Common use of Termination for Breach of Metrics Clause in Contracts

Termination for Breach of Metrics. The failure of Flextronics to obtain performance results better than or equal to the passing grade for those breachable metrics identified in Exhibit 5 for each element on the report card with respect to any Product Family as a result of any act or omission within Flextronics’ Control and Responsibility, for [•] (measured as the weighted average of the scorecards for each of those [•]), constitutes a material breach of Flextronics’ obligations under this Agreement with respect to that Product Family. If Nortel Networks does not exercise its right to terminate for such breach, any applicable liquidated damages owing pursuant to Section 9.1.2 will be paid by Flextronics for each successive month that Flextronics fails to obtain metric target as set out herein. If Nortel Networks does exercise its right to terminate for such breach, Flextronics’ liability for any damages Nortel Networks may have suffered due to the breach shall be reduced by the amount of liquidated damages already paid. If Flextronics disputes whether there has been a material breach for purposes of this Section 9.1.4, then such dispute will be submitted to the Dispute Resolution Process in Section 26 prior to Nortel Networks exercise of its termination rights or Flextronics obligation to pay any liquidated damages.