EXHIBIT 10.25
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CONTRACT FOR
the supply of
TELECOM RED PRODUCTS
CONTRACT NO: 652902
(PSUEDO CONTRACT NO. 652903)
From
BT Supply Management
Swindon
August 1997
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Contract Number: 652902 (Psuedo Estimated Contract Value:(pound)6,881,675
Contract No. 652903)
Contract relating to: Telecom Red Products
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CONTRACT dated 7 August 1997 between
(1) "BT" British Telecommunications plc registered office ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ Company Number 1800000; and
(2) "the Supplier":
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Name Registered Office Address Registered Number
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Versus Technology Ltd Unit B7 2520164
▇▇▇▇▇▇▇▇▇ Mall
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
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For (pound)1 payable to it by BT, the Supplier shall complete and deliver to BT
such work and/or equipment and/or services (as the case may be) as BT may order
from time to time within the Contract Period in accordance with the Contract
which comprises:
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Number Description
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1 Requirements
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2 Conditions
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3 Technical Requirements
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4 Generic Standards
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5 Subcontractors
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6 Working with BT Booklet
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and which, in the case of conflict, have precedence in the order listed.
SIGNED for and on SIGNED for and on
Behalf of the Supplier behalf of BT
Name Name ▇. ▇▇▇▇▇▇▇
Position Position Manager, Engineering Materials
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SCHEDULE 1
REQUIREMENTS
CONTRACT NO: 652902
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SCHEDULE 1 to CONTRACT NO: 652902 PAGE 1 of 17
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CONTENTS
SCOPE
1. DEFINITIONS
2. DURATION OF CONTRACT
3. DESCRIPTION OF SUPPLIES
4. QUANTITY OF SUPPLIES
5. PRICING
6. PAYMENT AND INVOICE DETAILS
7. AVAILABILITY OF SUPPLIES
8. PLACE OF MANUFACTURE
9. WORKING WITH BT
MANAGEMENT
10. QUALITY, QUALITY ASSURANCE AND QUALITY IMPROVEMENT
11. CHANGE CONTROL PROCEDURE
12. ENQUIRY POINTS
IMPLEMENTATION
13. ORDERING ARRANGEMENTS
14. DELIVERY - DIRECT DISTRIBUTION
15. DESPATCH - DIRECT DISTRIBUTION
16. DELIVERY - DEPOT
17. DESPATCH - DEPOT
18. ELECTRONIC DATA INTERCHANGE (EDI)
19. CONTRACT MANAGEMENT
20. GRADE OF SERVICE
21. PACKAGING AND LABELLING
22. ORDER OF PRECEDENCE
APPENDIX A
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 2 of 17
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1. DEFINITIONS
The definitions of expressions in the Condition headed 'Definitions' in
the Contract conditions shall unless the context requires otherwise,
apply in this Schedule 1.
In addition the following expressions shall, unless the context
requires otherwise, have the following meanings in the Schedule 1:
"the Contract Conditions"
- shall mean the provisions contained in Schedule 2 of the
Contract.
"the 'Working with BT' booklet"
- shall mean the booklet of that name referred to in the
Condition headed 'Working with BT' in this Schedule 1.
2. DURATION OF CONTRACT
The duration of the Contract shall be for the Contract Period from the
commencement date as stated in Schedule 2:1, unless terminated earlier
in accordance with its provisions or other right at law.
3. DESCRIPTION OF SUPPLIES
The Supplies for supply by the Supplier, in accordance with its
obligations under the Condition headed 'Quantity of Supplies' in this
Schedule 1, are of those listed in Appendix A to this Schedule.
Supplies may be modified by amendment during the contract period to
replace existing product and/or add new products, subject to the
agreement of both parties.
4. QUANTITY OF SUPPLIES
4.1 The Supplier agrees that the Contract is not for any specific
quantity of Supplies, but only for such quantities as may be
ordered by BT from time to time within the duration of the
Contract. Any estimated Contract value shown on or in the
Contract is for BT information purposes only and shall neither
be binding nor put any obligation of any kind on BT.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 3 of 17
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5. PRICING
5.1 Maximum Pricing
The prices to be paid for the Supplies supplied in accordance
with the Contract are as detailed in the Appendix A.
All prices detailed in Appendix A shall be maximum prices for
the Contract Period, subject to the provisions of this
Condition, in Pounds Sterling (exclusive of Value Added Tax).
The prices payable by BT are inclusive of all non-returnable
packing, delivery, any relevant licence fees and all other
charges associated with the Goods.
The Supplier shall not extend more favourable prices to any
other customer providing services within the U.K. for any item
covered by this Contract.
5.2 Price Review
A price review will take place during the Contract Period on
the following basis:-
5.2.1 The prices contained in the appendices are the maximum
prices applicable for the Contract Period.
5.3 Contract Rebate
5.3.1 1 April 1997 to 31 March 1998
It is agreed that should BT place orders for Supplies
against this Contract which reach (pound)3.0m in the
12 month period from 1 April 1997, BT will receive a
rebate of 5% from the Supplier against these
purchases. Should BT exceed a spend of (pound)3.0m
target in this period, a further 15% rebate will be
payable against all purchases in excess of
(pound)3.0m.
Should BT order GSM product against this Contract
within this period then the rebates will apply from a
level of (pound)3.2m.
5.3.2 1 April 1998 to 31 March 1999
It is agreed that the rebate structure, as set out in
Paragraph 5.3.1 above, will apply to orders for
Supplies made in this period, with the exception of
Item No 8a, the LinkGuard Board (Item Code 502434).
This item will be included in the calculation of
total spend, but will be excluded from the agreed
rebate structure.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 4 of 17
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5.3.3 It is agreed that Supplies shall include all items on
this contract, as listed in Appendix A to this
Schedule, and any other equipment that BT may
purchase.
5.3.4 Unless BT and the Supplier can agree a rebate
structure to apply for the period 1 April 1999 to 30
June 1999, the same rebate structure as detailed in
Paragraph 5.3.2 above will apply against the spend on
a pro rata basis.
6. PAYMENT AND INVOICE DETAILS
6.1 For each order for the Supplies made by BT, the Supplier
shall, following delivery in accordance with the Contract of
all (or, where agreed in writing by BT, each agreed instalment
of) the Supplies comprised in the order, submit an invoice for
the price of those Supplies.
6.2 Payment of a correct invoice submitted in accordance with this
Condition shall (subject to the following paragraph of this
Condition) be made, on average, within the Payment Period from
the date of its receipt.
6.3 BT reserves the right to refuse to pay any invoice which is
not submitted in accordance with this Condition, or if any
Supplies to which the invoice relates are not in accordance
with the Contract.
6.4 Payment for Depot (NDC) Stocked Items
The Supplier shall, on its own forms, render invoices to BT at
the Invoice Address.
British Telecommunications plc
Accounts Payable Centre
▇▇ ▇▇▇ ▇▇▇
Telecoms House
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Tel: ▇▇▇▇ ▇▇▇▇▇▇ (Suppliers have to state that they are on
the ATP system)
One invoice must be raised per delivery address for each Goods
Release Form.
6.5 Payment For Direct Delivery Items
Psuedo Contract No. 652903 has been allocated to cover the
delivery of items to Regional Distribution Centres, and direct
to site, and should be quoted on all relevant despatch/invoice
documentation.
Each week the Supplier is required to send: one copy of the
despatch advice with the Supplies and one copy to be sent to
BT Supply Management, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
Star Avenue, Swindon, SN2 1BS, and
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 5 of 17
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individual invoices relevant to that despatch to British
Telecommunications plc, Accounts Payable Centre, PO Box 998,
Telecoms House, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇.
6.6 The information on the Supplier's invoice shall conform with
the requirements specified in the `Working with BT' booklet.
Both despatch advices to contain the following information:-
British Telecommunications plc Contract Number (Psuedo
Contract 652903)
British Telecommunications plc Document Reference
British Telecommunications plc Requisition Number
British Telecommunications plc Item Code
British Telecommunications plc Item Description
Quantity Despatched
Delivery Address
Date of Despatch
6.7 The information on the Contractor's invoice shall conform with
the requirements specified in the `Working with BT' booklet.
NB: During the Contract period the Method of Payment is likely to
be altered to Payment on Receipt.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 6 of 17
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NDC DELIVERY
GOODS RELEASE FORM
ATTENTION OF: ........................ FROM:.................................
TELEPHONE No:......................... TELEPHONE No:.........................
FAX No:............................... FAX No:...............................
--------------------------------- ----------------------------------------------
CONTRACTOR: VERSUS TECHNOLOGY LTD CONTRACT NUMBER: 652902
--------------------------------- ----------------------------------------------
SERIAL NUMBER:
--------------------------------- ----------------------------------------------
DOCUMENT REFERENCE:
--------------------------------- ----------------------------------------------
DATE:
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ITEM CODE DESCRIPTION TOTAL TOTAL CRD ▇▇▇
RELEASED RELEASED
TO DATE
------------ ----------------------------------- ---------------- ---------------- --------------- ----------------
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SIGNED: ............................
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 7 of 17
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DIRECT DELIVERY
GOODS RELEASE FORM
ATTENTION OF: ........................ FROM:.................................
TELEPHONE No:......................... TELEPHONE No:.........................
FAX No:............................... FAX No:...............................
--------------------------------- ----------------------------------------------
CONTRACTOR: VERSUS TECHNOLOGY LTD CONTRACT NUMBER: 652903
--------------------------------- ----------------------------------------------
SERIAL NUMBER:
--------------------------------- ----------------------------------------------
DOCUMENT REFERENCE:
--------------------------------- ----------------------------------------------
DATE:
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ITEM CODE DESCRIPTION TOTAL TOTAL
RELEASED RELEASED
TO DATE
------------ ----------------------------------- ---------------- --------------
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SIGNED: ............................
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 8 of 17
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7. AVAILABILITY OF SUPPLIES
7.1 The Supplier shall at its own expense, maintain sufficient
stock of the Supplies as is reasonable to meet such quantities
as may be ordered by BT. BT will provide the Supplier with 3
month rolling forecasts for all the items on the Contract. The
ordering pattern shall be on the basis of 1 month firm
requirement, months 2 and 3 forecast (provisional) requirement
only.
7.2 BT considers it to be the responsibility of the Supplier to
determine such stock levels and BT does not wish to be
prescriptive on this issue. However, recognising the
volatility of demand patterns, BT believes that reasonable
stock levels should be available.
7.3 During the continuance of the Contract BT shall have the right
to audit the Supplier to ensure reasonable stocks or processes
are in place and effective.
7.4 The Supplier shall give BT 2 months notice of any `shut-down'
period. During any `shut-down' period the Supplier shall
provide sufficient resources to enable the continuation of the
required delivery service. What constitutes a reasonable
delivery service shall be agreed between both parties.
8. PLACE OF MANUFACTURE
The Supplies will be manufactured and assembled at:-
Versus Technology Ltd, ▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Summit
Centre, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇
apart from the manufacture of components and materials bought in, in
accordance with normal trade practice. The Supplier shall not
manufacture or assemble the Supplies at any other address without the
prior written agreement of BT, which agreement shall not be
unreasonably withheld.
9. WORKING WITH BT
The provisions of the booklet 'Working with BT' edition 3 dated 1
August 1994 (a copy of which the Supplier has received) shall apply to
the Contract to the extent specified in the Contract.
10. QUALITY, QUALITY ASSURANCE AND QUALITY IMPROVEMENT
10.1 The Supplies shall be manufactured in accordance with the
quality requirements as stipulated via the contracted
specifications and Generic Standards (Schedule 3).
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 9 of 17
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10.2 Incumbent within the above requirement will be for the
Supplier to manage the Contract in a controlled quality
manner, in accordance with an ISO 9000 or equivalent Quality
Management System and appropriate Quality Plans. Any changes
to the Suppliers' Quality Management System or Quality Plans
shall be notified to the BT Procurement Team.
10.3 The Supplier shall demonstrate compliance to the contracted
requirements.
10.4 The Supplier shall declare their testing strategy for all
stages of the production processes from incoming goods to
finished product.
10.5 The Supplier shall employ a suitable level of Quality
Assurance.
10.6 The Supplier shall assist BT in measuring the efficiency of
processes as required, with an aim to optimise process yield.
10.7 The Supplier is wholly responsible for ensuring compliance to
the above requirements for any Supplies sub-contracted.
10.8 The Supplier shall demonstrate a commitment to continual
Quality Improvement, addressing shortfalls in the BT Vendor
Rating Scores, and to seek improvements in their quality,
technical and commercial deliverables. Visibility of such
progress will be requested via suitable Quality Improvement
Programmes, these shall be reviewed at the regular BT/Supplier
interface meetings.
11. CHANGE CONTROL PROCEDURE
11.1 The Supplier shall notify BT of any proposed changes, to the
form, fit or function of the Supplies. BT requires four weeks
notice of proposed changes for authorisation to be considered.
No changes are to be made without written authorisation from
BT Supply Management (using an agreed change procedure form),
such authorization shall not be unreasonbly withheld.
11.2 All requests for changes from BT shall be forwarded to the
Supplier by BT Supply Management (using an agreed change
procedure form). The Supplier shall respond to this request
within ten days of its receipt.
11.3 In the event of changes proposed by either party being agreed,
a formal Contract amendment shall be signed by the parties.
11.4 Any requests for concessions raised by the Supplier, against
the agreed specifications, shall be forwarded to BT Supply
Management (using an agreed change procedure form). Two weeks
notice is required by BT for consideration of the request. No
Supplies may be supplied against the concession until written
agreement has been given by BT Supply Management.
11.5 All concessions may be subject to a discount to the prices of
the Supplies concerned and which must be agreed prior to the
granting of such concession by BT.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 10 of 17
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12. ENQUIRY POINTS
The following persons are appointed to answer enquiries in relation to
the Contract as designated:
---------------------------- ----------------------------------------
BT Supplier
---------------------------- ----------------------------------------
Commercial: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
PP C108 NumereX Corp.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ Star Avenue Willows Grove
Swindon PA 19090
▇▇▇ ▇▇▇ USA
Tel: ▇▇▇▇▇ ▇▇▇▇▇▇ Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: ▇▇▇▇▇ ▇▇▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
---------------------------- ----------------------------------------
Technical: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecom Red Versus Technology Limited
PP703M ▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Dial House Southwood Summit Centre
21 Chaple Street Farnborough
Salford M3 7BA ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Tel: ▇▇▇▇ ▇▇▇ ▇▇▇▇ Tel: ▇▇▇▇▇ ▇▇▇▇▇▇
Fax: ▇▇▇▇ ▇▇▇ ▇▇▇▇ Fax: ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------- ----------------------------------------
Enquiries relating to particular orders placed under the Contract shall
be referred in the case of BT to the address specified on the relevant
order and in the case of the Supplier to:
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Address: Unit B7
▇▇▇▇▇▇▇▇▇ Mall
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Tel: ▇▇▇▇▇ ▇▇▇▇▇▇
Fax: ▇▇▇▇▇ ▇▇▇▇▇▇
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 11 of 17
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13. ORDERING ARRANGEMENTS
13.1 The Supplier is to have available sufficient stock to meet
such quantities as may be ordered from time to time, against
estimated quantities detailed in the Contract by British
Telecommunications plc, Supply Management, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇, during the Contract
period.
13.2 The Contract is to allow for 2 types of order:-
(i) Direct Delivery
For all Items, except Item 7, delivery by the
Supplier within 5 working days. For Item 7 (Scanner
Assembly) delivery by the Supplier within 6 weeks.
Receipt of order by the Supplier is construed as day
one of the process. The process must also allow for
an emergency delivery where the Supplier will use his
best endeavour to deliver inside the lead time.
(ii) Depot
Call-offs will be issued by Supply Management for
delivery within 2 weeks from date of order.
14. DELIVERY - DIRECT DISTRIBUTION (Psuedo Contract No 652903)
14.1 The Supplier shall deliver the Supplies ordered by BT to BT at
the address or addresses in the United Kingdom that BT may
specify. For all Items, except Item 7, all orders to be
delivered within 5 working days. For Item 7 all orders to be
delivered within 6 weeks from receipt of order by the
Supplier, unless otherwise specified.
The Supplier shall not, without the prior permission of BT,
deliver any part order (by quantity or by item). In the event
that the Supplies are not available for delivery at the agreed
time, the Supplier shall (without prejudice to BT's rights
under the Contract) immediately inform BT by telephone or
facsimile using Late Order form or telex and confirm such
communication by post.
14.2 Notice of Delivery
Deliveries to Regional Distribution Centres, other staffed or
unstaffed premises, will require the Supplier to give at least
24 hours notice or such deliveries by telephone to the
appropriate District Manager's office. Relevant orders will be
annotated to this effect.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 12 of 17
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15. DESPATCH ADVICES - DIRECT DISTRIBUTION (Pseudo Contract No 652903)
------------------------------------------------------------------
One copy to be sent to BT plc, Supply Management, PP ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇ on the day the Supplies are
despatched and one copy to be sent with the Supplies either securely
fastened to the outside of the consignment, or handed to the District
Stores on delivery.
16. DELIVERY - DEPOT
16.1 Delivery instructions will be given within 3 working days of
British Telecommunications plc, Supply Management, receiving
details of the Supplies passing inspection at Contractor's
Works. Supplies to be delivered as soon as possible after
receipt of such instructions, but in any event no later than 5
working days therefrom.
The Supplies to be delivered to either or both of the
following BT plc depots: Crayford and Northallerton. (See
"Working with BT" booklet for details of addresses).
16.2 Depot Appointment System and Security
All deliveries must be made on a day specified by the depot.
The Supplier, subcontractors or their agents should give prior
notification of delivery, including the following information:
item description, quantity and Contract number, also the
vehicle registration number, if known. Telephone numbers and
delivery times available are:-
CRAYFORD Tel: ▇▇▇▇ ▇▇▇▇▇▇. Deliveries may be made
between 7.00 am and 1.45 pm.
NORTHALLERTON Tel: ▇▇▇▇▇ ▇▇▇▇▇▇. Deliveries may be made
between 8.00 am and 3.00 pm.
Deliveries will only be accepted on the specified date and
between the hours shown. British Telecommunications plc
Security staff shall, if they so decide, have access at any
time to vehicles of Contractors, subcontractors or their
agents while such vehicle/s are entering, leaving or both any
BT depot to stop and search any such vehicle/s.
16.3 Personal Protective Equipment (PPE)
With effect from 1 May 1997, where deliveries are made to BT
Distribution Sites it is the Supplier's responsibility to
ensure that drivers wear appropriate PPE (high visibility
▇▇▇▇▇▇▇, safety shoes, and a safety helmet). From 1 May 1997,
all incorrectly attired drivers will be refused entry to BT
Distribution Sites.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 13 of 17
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17. DESPATCH ADVICES: DEPOT DELIVERY
One copy to be enclosed with the Supplies and one copy to be sent to:
BT plc, Supply Management, at the depot to which the Supplies are
consigned. Both Despatch Advices to contain:-
British Telecommunications plc Contract Number
British Telecommunications plc Item Description
British Telecommunications plc Item Code
Contractor's Document Reference
Quantity
Requisition Number and Document Reference Number
Date and Method of Despatch
Consignment Note, Where Applicable
Packaging Details
Delivery Address
18. ELECTRONIC DATA INTERCHANGE (EDI)
At the option of BT, the Supplier agrees to implement an EDI link for
the transmission of documents including SD67s and invoices.
19. CONTRACT MANAGEMENT
19.1 LATE ORDERS FORM - see attached form `a' for late orders which
must be completed and faxed to 01793 547175 for all orders
which will not be delivered by the due date. Any outstanding
orders MUST be reported weekly.
19.2 SELF-MONITORING FORM - See attached form `b'.
The Supplier is to have suitable Monitoring Systems to provide
well structured, accurate and timely reports to BT. The form
is to be completed and returned to BT Supply Management by the
3rd working day of each month.
The table overleaf outlines the input requirements for the
Self Monitoring Form.
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 14 of 17
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Data Field Input Requirements
------------------------------------------- ---------------------------------------------------------------------
Supplier Company Name.
------------------------------------------- ---------------------------------------------------------------------
Month Enter the month in which the orders were due for delivery.
------------------------------------------- ---------------------------------------------------------------------
Contract Number Enter BT Contract number. One form per Contract.
------------------------------------------- ---------------------------------------------------------------------
Item Code/Description Insert BT item code followed by description.
------------------------------------------- ---------------------------------------------------------------------
Quantity Ordered (Due for delivery in Total quantity on order by BT due for delivery in the reporting
reporting month) month e.g. 100 units were ordered by BT beginning of October, the
lead-time is 2 weeks therefore all
100 are due in October (within the 2
week lead-time), BUT if the
lead-time is 8 weeks then the order
should be recorded in the month it
is due to be delivered.
------------------------------------------- ---------------------------------------------------------------------
Quantity Delivered to Depot/Site Total quantity delivered to depot or site within the contractual
lead time, e.g.
100 units = 100% 90 units = 90% ( no arrears)
------------------------------------------- ---------------------------------------------------------------------
Value of Quantity Ordered Contract unit price multiplied by the volume of
quantity ordered.
------------------------------------------- ---------------------------------------------------------------------
Cumulative Quantity Ordered (Units) Cumulative order quantity from 1 April 1997.
------------------------------------------- ---------------------------------------------------------------------
Value Cumulative(pound) Cumulative value of order from 1 April 1997.
------------------------------------------- ---------------------------------------------------------------------
Arrears from previous month(s) Quantity of order in arrears to BT from previous
month(s).
------------------------------------------- ---------------------------------------------------------------------
% Delivery Performance Quantity delivered divided by Quantity ordered in month plus
Quantity Delivered / (Quantity previous month's arrears*100,
Order + Arrears)*100 e.g. 200 delivered /(100 ordered +250 arrears)*100=57%
------------------------------------------- ---------------------------------------------------------------------
Liquidated Damages Applicable for Month The % of Liquidated Damages applicable are outlined in your current
contract. The % is to be applied to the value of the order which
is late, e.g. the order value = (pound)100, the order is late by one
week the LDR = 5%, therefore the value of LDR = (pound)5 (5% of
(pound)100).
------------------------------------------- ---------------------------------------------------------------------
Cumulative Liquidated Damages Total damages applicable to each item from 1 April 1997.
------------------------------------------- ---------------------------------------------------------------------
Quantity of finished stock held Volume of finished stock held at manufacturers.
------------------------------------------- ---------------------------------------------------------------------
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 15 of 17
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Form `a'
LATE ORDERS REPORT
------------------------ ------------------------------------------------------------- ---------------------------------------------
COMPANY: VERSUS TECHNOLOGY LIMITED CONTRACT NO:
------------------------ ----------------- --------------------- --------------------- ---------------------------------------------
PROPOSED
REQ NO./ ITEM DUE DELIVERY REASON LATE/
CALL OFF REF CODE DATE DATE ACTION TAKEN
------------------------ ----------------- --------------------- --------------------- ---------------------------------------------
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SCHEDULE 1 to CONTRACT NO: 652902 PAGE 16 of 17
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Form `b'
SUPPLIER DELIVERY PERFORMANCE
SELF MONITORING FORM
SUPPLIER: VERSUS TECHNOLOGY LIMITED
CONTRACT No: ....................... MONTH:......................
----------------------------- -------------- --------------- -------------- ----------------- ---------------- -------------
ITEM CODE/ QUANTITY QUANTITY VALUE OF CUMULATIVE VALUE ARREARS
DESCRIPTION ORDERED (DUE DELIVERED TO QUANTITY QUANTITY CUMULATIVE FROM
FOR DELIVERY DEPOT/ SITE ORDERED ORDERED (UNITS) (pound) PREVIOUS
IN REPORTING MONTH(S)
MONTH)
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TOTAL
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--------------------- --------------- ---------------- ---------------
% DELIVERY LIQUIDATED CUMULATIVE QUANTITY OF
PERFORMANCE DAMAGES LIQUIDATED FINISHED
Quantity Delivered APPLICABLE DAMAGES STOCK HELD
/ (Quantity Order FOR MONTH
+ Arrears)*100
--------------------- --------------- ---------------- ---------------
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SCHEDULE 1 to CONTRACT NO: 652902 PAGE 17 of 17
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20. GRADE OF SERVICE
20.1 The Supplier is required to meet 100% Grade of Service.
20.2 The Grade of Service is defined as the number of times the
Supplier achieves delivery of individual orders within the
lead time for each calendar month, expressed in terms of a
percentage.
21. PACKAGING AND LABELLING
As detailed in the Schedule 5.
22. ORDER OF PRECEDENCE
To the extent which the following documents form part of or apply to
the Contract, they shall in the case of conflict have the order of
precedence in which they are listed below:
(i) Schedule 1 - Requirements
(ii) Contract Conditions
(iii) Technical Requirements
(iv) Generic Standards
(v) Subcontractors
SCHEDULE 1 to CONTRACT NO: 652902 PAGE 1 of 1
APPENDIX A
--------------------------------------------------------------------------------
FIXED PRICES FOR THE DURATION OF CONTRACT
---------------------------------------------------------------------------------------------------------------------------------
ITEM DESCRIPTION ESTIMATED DELIVERY TO DEPOT OR ANYWHERE IN UK EX-WORKS
ITEM CODE QUANTITY
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
1 502270 Dual Link Board * * *
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
2 502319 Dual Microscanner Chassis
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
3 502279 Processor
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
4 502280 PSIM
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
5 502298 X-R Pair
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
6 502299 X-Sim
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
7 502323 Scanner Assembly
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
8a 502434 LinkGuard Board
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
8b 502434 LinkGuard Board
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
9 502435 PSIM Modification
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
10 502436 Processor Modification
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
11 502437 LinkGuard Management System
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
12 502438 PSIM V24 0.25M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
13 502439 PSIM V24 1.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
14 502440 PSIM V24 2.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
15 502441 PSIM V24 3.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
16 502442 Processor V24 0.25M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
17 502443 Processor V24 1.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
18 502444 Processor V24 2.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
19 502445 Processor V24 3.0M Cord
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
20 502446 De-bug Cable 5.0M
---- ------ --------------------------- --------------- ---------------------------------------- --------------------------------
Note: Item 8a. The price for this item is based on the placement of a single
order for 5000 items for supply over an agreed period
* Confidential information which has been omitted pursuant to Rule 24b-2
under the Securities Exchange Act of 1934 and filed separately with the SEC.
------------------------------------------------------------------------
SCHEDULE 2
CONDITIONS OF CONTRACT
CONTRACT NO: 652902
------------------------------------------------------------------------
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 1 of 21
--------------------------------------------------------------------------------
CONTENTS
1. DEFINITIONS
2. QUALITY OF SUPPLIES
3. COMPLIANCE WITH LAWS AND REGULATIONS
4. PRICING
5. PAYMENT AND INVOICING
6. ASSIGNMENT AND SUBCONTRACTING
7. ACCESS, ASSISTANCE AND PROGRESS REPORTS
8. MISTAKES IN INFORMATION
9. BT SUPPLIED ITEMS AND PROPERTY
10. GUARANTEE
11. TITLE AND RISK
12. INFORMATION
13. CONFIDENTIALITY
14. FORCE MAJEURE
15. DEFAULT
16. RIGHT TO REJECT
17. LICENCE TO USE INFORMATION
18. DELIVERY
19. REPAIRABILITY
20. SUPPORT AND SPARES
21. INTERFACE WITH OTHER EQUIPMENT
22. TERMINATION
23. INDEMNITY - INTELLECTUAL PROPERTY
24. INDEMNITY - GENERAL
25. LIMITATION OF LIABILITY
26. INSURANCE
27. CONTRACT CHANGE PROCEDURE
28. NOTICES
29. GENERAL
30. DOCUMENTATION
31. USE, TRANSFERABILITY, MAINTENANCE AND MODIFICATION OF SOFTWARE
32. VIRUSES AND ELECTRONIC REPOSSESSION
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 2 of 21
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GENERAL CONDITIONS
1. DEFINITIONS
In the Contract, the following expressions shall have the meanings, if
any, ascribed to them:
------------------------------- ----------------------------------------------
Expression Meaning
------------------------------- ----------------------------------------------
Commencement Date Date of Contract
------------------------------- ----------------------------------------------
Contract Period 24 months
------------------------------- ----------------------------------------------
Payment Period 30 working days on average
------------------------------- ----------------------------------------------
Liquidated Damages Rate (LDR) 5% per week or part of delay
------------------------------- ----------------------------------------------
Maximum LDR (MLDR) 20%
------------------------------- ----------------------------------------------
Invoice Address Accounts Payable Centre
▇▇ ▇▇▇ ▇▇▇
Telecoms House
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
------------------------------- ----------------------------------------------
Guarantee Period 24 months
------------------------------- ----------------------------------------------
Supplier's Commercial Contact As detailed in Schedule 1
------------------------------- ----------------------------------------------
Supplier's Technical Contact As detailed in Schedule 1
------------------------------- ----------------------------------------------
BT's Commercial Contact ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
PP ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Tel: ▇▇▇▇▇ ▇▇▇▇▇▇
Fax: ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------- ----------------------------------------------
BT's Technical Contact As detailed in Schedule 1
------------------------------- ----------------------------------------------
BT's Quality Contact ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
address as above
------------------------------- ----------------------------------------------
Support Period 7 years for Items 1, 2, 3, 4, 5, 6 and 7
5 years for Items 8 to 20
------------------------------- ----------------------------------------------
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 3 of 21
--------------------------------------------------------------------------------
1. DEFINITIONS (continued)
"Booklet"
- The Working with BT Booklet issue number 3.
"BT"
- British Telecommunications plc, its successors and assigns
and, where appropriate, companies within the BT Group of
companies.
"BT Network"
- All exchange equipment, transmission equipment, network
terminating equipment, line plant, power plant and ancillary
equipment, owned or operated by BT.
"BT Supplied Items"
- All items provided by BT to the Supplier in connection with
this Contract.
"Contract"
- This Contract.
"Contract Price"
- The total sum payable to the Supplier by BT for Supplies.
"Contract Personnel"
- The Supplier's employees, subcontractors and agents (and their
employees, subcontractors and agents) engaged in the
performance of the Contract.
"Design Information"
- Any Information furnished by BT concerning the purpose,
function, design or manufacture of Supplies.
"Equipment"
- All components, materials, plant, tools, test equipment,
documentation, hardware, firmware, Software and things
comprised in Supplies.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 4 of 21
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"Foreground Information"
- All information generated in the course of or arising from the
performance of the Contract.
"Information"
- Information whether written or oral or any other form,
including, but not limited to, documentation, specifications,
reports, data, notes, drawings, models, patterns, samples,
software, computer outputs, designs, circuit diagrams,
inventions, whether patentable or not and know-how.
"Intellectual Property Right"
- Any patent, ▇▇▇▇▇ patent, registered design, copyright, design
right, semiconductor topography right, know-how, or any
similar right exerciseable in any part of the world and shall
include any applications for the registration of any patents
or registered designs or similar registrable rights in any
part of the world.
"Site"
- Premises specified by BT, upon which the Supplier is to
install and/or deliver Supplies.
"Software"
- All computer programs including but not limited to all source
code and object code whether in machine readable, optically
readable or any other format comprised in Supplies and the
media on which it is supplied.
"Specification"
- Any specification of Supplies provided by BT.
"Subcontractor"
- Any person, partnership or corporation with whom the Supplier
places a contract and/or an order for the supply of any
equipment, item, service or for any work in relation to the
Contract, and "subcontract" shall be construed accordingly.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 5 of 21
--------------------------------------------------------------------------------
"Supplies"
- All Equipment, Information, Work and, where applicable,
Repairable Equipment the Contract requires to be supplied to
or performed for BT.
"Tooling"
- Any equipment and software developed, produced or utilised at
any time for the manufacture of Supplies and owned or paid for
or to be paid for or supplied by BT.
"Work"
- Work the Contract requires to be undertaken for BT.
2. QUALITY OF SUPPLIES
a) Supplies shall be to BT's reasonable satisfaction, comply with
the latest applicable issue of European and International
Standards and other documents referred to in the Contract and,
unless required by the Contract, shall be brand new and not
used, reconditioned, repaired or refurbished.
b) Millennium Warranty: The Supplier warrants that the Supplies
are, where applicable, fully compatible (without modification,
loss of performance, loss of use, or work or expense on the
part of BT) with changes to inputs, outputs or other
information in relation to dates arising in the year 2000 and
beyond.
3. COMPLIANCE WITH LAWS AND REGULATIONS
The Supplier and Supplies shall comply with:
a) the requirements of the Booklet, all applicable legislation,
regulations or by-laws of a Local or other Authority; and
b) any BT site regulations that may be notified to the Supplier.
4. PRICING
The Contract Price and all other prices payable by BT shall be
inclusive, where relevant, of all non-returnable packing, delivery to
Site, unless otherwise stated, any licence fees, installation, testing
and commissioning and all other charges associated with Supplies but
shall exclude VAT.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 6 of 21
--------------------------------------------------------------------------------
5. PAYMENT AND INVOICING
5.1 BT will pay invoices submitted in accordance with paragraph 6
of Schedule 1 within the Payment Period commencing on the date
of receipt of a valid invoice. Payment of 100% of the Contract
Price shall become due upon complete performance of the
Contract.
6. ASSIGNMENT AND SUBCONTRACTING
6.1 The Supplier shall not, without BT's written consent, which
shall not be unreasonably withheld, assign or subcontract the
whole or any part of the Contract. Any consent, if given,
shall not affect the Supplier's obligations or liabilities
under the Contract. At the outset of the Contract the list of
agreed sub-contractors is detailed in Schedule 5 to this
Contract.
6.2 The Supplier shall allow BT access to its subcontractors for
the purpose of validating compliance with the terms of this
contract. BT would intend to do this via general audit, and/or
through individual quality and capability assessments.
7. ACCESS, ASSISTANCE & PROGRESS REPORTS
The Supplier shall:
a) ensure that BT (or any person authorised by BT) shall have
access at all reasonable times to the premises of the
Supplier, and those of any subcontractor, as BT may require to
assess the progress of the Contract; and
b) render such reports to BT on the performance of the Contract,
and attend such meetings, as may be reasonably required by BT;
and
c) nominate a suitable representative to attend all such
meetings. The representative shall be fully conversant at all
times with the performance of the Contract.
8. MISTAKES IN INFORMATION
8.1 The Supplier shall inform BT in writing of any mistakes in
Design Information within a reasonable time of receipt.
8.2 Any mistakes in Information owned or controlled by the
Supplier and in any Foreground Information shall be the
Supplier's responsibility to remedy at its cost whether such
Information has been approved by BT
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 7 of 21
--------------------------------------------------------------------------------
or not. Where any such remedial work is undertaken by BT the
Supplier shall bear all costs, provided that BT shall first
have notified the Supplier in writing of its intention to
perform such remedial work and provided the Supplier the
option of performing the work itself. Should BT proceed to
perfom the remedial work without having provided the Supplier
said option and the Supplier not having declined in writing to
perform said work, BT shall bear all costs.
9. BT SUPPLIED ITEMS AND PROPERTY
9.1 All BT Supplied Items shall remain the property of BT. The
Supplier shall return them to BT upon completion or
termination of the Contract or earlier reasonable request by
BT. The Supplier shall keep the BT Supplied Items, and (before
their delivery to BT) any Supplies, items or things that are
or have become BT's property ("BT property"), in safe custody
and good condition, set aside and clearly marked as BT
property.
9.2 Upon receipt of the BT Supplied Items, the Supplier shall
satisfy itself that they are not defective or deficient for
the purpose for which they are being provided, and within 14
days of receipt shall notify BT of any defects or
deficiencies.
9.3 The Supplier shall not, without the prior written consent of
BT, use BT Supplied Items for any purpose other than is
necessary for the performance of the Contract, or allow any
other party to use, take possession of, or have any rights or
lien over BT Supplied Items or BT property.
9.4 Without limiting the generality of the Supplier's obligations,
the Supplier shall not have, and shall ensure that Contract
Personnel shall not have, a lien on the BT Supplied Items or
BT property for any sum due. The Supplier shall take all
reasonable steps to ensure the title of BT and the exclusion
of such lien are brought to the notice of all Contract
Personnel dealing with any BT Supplied Items or BT property.
9.5 In the event of any threatened seizure of any BT Supplied
Items or BT property or in the event of the Supplier (or any
Contract Personnel in possession of such BT Supplied Items or
property) going into receivership, administration or
liquidation (or the equivalent of any of these) the Supplier
shall:
a) notify BT immediately; and,
b) draw to the attention of the relevant official that
BT Supplied Items and BT property are the property of
BT and do not form part of the Supplier's assets;
and,
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 8 of 21
--------------------------------------------------------------------------------
c) allow BT to enter the Supplier's premises or those of
any Contract Personnel where BT Supplied Items or BT
property are stored and take possession of them.
10. GUARANTEE
10.1 Without prejudice to any rights or remedies available to BT,
the Supplier shall at its own cost promptly remedy (by repair,
replacement or modification, at BT's option), any defects in
Supplies notified by BT and which become apparent during the
Guarantee Period, due to:
a) defective workmanship or materials; or,
b) faulty design, (other than a design made or furnished
or specified by BT and for which the Supplier has
previously disclaimed responsibility in writing
within a reasonable time of receipt): or,
c) any act, neglect or omission by the Supplier or
Contract Personnel.
10.2 The Supplier shall:
a) ensure that any remedied part of Supplies is
compatible with all Supplies; and
b) complete the remedy to the satisfaction of BT within
10 working days of receipt from BT of the defective
Supplies; and
c) ensure that defective Supplies are not remedied on BT
premises without BT's consent, unless, for
operational or technical reasons they can only be
removed or replaced with difficulty; and
d) cause the minimum of disruption to BT and/or its
customers in effecting any remedy. The time at which
any remedy is to be effected out shall be agreed with
BT and BT may at its discretion direct the Supplier
to work outside normal working hours at no cost to
BT.
10.3 The unexpired period of the Guarantee Period or, if longer, a
further guarantee period of 6 months, and the provisions of
this Condition, shall apply to all repaired or replacement
Supplies and parts.
The Supplier shall, upon receipt of Supplies returned under
this Condition, immediately investigate those Supplies and
take all necessary corrective action to prevent recurrence of
the defects in any
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 9 of 21
--------------------------------------------------------------------------------
Supplies to be supplied under the Contract. The Supplier shall
on a monthly basis report in writing to BT's Technical Contact
the outcome of all such investigations not previously so
reported. The information required in this report shall be as
follows:-
a) a summary of the quantities of each type of Supplies
returned to BT under this Condition, the quantities
investigated the results of the investigation and the
quantities awaiting investigation.
b) a full defect analysis including:
- the BT item description
- the serial number
- the manufacturing date
- the reported fault
- the results of any tests carried out,
including (without limitation) any simulated
tests such as simulated customer tests,
factory functional tests and soak tests
- failed component analysis
- failure mechanisms
- corrective action necessary
c) the details of any corrective action taken to prevent
a recurrence of defects.
d) without prejudice to the rights of BT under this
Condition, the reasons for any Supplies returned not
being accepted under the terms of this guarantee and
a breakdown of those Suppliers by the code number
quoted on any applicable fault label supplied.
10.4 The obligation set out in this clause shall not apply to
defects in the Supplies caused by the negligence or wilful
damage by BT.
11. TITLE AND RISK
11.1 Without prejudice to BT's right to reject under the Contract,
the title in Supplies shall pass to BT upon the earlier of
delivery or the passing of risk or payment (including any part
payment) and shall be free from any claims or encumbrance
whatsoever.
11.2 If any Supplies are rejected by BT or the Contract is
terminated, title to any Supplies not accepted by BT and any
materials or things which have not been incorporated in any
part of accepted Supplies, shall re-vest in the Supplier on
the expiration of 30 days from the date on which such
termination or rejection takes effect unless BT gives notice
to the Supplier within such period that it intends to either
issue a certificate of Commercial Service in respect of the
rejected Supplies or otherwise retain title in them.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 10 of 21
--------------------------------------------------------------------------------
11.3 Any payment made by BT for Supplies, materials or things which
re-vest in the Supplier is a sum due to BT from the Supplier.
11.4 The Supplier shall deliver to BT any Supplies the title in
which BT has elected to retain under this Condition and if it
shall fail to do so BT may enter the Supplier's premises and
remove such Supplies and recover the cost of so doing from the
Supplier, subject to BT paying a fair and reasonable price for
such Supplies.
11.5 The risk of loss of or damage to Supplies shall pass to BT
upon delivery.
12. INFORMATION
12.1 Either party that has in the course of the Contract received
information in a recorded form from the other (or has recorded
received information) shall return these records upon
a) expiry or termination of the Contract; or
b) earlier upon reasonable request
unless such records are part of the Supplies.
13. CONFIDENTIALITY
13.1 Either party receiving Information ("the Recipient") from the
other shall not without the prior written consent of the other
use the Information other than for the purposes of the
Contract or disclose the Information to any person other than
BT employees or Contract Personnel who have a need to know.
13.2 Paragraph 1 of this Condition shall not apply to Information
that is:
a) published or becomes so otherwise than by a breach of
the Contract; or
b) lawfully known to the recipient at the time of
disclosure and is not subject to any obligations of
confidentiality; or
c) lawfully disclosed to the recipient without any
obligations of confidentiality by a third party; or
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 11 of 21
--------------------------------------------------------------------------------
d) replicated by development independently carried out
by or for the recipient by an employee or other
person without access or knowledge of the
Information.
13.3 The Supplier shall ensure that any subcontractor is bound by
similar confidentiality terms to those in the Condition.
13.4 Without prejudice to any prior obligations of confidentiality
it may have, the Supplier shall ensure that no publicity,
relating to the Contract, shall take place without the prior
written consent of BT.
13.5 Paragraph 13.4 of this condition shall not apply to the extent
that it conflicts with any legal obligations of the Supplier
or its ultimate parent company. The Supplier shall give BT
advance notice of any intended publications, together with
evidence of the Supplier's legal obligation to publish the
material.
14. FORCE MAJEURE
14.1 Neither party shall be liable to the other party for any delay
in the performance of the Contract directly caused by any
event beyond its reasonable control ("the Force Majeure
Period") provided such party shall have first given the other
party written notice within seven days after becoming aware
that such delay was likely to occur.
14.2 If the Supplier is so delayed and the Force Majeure period
exceeds 25 days, BT shall have the option by written notice to
the Supplier to terminate the Contract forthwith in whole or
in part and have no liability for the whole or part so
terminated.
14.3 For the avoidance of doubt, the provisions of this Condition
shall not affect BT's right to terminate the Contract under
Paragraph 4 of the Condition headed "Termination".
15. DEFAULT
15.1 Subject to the provisions of the Condition headed "Force
Majeure", if the Supplier does not deliver, install, or
complete (as the case may be) any Supplies by the due date,
the Supplier shall be in breach of the Contract and shall pay
to BT on request an amount of liquidated damages in respect of
such delay at the LDR up to the MLDR of the price of the
delayed Supplies.
15.2 BT may, at its option, at any time deduct any amount of
liquidated damages then due from the Supplier to BT from any
sums then due from BT to the Supplier and any not so deducted
may be recovered by BT from the Supplier as a debt.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 12 of 21
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15.3 Payment of, or BT's right to, liquidated damages under this
Condition shall not affect any of BT's rights under the
Condition headed "Termination".
16. RIGHT TO REJECT
16.1 BT shall have the right to reject the whole or any part of the
Supplies that it reasonably considers are not in accordance
with the Contract.
16.2 The Supplier shall at its own risk and expense, replace
rejected Supplies with Supplies that accord with the Contract
within 14 days of notice of rejection from BT.
16.3 Initial receipt of Supplies at the delivery point may be
signed for as unexamined and this shall not affect BT's rights
subsequently to reject those Supplies. Where subsequent
checking shows a deficiency in the quantity of Supplies
delivered, the Supplier shall make good the deficiency within
14 days of notice from BT of the deficiency.
17. LICENCE TO USE INFORMATION
Notwithstanding any other Condition, the Supplier hereby grants to BT
non-exclusive, royalty free, world-wide rights, by or on behalf of BT,
to copy and use information supplied under the Contract or derived by
BT from the Supplies as necessary for the purpose of interfacing with
other equipment as may form part of the BT Network or any other
telecommunications network of those countries listed in Appendix A to
this Schedule.
BT will seek the agreement of the Supplier to extend the license to
such other countries as BT may require. The Supplier shall not
unreasonably withhold such agreement. The extension of the licence will
be subject to BT and the relevant party within the country. Any such
information disclosed to a third party will be performed under a
mutually acceptable non-disclosure agreement.
For such purpose, the Supplier shall promptly provide such additional
Information as BT may request. BT shall pay the costs of the collation,
reproduction and despatch of the Information.
BT shall not deploy any Supplies purchased against this Contract in
any country outside of the UK without the prior agreement of the
Supplier. Such agreement shall not be unreasonably withheld.
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 13 of 21
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18. DELIVERY
18.1 The Supplier shall deliver Supplies in accordance with the
Contract for time of delivery. If no time is so specified, the
Supplier shall deliver Supplies in accordance with such
timescales as the parties may agree or as BT may specify.
18.2 The Supplier shall deliver Supplies ordered by BT to BT at the
addresses in the United Kingdom of Great Britain and Northern
Ireland that BT may specify.
19. REPAIRABILITY
19.1 The Supplier agrees to apply no more than a 20% Gross Margin
on the cost of materials and labour for the repair of any
items supplied against this Contract (that are not subject to
warranty). The Supplier agrees that BT shall have the right to
audit material and labour costs to satisfy themselves that
they are reasonable. If BT does not agree that such costs are
reasonable then the Supplier shall supply to BT as soon as is
reasonably practicable after a request from BT such
Information (including all revisions and updates) in such
format as BT shall reasonably require to enable BT to repair
Supplies or have them repaired by a competent supplier.
19.2 In respect of all components comprised or to be comprised in
Supplies, the Supplier shall:
a) ensure they can be obtained from more than one source
or notify BT accordingly; and
b) ensure they or their specification can be supplied to
BT at any time on request so as to enable manufacture
by any competent supplier.
c) inform BT at least six months before a component
supplier will cease to be able to supply; and,
d) ensure availability of those that are custom-designed
to BT or its suppliers on fair and reasonable terms
or ensure availability of specifications so as to
enable manufacture by any competent supplier; and
e) ensure that any such provisions and undertakings in
any subcontract referred to in this Condition are
fully observed and performed by the subcontractor;
and,
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 14 of 21
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f) notify BT immediately a fault is identified at any
time in their manufacture and in particular, but
without limitation, where BT has already purchased
affected components.
19.3 No separate licence fees shall be payable by BT for the use of
Information supplied in accordance with this Condition. The
Supplier warrants that BT, and any manufacturer or other
supplier nominated by BT, are and shall remain free to use
such Information for the manufacture and supply of components
for use by BT or any third parties in repairing and
maintaining Supplies.
20. SUPPORT AND SPARES
20.1 The Supplier shall ensure availability of such spares and
support as BT may require for the Support Period commencing on
the Commencement Date.
20.2 The Supplier shall by prompt written notice, offer BT such new
or amended versions of Supplies and parts, as may be developed
throughout the Contract Period for the Support Period, but BT
shall not be obliged to accept them.
21. INTERFACE WITH OTHER EQUIPMENT
21.1 The Supplier shall ensure the successful interworking of
Supplies in or with the BT Network, or any other network
specified by BT, existing at the Commencement Date and that
Supplies do not impair or degrade the performance or operation
of the BT Network.
21.2 Within 2 months of any request by BT the Supplier shall
supply, at its own cost such Information as BT may reasonably
require to enable BT to interface and fully interwork Supplies
with the BT Network or any other telecommunications network.
22. TERMINATION
22.1 If the Supplier commits a material breach or persistent
breaches of the Contract, and in the case of a breach which is
capable of remedy, fails to remedy the breach within 14 days
(or such longer period as BT may at its option agree in
writing) of written notice from BT to do so then BT shall have
the right:
a) at any time to terminate the Contract forthwith as a
whole or (at BT's option) in respect of any part of
the Contract to be performed; and
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 15 of 21
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b) to recover from the Supplier all directly resulting
losses and expenses (including, without limitation,
the additional cost of completing Supplies, or having
Supplies completed by another supplier, to a similar
standard).
22.2 BT shall have the right at any time to terminate the Contract
forthwith and to recover from the Supplier all directly
resulting losses and expenses (including, without limitation,
the additional cost of completing the Supplies, or having the
Supplies completed by another supplier, to a similar standard)
if the Supplier shall become insolvent or ceases to trade or
compound with its creditors; or a bankruptcy petition or order
is presented or made against the Supplier; or where the
Supplier is a partnership, against any one partner, or if a
trustee in sequestration is appointed in respect of the assets
of the Supplier or (where applicable) any one partner; or a
receiver or an administrative receiver is appointed in respect
of any of the Supplier's assets; or a petition for an
administration order is presented or such an order is made in
relation to the supplier; or a resolution or petition or order
to wind up the Supplier is passed or presented or made or a
liquidator is appointed in respect of the Supplier (otherwise
than for reconstruction or amalgamation).
22.3 BT may at any time on written notice terminate the Contract
forthwith if the ownership or control of the Supplier is
materially changed to (in BT's reasonable opinion) BT's
detriment.
22.4 BT may at any time on written notice terminate the Contract
forthwith. Where BT terminates the Contract under this
paragraph 4 and does not have any other right to terminate the
Contract, the following shall apply:
a) BT shall subject to subparagraph (b) below, pay the
Supplier such amounts as may be necessary to cover
its reasonable costs and outstanding and unavoidable
commitments (and reasonable profit thereon)
necessarily and solely incurred in properly
performing the Contract in relation to Applicable
Supplies (as defined below) prior to termination.
b) BT shall not pay for any such costs or commitments
that the Supplier is able to mitigate and shall only
pay costs and commitments that BT has validated to
its satisfaction. BT shall not be liable to pay for
any Applicable Supplies that, at the date of
termination, BT is entitled to reject (including any
Supplies for which BT may have issued a Certificate
of Commercial Service) or has already rejected. BT's
total liability under sub-paragraph (a) above shall
not in any circumstances exceed the
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 16 of 21
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price that would have been payable by BT for
Applicable Supplies if the Contract had not been
terminated.
c) In this paragraph 4, "Applicable Supplies" means
Supplies in respect of which the Contract has been
terminated under this paragraph, which were ordered
by BT under the Contract before the date of
termination, and for which payment has not at that
date become due from BT.
d) Sub-paragraphs (a) and (b) above encompass the total
liability of BT for termination pursuant to this
Paragraph 4, and BT shall be liable for no other
costs, claims, damages, or expenses consequent upon
such termination.
22.5 Each right of BT under this Condition is without prejudice to
any other right of BT under this Condition or otherwise.
23. INDEMNITY - INTELLECTUAL PROPERTY
23.1 The Supplier indemnifies BT against all actions, claims,
proceedings, damages, costs and expenses arising from any
actual or alleged infringement of Intellectual Property Rights
or breach of confidentiality by BT's possession or use of any
of the Supplies anywhere licensed to BT in the United Kingdom.
23.2 BT shall notify the Supplier in writing of any such allegation
received by BT and shall not make any admissions unless the
Supplier gives prior written consent.
23.3 At the Suppliers request and expense, BT shall permit the
Supplier to conduct all negotiations and litigation. BT shall
give all reasonable assistance and the Supplier shall pay BT's
costs and expenses so incurred.
23.4 The Supplier may, at its expense, modify or replace the
Supplies to avoid any alleged or actual infringement or
breach. The modification or replacement must not affect the
performance of the Supplies.
23.5 This indemnity shall not apply to infringements or breaches
arising directly from:
a) compliance with the Design Information where such
compliance inevitably results in the infringement.
This exception does not apply to infringements
resulting from a BT requirement that the Supplies
comply with a national or international standard; or
SCHEDULE 2 to CONTRACT NO: 652902 PAGE 17 of 21
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b) the combination of the Supplies with other items not
supplied under the Contract.
23.6 Without prejudice to paragraph 5 (a) of this Condition, BT
warrants that compliance with any such design provided under
the Contract will not cause infringement or breach.
23.7 This Condition shall survive the expiry or termination of the
Contract.
24. INDEMNITY - GENERAL
Without prejudice to any other rights or remedies available to BT, the
Supplier shall indemnify BT against all loss of or damage to any BT
property to the extent arising as a result of the negligence or wilful
acts or omissions of the supplier or Contract Personnel in relation to
the performance of the Contract; and all claims and proceedings,
damages, costs and expenses arising or incurred in respect of:
a) death or personal injury of any Contract Personnel in relation
to the performance of the Contract, except to the extent
caused by BT's negligence; or
b) death or personal injury of any other person to the extent
arising as a result of the negligence or wilful acts or
omissions of the Supplier or Contract Personnel in relation to
the performance of the Contract; or
c) loss of or damage to any property to the extent arising as a
result of the negligence or wilful acts or omissions of the
Supplier or Contract personnel in relation to the performance
of the Contract;
d) or under Part 1 of the Consumer Protection Act 1987 in
relation to Supplies.
25. LIMITATION OF LIABILITY
25.1 Subject to Paragraph 3 of this Condition, neither party shall
be liable to the other under the Contract for any indirect or
consequential loss or damage.
25.2 Subject to Paragraph 3 of this Condition the liability of
either party to the other under this Contract shall not exceed
(pound)2,000,000 per unrelated incident or the greater of
(pound)6,000,000 or the Contract Price in aggregate.
25.3 Paragraphs 1 and 2 of this Condition shall not apply to loss
or damage arising out of or in connection with:
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(i) death or personal injury; or
(ii) the wilful failure of either party to perform its
contractual obligations; or
(iii) paragraph d) of the Condition headed "Indemnity"; or
(iv) the payment of liquidated damages; or
(v) BT's obligation to pay the Contract Price.
(vi) the condition headed `Intellectual Property'
26. INSURANCE
26.1 The Supplier shall at its own expense effect and maintain for
the Contract Period such insurance as required by any
applicable law and as appropriate in respect of its
obligations under the Contract. Such insurances shall include
third party liability insurance with an indemnity limit of not
less than (pound)2,000,000 for each and every claim.
26.2 If the Supplier cannot provide evidence of such insurance to
BT on request, BT may arrange such insurance and recover the
cost from the Supplier.
26.3 The Supplier shall notify BT as soon as it is aware of any
event occurring in relation to the Contract which may give
rise to an obligation to indemnify BT under the Contract, or
to a claim under any insurance required by the Contract.
26.4 This Condition shall not be deemed to limit in any way the
Supplier's liability under the Contract.
27. CONTRACT CHANGE PROCEDURE
The Contract may only be varied by written agreement between each
party's Commercial Contact who shall each respond in writing within ten
days of receipt of a proposal for a variation from the other.
28. NOTICES
Notices required under the Contract to be in writing shall be delivered
by hand, post or facsimile transmission to the Commercial Contact of
the recipient and shall be deemed to be given upon receipt (except
notices sent by facsimile transmission, which shall be deemed to be
given upon transmission).
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29. GENERAL
29.1 The invalidity or unenforceability for any reason of any
provision of the Contract shall not prejudice or affect the
validity or enforceability of its other provisions.
29.2 The headings to the Contract provisions are for reference only
and shall not affect their interpretation.
29.3 a) No delay, neglect or forbearance by either party in
enforcing any provision of the Contract shall be
deemed to be a waiver or in any way prejudice any
rights of that party.
b) No waiver by either party shall be effective unless
made in writing or constitute a waiver of rights in
relation to any subsequent breach of the Contract.
29.4 The Contract governs the relationship between the parties to
the exclusion of any other terms and conditions on which any
quotation or tender response has been given to BT.
29.5 The Contract is governed by English law and subject to the
non-exclusive jurisdiction of the English courts.
29.6 The Supplier shall not be, nor in any way represent itself as,
an agent of BT and shall have no authority to enter into any
obligation on behalf of BT or to bind BT in any way.
29.7 Except as expressly set out in the Contract, no assignment of
or licence under any Intellectual Property Right or trade ▇▇▇▇
or service ▇▇▇▇ (whether registered or not) is granted by the
Contract.
29.8 The following provisions of the Contract shall survive its
termination or expiry in addition to those provisions relating
to intellectual property and those which by their content or
nature will so survive:
BT Supplied Items and Property
Guarantee
Information
Confidentiality
Indemnity
Intellectual Property
Limitation of Liability
Millennium Warranty
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30. DOCUMENTATION
30.1 In this Condition, "Documentation" means the installation,
user and maintenance guides to be supplied under the Contract.
30.2 The Supplier hereby grants to BT non-exclusive, royalty free
rights to:
a) copy and disclose to BT personnel, and personnel
within the BT Group;
b) make adaptations of; and
c) copy and disclose such adaptations of the
Documentation for the purposes of the sale, lease or
hire of the Supplies.
31. USE, TRANSFERABILITY, MAINTENANCE AND MODIFICATION OF SOFTWARE
31.1 In this Condition, "lawful user" is as defined in the
Copyright (Computer Programs) Regulations 1992.
31.2 Notwithstanding any other Condition, the Supplier grants to
BT non-exclusive, royalty free worldwide rights to any
Software supplied under the Contract to the effect that BT
has:
a) all the rights of a lawful user of the Software; and
b) the rights to copy, disclose and use for any purpose
any Information which:
c) has been derived by BT from observing, studying or
testing the functioning of the Software;
d) relates to the ideas and principles which underline
any element of the Software; and
e) is not subject to theSuppliers (or its licensor's)
copyrights in the United Kingdom.
32. VIRUSES AND ELECTRONIC REPOSSESSION
32.1 The Supplier shall use reasonable endeavours ensure that
adequate detection software is used to test the Software and
all updates for viruses and shall take all reasonable steps to
ensure that Software infected by viruses is not supplied under
the Contract. For the purposes of this Paragraph "viruses"
shall include "logic-bombs" as the
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same may be generally understood within the computing industry
from time to time.
32.2 The Supplier warrants that all Software is free of charges,
bias or other encumbrance affecting title or right to deliver
the Software free of encumbrances. Without prejudice to its
other liabilities under the Contract, the Supplier indemnifies
BT against all claims, demands, damages, costs and expenses
suffered by BT and all damage or loss to BT property arising
from any Electronic Repossession. For the purpose of this
Condition, "Electronic Repossession" shall mean any function
in the Software which prevents BT from Continuing to use the
Software.
APPENDIX A
Australia Taiwan
Austria Thailand
Belgium USA
Canada
China
Czech Republic
Denmark
France
Germany
Greece
Hungary
India
Indonesia
Israel
Italy
Japan
Kenya
Lebanon
Malaysia
Netherlands
New Zealand
North East Asia
Norway
Portugal
Romania
Russia
Saudi Arabia
Singapore
Slovakia
South Africa
South Korea
Spain
Sweden
Switzerland