relating to transportation, delivery, duties and
insurance. Customer will be responsible for filing claims relating to any
lost or damaged goods.
14 TAXES AND DUTIES
Customer is responsible for all taxes imposed in connection with the
sale to Customer of 3Com Products or services or which 3Com may incur in
respect of this Agreement (except taxes imposed on 3Com's income) including,
without limitation, all sales, value-added, gross receipts, excise, or other
taxes of any nature, and any penalties, interest, and collection or
withholding costs associated with any of the foregoing items. Alt such
amounts are in addition to other amounts payable hereunder and this
obligation shall survive termination or expiration of this Agreement
If applicable law requires Customer to withhold any income taxes
levied by the authorities of Canada on payments to be made pursuant to this
Agreement ("Withholding Tax"), Customer shall take advantage of the reduced
Withholding Tax provided for by the Canada-United States tax treaty then in
force and shall be entitled to deduct such Withholding Tax from the payments
due to 3Com hereunder. Customer shall promptly effect payment of the
Withholding Tax to the appropriate tax authorities and shall transmit to 3Com
within thirty (30) business days of such payment official tax receipts or
other evidence issued by the appropriate tax authorities sufficient to enable
3Com to support a claim for income tax credits in the United States Customer
further agrees to assist 3Com, upon request, if 3Com contests, by appropriate
legal or administrative proceedings, the validity or amount of the
Withholding Tax. In the event 3Com does not receive official tax receipts or
other evidence within thirty (30) days, 3Com shall have the right to invoice
Customer for such Withholding Tax and Customer agrees to pay such amounts
upon receipt of the invoice.
For shipments within the United States, Customer may provide 3Com
with a tax exemption certificate acceptable to the taxing authorities in lieu
of paying such taxes: however,
6
Customer shall reimburse 3Com for any fines, penalties, taxes, and other
charges assessed by the taxing authorities, as well as 3Com's reasonable
expenses due to Customer's submission of invalid information.
On orders shipped outside the United States, Customer shall be the
importer of record and is responsible for obtaining import licenses, paying
import license or permit fees, duties and customs fees and any other
governmental or import taxes or fees, and preparing and submitting all
required documentation in connection with importing the 3Com Products.
15 EXPORT CONTROL REGULATIONS
Customer will not export or re-export the Products (including their
accompanying documentation or any copies thereof) purchased under this
Agreement in violation of any applicable laws or regulations of the United
States or in the country in which Customer obtained them. Customer agrees to
comply with the U.S. Export/Re-Export Requirements set forth in Exhibit B,
attached hereto and incorporated herein by reference. The list of countries
in Exhibit B is accurate as of May, 1999. Such list is subject to change by
the U.S. Government, and it shalt be considered updated to be consistent with
then-current U.S. law. Additional information about Customer may be required
before encrypted Products may be purchased. The purchase will be allowed only
if it is in full compliance with U.S. law. 3Com may require Customer to fill
out and execute additional export control documents.
3Com agrees to use commercially reasonable steps to obtain, at
3Com's expense, all documentation required by the United States Export
Administration Regulations and/or other authorities to permit the exportation
of Products (including their accompanying documentation or any copies
thereof) to Customer. Customer agrees to obtain and provide International
Import Certificates and/or other support documentation required by 3Com in
order to apply for U.S. export licenses. Customer agrees to furnish 3Com with
all necessary information needed for the export licensing process in a timely
manner. 3Com shall have no liability or obligation to Customer if the
responsible government authorities decline to issue any such export licenses
or if such licenses are not issued in a timely manner. ALL ORDERS ISSUED
PURSUANT TO THIS AGREEMENT ARE SUBJECT TO THE OBTAINING OF SAID LICENSES.
If Customer chooses to use a freight forwarder or agent, other than
a 3Com preferred freight forwarder, to export Products (including their
accompanying documentation or any copies thereof) from the United States,
Customer or its properly authorized agent or forwarder must hold a properly
executed power of attorney to prepare and sign Shipper's Export Declarations
as exporter of record from the United States.
Customer must fill out, sign and return to the 3Com Trade and
Compliance department, the Customer Qualification Questionnaire in Exhibit E,
attached and incorporated by reference, prior to any product being exported.
16 WARRANTIES
16.1. HARDWARE WARRANTY. 3Com warrants to Customer that all Hardware
sold by 3Com to Customer under the terms of this Agreement will be free from
defects in workmanship and materials under normal use and service for the
following lengths of time from the date of purchase:
Network Interface Cards Lifetime of Network Interface Card
Most Hardware One Year*
* unless a longer warranty is indicated in the limited warranty accompanying the
Hardware Product. Accessories may have a shorter warranty.
Spare parts and spares kits 90 days
7
3Com's sole obligation under this express warranty shall be, at 3Com's option
and expense, to repair the defective Product or part, deliver to Customer an
equivalent Product or part to replace the defective item, or if neither of
the two foregoing options is reasonably available, 3Com may, in its sole
discretion, refund to Customer the purchase price paid for the defective
Product. All Products that are replaced will become the property of 3Com.
Replacement Products or parts may be new or reconditioned. 3Com warrants any
replaced or repaired Product or part for ninety (90) days from shipment or
the remainder of the initial warranty period, whichever is longer.
16.2. SOFTWARE WARRANTY 3Com warrants to Customer that each Software
program licensed from it, except as noted below, will perform in substantial
conformance to its program specifications for a period of ninety (90) days.
3Corn warrants the media containing Software against failure during the
warranty period. The warranty commences on the date of purchase. No updates
are provided under this Agreement unless specifically stated as an included
service in the warranty in the user guide accompanying the Software at the
time of delivery. 3Com's sole obligation with respect to this express
warranty shall be (in 3Com's discretion) to refund the purchase price paid by
Customer for any defective Software, or to replace any defective media with
Software which substantially conforms to applicable 3Com published
specifications. Customer assumes responsibility for the selection of the
appropriate applications program and associated reference materials. 3Com
makes no warranty or representation that its Software will meet Customer's
requirements or work in combination with any hardware or applications
software products provided by third parties, that the operation of the
Software will be uninterrupted or error-free, or that all defects in the
Software will be corrected. For any third party products listed in the 3Com
Software documentation or specifications as being compatible, 3Com will make
reasonable efforts to provide compatibility, except where the
non-compatibility is caused by a "bug" or defect in the third party's product
or from use of the Software not in accordance with 3Com's published
specifications or user manual.
THIS 3COM SOFTWARE PRODUCT MAY INCLUDE OR BE BUNDLED WITH THIRD
PARTY SOFTWARE, THE USE OF WHICH IS GOVERNED BY A SEPARATE END USER LICENSE
AGREEMENT. THIS 3COM WARRANTY DOES NOT APPLY TO SUCH THIRD PARTY SOFTWARE.
FOR THE APPLICABLE WARRANTY, PLEASE REFER TO THE END USER LICENSE AGREEMENT
GOVERNING THE USE OF SUCH SOFTWARE.
16.3 YEAR 0000 XXXXXXXX In addition to the Hardware Warranty and
Software Warranty identified above, 3Com warrants that each Product sold or
licensed to Customer that is date sensitive will continue performing properly
with regard to such date data on and after January 1, 2000, provided that all
other products used by Customer in connection or combination with the 3Com
Products, including hardware, software, and firmware, accurately exchange
date data with the 3Com Product with the exception of those Products
identified at 3Com's Web site, xxxx://xxx.0xxx.xxx/xxxxxxxx/xx000.xxxx, as
not meeting that standard. If it appears that Product that is stated to meet
this standard does not perform properly with regard to such date data on and
after January 1, 2000, and Customer notifies 3Com before ninety (90) days
after shipment of the Product by 3Com, 3Com shall, at its option and expense,
provide a Software update which would effect the proper performance of such
Product, repair such Product, deliver to Customer an equivalent Product to
replace such Product, or if none of the foregoing is feasible, refund to
Customer the purchase price paid for such Pro duct Any Software update and
replaced or repaired Product will carry a Year 0000 Xxxxxxxx for ninety (90)
days.
16.4 OBTAINING WARRANTY SERVICE. Customer must contact the 3Com
Corporate Service Center or an Authorized 3Com Service Center promptly within
the applicable warranty period to obtain warranty service authorization.
Dated proof of purchase may be required. Products returned to 3Com's
Corporate Service Center must be pre-authorized by 3Com with a User Service
Order (USO) number (or a Return Material Authorization (RMA) number or a
Service Repair Order (SRO) number, whichever was issued) marked on the
outside of the package, and sent prepaid and packaged appropriately for safe
shipment, and it is recommended that they be insured or sent by a method that
provides for tracking of the package. Responsibility for loss or damage does
not transfer to 3Com until the returned item is received by 3Com. The
repaired or replaced item will be shipped to Customer, at 3Com's expense, not
later than thirty (30) days after 3Com receives the defective Product, except
that batch returns of more than thirty (30) units may be subject to a
turnaround time greater than thirty (50) days. Quicker turnaround time can be
obtained by purchasing a 3Com service agreement and 3Com will retain risk of
loss or damage until the item is delivered to Customer.
8
3Com shall not be responsible for any software, firmware,
information, or memory data of Customer contained in, stored on, or
integrated with any products returned to 3Com for repair, whether under
warranty or not.
In the event a Product completely fails to function or exhibits a
defect in materials and workmanship within the first forty-eight (48) hours
of installation but no later than thirty (30) days after the date of
purchase, and this is verified by 3Com, it will be considered dead- or
defective-on-arrival (IDOA) and a replacement shall be provided prior to 3Com
receiving the defective Product, but only if Customer provides a purchase
order number, credit card number, or other method of payment acceptable to
3Com, to be used if 3Com needs to charge Customer for the replacement, as
explained below. The replacement Product will normally be shipped not later
than three (3) business days after 3Com's verification of the DOA Product,
but may be delayed due to export or import procedures. The shipment of a
replacement product prior to 3Com receiving the defective Product is subject
to local legal requirements and may not be available in all locations. When
such a replacement is provided and Customer fails to return the defective
Product to 3Com within fifteen (15) days after shipment of the replacement,
3Com will charge Customer for the replacement Product, at list price.
16.5 WARRANTIES EXCLUSIVE. IF A 3COM PRODUCT DOES NOT OPERATE AS
WARRANTED ABOVE, CUSTOMER'S SOLE REMEDY FOR BREACH OF THAT WARRANTY SHALL BE
REPAIR, REPLACEMENT, OR REFUND OF THE PURCHASE PRICE PAID, AT 3COM'S OPTION.
TO THE FULL EXTENT ALLOWED BY LAW, THE FOREGOING WARRANTIES AND REMEDIES ARE
EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES, TERMS, OR CONDITIONS,
EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTORY OR
OTHERWISE, INCLUDING WARRANTIES, TERMS, OR CONDITIONS OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, AND SATISFACTORY QUALITY AND CORRESPONDENCE
WITH DESCRIPTION, ALL OF WHICH ARE EXPRESSLY DISCLAIMED. 3COM'S WARRANTIES
CONTAINED HEREIN RUN ONLY TO CUSTOMER, AND ARE NOT EXTENDED TO ANY THIRD
PARTIES. SCOM NEITHER ASSUMES NOR AUTHORIZES ANY OTHER PERSON TO ASSUME FOR
IT ANY OTHER LIABILITY IN CONNECTION WITH THE SALE, INSTALLATION, MAINTENANCE
OR USE OF ITS PRODUCTS.
3COM SHALL NOT BE LIABLE UNDER THIS WARRANTY IF ITS TESTING AND
EXAMINATION DISCLOSE THAT THE ALLEGED DEFECT IN THE PRODUCT DOES NOT EXIST OR
WAS CAUSED BY CUSTOMER'S OR ANY THIRD PERSON'S MISUSE, NEGLECT, IMPROPER
INSTALLATION OR TESTING, UNAUTHORIZED ~EMPTS TO OPEN, REPAIR OR MODIFY THE
PRODUCT, OR ANY OTHER CAUSE BEYOND THE RANGE OF THE INTENDED USE, OR BY
ACCIDENT, FIRE, LIGHTNING, OTHER HAZARDS, POWER CUTS OR OUTAGES, OR ACTS OF
GOD.
17 NON-WARRANTY REPAIR SERVICE
Non-warranty repair services for Hardware will be provided at a 3Com
designated facility for a fixed price. When a Product is obsoleted, 3Com will
issue an obsolescence notice that will state the period of time that repair
seNice will continue to be available. Spare parts are normally available for
two (2) years after obsolescence, and repairs are normally available for five
(5) years after obsolescence.
18 PATENT AND COPYRIGHT INDEMNITY
3Com shall, at its own expense, defend or settle any suit or
proceeding that is instituted against Customer to the extent such suit or
proceeding alleges that any Product sold by 3Com hereunder infringes any duly
issued patent or copyright of the United States, and shall pay all damages
awarded therein against Customer or agreed upon in settlement by 3Com;
provided that Customer (i) gives 3Com immediate notice in writing of any such
suit, proceeding or threat thereof', (ii) permits 3Com sole control, through
counsel of 3Com's choice, to answer the charge of infringement and defend
and~or settle such suit; and (iii) gives 3Com all the needed information,
assistance and authority, at 3Com's expense, to enable 3Com to defend or
settle such suit.
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The above provision shall not apply to, and 3Com shall have no
liability or obligation for, any infringement arising from the following: (i)
any modification, servicing or addition made to the Product by anyone other
than 3Com; (ii) the use of such a Product as a pan of or in combination with
any devices, parts or software not provided by 3Com; (iii) compliance with
Customer's design requirements or specifications; (iv) the use of other than
a current unaltered release of the Software available from 3Com; or (v) the
use of such Product to practice any method or process which does not occur
wholly within the Product. This exclusion applies to the extent that the
infringement would have been avoided but for such modification, combination,
compliance with specifications, use of other than the current release, or
practice of such method or process.
In the event the use of any Product purchased from 3Com be enjoined,
or in the event 3Com wishes to minimize its potential liability hereunder,
3Com may, at its sole option and expense: (i) procure for Customer the right
to use such Product; (ii) substitute a functionally equivalent,
non-infringing unit of the Product; (iii) modify such Product so that it no
longer infringes but remains functionally equivalent; or (iv) if none of the
foregoing are commercially feasible, take back such Product and refund the
purchase price paid by Customer for such Product, depreciated over a five (5)
year period using the straight line method. 3Com shall in no event be
obligated to accept new orders for Products which are subject to a claim of
infringement covered under this Section.
THIS SECTION STATES 3COM'S TOTAL RESPONSIBILITY AND LIABILITY, AND
CUSTOMER'S SOLE REMEDY, FOR ANY ACTUAL OR ALLEGED INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHT BY ANY PRODUCTS DELIVERED HEREUNDER OR ANY PART
THEREOF AND IS IN LIEU OF AND REPLACES ANY AND ALL OTHER EXPRESS, IMPLIED OR
STATUTORY WARRANTIES REGARDING INFRINGEMENT.
19 LIMITATION OF LIABILITY
TO THE FULL EXTENT ALLOWED BY LAW THE PARTIES EXCLUDE ANY LIABILITY,
WHETHER BASED IN CONTRACT OR TORT (INCLUDING NEGLIGENCE), FOR INCIDENTAL,
CONSEQUENTIAL, INDIRECT, SPECIAL OR PUNITIVE DAMAGES OF ANY KIND, OR FOR LOSS
OF REVENUE OR PROFITS, LOSS OF BUSINESS, LOSS OF INFORMATION OR DATA, OR
OTHER FINANCIAL LOSS ARISING OUT OF OR IN CONNECTION WITH THE SALE,
INSTALLATION, USE, PERFORMANCE, FAILURE OR INTERRUPTION OF THE PRODUCTS
PURCHASED OR LICENSED UNDER THIS AGREEMENT. THE EXCLUSIONS STATED IN THIS
PARAGRAPH ALSO APPLY TO SCOM'S SUPPLIERS.
NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, THE MAXIMUM
LIABILITY OF EITHER PARTY HEREUNDER SHALL NOT EXCEED THE PURCHASE PRICE OF
THE PRODUCTS PURCHASED DURING THE TERM OF THIS AGREEMENT. IN THE CASE OF
CUSTOMER'S LIABILITY TO 3COM, THE FOREGOING AMOUNT SHALL BE IN ADDITION TO
THE PAYMENTS DUE BY CUSTOMER TO 3COM FOR PRODUCTS PURCHASED HEREUNDER.
THE DISCLAIMER OF LIABILITY WILL NOT BE AFFECTED IF ANY REMEDY
PROVIDED HEREIN SHALL FAIL OF ITS ESSENTIAL PURPOSE. CUSTOMER HAS ACCEPTED
THE DISCLAIMER OF LIABILITY AS PART OF A BARGAIN TO LOWER THE PRICE OF THE
GOODS AND UNDERSTANDS THAT THE PRICE OF THE GOODS WOULD BE HIGHER IF 3COM
WERE REQUIRED TO BEAR ADDITIONAL LIABILITY.
20 PRODUCT CHANGES
3Com reserves the right to change, improve or add any new Product at
any time. 3Com shall provide written notice of any major changes to Products
purchased under this Agreement that affect form, fit or function prior to
their implementation.
21 CONFIDENTIALITY AND PUBLICITY
During the course of this Agreement, each party may disclose to the
other certain proprietary or confidential information which shall be received
in confidence and not revealed to third parties or applied to uses other than
recipient's performance of its obligations hereunder, as specified in greater
detail in Exhibit C - Mutual Nondisclosure Agreement, anached hereto unless
10
previously executed. The term of any previously executed nondisclosure
agreement is hereby extended to be coterminous with this Agreement. Neither
party shall disclose, advertise or publish the terms or conditions of this
Agreement without the prior written consent of the other party.
22 GENERAL
22.1 PARTICIPATION BY AFFILIATES. Affiliates of Customer as
hereinafter defined may elect to purchase Products from 3Com under this
Agreement by such Affiliate issuing its own purchase order to 3Com. As used
herein, "Affiliate" shall mean any company more than fifty percent (50%) of
the voting stock of which is owned or controlled directly or indirectly by
Customer or Customers parent or subsidiary. The dollar value of purchases by
Affiliates shall be included in the aggregate volume of Product purchases.
The Affiliate will have primary responsibility for charges incurred in
connection with such purchase order. The list of participating Affiliates in
Exhibit F will be provided by Customer to 3Com upon the signing of this
Agreement, and will be updated whenever a change is made. Any Affiliate
included on the list shall be deemed to have agreed to be bound by all the
terms and conditions of this Agreement, and Customer shall guarantee such
Affiliate's fulfillment of its obligations under this Agreement. Customer
hereby agrees to pay to 3Com within ten (10) days of 3Com's first written
demand therefor any sum which any of Customer's Affiliates is delinquent in
paying to 3Com, subject only to such defenses as would be available to
Customer had Customer purchased the Products directly from 3Com. The
provisions of this paragraph shall survive the termination, cancellation or
expiration of this Agreement.
22.2 ENTIRE AGREEMENT This Agreement is intended as the complete,
final and exclusive statement of the terms of the agreement between the
parties relating to the subject matter hereof and supersedes all prior
understandings, writings, proposals, representations or communications, oral
or written, relating to the subject matter hereof. This Agreement may not be
modified except in a writing executed by both parties.
22.3 FORCE MAJEURE. Neither party shall be liable to the other party
for any alleged loss or damages resulting from delays in performance
(including for 3Com loss or damages resulting from delivery of the Products
being delayed) caused by acts of the other party, acts of civil or military
authority, governmental priorities, earthquake, fire, flood, epidemic,
quarantine, energy crisis, strike, labor trouble, war, riot, accident,
shortage, delay in transportation, or any other causes beyond the reasonable
control of the party whose performance is so delayed.
22.4 NOTICES. Any notice regarding non-performance, breach,
termination, or renewal shall be given in writing and shall be hand delivered
or deposited, postage prepaid, registered or certified mail, return receipt
requested, in the United States or other country's mail, or sent by a
recognized overnight courier, addressed to Customer or 3Com, as the case may
be, at the address first stated in this Agreement or at such other address as
shall be given by either one to the other in writing. All other notices may
be sent by regular mail or by facsimile or e-mail confirmed by first class
mail. All notices shall be deemed to have been given and received on the
earlier of actual delivery or three (3) days from the date of postmark.
22.5 WAIVER. A waiver of any default hereunder or of any of the
terms and conditions of this Agreement shall not be deemed to be a continuing
waiver or a waiver of any other default or of any other term or condition,
but shall apply solely to the instance to which such waiver is directed. The
exercise of any right or remedy provided in this Agreement shall be without
prejudice to the right to exercise any other right or remedy provided by law
or equity.
22.6 SEVERABLLFTY. In the event any provision of this Agreement is
found to be invalid, illegal or unenforceable, a modified provision shall be
substituted which carries out as nearly as possible the original intent of
the parties and the validity, legality and enforceability of any of the
remaining provisions shall not in any way be affected or impaired thereby.
22.7 ASSIGNMENT Assignment of this Agreement shall be prohibited
without the express written consent of the other y; except that 3Com shall be
entitled to assign its interest in this Agreement to any subsidiary or
affiliate or in connection with a merger or other business combination in
which 3Com is not the surviving entity. Any attempted assignment in violation
of this provision shall be null and void.
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22.8 PHOTOCOPY OF ORIGINAL. Both parties agree that an unaltered and
accurate photocopy of the executed original of this Agreement may be used for
the purpose of making any required or allowed public filings or other
purposes.
22.9 DISPUTE RESOLUTION. The parties will attempt in good faith to
promptly resolve any dispute, controversy, or claim ("Dispute") arising out
of or relating to this Agreement through negotiations between the parties
before resorting to other remedies available to them. Any such Dispute shall
be referred to appropriate senior executives (e.g., director or V.P. level)
of each party who shall have the authority to resolve the matter. Discussion
and correspondence relating to trying to resolve such Dispute shall be
treated as confidential information developed for the purpose of settlement
and shall be exempt from discovery or production and shall not be admissible
in subsequent mediation, other alternate dispute resolution ("ADA") or
litigation. If the senior executives are unable to resolve the Dispute within
thirty (30) days from the date of the written communication requesting
referral to the executives and either party wishes to pursue its rights
relating to such Dispute, then the Dispute will be mediated by a mutually
acceptable mediator appointed pursuant to the mediation rules of
JAMS/Endispute within thirty (30) days after written notice by one party to
the other demanding non-binding mediation. Neither party may unreasonably
withhold consent to the selection of a mediator or the location of the
mediation. Both parties will share the costs of the mediation equally, except
that each party shall bear its own costs and expenses, including attorney's
fees, witness fees, travel expenses, and preparation costs. The parties may
also agree to replace mediation with some other form of non-binding or
binding ADR. If the parties agree upon binding arbitration, the power of the
arbitrator(s) shall be limited to that possessed by a Superior Court Judge in
California and the arbitrator(s) shall be prohibited from awarding damages or
remedies in excess of those allowed by the provisions of this Agreement.
Any Dispute which the parties cannot resolve through mediation
within two (2) months of the date of the initial demand for it by one of the
parties may then be submitted to a court for resolution. The use of any ADR
procedures will not be construed under the doctrine of laches, waiver or
estoppel to adversely affect the rights of either party.
Any Dispute regarding the following is not required to be negotiated
or mediated: non-payment or Fate payment: breach of any obligation of
confidentiality; infringement, misappropriation, or misuse of any
intellectual property right; any other claim where interim relief from the
court is sought to prevent serious and irreparable injury to one of the
parties or to others.
22.10 GOVERNING LAW. This Agreement shall be construed in accordance
with and all disputes hereunder shall be governed by the laws of the State of
California, excluding its conflicts of law rules and excluding the United
Nations Convention on Contracts for the International Sale of Goods. With the
exception of the Dispute Resolution provision, above, the Superior Count of
Santa Xxxxx County, California, and/or the United States District Count for
the Northern District of California shall have non-exclusive jurisdiction and
venue over all controversies in connection herewith.
22.11 ATTORNEY'S FEES. In any legal action to enforce, or arising
out of a sale subject to, this Agreement, the prevailing party shall be
awarded all arbitration costs or court costs and reasonable attorney's fees
incurred.
Additionally, attorney's fees incurred in enforcing any judgment are
recoverable as a separate item, and this paragraph regarding post~udgment
attorney's fees shall be severable from the other provisions of this
Agreement, shall survive any judgment, and shall not be deemed merged into
any judgment.
22.12 CHOICE OF LANGUAGE. The original of this Agreement has been
written in English. In the event of any conflict or inconsistency between the
English language version and the local language version of this Agreement (if
a local language version is prepared), the English language version will be
the controlling document for all purposes.
22.13 UNITED STATES GOVERNMENT END USERS. All technical data and
computer software is commercial in nature and developed solely at private
expense. Software is delivered as "Commercial Computer Software" as defined
in DEARS 252.227-7014 (June 1995) or as a "Commercial Item" as defined in FAR
2.101(a) and as such is provided with only such rights as
12
are provided in 3Com's standard commercial license for such software.
Technical data is provided with limited rights only as provided in DFARS
252.227-7015 (Nov 1995) or FAR 52.227-14 (June 1987), whichever is
applicable. Customer agrees not to remove, deface or modify any portion of
any legend provided on any licensed program or documentation delivered to it
under this Agreement.
23. LEASING
Subject to the provisions of this section, Customer may arrange to
have Products delivered to it under a leasing arrangement between Customer
and a third party lessor ("Lessor"). 3Com's obligations to accept any
purchase order from Lessor and to deliver Product pursuant to such purchase
order from Lessor are subject to the following conditions:
a. The purchase order indicates on its face that Lessor is
ordering the Product identified in the purchase order on
behalf of Customer;
b. The purchase order indicates on its face that it is in
accordance with, and subject to, the terms and conditions of
this Agreement; and
c. The Lessor has been approved by 3Com's credit department.
Subject to any specific provisions found in a bilaterally-executed agreement
between 3Com and Lessor, Lessor wilt be considered Customer's agent for the
purpose of ordering Product and making payment and the rights and obligations
of Customer and 3Com identified in this Agreement shall remain except for the
following:
(1). Title to Product delivered pursuant to such order shall be
presumed vested in Lessor;
(2). The license accompanying the Product shall apply to Lessor; and
(3). Notwithstanding anything to the contrary in the license
accompanying the Product, Lessor may transfer such title and license rights
to Customer under a leasing arrangement.
Should a bilaterally-executed agreement between 3Com and Lessor indicate that
any or all rights and obligations under such leasing agreement are between
SCorn and Lessor, notwithstanding the provisions of this Agreement, 3Com
shall have no obligations to Customer pursuant to Lessor's purchase order
except for those identified in any end user license and 3Com limited warranty
accompanying the Product.
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EXHIBIT A-1
VOLUME DISCOUNT SCHEDULE FOR DESTINATIONS
IN THE UNITED STATES AND CANADA
[Redacted - Subject to a request for confidential treatment filed with the SEC
on June 27, 2000].
EXHIBIT A-2
VISITOR BASED NETWORKING PRICE LIST
[Redacted - Subject to a request for confidential treatment filed with the SEC
on June 27, 2000].
2
