Common use of Material Management Clause in Contracts

Material Management. 4.1 NSGT will comply with the following obligations to ensure good component material management for the Products, (a) perform component level failure analysis, (b) make its best efforts to work with Xtera’s other related vendors of the Products to reduce component lead-times and costs, and (c) implement materials management consistent with standard industry inventory management practices, including but not be limited to the use of, FIFO, minimum order quantities, and long lead-time component management. 4.2 Xtera will be solely responsible for all costs relating to the collection and replacement of Product and Parts due to any Product or Part design issue attributable to designs provided by Xtera and Parts supplied by an Xtera Designated Supplier. NSGT shall be solely responsible for all costs relating to the collection and replacement of Product and/or Parts due to any defect in workmanship and shall arrange and perform all returns material authorization procedures with suppliers, including Xtera Designated Suppliers. NSGT will partner with Xtera to drive for root cause on material related issues.