Exhibit 10.3
MASTER SUPPLY AGREEMENT
BY AND BETWEEN
DIVEO, INC.
AND
LUCENT TECHNOLOGIES WORLD SERVICES, INC.
Effective as of November 22, 1999
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Master Supply Agreement Diveo / Lucent Confidential
TABLE OF CONTENTS
1. AGREEMENT OVERVIEW......................................................1
1.1. General...............................................................1
1.2. Territory.............................................................1
1.3. Strategic Relationship................................................2
2. TERM....................................................................2
2.1. Initial Term..........................................................2
2.2. Extension.............................................................2
3. PURCHASING AND ORDERING.................................................3
3.1. Purchase Orders.......................................................3
3.2. Administrative Changes................................................4
3.3. Timing of Delivery....................................................4
3.4. Cancellation and Rescheduling of Purchase Orders......................6
3.5. Termination of Purchase Orders........................................7
3.6. Demonstration Products................................................8
4. SHIPPING AND DELIVERY...................................................8
4.1. Incorrect Delivery....................................................8
4.2. Purchase Order Tracking...............................................8
4.3. Packing...............................................................8
4.4. Labeling..............................................................9
4.5. Factory Testing.......................................................9
4.6. Shipping..............................................................9
4.7. Title and Risk of Loss...............................................10
5. DELIVERY OF SERVICES...................................................10
5.1. Use of Third Parties.................................................10
5.2. Key Lucent Positions and Management Escalation Process...............11
5.3. Implementation Plans, Milestones and Milestone Dates.................12
6. ACCEPTANCE TESTING AND FINAL ACCEPTANCE................................12
6.1. Acceptance Testing...................................................12
6.2. Acceptance Testing Failures, Cure Periods and Remedies...............13
6.3. Acceptance...........................................................13
7. SERVICE LEVELS.........................................................14
7.1. General..............................................................14
7.2. Failure to Perform...................................................14
7.3. Periodic Reviews.....................................................14
7.4. Measurement and Monitoring Tools.....................................15
8. SOFTWARE LICENSES AND PROPRIETARY RIGHTS...............................15
8.1. Licenses.............................................................15
8.2. Proprietary Rights...................................................16
8.3. Right to Resell and Sublicense.......................................17
8.4. Technical Materials Availability.....................................18
9. DIVEO RESPONSIBILITIES.................................................18
9.1. Facilities and Resources.............................................18
9.2. Savings Clause.......................................................18
10. CHARGES..............................................................19
10.1. General..............................................................19
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Master Supply Agreement i Diveo / Lucent Confidential
10.2. Taxes................................................................19
10.3. Incidental Expenses..................................................20
10.4. Commitment...........................................................20
10.5. Lucent-Provided Financing............................................21
10.6. Competitive Pricing..................................................23
11. INVOICING AND PAYMENT................................................24
11.1. Invoicing............................................................24
11.2. Payment Due..........................................................25
11.3. Accountability.......................................................26
11.4. Proration............................................................26
11.5. Set Off..............................................................26
11.6. Disputed Charges.....................................................27
11.7. Encumbrances.........................................................27
12. CONFIDENTIALITY......................................................27
12.1. Confidential Information.............................................27
12.2. Obligations..........................................................27
12.3. Exclusions...........................................................28
12.4. No Implied Rights....................................................28
13. REPRESENTATIONS, WARRANTIES AND COVENANTS............................29
13.1. Pass-Through Warranties..............................................29
13.2. Ownership or Use.....................................................29
13.3. Authorization........................................................29
13.4. Inducements..........................................................29
13.5. Work Standards.......................................................30
13.6. Product Warranties...................................................30
13.7. Discontinued Lucent Products.........................................31
13.8. Compliance...........................................................32
13.9. Integration..........................................................32
13.10. Documentation........................................................33
13.11. Viruses..............................................................33
13.12. Disabling Code.......................................................33
13.13. Year 2000............................................................34
13.14. Disclaimer...........................................................34
14. TERMINATION..........................................................34
14.1. Termination for Cause................................................34
14.2. Termination by Lucent................................................35
14.3. Termination Option for Lucent's Failure to Provide Financing.........35
14.4. Disengagement Assistance.............................................35
15. LIABILITY............................................................35
15.1. General Intent.......................................................35
15.2. Liability Restrictions...............................................36
15.3. Force Majeure........................................................36
16. INDEMNIFICATION......................................................37
16.1. Indemnities by Lucent................................................37
16.2. Indemnities by Diveo.................................................38
16.3. Infringement.........................................................38
16.4. Indemnification Procedures...........................................39
17. DISPUTE RESOLUTION...................................................40
17.1. Informal Dispute Resolution..........................................40
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Master Supply Agreement ii Diveo / Lucent Confidential
17.2. Litigation...........................................................40
17.3. Continued Performance................................................41
17.4. Governing Law........................................................41
18. INSURANCE REQUIREMENTS...............................................41
19. GENERAL..............................................................42
19.1. Binding Nature and Assignment........................................42
19.2. Entire Agreement.....................................................42
19.3. Notices..............................................................42
19.4. Counterparts.........................................................43
19.5. Relationship of Parties..............................................43
19.6. Severability.........................................................43
19.7. Consents and Approval................................................43
19.8. Waiver of Default....................................................44
19.9. Cumulative Remedies..................................................44
19.10. Survival.............................................................44
19.11. Public Disclosures...................................................44
19.12. Service Marks........................................................45
19.13. Third Party Beneficiaries............................................45
19.14. Amendment............................................................45
19.15. Interpretation.......................................................45
19.16. Incorporation by Reference and Order of Precedence...................45
19.17. Right of Access......................................................46
19.18. Export Control.......................................................46
LIST OF SCHEDULES
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Glossary Glossary of Defined Terms
Schedule A Scope of Deliverables
Schedule B Service Level Agreements
Schedule C Pricing
Schedule D Territory
Schedule E Product Documentation and Specifications
Schedule F Acceptance Test Plans
Schedule G Training
Schedule H Warranty Periods
Schedule I Key Lucent Personnel and Escalation Procedures
Schedule J Purchase Order and Change Order Process
Schedule K City Plan Template
Schedule L Diveo Requirements Document
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Master Supply Agreement iii Diveo / Lucent Confidential
MASTER SUPPLY AGREEMENT
This Master Supply Agreement (together with the Schedules attached hereto,
the "Agreement"), effective as of November 22, 1999 (the "Effective Date"), is
entered into by and between DIVEO, INC., a Delaware corporation with offices
located at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ (and
together with its Affiliates, "Diveo" or "Buyer"), and LUCENT TECHNOLOGIES WORLD
SERVICES, INC., a Delaware corporation with offices located at ▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Lucent" or "Seller"). The Parties
agree that the following terms and conditions shall apply to the products and
services to be provided by Lucent under this Agreement in consideration of
certain payments to be made by Diveo. Capitalized terms used in this Agreement
are defined in the "Glossary of Defined Terms" attached hereto and incorporated
herein by this reference.
1. AGREEMENT OVERVIEW
1.1. General.
(a) This Agreement sets forth the general terms and conditions
under which Diveo may purchase and receive Products and
Services from Lucent.
(b) The Parties acknowledge that this Agreement does not grant to
Lucent an exclusive privilege to sell or otherwise provide to
Diveo any or all of the Products or Services of the type
described in this Agreement. Diveo may contract with other
manufacturers and suppliers for the procurement of comparable
equipment, software, systems, deliverables or services. Lucent
is not restricted from selling the types of products or
services that may be purchased and ordered by Diveo hereunder
to other parties, except as provided in Section 8.2 with
respect to Developed Deliverables.
(c) Promptly following the Effective Date, Diveo shall cause its
Affiliates in the Territory to execute supplemental signature
pages to this Agreement in order to permit such Affiliates to
purchase Products and Services under this Agreement. Likewise,
Lucent shall, promptly following the Effective Date, cause its
Affiliates in the Territory to execute supplemental signature
pages to this Agreement to obligate such Affiliates to the
terms and conditions of this Agreement. Diveo and Lucent each
agree to guarantee the performance of their respective
Affiliates under this Agreement.
1.2. Territory.
(a) The Parties agree that as of the Effective Date the terms of
this Agreement shall apply with respect to Lucent's provision
of Products and Services within the Territory to Diveo and
Diveo's Affiliates.
(b) The Territory shall be expanded in the event that (i) the
Parties mutually agree to add a country to the list of those
countries comprising the Territory, in which case, the Parties
shall amend Schedule D to list such country or (ii) Lucent or
its Affiliates are directly selling in the normal course of
business in other countries in Latin America similar type
products and services as those that Diveo can
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Master Supply Agreement 1 Diveo / Lucent Confidential
purchase hereunder, in which case, Schedule D shall be deemed
to be amended to include such additional countries.
1.3. Strategic Relationship.
(a) Lucent-provided Roof Rights and Building Access. If requested
by Diveo, Lucent shall grant to Diveo, at no cost to either
Party, roof and interior rights to buildings in the Territory
owned by Lucent. In addition, Lucent shall, at no out of
pocket cost from Lucent to a third party, reasonably assist
Diveo in obtaining such rights with respect to any other
buildings leased or occupied by Lucent in the Territory.
Nothing herein shall obligate Lucent to violate any of its
existing real property lease agreements or any other agreement
or legal instrument to which Lucent is subject. Within ninety
(90) days of the Effective Date and semi-annually thereafter
upon Diveo's written request, Lucent shall provide Diveo with
a written list of all addresses of current real estate
properties owned or leased by Lucent in the Territory.
(b) Business Development. The Parties will provide reasonable
marketing support to each other in connection with business
opportunities of each Party. Such support may also include
co-marketing activities where Lucent would also sell Diveo
services and products in conjunction with Lucent services and
products.
(c) Network Element Recommendations. From time to time during the
Term of this Agreement, Lucent may provide, under a Purchase
Order Project Engineering and Professional Services (as
referred to in Schedule A). In the Event Diveo engages Lucent
to provide such Project Engineering and Professional Services
pursuant to an accepted Purchase Order, Lucent agrees to
consider what is in the best interests of Diveo in making
product and services recommendations, including recommending
Third Party Products and services where appropriate, even
where Lucent has competing products and services.
2. TERM
2.1. Initial Term.
The term of this Agreement shall begin upon the Effective Date and
shall continue for a period of five years (the "Initial Term"),
unless terminated earlier or extended in accordance with this
Agreement.
2.2. Extension.
This Agreement shall be extended for additional one year periods on
the terms then in effect (each, an "Extended Term" and together with
the Initial Term, the "Term") unless (i) a Party gives the other
Party written notice sixty (60) days prior to the expiration of the
Initial Term or Extended Term or (ii) the Agreement is otherwise
terminated earlier in accordance with the terms of this Agreement.
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Master Supply Agreement 2 Diveo / Lucent Confidential
3. PURCHASING AND ORDERING
3.1. Purchase Orders.
(a) All purchases of Products or Services shall be made by means
of orders (each, a "Purchase Order", such term to include any
changes made to the Purchase Order pursuant to the terms of
this Agreement, including the Change Order process set forth
in Schedule J) issued and executed by Diveo or any of Diveo's
Affiliates to Lucent (or Lucent's applicable Affiliate, in the
case of Services to be performed in one of the countries
forming part of the Territory) from time to time pursuant to
this Section and Schedule J. Diveo will not be liable to
Lucent for any charges, additional or otherwise, for Products
or Services provided by Lucent unless set forth in a Purchase
Order, or otherwise mutually agreed upon by the Parties in
writing.
(b) Lucent agrees to provide and deliver, and Diveo agrees to
purchase according to the terms of this Agreement, including
the Purchase Order and Change Order Process and lead times set
forth in Schedule J:
(i) Any Product or Service listed in a Schedule hereto that
is specified by Diveo in a Purchase Order that conforms
to Subsection (f) of this Section; and
(ii) Any other Product or Service specified by Diveo in a
Purchase Order that conforms to Subsection (f) of this
Section and is accepted or is deemed to be accepted by
Lucent in accordance with Subsection (d) below.
(c) Schedule J contains Purchase Order processes that the Parties
will utilize in connection with the issuance of Purchase
Orders. Part of this process includes Purchase Order
Initiation Forms (POIFs).
(i) Within five (5) Business Days after Lucent's receipt of
a POIF, which Diveo may present in connection with the
potential supply of Third Party Content to be provided
on a cost plus basis or other Products and Services
(including those to be provided by Lucent) for which no
price is specified in Schedule C, Lucent shall
acknowledge its receipt of such POIF and shall provide
Diveo with its preliminary feedback regarding the
subject matter thereof.
(ii) As soon as practicable, but in any event within fifteen
(15) business days after Lucent's receipt of the POIF,
Lucent shall, to the extent applicable, identify for
Diveo's approval: (1) the proposed third party
suppliers, (2) their associated price quotations, (3)
any other proposed terms relating to the purchase of
such Products or Services from such third parties, and,
(4) in the case of Products or Services to be provided
by Lucent, the proposed Lucent price (subject to and in
accordance with the pricing set forth in this
Agreement).
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Master Supply Agreement 3 Diveo / Lucent Confidential
(iii) If Lucent fails to comply with its obligations as
specified in this Subsection (c), but Diveo nevertheless
proceeds to order the related Third Party Content
through Lucent, Lucent shall only be entitled to an 8%
markup on such Third Party Content (i.e., Lucent shall
not be eligible for the full 20% markup that it
otherwise might have been able to earn with respect to
such purchase as provided in Schedule C); provided that
nothing in this provision shall be deemed to limit
Lucent's otherwise applicable obligations with respect
to such Third Party Content.
(d) To the extent that any Purchase Order is either consistent
with (i) the requirements of a City Plan approved by Lucent or
(ii) Lucent's ordering lead times set forth in Schedule J for
the Products and Services identified therein, then Lucent may
not reject such Purchase Order and shall be deemed to have
accepted a Purchase Order on the first business day
immediately following receipt of such Purchase Order.
Otherwise, Lucent shall be deemed to have accepted a Purchase
Order by close of business of the tenth (10th) business day
following receipt of such Purchase Order if Lucent has not
notified Diveo in writing of its rejection of the Purchase
Order pursuant to Section 19.3 prior to such time. In the
event of a disaster declared by Diveo, Lucent will use
commercially reasonable efforts to expedite the acceptance of
any Purchase Orders that are submitted by Diveo as a means of
mitigating the adverse effects to Diveo of such disaster;
provided, however, that the terms and conditions of Section
3.3(c) shall not apply to such Purchase Order.
(e) Estimates or forecasts furnished by Diveo to Lucent shall not
constitute Purchase Orders or commitments for purchases.
(f) Purchase Orders placed under this Agreement may be made by
means of mail or fax pursuant to Section 19.3, Diveo's
extranet ordering system, or such other mutually agreed upon
methods (e.g., electronic data interchange). No Purchase Order
or other ordering document which would otherwise modify or
supplement this Agreement or any Schedule shall add to or vary
the terms of this Agreement. All such proposed variations or
additions (whether submitted by either Party) are hereby
objected to and deemed material. Each Purchase Order shall
contain the applicable information set forth in Schedule J.
3.2. Administrative Changes.
Lucent will use commercially reasonable efforts to notify Diveo at
least thirty (30) calendar days in advance of any administrative
changes with respect to any Product set forth in Schedule A or
previously provided by Lucent to Diveo, such as changes in product
part numbers or descriptions, as well as newly compatible products
or components.
3.3. Timing of Delivery.
(a) The Delivery and Acceptance dates for Products and Delivery
for Services shall be firm. Lucent will deliver Products and
Services strictly in accordance with
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Master Supply Agreement 4 Diveo / Lucent Confidential
the terms and conditions of accepted or deemed accepted
Purchase Orders or Change Control Form (as such Change Control
Form is further described in Schedule J).
(b) If Lucent discovers any potential delay that threatens the
timely Delivery and Acceptance of Products or the Delivery of
Services with respect to a Purchase Order, Lucent shall
immediately notify Diveo of such delay. If requested by Diveo,
Lucent shall provide a written plan for correction of such
delay.
(c) Subject to Sections 3.1(d), 9.2 and 15.3, if Lucent fails to
deliver
(i) any Product or Service for which a corresponding
Delivery time is set forth in Schedule J of the
Agreement in accordance with such corresponding Delivery
time;
(ii) any other Products or Services in accordance with the
scheduled Delivery date or Acceptance date set forth in
the corresponding accepted Purchase Order;
then after five (5) business days following such scheduled
Delivery or Acceptance date, as applicable, Diveo shall be
entitled to deduct from the price of the Products, Services or
both (if included in the Purchase Order) an amount equal to
one-tenth of a percent (.1%) of the price of Products and
Services under such Purchase Order for each calendar day of
delay after such five-day grace period until actual Delivery
or Acceptance (or Provisional Acceptance), as applicable, of
such Products and Services, up to a maximum deduction of one
hundred percent (100%) of the price for such Products and
Services (the "Delivery Pricing Adjustment"). Notwithstanding
the preceding sentence, Lucent shall not be liable for a
Delivery Pricing Adjustment to the extent that Lucent can
demonstrate that its failure to deliver a Product or Service
in accordance with the scheduled Delivery or Acceptance date,
as applicable, set forth in the corresponding Purchase Order
is reasonably caused by (i) the wrongful actions of Diveo, or
(ii) a force majeure condition as defined in this Agreement,
or (iii) a change, revision, modification, or special
requirement with respect to such Product, or Service, or the
Delivery date for such Product or Service, each to the extent
requested by Diveo and approved by Lucent after Lucent has
accepted the Purchase Order corresponding to such Product or
Service. To the extent that Diveo has not otherwise terminated
the Purchase Order as provided in Subsection 3.5 below and
Diveo has elected to take the Delivery Pricing Adjustment as
provided above, such adjustment shall be Diveo's sole and
exclusive monetary remedy with respect to the delay
attributable to the failure to complete the Purchase Order;
provided, however, that in the event Lucent has persistent
delays over multiple Purchase Orders, such Delivery Pricing
Adjustment shall be in addition to any other rights or
remedies Diveo may have under this Agreement or at law or in
equity. Lucent agrees not to make an economic determination
not to deliver a Product or Service under a particular
Purchase Order due to the Delivery Pricing Adjustment.
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Master Supply Agreement 5 Diveo / Lucent Confidential
(d) If Lucent fails to make any Delivery or Acceptance (or
Provisional Acceptance) of a Product or Delivery of a Service
within the lesser of
(i) forty-five (45) calendar days after the scheduled
Delivery date or Acceptance date set forth in the
corresponding Purchase Order, and
(ii) such other time period as mutually agreed by the
Parties,
Then Diveo shall be entitled to terminate the corresponding
Purchase Order in accordance with Section 3.5.
(e) Lucent agrees to use its commercially reasonable efforts to
have scheduled shipment dates for Purchase Orders to be as
close to the Delivery date as possible.
3.4. Cancellation and Rescheduling of Purchase Orders
(a) Diveo can cancel Purchase Orders with respect to Products
contained in such Purchase Orders, in whole or in part at no
cost or liability anytime up to forty-five (45) days prior to
the scheduled shipment date for such Product. Should Diveo
cancel any Purchase Order for Products, in whole or in part
other than pursuant to Section 3.5, during the forty-five (45)
day period prior to the scheduled shipment date, Diveo agrees
to pay to Lucent cancellation and reconfiguration charges
equal to:
(i) five percent (5%) of the value of the canceled portion
of the Purchase Order if the cancellation notice is
given between twenty (20) and forty-five (45) days prior
to the scheduled shipment date; or
(ii) twenty percent (20%) of the value of the canceled
portion of the Purchase Order if the cancellation notice
is given within twenty (20) days prior to the scheduled
shipment date.
(b) Diveo can cancel Purchase Orders with respect to Services
contained in such Purchase Orders, in whole or in part, at no
cost or liability anytime prior up to twenty (20) days prior
to the scheduled start date set forth in the Purchase Order.
Should Diveo cancel any Purchase Order for Services, in whole
or in part other than pursuant to Section 3.5, during the
twenty (20) day period prior to the scheduled start date,
Diveo agrees to pay to Lucent cancellation charges for which
Diveo has been given prior notice on an Out-of-Pocket Expenses
basis equal to Lucent's demonstrable cancellation fees payable
to a third party, if any, as a direct result of such Diveo
cancellation..
(c) Purchase Orders for Products only may not be canceled
following shipment of the Products. Purchase Orders for
Services only may not be canceled following start of the
Service. The foregoing shall not impact any rights or remedies
otherwise available to Diveo under this Agreement.
(d) Following the Change Control process as specified in Schedule
J, Diveo may change the "ship to" destination of any Product
corresponding to a Purchase
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Master Supply Agreement 6 Diveo / Lucent Confidential
Order by submitting notice to Lucent in writing at least ten
(10) calendar days prior to delivery of the Product(s) at the
designated site. If such change is requested by Diveo with
less than forty-eight hours of notice prior to shipment,
Lucent will use all reasonable efforts to implement such
change. Diveo will be responsible for all additional
Out-of-Pocket Expenses that Lucent reasonably incurs as a
direct result of such change. Lucent will provide Diveo with
an estimate of such Out-of-Pocket Expenses as soon as possible
following Diveo's notice.
(e) Diveo may, without cost to Diveo, reschedule Delivery of any
Product corresponding to any Purchase Order at anytime prior
to actual shipment such that the resulting rescheduled
shipping date is up to one hundred twenty (120) days from the
original scheduled shipment date specified in the Purchase
Order (or such later date as either mutually agreed upon by
the Parties or identified as the ship date by Lucent);
provided, however, that unless otherwise agreed upon by the
Parties, Diveo may not reschedule any Product if the Delivery
of such Product was previously rescheduled by Diveo pursuant
to this Subsection (e). Such rescheduling shall be at no
liability to Diveo. Provided that the rescheduling was not
caused by delays by Lucent, Diveo shall be responsible solely
for additional Out-of-Pocket Expenses actually incurred by
Lucent for third party storage and transportation, if any.
(f) Diveo may reschedule Delivery of any Service corresponding to
any Purchase Order at anytime prior to scheduled start date
such that the resulting rescheduled delivery date is up to one
hundred twenty (120) days from the original start date
specified in the Purchase Order (or such later date as either
mutually agreed upon by the Parties). Such rescheduling shall
be at no cost or liability to Diveo.
(g) For the limited purpose of Diveo exercising its rights to
cancel or reschedule Delivery of Purchase Orders pursuant to
this Section only, all references in this Section 3.4 to the
scheduled shipment date specified in the Purchase Order shall
be extended day-for-day by the number of days Lucent is
delayed or is reasonably expected to be delayed in meeting the
scheduled shipment date.
3.5. Termination of Purchase Orders.
(a) As provided in Sections 3.3(d) and 6.2, Diveo may, by giving
written notice to Lucent, terminate the applicable Purchase
Order, in whole or in part, for cause as of a date specified
in the notice of termination. Additionally, in the event that
a Product fails to comply with the applicable Acceptance
Criteria as set forth in the Agreement, then Diveo may, by
giving written notice to Lucent, terminate, in whole or in
part for cause as of a date specified in the notice of
termination, any Purchase Orders under which Diveo has ordered
a quantity of the same Product or related Services and Lucent
has not yet Delivered such Products or related Services.
(b) In either of such events as described in Subsection (a), Diveo
may return to Lucent, those Products forming part of the same
Purchase Order that were delivered by Lucent during the sixty
(60) days immediately preceding the
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Master Supply Agreement 7 Diveo / Lucent Confidential
termination of the Purchase Order and that were intended to be
integrated and/or installed by Lucent with the foregoing
Products subject of the events described in Subsection (a), in
which case Lucent shall promptly refund to Diveo all charges
paid by Diveo to Lucent for such Products, and Diveo shall
have no further payment obligations to Lucent with respect to
such Products. The foregoing refund will be in the form of a
credit and payable by Lucent to Diveo in accordance with
Section 11.1(c).
3.6. Demonstration Products.
From time to time and at Diveo's reasonable request and at Lucent's
discretion, Lucent may, at no charge, provide Diveo with limited
quantities of Lucent Products not previously introduced to the
market generally by Lucent for the purpose of Diveo's evaluation (or
demonstration) for a trial period. Such trial shall be conducted
upon written terms and conditions mutually acceptable to the
Parties.
4. SHIPPING AND DELIVERY
4.1. Incorrect Delivery.
(a) Early deliveries of Products may be refused due to space or
security considerations and returned or stored at Lucent's
expense and risk of loss.
(b) Diveo assumes no liability for Services rendered or Products
produced, processed, rendered or shipped in excess of the
amounts specified in any Purchase Order submitted pursuant to
this Agreement.
(c) If Lucent makes a proper shipment in a timely manner and the
Diveo facility is not prepared to receive the shipment, Diveo
will be responsible for unavoidable Out-of-Pocket Expenses
that Lucent reasonably incurs as a direct result of Diveo's
failure to prepare. Lucent will provide Diveo with an estimate
of such Out-of-Pocket Expenses as soon as possible following
Diveo's notice.
4.2. Purchase Order Tracking.
In accordance with Schedule J, Lucent shall be responsible for
tracking and reporting on the Delivery and Acceptance (if
installation Services are being provided) of all Products from
receipt of the corresponding Purchase Order until Delivery or
Acceptance, as applicable, of such Products to the Diveo-designated
place of Delivery or Acceptance. Lucent will provide Diveo with
current status reports and information on Purchase Orders on a
monthly basis or more often as requested by Diveo and such other
information and reports as reasonably requested by Diveo regarding
Purchase Orders.
4.3. Packing.
All Products delivered to Diveo pursuant to this Agreement shall be
preserved, packaged and packed by Lucent to ensure safe Delivery to
their destinations without damages due to shipment.
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Master Supply Agreement 8 Diveo / Lucent Confidential
4.4. Labeling.
(a) Lucent will label each component of any Lucent Product no
later than at the time of Delivery of such components (or upon
installation if Lucent is to provide installation Services in
connection with such components). In addition to the
foregoing, Lucent will use reasonable and good faith efforts
to label each component of any Lucent Product, each container
and each set of packing documentation with any Diveo-provided
asset identification information prior to the Delivery or
installation of such components. Lucent shall follow industry
practices in labeling Products.
(b) Lucent will ▇▇▇▇ each shipping carton with (i) a brief
description of the contents and quantities of the Products
shipped within such shipping carton, and (ii) the address of
the Delivery destination specified on the applicable Purchase
Order.
4.5. Factory Testing.
The Lucent Products shall be tested by Lucent in accordance with
Lucent's relevant standard factory testing procedures. Diveo shall
have the right, but not the obligation, to be present during the
performance of such factory tests. If requested by Diveo, Lucent
agrees to provide results of the tests for such Lucent Products
purchased by Diveo hereunder, consistent with Lucent's applicable
policies.
4.6. Shipping
(a) Lucent will notify Diveo of Lucent's intent to ship Products
within a reasonable time prior to the scheduled Delivery date
as specified in the Purchase Order at the Delivery destination
address specified in a Purchase Order, so as to permit Diveo
to make necessary arrangements for receipt of the shipment.
The foregoing notwithstanding, Lucent shall deliver such
Products consistent with the agreed upon City Plan and
otherwise in accordance with the Agreement.
(b) Lucent will ship all Products to the Delivery destination
specified by Diveo in the corresponding Purchase Order in
accordance with applicable laws and regulations. All shipments
to Diveo's premises shall be consistent with Diveo's
reasonable shipping and delivery processes and procedures
provided or identified to Lucent in writing. Lucent will (i)
ship all deliveries complete unless otherwise agreed by Diveo,
and (ii) not ship any substitute item in place of a Product
specified in a Purchase Order that differs in form, fit or
function, unless otherwise agreed by Diveo in writing.
(c) Unless otherwise instructed by Diveo, Lucent will:
(i) enclose a packing memorandum with each shipment and,
when more than one package is shipped, identify the one
which contains the memorandum;
(ii) verify that bills of lading match corresponding shipping
invoices; and
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Master Supply Agreement 9 Diveo / Lucent Confidential
(iii) forward applicable bills of lading and shipping notices
with items shipped.
(d) All deliveries will be made as provided in Schedule C.
4.7. Title and Risk of Loss.
(a) Risk of loss of any Product shipped to Diveo will pass to
Diveo upon delivery of the Product to the designated site. In
the event a Product or Products are ordered with installation,
implementation and/or engineering Services, Lucent shall
continue to be responsible for all risk of loss on such
Product or Products (as if risk of loss did not pass upon
Delivery) until Acceptance of the Product or Products. In
connection with all of the foregoing, Lucent shall obtain all
necessary insurance its own name and shall be responsible for
any loss to the Products prior to the time periods set forth
above.
(b) License to use Software and title to Products shall pass to
Diveo as follows:
(i) Where a Product or Software is shipped to the designated
site or destination specified in the Purchase Order from
a country that is different from the country of such
designated site or destination (the country of such
designated site or destination the "Destination
Country"), such title to the Product or license to use
such Software, as applicable, shall pass immediately
prior to importation in the Destination Country; or
(ii) Where a Product or Software is shipped to the designated
site or destination specified in the Purchase Order from
within the same country as the country of such
designated site or destination, such title to the
Product or license to use such Software, as applicable,
shall pass upon delivery of such Product or Software to
the designated site or destination specified in the
Purchase Order.
5. DELIVERY OF SERVICES
5.1. Use of Third Parties.
(a) Lucent shall notify Diveo in writing in advance of engaging
any subcontractor to perform any of the obligations of Lucent
hereunder. Diveo shall have five (5) business days (or two (2)
business days in the event of an emergency) from receipt of
such notification to approve or disapprove the named
subcontractor in writing, provided that any disapproval of a
subcontractor is reasonably based. In the event that Diveo
fails to disapprove a subcontractor within the aforesaid
period, Diveo shall be deemed to have approved the said
subcontractor.
(b) Lucent will remain solely responsible for all obligations
performed by its subcontractors to the same extent as if such
obligations were performed by Lucent itself. Lucent shall be
Diveo's sole point of contact regarding Products and Services
provided by such subcontractors, including with respect to
payment. Lucent will not disclose Confidential Information of
Diveo to a
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Master Supply Agreement 10 Diveo / Lucent Confidential
subcontractor unless and until such subcontractor has agreed
in writing to protect the confidentiality of such information
in a manner substantially equivalent to that required of
Lucent under this Agreement, and in all respects, only on a
"need-to-know" basis.
(c) Upon Diveo's request, Lucent shall provide program management
with respect to Diveo's personnel and third party service
providers contracted directly by Diveo to perform services
related to the Products and Services. Subject to the terms of
this Agreement, Diveo retains the option (at its sole
discretion) to utilize their direct, indirect or contracted
personnel to perform services under this Agreement. In the
event Lucent intends to subcontract a particular component of
the Services to a third party, Lucent shall notify Diveo and
Diveo shall have the option (which option shall be exercised
within a reasonable time), in its sole discretion, to perform
such services itself or through its own subcontractor. Such
Diveo personnel and third parties shall not be considered
Lucent subcontractors for the purposes of this Agreement and
Lucent shall not be liable for the performance of such
services under this Agreement.
5.2. Key Lucent Positions and Management Escalation Process.
(a) Lucent shall assign individuals reasonably acceptable to Diveo
to fill the "Key Lucent Positions" set forth as such in
Schedule I, as Schedule I is amended from time to time by the
mutual written agreement of the Parties.
(b) In accordance with Section 17.1, issues arising between the
Parties may be escalated in accordance with management
escalation procedures set forth in Schedule I.
(c) Lucent agrees to use reasonable efforts to minimize any
turn-over or reassignment of the personnel filling the Key
Lucent Positions. Lucent agrees that personnel filling Key
Lucent Positions may not be transferred or re-assigned until a
suitable replacement has been put into place and the functions
and responsibilities of the individual being transferred or
re-assigned have been properly transitioned to the
replacement. Lucent agrees to consult with Diveo in connection
with the transfer or re-assignment of any personnel in the Key
Lucent Positions.
(d) As further provided in Schedule I, upon commencement of each
project (i.e., installation, implementation and/or engineering
Services), and until such time as the implementation for such
project is complete, Lucent shall appoint and maintain a
project manager, reasonably acceptable to Diveo, to devote the
necessary time and effort to the provision of the Services
required to fulfill the implementation of such project. Diveo
shall likewise appoint a project manager for each project.
Each Party's project manager shall be familiar with the
project and shall have authority to make day-to-day and
emergency decisions on behalf of such Party during the
implementation of the project.
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Master Supply Agreement 11 Diveo / Lucent Confidential
5.3. Implementation Plans, Milestones and Milestone Dates.
For all projects (e.g., installation, implementation and/or
engineering Services) that result in the installation,
implementation and/or engineering of of Product(s):
(a) Lucent shall prepare for Diveo's review, comment and approval,
a detailed, task-level implementation plan delineating
milestones (each, a "Milestone"), Milestone completion dates
(each, a "Milestone Date"), together with each Party's
respective responsibilities associated with the installation
or implementation work.
(b) If Lucent fails to achieve a Milestone on or before the
corresponding Milestone Date, (i) Lucent's Country Project
Manager (or in the event such position no longer exists, an
executive with a similar level of responsibility) will meet
with Diveo in person at Diveo's facilities, explain to Diveo
the root cause for the delay, and present to Diveo a plan to
remedy such failure, (ii) Lucent will take appropriate
preventive measures so that the failure does not recur, and
reasonably demonstrate to Diveo that such measures have been
performed.
6. ACCEPTANCE TESTING AND FINAL ACCEPTANCE
6.1. Acceptance Testing.
(a) Schedule F (Acceptance Test Plans) describes the three levels
of testing for the Products (i.e., unit testing, network
element testing and system testing) and such testing will be
implemented in accordance with Schedule F.
(b) In the event Lucent is providing Services that includes
Acceptance testing of Products, Lucent shall perform the
testing (for Diveo's review and Acceptance) in accordance with
Schedule F and the applicable Acceptance Test Period.
Alternatively, if Diveo is performing the Acceptance testing
without the assistance of Lucent, Acceptance testing of the
Products shall be conducted by Diveo within the applicable
Acceptance Test Period.
(c) In either case as set forth in (b) above, if such Product(s)
meets its Acceptance Criteria, Diveo will notify Lucent in
writing that such Product has received Acceptance pursuant to
Section 6.3. If such Product(s) does not meet its Acceptance
Criteria, Diveo may notify Lucent in writing of the failures
of the Product(s) to meet its Acceptance Criteria and Lucent
shall correct such problems in accordance with Section 6.2;
provided, however, if Lucent is providing Services that
includes Acceptance testing, Diveo shall not be obligated to
provide such notice of failures until such time following
Lucent's notice to Diveo that the Products have passed the
applicable Acceptance Criteria (i.e., Lucent Certification)
and are available for verification by Diveo in accordance with
Schedule F. Alternatively, Diveo may accept such Product
pursuant to Section 6.3 upon the condition that such failures
will be corrected by Lucent within a period of time reasonably
specified by Diveo (such acceptance a "Provisional
Acceptance"). In the event Diveo or its Affiliates, as
applicable, places a Product into commercial, revenue
producing service, such Product shall
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Master Supply Agreement 12 Diveo / Lucent Confidential
be considered Provisionally Accepted; provided that final
Acceptance of such Product shall be based upon the condition
that all other Products subject of the Purchase Order that are
required to be installed together and integrated as a complete
system also pass Acceptance.
6.2. Acceptance Testing Failures, Cure Periods and Remedies.
(a) If any Product(s) subject to Acceptance testing as described
in Section 6.1 fails to pass Acceptance testing, Diveo will
promptly (and in no event later than the applicable Acceptance
Testing Period) notify Lucent in writing, specifying the
nature of the failure in reasonable detail. Within ten (10)
days after receiving notice from Diveo, Lucent shall either
(i) correct all problems identified by Diveo, or, if that is
not reasonably possible, (ii) develop a plan for Diveo's
acceptance that describes in reasonable detail the steps
Lucent intends to take to correct such problem(s) within
thirty (30) days, and diligently proceed according to the plan
until all of the problem(s) are corrected. Upon completion of
such problem corrections, Diveo shall reconduct the Acceptance
testing as provided in Section 6.1 to the extent that Diveo
deems necessary to determine the compliance of the Product
with the Acceptance Criteria.
(b) Notwithstanding Subsection (a) above, if after a reasonable
number of repeated efforts (but not more than three (3)
attempts or more than a total of sixty (60) days for curing
all problems encountered), Lucent is unable to correct all of
the problems preventing Acceptance, Diveo may at its election:
(i) extend the testing periods for a reasonable period of
time and require Lucent to immediately replace the
non-conforming item(s);
(ii) accept the affected items at a mutually agreed reduced
price that reflects the diminished functionality, to be
replaced by full functionality items in the future at
Diveo's discretion, at which time full payment will be
made; or
(iii) cancel or modify the corresponding Purchase Order and
any other affected Purchase Order for cause and at no
cost to Diveo and Lucent shall promptly refund (not to
exceed 30 days) any amounts paid by Diveo or its
Affiliates for such Purchase Orders.
6.3. Acceptance.
A Product shall be considered to be accepted (the "Acceptance") only
as follows:
(a) With respect to a Product or Products subject of a Purchase
Order without installation, implementation and/or engineering
Services), such Products shall be Acceptance tested within
five (5) business days of delivery of the Product or Products
to the designated site or destination named in the Purchase
Order. Such Acceptance testing shall include an incoming
inspection to verify that such Product has been delivered in
accordance with the corresponding Purchase Order and meets the
Acceptance Criteria; and
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Master Supply Agreement 13 Diveo / Lucent Confidential
(b) With respect to any other Product, such Product shall be
considered to be accepted upon the earliest of:
(i) receipt by Lucent of written notice by Diveo certifying
that such Product conforms to its Acceptance Criteria;
(ii) satisfaction of all conditions underlying a Provisional
Acceptance as described in Section 6.1, or
(iii) the expiration of the Acceptance Testing Period for such
Product without notice of non-acceptance or of the terms
of a Provisional Acceptance by Diveo.
Notwithstanding anything to the contrary herein, Acceptance of
a Product shall only occur in accordance with the terms of
this Agreement.
7. SERVICE LEVELS
7.1. General.
Lucent shall at all times meet or exceed the quantitative and
qualitative service levels identified in Schedule B (the "Service
Levels").
7.2. Failure to Perform.
(a) Lucent recognizes that its failure to meet Service Levels as
specified in Schedule B, may have a material adverse impact on
the business and operations of Diveo. Accordingly, in the
event that Lucent fails to meet such Service Levels for
reasons other than the wrongful actions of Diveo (including
Diveo's failure to perform its duties and obligations on a
timely basis) or circumstances that constitute force majeure
under this Agreement, Diveo may elect, in addition to any
other rights or remedies available to Diveo hereunder, to
pursue remedies according to Schedule B.
(b) If Lucent fails to meet any Service Level, Lucent shall (i)
investigate and report on the root causes of the problem; (ii)
advise Diveo, as and to the extent requested by Diveo, of the
status of remedial efforts being undertaken with respect to
such problems; (iii) correct the problem and begin meeting the
Service Levels in the case that the root causes of the problem
are within Lucent's control; and (iv) take appropriate
preventive measures so that the problem does not recur.
7.3. Periodic Reviews.
Within three (3) months after the expiration of the first year
following the Effective Date and at least annually thereafter, Diveo
and Lucent shall review the Service Levels and shall make
adjustments to them as appropriate to reflect improved performance
capabilities associated with advances in the technology and methods
used to provide the Products and perform the Services.
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Master Supply Agreement 14 Diveo / Lucent Confidential
7.4. Measurement and Monitoring Tools.
Lucent shall use the measurement and monitoring tools and procedures
required to measure and report Lucent's performance of the Services
against the applicable Service Levels. Lucent shall report on all
Service Levels each month during the Term. Such measurement and
monitoring will permit reporting at a level of detail sufficient to
verify compliance with the Service Levels and will be subject to
audit by Diveo. Lucent shall provide Diveo with information and
access to such tools and procedures upon request, for purposes of
verification.
8. SOFTWARE LICENSES AND PROPRIETARY RIGHTS
8.1. Licenses.
(a) Commencing upon Delivery of Software pursuant to this
Agreement, Lucent grants Diveo and its Affiliates a perpetual,
transferable (as provided herein), nonexclusive, fully-paid,
royalty-free, irrevocable (except as provided by Subsection
(b) of this Section) and world-wide right and license (or
sublicense in the case of Software owned by a third party) to
use, copy (as provided herein), access, display, operate and
process the Software provided to Diveo pursuant to a Purchase
Order (collectively, the "Licenses"). These rights may be
exercised through officers, employees and agents for the sole
purpose of providing services to Diveo and its Affiliates.
Diveo may copy the Software for back-up purposes and for uses
that are in accordance with this Agreement. Any such
reproduction will include any copyright or similar proprietary
notice contained in the Software being reproduced. Diveo may
not decompile, disassemble or reverse engineer the Software.
(b) Lucent may revoke a particular License if and only if Diveo
(i) fails to pay undisputed licensing fees associated with
such License, and such nonpayment is not cured within thirty
(30) calendar days after written notice of such nonpayment
provided by Lucent to Diveo or (ii) fails to use commercially
reasonable efforts to cease from decompiling, disassembling or
reverse engineering the Software following receipt of notice
from Lucent.
(c) To the extent that Lucent is unable to secure the rights
specified in Section 8.1 with respect to Software associated
with Third Party Products, it shall be excused from that
obligation, provided that it gives Diveo prior written notice
of such inability sufficiently in advance so that Diveo may
seek alternate means of obtaining such rights.
(d) Diveo may, at no charge, relocate any Software to another
location for reuse with Equipment with which it was originally
delivered when such Equipment is itself to be relocated
consistent with this Agreement. Such relocation or reuse shall
not alter the Licenses.
(e) Diveo shall have the right to transfer any of the Licenses in
the event Diveo sells the Equipment with which such Software
is utilized or any component thereof in accordance with
Section 8.3, or in the event of an assignment or change in
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Master Supply Agreement 15 Diveo / Lucent Confidential
control in accordance with Section 19.1. Such transfers shall
be subject to (i) the transferee undertaking the restrictions
and covenants of the license, (ii) reasonable creditworthiness
of the transferee, (iii) a limitation that the transferee is
not a direct competitor of Lucent in the area of
telecommunications equipment manufacture, and (iv) with
respect to Software that is embedded as part of Equipment, a
limitation that the Software may be used only with the
Equipment on which it was utilized prior to the transfer.
(f) Lucent agrees to furnish and convey, at no additional charge
to Diveo, such documentation, training materials, manuals,
appropriate designs, appropriate drawings, and other media and
material pertaining to the use and operation of Products as is
necessary to permit Diveo to use and maintain such items in
accordance with this Agreement (the "Documentation"). Lucent
will provide the Documentation in both hard- and soft-copy
formats. Diveo may make a reasonable number of copies of the
Documentation; provided, however, that all such copies shall
contain the copyright legends placed on the original versions
by Lucent.
(g) In the event that a Diveo employee violates the License
restrictions set forth in Subsection (a) of this Section,
Diveo shall, at its own expense take such reasonable actions
as may be necessary to remedy such violation and cooperate in
all reasonable respects to minimize the violation and any
damage resulting therefrom.
(h) Except as otherwise provided pursuant to Section 8.4, no
Source Code is included in Software provided under the
Agreement. Diveo acknowledges that, in the event it attempts
to decompile, disassemble or reverse engineer Software other
than any Developed Deliverable, Lucent may proceed directly to
court. If a court of competent jurisdiction should find that
Diveo has attempted to decompile, disassemble or reverse
engineer such Software, Diveo agrees that without any
additional findings of irreparable injury or other conditions
to injunctive relief, Lucent shall be entitled to seek the
entry of an appropriate order against Diveo without opposition
to restrain Diveo from any further attempt to decompile,
disassemble or reverse engineer such Software.
8.2. Proprietary Rights.
(a) Title to the Software shall remain in Lucent or its suppliers.
Title to any software owned or licensed directly by Diveo
(other than Software licensed from or through Lucent under
this Agreement) shall not be affected by this Agreement and
such title shall remain with Diveo or its suppliers. With
respect to any documentation, engineering, designs or other
requested Services that result in a documentation deliverable,
Diveo may use such deliverable in any manner and to the extent
such deliverable incorporates or is based on Diveo provided
technical information or specifications Lucent agrees not to
use such information or specifications in connection with any
other similar work for any other customer of Lucent.
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Master Supply Agreement 16 Diveo / Lucent Confidential
(b) The Parties do not expect that Lucent will develop custom
Software in the course of performance under this Agreement,
and nothing contained in the Agreement may be interpreted to
require Lucent to develop such custom Software.
(c) Diveo and Lucent may agree that Lucent will perform certain
custom development work pursuant to mutually agreed-upon
terms, conditions and fees set forth in a separate written
agreement duly signed by the Parties (such Deliverables the
"Developed Deliverables").
8.3. Right to Resell and Sublicense.
Except as may be otherwise provided by the terms and conditions of
the Credit Agreement, Diveo shall have the right to assign,
transfer, sell, alienate or lease Lucent Products, and, subject to
Section 8.1, sublicense the right to use the Software that is
embedded or otherwise provided with such Lucent Products to third
parties in conjunction with (A) the disposal of such Products,
provided that (i) Diveo shall not sell or otherwise transfer a
Lucent Product to any person or entity that is a manufacturer of
telecommunications products that compete directly with the Lucent
Products being disposed of, and (ii) all warranties applicable to
such Product shall automatically terminate at the time Diveo makes
delivery of the Product to the third party, and (B) (i) Customer
Colocations involving such Products, or (ii) Customer Virtual
Colocations involving such Products, and pass through to such
customers the standard warranty rights (and the applicable warranty
exclusions) granted by Lucent generally to its customers, which
rights shall be valid only for the remaining term, if any, of the
Initial Warranty Period applicable to such Products; provided,
however, if this Agreement is assigned as provided herein, the
rights granted to Diveo under this Agreement that are applicable to
such Lucent Products shall be assignable to the assignee of this
Agreement. In connection therewith:
(a) Each third party shall agree in writing that its license for
any Software to which Lucent maintains title under this
Agreement is revocable by Lucent in the event such third party
materially breaches the licensing restrictions imposed upon
Diveo under this Agreement pursuant to Section 8.1;
(b) Each such third party shall agree in writing to
confidentiality terms and conditions substantially similar to
those set forth in Article 12; and
(c) With respect to rights granted to Diveo under Article 13 and
passed through to such third parties, the Parties will agree
upon a reasonable means of administering Lucent's fulfillment
of its obligations with respect to such rights.
Where Diveo substantially complies with the obligations set forth
above, Diveo shall have no liability to Lucent for any action or
omission of such third parties except for providing Lucent
reasonable assistance in bringing claims as against the third party
for reasonable claims.
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Master Supply Agreement 17 Diveo / Lucent Confidential
8.4. Technical Materials Availability
(a) As used herein, a "Technical Materials Trigger Event" shall
mean the satisfaction of any of the following conditions: (i)
the insolvency of Lucent or the institution by Lucent of
insolvency, receivership or bankruptcy proceedings; (ii) a
general assignment by Lucent for the benefit of creditors;
(iii) the appointment of a receiver for Lucent; or (iv) the
filing of creditors of Lucent of a petition in bankruptcy
against Lucent which is not stayed or dismissed within sixty
(60) calendar days together with a material breach by Lucent
or where there is an inability for Lucent to perform within
such sixty (60) days.
(b) Upon the occurrence of a Technical Materials Trigger Event,
Lucent shall immediately deliver to Diveo the Source Code for
Lucent Products and grant to Diveo at no additional charge a
license to use, copy, access, display, modify, enhance,
operate, process and create derivative works of the Source
Code for the Lucent Product(s) then being used by Diveo and
any associated documentation for such Lucent Products to the
extent necessary for Diveo to modify, maintain and enhance
solely for its own use in accordance with the terms of this
Agreement, the Lucent Products that Diveo has the right to use
under this Agreement; provided, however, such license and
delivery of the Source Code will not be required where Diveo
can obtain, with Lucent's assistance (e.g., by providing a
third party with Source Code or by any other appropriate
method), the same support services that Lucent is required to
provide under this Agreement from another entity (either
working with or independently from Lucent) at a price that is
equal to or less than prices for such support as provided
herein. Any such released Source Code shall be subject to the
confidentiality provisions set forth in this Agreement.
(c) Lucent acknowledges that, in the event it breaches its
obligation to provide the Source Code and license as provided
in this Section, Diveo may be irreparably harmed. In such a
circumstance, Diveo may proceed directly to court.
9. DIVEO RESPONSIBILITIES
9.1. Facilities and Resources.
Diveo's responsibility for providing facilities, personnel and other
resources as necessary to permit Lucent to deliver the Products and
Services shall be as set forth in this Agreement.
9.2. Savings Clause.
(a) Diveo's failure to perform any of its responsibilities set
forth in this Agreement (other than Diveo obligations to pay
undisputed amounts under Article 10.3) shall not constitute a
material breach of the Agreement or otherwise be deemed to be
grounds for termination by Lucent.
(b) Each Party's nonperformance of its obligations under this
Agreement shall be excused (such Party the "Excused Party") if
and to the extent: (i) such
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Master Supply Agreement 18 Diveo / Lucent Confidential
nonperformance is a direct result of the other Party's failure
to perform its responsibilities, (ii) the Excused Party
provides such other Party with reasonable notice of such
nonperformance, and (iii) the Excused Party uses commercially
reasonable efforts to perform notwithstanding such other
Party's failure to perform. Such other Party shall compensate
the Excused Party for any documented, out of pocket additional
and reasonable costs and expenses incurred by the Excused
Party as a direct result of such other Party's failure to
perform, or delay in performing, its obligations under the
Agreement.
10. CHARGES
10.1. General.
The charging mechanisms and pricing methodologies for Products,
other Products and Services are expressly set forth in the
Agreement. The Parties agree to supplement Schedule C in a manner
consistent with the other pricing terms of this Agreement as
necessary if and when Diveo purchases Products and Services for
which pricing is not set forth in Schedule C. Diveo will not be
liable to Lucent for any charges, additional or otherwise, for
Products or Services provided by Lucent unless such charges are
expressly set forth in a Purchase Order, this Agreement (including
its Schedules) or as otherwise may be mutually agreed by the Parties
in writing. As more definitively set forth in Schedule C, Lucent
shall pay all Delivery Duty Paid (DDP) (as set forth in the ICC
Incoterms 1990) related costs (i.e., transportation, insurance,
customs duties and taxes) related to the shipment of Products (less
the costs related to shipping FCA Miami which is included in the
price for the Products) under this Agreement ("Incremental DDP
Costs") and Diveo shall reimburse Lucent therefore on an
Out-of-Pocket Expense basis (i.e., no ▇▇▇▇-up).
10.2. Taxes.
The Parties' respective responsibilities for taxes arising under or
in connection with this Agreement shall be as follows:
(a) Diveo shall bear all taxes, duties, levies and similar charges
(and any related interest and penalties), however designated,
imposed as a result of the existence or operation of this
Agreement, except (i) any tax imposed upon Lucent in a
jurisdiction other than the jurisdiction under the laws of
which Lucent was formed (hereinafter the "Resident
Jurisdiction") if such tax is allowable as a credit against
the Resident Jurisdiction income taxes of Lucent; and (ii) any
net income tax imposed upon Lucent by an government entity
within Lucent's Resident Jurisdiction. In order for the
exception contained in (i) to apply, Diveo must furnish Lucent
with such evidence as may be required by the Resident
Jurisdiction taxing authorities to establish that such tax has
been paid within thirty (30) days of issuance by the local
taxing authority so that Lucent may claim the credit.
(b) If Diveo is required to bear a tax, duty, levy or similar
charge pursuant to (a) above, then Diveo shall pay such tax,
duty, levy or similar charge and any additional amounts as are
necessary to ensure that the net amounts received by
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Master Supply Agreement 19 Diveo / Lucent Confidential
Lucent hereunder after all such payments or withholdings equal
the amounts to which Lucent is otherwise entitled under this
Agreement as if such tax, duty, levy or similar charge did not
exist.
(c) Each Party shall bear all wage withholding, social security
and other employment related taxes with respect to its
employees. In no event shall Diveo be liable to Lucent for any
ex-▇▇▇ related costs or expenses beyond payment for the price
of Services and costs and expenses that Diveo is specifically
required to reimburse to Lucent pursuant to this Agreement, if
any.
(d) Lucent shall not collect an otherwise applicable tax if
Diveo's purchase is exempt from Lucent's collection of such
tax and a valid exemption certificate is furnished by Diveo to
Lucent.
(e) The Parties agree to cooperate with each other to minimize, to
the extent legally permissible, taxes arising under this
Agreement. Lucent's invoices shall separately state the
amounts of any taxes Lucent is collecting from Diveo. Each
Party shall provide and make available to the other any resale
certificates, information regarding out-of-state or
out-of-country sales or use of equipment, materials or
services, and other exemption certificates or information
reasonably requested by either Party.
10.3. Incidental Expenses.
Lucent acknowledges that all expenses that Lucent expects to incur
in performing under this Agreement (including document reproduction
and long-distance telephone) are included in Lucent's charges under
in this Agreement. Accordingly, such Lucent expenses are not
separately reimbursable by Diveo unless, on a case-by-case basis for
unusual expenses, Diveo has agreed in advance and in writing to
reimburse Lucent for the expense.
10.4. Commitment.
(a) For purposes of this Agreement, "Commitment" shall mean
Diveo's agreement to issue and pay for Purchase Orders in
accordance with the terms of this Agreement for at least
twenty-five million dollars ($25,000,000) by the end of the
Initial Term subject to the provisions of this Section 10.4.
(b) Diveo shall be relieved from the Commitment:
(i) By the total price (or portion thereof if only partially
terminated) of the Products and Services ordered under
any Purchase Order that are terminated in accordance
with Section 3.5 or Section 14.1;
(ii) By the total price of any Product returned to Lucent for
failing to meet Acceptance in accordance with the terms
of this Agreement;
(iii) By the total price (or portion thereof if only partially
terminated) for Services ordered under a Purchase Order
that are terminated due to Lucent's failure to meet its
obligations under this Agreement; and
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Master Supply Agreement 20 Diveo / Lucent Confidential
(iv) By the total amount of the Commitment not met if this
Agreement is terminated in accordance with Sections 14.1
or Section 14.3 prior to the expiration of the Initial
Term or by the total amount of the Commitment not met at
such time funding under the Credit Agreement is not
provided through no default of Diveo under the Credit
Agreement.
(c) In the event Diveo fails to issue and pay for Purchase Orders
to meet the Commitment (as such Commitment is reduced or
relieved as provided in Subsection (b) above, hereinafter the
"Adjusted Commitment") by the expiration of the Initial Term,
Diveo shall pay Lucent (from funds other than from the Lucent
financing) an amount equal to 50% of the difference between
the Adjusted Commitment and the total price for all Purchase
Orders issued and paid for by Diveo under this Agreement as of
the expiration date of Initial Term.
10.5. Lucent-Provided Financing.
(a) Lucent shall provide Diveo financing in accordance with the
Credit Agreement and otherwise in accordance with the terms of
this Agreement.
(b) For purposes of this Agreement, "Lucent Content" shall refer
to (i) all Lucent Products and Services, (ii) all ▇▇▇▇▇▇
radios, radio accessories and antennae (collectively, the
"▇▇▇▇▇▇ Radios"), subject to the limitation set forth in
Section 10.5(d)(ii) below, and (iii) all Incremental DDP Costs
related to the foregoing. In the event ▇▇▇▇▇▇ is no longer
selling radios that will work in the Diveo Network or Lucent
fails to Deliver ▇▇▇▇▇▇ radios, radio accessories and
antennae, Diveo may change ▇▇▇▇▇▇ with another radio
manufacturer.
(c) For purposes of this Agreement, "Non-Lucent Content" shall
refer to (i) all Third Party Content and other services
ordered under this Agreement (including all Services provided
by Diveo under subcontract with Lucent) and (ii) all
Incremental DDP Costs related to the foregoing.
(d) Lucent agrees to provide financing (subject to the terms and
conditions set forth in the Credit Agreement, including limits
on the total financing amounts) for all Lucent Content and
Non-Lucent Content. For purposes of this Subsection (d) (i)
"Total Contract Year Draw Down" shall refer to the total
dollar amount drawn down by Diveo under the Credit Agreement
during a Contract Year and (ii) "Delta" shall mean that amount
equal to the difference between the actual total amount drawn
down by Diveo for Lucent Content during a Contract Year and
the total amount Diveo would have been required to have drawn
down so that eighty percent (80%) of the Total Contract Year
Draw Down for such Contract Year was for Lucent Content (the
Delta can be a positive number if Diveo's draw down of Lucent
Content exceeds 80% or a negative number if Diveo's draw down
is below 80%).
(i) Diveo may use up to eighty percent (80%) of the Total
Contract Year Draw Down during the each Contract Year
for Lucent Content and twenty percent (20%) of the Total
Contract Year Draw Down during each Contract Year for
Non-Lucent Content (up to fifty percent (50%) of
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Master Supply Agreement 21 Diveo / Lucent Confidential
which twenty percent may be used towards Services
provided by Diveo under subcontract with Lucent; Lucent
shall have no obligation to provide financing for any
Diveo-provided Services in excess of such fifty percent
maximum).
(ii) As part of the Lucent Content, Diveo may use up to
twenty-five percent (25%) of the Total Contract Year
Draw Down during each Contract Year for ▇▇▇▇▇▇ Radios.
In the event Diveo purchases ▇▇▇▇▇ radios from Lucent,
the foregoing twenty-five percent will be reduced on a
pro rata basis based on the percentage of the Total
Contract Year Draw Down Diveo used for purchasing ▇▇▇▇▇
radios, but in no event shall the total percentage Diveo
may use for ▇▇▇▇▇▇ Radios go below fifteen (15%) percent
of the Total Contract Year Draw Down.
(iii) Ninety (90) days prior to the end of each Contract Year
and at the end of each Contract Year, Lucent shall
provide for Diveo's review, and subject to Diveo's
confirmation, a reconciliation statement that specifies
the percentage of the Total Contract Year Draw Down (or
the then-current percentage for the statement provided
90 days prior to the end of the Contract Year) that was
used for Lucent Content and for Non-Lucent Content.
(1) Where the actual percentage for Lucent Content
subject of the Total Contract Year Draw Down is
lower than eighty percent (80%) in any Contract
Year, Diveo shall have a sixty (60) day period
from receipt of the reconciliation statement to
place Purchase Orders in order to increase the
percentage for Lucent Content. If at the end of
such sixty day period the percentage for Lucent
Content is less than eighty percent (80%) (taking
into account the additional Purchase Orders issued
by Diveo during the sixty day period), Diveo shall
pay Lucent, as Lucent's sole and exclusive remedy,
a "Surcharge" calculated as follows: (A) if the
Delta is between $1 and $1,000,000, 25% of such
amount; (B) if the Delta is between $1 and
$5,000,0000, 25% for the first $1,000,000 plus 15%
for such amount over $1,000,000.01; and (C) if the
Delta is greater than $5,000,000.01, 25% for the
first $1,000,000 plus 15% for amounts between
$1,000,000.01 and $5,000,000 plus 5% for amounts
over $5,000,000.01. Diveo shall be entitled to
offset against any Surcharge payable by any
Surcharge Credits (as calculated below) Diveo has
at the time the Surcharge is payable.
(2) Where the actual percentage for Lucent Content
subject of the Total Contract Year Draw Down is
greater than eighty percent (80%) in any Contract
Year, Diveo shall be entitled to a "Surcharge
Credit" calculated as follows: (A) if the Delta is
between $1 and $1,000,000, 25% of such amount; (B)
if the Delta is between $1 and $5,000,0000, 25%
for the first $1,000,000 plus 15% for such amount
over $1,000,000.01; and
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Master Supply Agreement 22 Diveo / Lucent Confidential
(C) if the Delta is greater than $5,000,000.01,
25% for the first $1,000,000 plus 15% for amounts
between $1,000,000.01 and $5,000,000 plus 5% for
amounts over $5,000,000.01. Diveo shall be
entitled to use all Surcharge Credits against any
Surcharges payable by Diveo in any Contract Year;
provided, however, that if at the end of the
Initial Term Diveo has any Surcharge Credits that
have not been off set against Surcharges, such
excess Surcharge Credits shall be automatically
extinguished, and Lucent shall have no liability
to Diveo with respect to such excess Surcharge
Credits.
(e) Subject to the terms set forth in Subsection (d) above, this
Agreement (including Schedule C) and the Credit Agreement,
Lucent shall provide financing and purchase Non-Lucent Content
on behalf of Diveo (e.g., Third Party Content and third party
and Diveo provided services). Such Non-Lucent Content needs to
be reasonable related to the Diveo Network. Lucent shall pay
all such delivered invoices in accordance with the payment
terms set forth on such invoice or as otherwise directed by
Diveo.
(f) Lucent shall continue to provide Diveo with financing for
Products and Services during the Disengagement Period as
described in Section 14.4(a) subject to the terms set forth in
Subsection (b) above and the terms of the Credit Agreement.
10.6. Competitive Pricing.
(a) Lucent's prices, terms and conditions (including financing),
viewed collectively, to Diveo ("Diveo's Overall Terms") shall
be no less favorable than the prices, terms and conditions
(including financing, if any), viewed collectively, extended
by Lucent to another Lucent or Lucent Affiliate customer
(excluding Lucent Affiliates, distributors, resellers, sales
agents, and governmental entities) in an executed contract
during the Term of this Agreement ("Comparable Customer's
Overall Terms"), for comparable volumes, mix, and
configurations of Products and Services for similar use in a
country in the Territory (a "Comparable Purchase").
(b) If a Comparable Customer's Overall Terms for a Comparable
Purchase in any country in the Territory, are more favorable
than Diveo's Overall Terms for a Comparable Purchase in the
same country (the "Affected Country"), then Lucent shall
prospectively offer amended prices and/or amended terms and
conditions (the "Lucent Offer") to Diveo for Comparable
Purchases in the Affected Country only, such that Diveo's
Overall Terms shall be no less favorable than the Comparable
Customer's Overall Terms. Diveo shall have thirty (30) days
from receipt of the Lucent Offer to accept, in writing, such
Lucent Offer. In the event that Diveo accepts the Lucent
Offer, the Parties shall execute a corresponding amendment to
this Agreement, which amendment shall be effective as of the
date of Diveo's written acceptance of the Lucent Offer. In the
event that Diveo does not accept the Lucent Offer, the prices,
terms and conditions then in effect pursuant to this Agreement
shall remain in effect for all countries in the Territory.
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Master Supply Agreement 23 Diveo / Lucent Confidential
(c) The following transactions shall not be considered in any
comparison of prices, terms and conditions: initial sales for
first entry into a geographic or product market ("market entry
sales"), sales made as part of the settlement of a dispute,
sales involving an exchange or the granting of intellectual
property rights (other than the granting of licenses to use
software furnished by Lucent to the customer), or the
provision of laboratory, trial, test, demonstration or
promotional hardware, software or services.
(d) Upon Diveo's written request, Lucent shall certify in writing
after its fiscal close each calendar year its compliance with
the undertakings in this Section.
11. INVOICING AND PAYMENT
11.1. Invoicing.
(a) Subject to Schedule C, Lucent will invoice Diveo for Products
and Services as follows:
(i) Products with Installation Services. With respect to
Products purchased by Diveo together with installation
Services pursuant to a Purchase Order, Lucent will
invoice Diveo for amounts due pursuant to this Agreement
for such Products as follows:
(1) ten percent (10%) of the value of the Purchase
Order upon Lucent's acceptance of a Purchase
Order;
(2) forty-five percent (45%) of the value of the
Purchase Order upon delivery of all Products
subject of the Purchase Order to the designated
site or destination specified in the Purchase
Order;
(3) twenty-five percent (25%) of the value of the
Purchase Order upon completion of installation of
all Products subject of the Purchase Order;
(4) five percent (5%) of the value of the Purchase
Order upon Provisional Acceptance (if applicable)
of all installed Products subject of the Purchase
Order;
(5) fifteen percent (15%) of the value of the Purchase
Order upon Acceptance of all Products subject of
the Purchase Order (if Provisional Acceptance) or
otherwise twenty percent (20%) of the value of the
Purchase Order.
All such invoices shall include: invoice date, shipment
number, Product part numbers and descriptions,
quantities, unit prices and total amount due and any
other data necessary for Diveo or the Diveo Affiliate to
reconcile such invoice, on a line by line basis, to the
originating Purchase Order(s) and Change Control
Order(s). Such invoices shall also indicate the
corresponding Purchase Order number for each invoiced
Product.
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Master Supply Agreement 24 Diveo / Lucent Confidential
(ii) Products without Installation Services. Lucent shall
invoice Diveo for Products ordered without installation
Services one hundred percent (100%) upon Delivery.
(iii) Services (other than Installation Services with Products
as provided above). Unless otherwise agreed upon by the
Parties (e.g., invoice based on meeting performance
milestones), Lucent shall invoice Diveo for Services
monthly in arrears. All invoices for Services to be
performed in any country other than the United States
shall be issued by the Lucent Affiliate in such country
to the Diveo entity on the Purchase Order. Such invoice
shall include invoice date, quantities, unit prices and
total amount due. Each invoice shall also indicate the
corresponding Purchase Order for each line item and the
corresponding milestone for each Service (if
applicable).
(b) All invoices shall be in United States dollars for Products
and United States based Services and in local currency for
locally provided Services. On each invoice, Lucent shall
include the calculations utilized to establish any charges,
and each invoice shall show details and information as to
charges as may be reasonably specified by Diveo, including as
necessary to satisfy Diveo's internal accounting; provided,
however, that to the extent that a firm pricing quotation
previously delivered to Diveo by Lucent expressly provides
such calculations, details and information, Lucent may
cross-reference such quotation in the applicable invoice in
lieu of including such calculations, details or information,
as applicable, in such invoice. Each invoice shall also (i)
separately state the amounts of any taxes Lucent is collecting
from Diveo and (ii) identify that the invoice is a
Lucent-issued invoice.
(c) To the extent a credit may be due Diveo pursuant to this
Agreement, Lucent shall provide Diveo with an appropriate
credit against amounts then due and owing. To the extent that
an amount due Diveo pursuant to this Agreement is not credited
or paid within sixty (60) days of becoming due, Lucent shall
pay such amounts to Diveo within thirty (30) calendar days
after such sixty-day period.
11.2. Payment Due.
(a) Subject to the other provisions of this Article 11 and
Schedule C, charges shall be due and payable by Diveo in
accordance with the time period set forth in Schedule J after
receipt of a proper invoice for such amount (i.e., net
forty-five (45) days). Subject to the other terms of this
Article 11, in the event that any payments are not received by
Lucent within ten (10) days after written notice to Diveo by
Lucent indicating that such payments are due and owing and
unpaid, then commencing at the end of such ten (10) day
period, Diveo will also pay a late fee equal to the lesser of
(a) one (1) percent of the amount of such payment per month;
or (b) the maximum amount permissible by law.
(b) In the event that Diveo consistently and repeatedly fails to
pay material undisputed amounts due under Purchase Orders in
accordance with Subsection
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Master Supply Agreement 25 Diveo / Lucent Confidential
(a) of this Section, and Diveo failure continues within sixty
(60) calendar days of notice from Lucent of such consistent
and repeated failures, then Lucent may, in addition to all
other remedies Lucent may have pursuant to this Agreement and
applicable law, condition acceptance of future Purchase Orders
on reasonable payment terms satisfactory to Lucent that
provide Lucent with reasonable assurances that it will be paid
in a satisfactory manner; provided, however, that such payment
terms shall be no less favorable to Diveo than prepayment in
full for such future Purchase Orders.
(c) All amounts due and payable to Lucent under this Article 11
shall be paid, at Diveo's option, (i) by check payable to the
order of Lucent, (ii) through draw-down of Lucent-provided
financing under the Credit Agreement, or (iii) by electronic
funds transfer to Lucent from account(s) designated by Diveo.
11.3. Accountability.
(a) Lucent shall maintain complete and accurate records of and
supporting documentation for the amounts billable to, and
payments made by, Diveo for (i) Services billed on a time and
materials basis, (ii) incidental expenses payable by Diveo
pursuant to Section 10.3, and (iii) any Out-of-Pocket Expenses
or costs payable by, or other expenses reimbursable by, Diveo
pursuant to the Agreement. Lucent shall maintain such records
and supporting documentation in accordance with generally
accepted accounting principles applied on a consistent basis.
(b) Lucent agrees to provide Diveo with documentation and other
information with respect to each invoice as may be reasonably
requested by Diveo to verify accuracy and compliance with the
provisions of this Agreement.
(c) Upon Diveo's reasonable request, Diveo and its authorized
agents and representatives shall, at Lucent's option, (i)
receive copies of or (ii) have access to such records and
supporting documentation as described in Subsection (a) of
this Section for purposes of audit during normal business
hours during the Term and during the period for which Lucent
is otherwise required to maintain such records. Lucent shall
reasonably cooperate with Diveo or its designees in connection
with audits or examinations by regulatory authorities.
11.4. Proration.
Periodic charges under this Agreement are to be computed on a
calendar month basis, and shall be prorated for any partial month.
11.5. Set Off.
With respect to any amount to be paid by Diveo hereunder, Diveo may
set off against such amount any amount that Lucent is obligated to
pay Diveo hereunder. With respect to any amount to be paid by Lucent
hereunder for which Diveo has provided Lucent with notification that
such amount is to be paid by Lucent, Lucent may set off against such
amount any amount that Diveo is obligated to pay Lucent hereunder.
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Master Supply Agreement 26 Diveo / Lucent Confidential
11.6. Disputed Charges.
Subject to Section 11.5, Diveo shall pay undisputed charges when
such payments are due under this Article 11. Diveo may withhold
payment of particular charges that Diveo disputes in good faith.
Diveo shall notify Lucent of any disputed invoice amounts in
accordance with Schedule J. In the event a dispute over an invoiced
amount is resolved against Diveo, Diveo shall pay such amount within
forty-five (45) days together with interest at the rate set forth in
Section 11.2(a) from the original due date until the payment date.
11.7. Encumbrances.
Except to the extent granted in the Credit Agreement or otherwise
expressly set forth in this Agreement, Lucent shall not perfect a
security interest, lien or other encumbrance upon any Product,
Product component or Service provided pursuant to this Agreement.
12. CONFIDENTIALITY
12.1. Confidential Information.
Lucent and Diveo each acknowledge that they may be furnished with,
receive, or otherwise have access to information of or concerning
the other Party that such Party considers to be confidential,
proprietary, a trade secret or otherwise restricted. As used in this
Agreement and subject to Section 12.3, "Confidential Information"
means all information, in any form, furnished or made available
directly or indirectly by one Party (the "Disclosing Party") to the
other (the "Receiving Party") that (i) concerns the operations,
affairs and businesses of the Disclosing Party, the financial
affairs of the Disclosing Party, the relations of the Disclosing
Party with its customers, employees and service providers, and
technical information of a Disclosing Party, or (ii) is marked
confidential, restricted, proprietary, or with a similar
designation. The terms and conditions of this Agreement shall be
deemed Confidential Information.
12.2. Obligations.
The following obligations with respect to Confidential Information
shall survive the expiration or termination of this Agreement for a
period of seven (7) years or such longer period as required by
regulation, law or court order.
(a) Each Party's Confidential Information shall remain the
property of that Party except as expressly provided otherwise
by the other provisions of this Agreement. Each Party shall
each use at least the same degree of care, but in any event no
less than a reasonable degree of care, to prevent unauthorized
disclosure of Confidential Information as it employs to avoid
unauthorized disclosure of its own information of a similar
nature. Except as otherwise permitted hereunder, the Parties
may disclose such information to entities performing services
required hereunder or to third party consultants, agents or
contractors where the entity or person agrees in writing to
assume the obligations substantially similar to those
described in this Section 12.2.
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Master Supply Agreement 27 Diveo / Lucent Confidential
(b) Each Party shall take reasonable steps to ensure that its
employees, consultants, agents and contractors comply with
this Section 12.2. In the event of any disclosure or loss of,
or inability to account for, any Confidential Information of
the Disclosing Party, the Receiving Party shall promptly, at
its own expense: (i) notify the Disclosing Party in writing;
(ii) take such actions as may be necessary and cooperate in
all reasonable respects with the Disclosing Party to minimize
the violation and any damage resulting therefrom.
12.3. Exclusions.
(a) Confidential Information shall exclude any particular
information that the Receiving Party can demonstrate:
(i) At the time of disclosure, was lawfully in the public
domain or in the possession of the Receiving Party;
(ii) After disclosure, is lawfully published or otherwise
becomes part of the public domain through no fault of
the Receiving Party;
(iii) Was received after disclosure from a third party who had
a lawful right to disclose such information to the
Receiving Party without any obligation to restrict its
further use or disclosure;
(iv) Was lawfully independently developed by the Receiving
Party without reference to Confidential Information of
the Disclosing Party; or
(v) Was required to be disclosed to satisfy a legal
requirement of a competent government body; provided
that, immediately upon receiving such request and to the
extent that it may legally do so, the Receiving Party
advises the Disclosing Party promptly and prior to
making such disclosure in order that the Disclosing
Party may interpose an objection to such disclosure,
take action to assure confidential handling of the
Confidential Information, or take such other action as
it deems appropriate to protect the Confidential
Information.
(b) Either Party may disclose the terms and conditions of this
Agreement to third parties that (i) have expressed a bona fide
interest in consummating a significant financing, merger or
acquisition transaction between such third parties and such
Party, (ii) have a reasonable ability (financial and
otherwise) to consummate such transaction, and (iii) have
executed a nondisclosure agreement that includes within its
scope the terms and conditions of this Agreement and also
includes a procedure to limit the extent of copying and
distribution of this Agreement. Each Party shall endeavor to
delay the disclosure of the terms and conditions of this
Agreement until the status of discussions concerning such
transaction warrants such disclosure.
12.4. No Implied Rights.
Nothing contained in this Section shall be construed as obligating a
Party to disclose its Confidential Information to the other Party,
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Master Supply Agreement 28 Diveo / Lucent Confidential
or as granting to or conferring on a Party, expressly or impliedly,
any rights or license to the Confidential Information of the other
Party.
13. REPRESENTATIONS, WARRANTIES AND COVENANTS
13.1. Pass-Through Warranties.
Without limiting any other representation, warranty or covenant
contained in this Article 13, Lucent may from time to time provide
certain Products and other items for which Lucent is entitled to
warranties and indemnities from the manufacturers, lessors or
licensors of such items. Lucent shall pass through to Diveo the
benefits of such warranties and indemnities to the extent that
Lucent is permitted pursuant to any agreements between Lucent and
such manufacturers, lessors or licensors. To the extent that Lucent
is able to pass through to Diveo any such benefits, Diveo may
enforce such benefits in Lucent's name, and Lucent shall reasonably
cooperate with Diveo as necessary to permit Diveo to enforce such
benefits.
13.2. Ownership or Use.
Lucent represents and warrants that Diveo shall receive good and
valid title to all Products (excluding Software Products) provided
pursuant to this Agreement and shall be entitled to the rights of
possession and quiet enjoyment thereto, free of any liens or
encumbrances, except as provided in the Credit Agreement.
13.3. Authorization.
(a) Each Party represents and warrants to the other that:
(i) It has the requisite corporate power and authority to
enter into this Agreement and to carry out the
transactions contemplated by this Agreement; and
(ii) the execution, delivery and performance of this
Agreement and the consummation of the transactions
contemplated by this Agreement have been duly authorized
by the requisite corporate action on the part of such
Party.
(b) Each Party represents and warrants to the other that it is not
subject to any contractual or other obligation that would
prevent it from entering into this relationship.
13.4. Inducements.
Each Party represents and warrants that it has not offered or
provided any inducements in violation of law or the other Party's
policies, of which it has been given notice, in connection with this
Agreement.
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Master Supply Agreement 29 Diveo / Lucent Confidential
13.5. Work Standards.
(a) Lucent covenants that the Services shall be rendered by Lucent
with promptness and diligence and shall be executed in a
workmanlike manner, in accordance with the practices and high
professional standards used in well-managed operations
performing services similar to the Services. Lucent covenants
that it shall use adequate numbers of qualified individuals
with suitable training, education, experience, and skill to
perform the Services.
(b) If the Services prove not to be performed as required within a
twelve-(12) month period commencing on the date of completion
of the applicable Services, Lucent shall correct the defect or
non-conforming Services at no additional cost or expense to
Diveo. In the event the Services cannot be corrected within
the applicable time periods specifically identified in this
Agreement or thirty (30) days of Diveo's notice, whichever
period is shorter (or such additional period of time as may be
mutually agreed upon), Lucent shall at Diveo's option render a
full refund or credit based on the original charges for the
Services.
13.6. Product Warranties.
(a) During the Warranty Period and any Extended Warranty Periods
for each Lucent Product, Lucent shall perform the specific
warranty and extended warranty Services as may be set forth in
Schedule A.
(b) During the Warranty Period and any Extended Warranty Periods,
Lucent warrants that Products (other than Third Party
Products) provided under this Agreement shall be free from
defects in , material and workmanship, and shall operate in
accordance with applicable Acceptance Criteria, during the
Warranty Period and any Extended Warranty Periods.
(c) Lucent covenants that all Lucent Product components (except
for spare parts provided in the course of repair or
replacement, which may be refurbished or re-manufactured)
provided hereunder shall be new, not refurbished or
re-manufactured.
(d) During the applicable Warranty Period and Extended Warranty
Period, with respect to the Software associated with Lucent
Products, Lucent covenants that it shall provide to Diveo, at
no additional charge, error-fixes, corrections and revisions
to the Software that are necessary to maintain such Software
in compliance with the Acceptance Criteria or as otherwise
generally provided to any other customer of Lucent. The
foregoing warranties and covenants shall also apply with
respect to new versions, upgrades and enhancements provided by
Lucent to the Software.
(e) During the term of this Agreement, Lucent covenants that it
shall provide updated Documentation reflecting any changes to
Products (other than Third Party Products).
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Master Supply Agreement 30 Diveo / Lucent Confidential
(f) During the Warranty Period and any Extended Warranty Periods,
Lucent shall provide telephone support to Diveo in order to
assist Diveo to locate and correct functional or operational
problems with Products (other than Third Party Products). Such
support shall be provided on a 8 hour, 5-days-per-week basis
(provided that if Diveo purchases maintenance Services offered
by Lucent, such support is provided on a 24 hour,
7-days-per-week basis). Lucent shall provide a toll-free
number for Diveo's calls to Lucent.
(g) During the Warranty Period and any Extended Warranty Periods,
Lucent will provide Diveo with all software updates to
Software. Lucent shall implement all updates to all Lucent
Products. Upgrades and new software releases will be charged
in accordance with the price established at the time the
upgrade is implemented by Diveo or on Diveo's behalf and
incorporated into Schedule C subject to the following: Diveo
shall not be required to pay any additional charges relating
to that portion of an upgrade or new software release that (A)
constitutes an update, (B) reflects only an immaterial
enhancement or improvement in current functionality and not
new functionality or materially increased functional capacity
or (C) is provided by Lucent to another customer as part of
the provision of software maintenance services under similar
terms and conditions. To the extent the upgrade or new
software release includes new functionality or materially
increased functional capacity and Diveo desires to take
advantage of same, Diveo shall pay a fair and competitive
price established at the time the upgrade or new software
release is implemented by Diveo or on Diveo's behalf and the
resulting incremental price shall be incorporated in Schedule
C.
(h) During the Warranty Period and any Extended Warranty Periods,
Lucent shall provide access to technical resources to resolve
any problem with Products (other than Third Party Products)
that Diveo cannot resolve through lower level support,
including help desk support for problems that cannot be
remotely diagnosed and cured. If on-site support reveals that
the problem originated with Diveo or a third-party, Lucent may
charge Diveo reasonable time and material rates for the
on-site support.
(i) Subject to Section 19.9 of the Agreement, in the event that
any Product fails to comply with in this Section 13.6, Diveo
will notify Lucent, specifying the nature of the failure in
reasonable detail. Lucent shall correct the failure at no
additional charge to Diveo so that the Product complies with
this Section 13.6. The Parties agree to follow the procedures
established in Schedule H with respect to any warranty claims
made by Diveo under this Section 13.6.
13.7. Discontinued Lucent Products
(a) Lucent shall notify Diveo at least one (1) year before Lucent
discontinues accepting Purchase Orders from Diveo for a Lucent
Product. Where Lucent generally offers an equivalent Lucent
Product (based upon form, fit and function) this notification
period may vary but shall in no event be less than six (6)
months.
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Master Supply Agreement 31 Diveo / Lucent Confidential
(b) Lucent shall, in addition to its obligations under this
Agreement (including with respect to the Product warranties
set forth in this Agreement), make available ongoing Warranty
Period and Extended Warranty Period support during Extended
Warranty Periods upon the terms and conditions of this
Agreement for a period of five (5) years after the earlier of
(i) termination in whole or expiration of the Agreement, or
(ii) such Product's discontinued availability effective date.
13.8. Compliance.
Lucent represents and warrants that all Products delivered hereunder
operate in conformance with all applicable domestic and
international laws and regulations, including, safety and
environmental laws and regulations (collectively, "Laws") in effect
as of the date of Delivery. Upon Diveo's request, Lucent will issue
to Diveo written statements of compliance that Products provided to
Diveo comply with the foregoing representation, warranty and
covenant. Lucent agrees to provide any required changes to the
Lucent Products as a result of changes in the Laws in the event (i)
of a manufacturer recall, (ii) the applicable Laws require the
manufacturer to make such changes, (iii) such changes are otherwise
provided under the Warranty Period or Extended Warranty Period, or
(iv) Lucent provides such changes to any other Lucent customer in
the Territory.
13.9. Integration.
Lucent warrants that for a period of twelve (12) months following
the Acceptance date of any Lucent Product purchased hereunder, such
Lucent Product, when installed and used in accordance with any
portion of the Network Architecture designed and engineered by
Lucent, will interface and interoperate in an integrated way with
the other Products recommended in writing by Lucent for inclusion in
such portion of the Network Architecture designed and engineered by
Lucent. If a Lucent Product fails to so interface and interoperate
during such twelve-month period, Lucent shall initiate corrective
actions after receipt of notice of the defect or failure and shall
promptly cure such defect at Lucent's sole cost and expense. The
Parties agree to follow the procedures established in Schedule H
with respect to any warranty claims made by Diveo under this Section
13.9.
This warranty shall not apply to the extent that the applicable
Lucent Product's failure to operate results from:
(a) the Lucent Products having been installed by a party other
than Lucent not in accordance with the Network Architecture
designed by Lucent, or Documentation and other advice and
training provided by Lucent;
(b) a failure or defect in Third Party Products to operate
interconnected to the Lucent Products or from such Third Party
Product's failure to operate in accordance with its
specifications;
(c) any changes made to the applicable portion of the Network
Architecture without Lucent's written recommendation or
approval;
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Master Supply Agreement 32 Diveo / Lucent Confidential
(d) a defect in the applicable Lucent Product that is otherwise
covered by the warranties contained in Section 13.6 and
Schedule H;
(e) Diveo's failure to load any software updates or upgrades made
available by Lucent for the correction of any identified
performance problem;
(f) Diveo's failure to maintain the Lucent Product and the
applicable portion of the Network in accordance with Lucent's
written instructions;
(g) Any damage to the Lucent Product or to the other Products in
the applicable portion of the Network caused by external
forces outside of Lucent's control; or
(h) Any other event of force majeure as defined in this Agreement
13.10. Documentation.
Lucent covenants that all Documentation provided by Lucent will (a)
accurately reflect the operations and capabilities of any
corresponding Products, (b) be accurate, complete and written in a
manner understood by Diveo, (c) be updated from time to time to
reflect the changes to the Products to the extent that Lucent
generally provides such updates to its customers (including pursuant
to warranty or extended warranty services), and (d) be provided in
the English language and any other languages in which the
Documentation is or becomes available. If translation of the
documents into another language is required, expenses related to the
translation service are to be paid by Diveo.
13.11. Viruses.
Lucent covenants that it shall exercise reasonable care in
recommending Third Party Products that are free of Viruses and that
there are no Viruses coded or introduced into (a) any Lucent Product
or (b) other Product that is not a Third Party Product. Lucent
agrees that, in the event a Virus is found to have been introduced
into any such Lucent Product or other Product that is not a Third
Party Product either (i) prior to Delivery of such Lucent Product or
Product to Diveo, or (ii) from any modification, upgrade,
enhancement or new release to such Lucent Product or Product
provided by Lucent, Lucent shall use all commercially reasonable
efforts, at no additional charge, to assist Diveo in reducing the
effects of the Virus and, if the Virus causes a loss of operational
efficiency or loss of data, to assist Diveo to the same extent to
mitigate such losses.
13.12. Disabling Code.
Lucent covenants that it shall not without the prior written consent
of Diveo, Lucent shall not insert into any Product any code which
would have the effect of disabling or otherwise shutting down all or
any portion of a Product ("Disabling Code"). With respect to any
Disabling Code that may be part of any Product, Lucent shall not
invoke such Disabling Code at any time, including upon expiration or
termination of this Agreement (in whole or in part) for any reason,
without Diveo's prior written consent.
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Master Supply Agreement 33 Diveo / Lucent Confidential
13.13. Year 2000.
Lucent represents, warrants and covenants:
(a) that it will exercise reasonable care in recommending Third
Party Products that are Year 2000 Compliant;
(b) that, during the longer of (i) the Warranty Periods and
Extended Warranty Periods and (ii) December 31, 2001, Lucent
Products, and other Products other than Third Party Products,
shall be Year 2000 Compliant; and
(c) to the extent that Lucent provides testing and validation
Services with respect to a Diveo Network (which Services may
be performed in Lucent's sole discretion) and certifies that
such Diveo Network is Year 2000 Compliant, that such Diveo
Network is Year 2000 Compliant.
At Diveo's reasonable request, Lucent agrees to cooperate and assist
Diveo and its designated third party contractors in connection with
Diveo's other Year 2000 compliance efforts.
13.14. Disclaimer
(a) The foregoing representations warranties, and covenants will
not extend to defective conditions or non-conformities to the
extent resulting from the following, if not consistent with
the applicable Specifications and Documentation: Diveo
modification, misuse, neglect, accident, abuse, improper
wiring, repairing, splicing, alteration, installation, storage
or maintenance.
(b) THE FOREGOING REPRESENTATIONS AND WARRANTIES ARE EXCLUSIVE AND
IN LIEU OF ALL OTHER EXPRESS AND IMPLIED WARRANTIES, INCLUDING
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE. DIVEO'S SOLE AND EXCLUSIVE REMEDY FOR A BREACH OF THE
PRODUCT WARRANTY SET FORTH IN SECTION 13.7 HEREUNDER SHALL BE
LUCENT'S OBLIGATION TO REPAIR, REPLACE, CREDIT OR REFUND AS
PROVIDED HEREIN.
14. TERMINATION
14.1. Termination for Cause.
In the event that Lucent:
(a) commits a material breach of this Agreement, which breach is
not cured within thirty (30) calendar days after notice of
breach from Diveo to Lucent,
(b) commits a material breach of this Agreement which is not
capable of being cured within thirty (30) calendar days and
fails to (i) proceed promptly and diligently to correct the
breach, (ii) develop within thirty (30) calendar days
following written notice of breach from Diveo a complete plan
for curing the
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Master Supply Agreement 34 Diveo / Lucent Confidential
breach, and (iii) cure the breach within sixty (60) calendar
days of notice thereof, or
(c) commits numerous breaches of its duties or obligations which
collectively constitute a material breach of this Agreement,
Then Diveo may, by giving written notice to Lucent, terminate this
Agreement or any affected Purchase Orders, in whole or in part, for
cause as of a date specified in the notice of termination.
14.2. Termination by Lucent.
In the event that Diveo materially and repeatedly fails to pay
Lucent when due undisputed charges under this Agreement and Diveo
continues to materially and repeatedly not pay Lucent when due
undisputed charges following sixty (60) calendar days of written
notice from Lucent, Lucent may, by giving written notice to Diveo,
terminate this Agreement as of a date specified in such notice of
termination.
14.3. Termination Option for Lucent's Failure to Provide Financing.
In the event Diveo terminates the Credit Agreement in accordance
with the terms and conditions of such Credit Agreement due to a
material breach by Lucent , Diveo may upon notice to Lucent elect to
terminate this Agreement in whole or in part. Any such termination
shall be at no cost or liability to Diveo, excluding amounts due and
payable by Diveo as of the date of such termination.
14.4. Disengagement Assistance.
(a) Upon termination or expiration of this Agreement, Diveo may
extend all or any portion of the Agreement beyond the
effective date of termination one or more times as it elects,
at its sole discretion, provided that the total of all such
extensions shall not exceed six (6) months (unless a longer
time period is mutually agreed to by the Parties) following
the original effective date of termination or expiration (such
period the "Disengagement Period"). In the event Lucent
terminates this Agreement in accordance with Section 14.2,
Lucent may request Diveo to pay for estimated Services to be
provided during the month in advance (with unused time to be
credited to Diveo or refunded if no further payments are due
Lucent).
(b) Upon termination or expiration of this Agreement, Lucent
agrees to provide Diveo and its designated third party
providers all reasonable assistance as necessary to effect a
smooth transition to a new supplier.
15. LIABILITY
15.1. General Intent.
Subject to the specific provisions of this Article 15, it is the
intent of the Parties that each Party shall be liable to the other
Party for any actual damages incurred by the non-
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Master Supply Agreement 35 Diveo / Lucent Confidential
breaching Party as a result of the breaching Party's failure to
perform its obligations in the manner required by this Agreement.
15.2. Liability Restrictions.
(a) IN NO EVENT, WHETHER IN CONTRACT OR IN TORT (INCLUDING BREACH
OF WARRANTY, NEGLIGENCE AND STRICT LIABILITY IN TORT), SHALL A
PARTY BE LIABLE FOR INDIRECT OR CONSEQUENTIAL, EXEMPLARY,
PUNITIVE OR SPECIAL DAMAGES, INCLUDING, WITHOUT LIMITATION,
LOST REVENUES, LOST PROFITS AND SIMILAR DAMAGES EVEN IF SUCH
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES IN
ADVANCE.
(b) Subject to Subsections (c) and (d) of this Section, each
Party's total liability to the other, whether in contract or
in tort (including breach of warranty, negligence and strict
liability in tort) shall be limited to an amount equal to the
greater of (i) ten million U.S. Dollars (U.S. $10,000,000) and
(ii) twenty-five percent (25%) of the total amounts paid to
Lucent under this Agreement.
(c) The limitation set forth in Subsection (b) of this Section
shall not apply with respect to: (i) damages occasioned by
willful misconduct, including abandonment or wrongful
termination of this Agreement by Lucent, (ii) claims of breach
of confidentiality, (iii) claims subject to indemnification
pursuant to the Agreement, (v) failure to comply with
applicable laws and regulations, and (vii) any amounts paid by
Diveo that are refundable (either by credit or payment) by
Lucent pursuant to this Agreement.
(d) For the purposes of this Section 15.2, all amounts payable or
paid to third parties in connection with claims that are
eligible for indemnification pursuant to this Agreement shall
be deemed direct damages.
15.3. Force Majeure.
(a) No Party shall be liable for any default or delay in the
performance of its obligations under this Agreement if and to
the extent such default or delay is caused, directly or
indirectly, by fire, flood, lightning, earthquake, elements of
nature or acts of God, riots, civil disorders, rebellions or
revolutions in any country, with respect to Lucent, its sole
suppliers or its subcontractors, or any other cause beyond the
reasonable control of such Party; provided, however, that (i)
the non-performing Party is without fault in causing such
default or delay, and (ii) such default or delay could not
have been prevented by reasonable precautions and cannot
reasonably be circumvented by the non-performing Party through
the use of alternate sources, workaround plans or other means,
including to the extent contemplated by applicable disaster
recovery processes or procedures).
(b) In such event the non-performing Party shall be excused from
further performance or observance of the obligation(s) so
affected for as long as such circumstances prevail and such
Party continues to use commercially reasonable
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Master Supply Agreement 36 Diveo / Lucent Confidential
efforts to recommence performance or observance whenever and
to whatever extent possible without delay. In addition, in
such event, Lucent shall give priority status to Diveo at
least as favorable as that given to other customers to
recommence performance or observance of its obligations. Any
Party so delayed in its performance shall immediately notify
the Party to whom performance is due by telephone (to be
confirmed in writing within two (2) business days of the
inception of such delay) and describe at a reasonable level of
detail the circumstances causing such delay.
(c) If any event under Subsection (a) of this Section above
substantially prevents, hinders, or delays Lucent's
performance for more than sixty (60) consecutive calendar
days, then at Diveo's option: (i) Diveo may terminate for
convenience at no charge to Diveo or modify any affected
portion of any Purchase Order, or terminate for convenience at
no charge to Diveo any affected portion of this Agreement, and
the charges payable hereunder shall be equitably adjusted to
reflect such termination; or (ii) Diveo may terminate this
Agreement without liability to Diveo or Lucent as of a date
specified by Diveo in a written notice of termination to
Lucent. Lucent shall not have the right to any additional
payments from Diveo for costs or expenses incurred by Lucent
as a result of any force majeure occurrence.
16. INDEMNIFICATION
16.1. Indemnities by Lucent.
Lucent agrees to defend Diveo and its Affiliates and their
respective officers, directors, employees, agents, successors, and
assigns, from any claim, action, or suit, and to indemnify Diveo and
its Affiliates and their respective officers, directors, employees,
agents, successors, and assigns against all liabilities assessed
against Diveo by final judgment or Lucent approved settlement
arising from, in connection with, or based on allegations of, any of
the following:
(a) Lucent's failure to observe or perform any duties or
obligations to third parties (e.g., duties or obligations to
subcontractors);
(b) Any claims of infringement of any patent, trade secret, or
copyright alleged to have occurred based upon the provision of
Lucent Products or performance of Services by Lucent, except
to the extent that such claims arise from (i) modification of
a Product or any component thereof by Diveo that is not
recommended or otherwise approved by Lucent, (ii) maintenance
of a Product by Diveo other than in accordance with the
Specifications and the provisions set forth in this Agreement
that is not recommended or otherwise approved in writing by
Lucent, (iii) use of a Product by Diveo in combination with
deliverables furnished by third parties that is not
recommended or otherwise approved in writing by Lucent, or (v)
arises solely from Lucent's incorporation of software or
equipment into a Product that is provided by directly by
Diveo;
(c) The death or bodily injury of any agent, employee, customer,
business invitee or any other person caused by the tortious
conduct of Lucent;
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Master Supply Agreement 37 Diveo / Lucent Confidential
(d) The damage, loss or destruction of any real or tangible
personal property caused by the tortious conduct of Lucent; or
(e) Any claim, demand, charge, action, cause of action, or other
proceeding asserted against Diveo but resulting from an act or
omission of Lucent in its capacity as an employer of a person.
16.2. Indemnities by Diveo.
Diveo agrees to defend Lucent and its Affiliates and their
respective officers, directors, employees, agents, successors, and
assigns, from any claim, action, or suit, and to indemnify Lucent
and its Affiliates and their respective officers, directors,
employees, agents, successors, and assigns against all liabilities
assessed against Lucent by final judgment or Diveo approved
settlement arising from, in connection with, or based on allegations
of, any of the following:
(a) Diveo's failure to observe or perform any duties or
obligations to third parties (e.g., duties or obligations to
subcontractors);
(b) Any claims of infringement of any patent, trade secret, or
copyright, alleged to have occurred based upon misuse of
Lucent Products by Diveo, including (i) modification of a
Product or any component thereof by Diveo that is not
recommended or otherwise approved in writing by Lucent, (ii)
maintenance of a Product performed by Diveo other than in
accordance with the Specifications and the provisions set
forth in this Agreement that is not recommended or otherwise
approved in writing by Lucent, (iii) use of a Product by Diveo
in combination with deliverables furnished by third parties
that is not recommended or otherwise approved in writing by
Lucent;
(c) The death or bodily injury of any agent, employee, customer,
business invitee or any other person caused by the tortious
conduct of Diveo;
(d) The damage, loss or destruction of any real or tangible
personal property caused by the tortious conduct of Diveo; or
(e) Any claim, demand, charge, action, cause of action, or other
proceeding asserted against Lucent but resulting from an act
or omission of Diveo in its capacity as an employer of a
person.
16.3. Infringement.
If any use by Diveo of any Product or other item used by Lucent to
provide the Services becomes, or in Lucent's reasonable opinion is
likely to become, the subject of an infringement or misappropriation
claim or proceeding and is enjoined or Diveo's use is otherwise
adversely impacted, in addition to indemnifying Diveo as provided in
Section 16.1 and to the other rights Diveo may have under this
Agreement, Lucent shall, promptly at Lucent's expense:
(a) Secure the right to continue using the Product or item, or
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Master Supply Agreement 38 Diveo / Lucent Confidential
(b) If the action described in Subsection (a) cannot be
accomplished by Lucent, replace or modify the Product or item
to make it non-infringing, provided that any such replacement
or modification will not degrade the fit, form or function of
the affected Products or Services, or
(c) If the action described in Subsection (b) of this Section
cannot be accomplished by Lucent, and only in such event,
provide Diveo with a full refund for the affected Products and
Services.
16.4. Indemnification Procedures.
With respect to third-party claims, the following procedures shall
apply:
(a) Promptly after receipt of notice of the commencement or
threatened commencement of any civil, criminal,
administrative, or investigative action or proceeding
involving a claim in respect of which Indemnitee will seek
indemnification pursuant to this Article 16, Indemnitee will
notify Indemnitor of such claim in writing. No failure to so
notify Indemnitor will relieve Indemnitor of its obligations
under this Agreement except to the extent that it can
demonstrate damages attributable to such failure. Within
fifteen (15) calendar days following receipt of written notice
from Indemnitee relating to any claim, but no later than ten
(10) calendar days before the date on which any response to a
complaint or summons is due, Indemnitor will notify Indemnitee
in writing if Indemnitor elects to assume control of the
defense and settlement of that claim (a "Notice of Election").
(b) If Indemnitor delivers a Notice of Election relating to any
claim within the required notice period, Indemnitor shall be
entitled to have sole control over the defense and settlement
of such claim; provided that (i) Indemnitee shall be entitled
to participate in the defense of such claim and to employ
counsel at its own expense to assist in the handling of such
claim, and (ii) Indemnitor shall obtain the prior written
approval of Indemnitee before entering into any settlement of
such claim or ceasing to defend against such claim if such
settlement or ceasing to defend shall have a material impact
on the Indemnitee. After Indemnitor has delivered a Notice of
Election relating to any claim in accordance with the
preceding paragraph, Indemnitor shall not be liable to
Indemnitee for any legal expenses incurred by Indemnitee in
connection with the defense of that claim. In addition,
Indemnitor shall not be required to indemnify Indemnitee for
any amount paid or payable by the Indemnitee in the settlement
of any claim for which the Indemnitor has delivered a timely
Notice of Election if such amount was agreed to without the
written consent of the Indemnitor.
(c) If Indemnitor does not deliver a Notice of Election relating
to any claim within the required notice period, Indemnitee
shall have the right to defend the claim in such manner as it
may deem appropriate, at the cost and expense of Indemnitor.
Indemnitor shall promptly reimburse Indemnitee for all such
costs and expenses.
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Master Supply Agreement 39 Diveo / Lucent Confidential
17. DISPUTE RESOLUTION
Any dispute between the Parties arising out of or relating to this
Agreement, including with respect to the interpretation of any provision
of this Agreement and with respect to the performance by Lucent or Diveo,
shall be resolved as provided in this Article 17.
17.1. Informal Dispute Resolution.
(a) Prior to the initiation of formal dispute resolution
procedures, the Parties shall first attempt to resolve their
dispute informally pursuant the escalation procedures set
forth in Schedule I. In connection with such escalation
process:
(i) The designated representatives shall meet as often as
the Parties reasonably deem necessary in order to gather
and furnish to the other all information with respect to
the matter in issue which the Parties believe to be
appropriate and germane in connection with its
resolution. The representatives shall discuss the
problem and attempt to resolve the dispute without the
necessity of any formal proceeding.
(ii) During the course of discussion, all reasonable requests
made by one Party to another for non-privileged
information, reasonably related to this Agreement, shall
be honored in order that each of the Parties may be
fully advised of the other's position.
(iii) The specific format for the discussions shall be left to
the discretion of the designated representatives.
(b) The Parties agree that disputes, controversies or claims
between them shall not be subject to the provisions of this
Section where:
(i) A Party makes a good faith determination that a breach
of the terms of this Agreement by the other Party is
such that a temporary restraining order or other
injunctive relief is the only appropriate and adequate
remedy; or
(ii) Institution of formal proceedings earlier than as set
forth in Section 17.2(a) is necessary to avoid the
expiration of any applicable limitations period or to
preserve a superior position with respect to other
creditors.
(c) If a Party files a pleading with a court seeking immediate
injunctive relief and this pleading is challenged by the other
Party and the injunctive relief sought is not awarded in
substantial part, the Party filing the pleading seeking
immediate injunctive relief shall pay all of the costs and
attorneys' fees of the Party successfully challenging the
pleading.
17.2. Litigation.
(a) Formal proceedings for the resolution of a dispute may be
commenced after the earlier of:
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Master Supply Agreement 40 Diveo / Lucent Confidential
(i) The designated representatives described in Section 17.1
conclude in good faith that amicable resolution through
continued negotiation of the matter does not appear
likely; or
(ii) Thirty (30) calendar days after the initial written
request to appoint a designated representative pursuant
to Subsection 17.1(a) above (this period shall be deemed
to run notwithstanding any claim that the process
described in this Section 17.1 was not followed or
completed).
(b) The Parties consent to the jurisdiction of the courts of the
State of Florida (and to venue in Dade County), and to
jurisdiction and venue in the United States District Court for
the Southern District of Florida for all litigation that may
be brought with respect to the terms of, and the transactions
and relationships contemplated by, this Agreement. The Parties
further consent to the jurisdiction of any state court located
within a district that encompasses assets of a Party against
which a judgment has been rendered for the enforcement of such
judgment or award against the assets of such Party.
17.3. Continued Performance.
Each Party agrees to continue performing its obligations under this
Agreement while any dispute is being resolved except to the extent
the issue in dispute precludes performance.
17.4. Governing Law.
This Agreement and performance under it shall be governed by and
construed in accordance with the laws of the State of New York
without regard to its choice of law principles.
18. INSURANCE REQUIREMENTS
During the Term, Lucent shall have and maintain in force the following
insurance coverages:
(a) Worker's Compensation and Employer's Liability as prescribed
by the law of the State or Nation in which the work is
performed. Lucent reserves the right to self-insure where
allowed by law.
(b) General Liability, including Products and Completed Operations
Liability, with a combined single limit for bodily injury and
property damage of at least US$ 1,000,000 for each occurrence.
(c) Automobile Liability if the use of motor vehicles is required
with a combined single limit of liability of at least US$
1,000,000 for each occurrence for vehicles operated in the
United States of America. For vehicles operated outside of the
United States of America, the limits of liability will be in
accordance with local legal requirements and sufficient to
meet normal and customary claims.
The foregoing insurance coverages shall be primary and non-contributing
with respect to any other insurance or self insurance that may be
maintained by Diveo. Lucent shall cause its insurers to issue certificates
of insurance evidencing that the coverages and policy endorsements
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Master Supply Agreement 41 Diveo / Lucent Confidential
required under this Agreement are maintained in force and that not less
than thirty (30) calendar days written notice shall be given to Diveo
prior to any modification, cancellation or non-renewal of the policies.
The minimum limits of coverage specified herein are not intended, and
shall not be construed, to limit any liability or indemnity of Lucent
under this Agreement.
19. GENERAL
19.1. Binding Nature and Assignment.
(a) This Agreement shall accrue to the benefit of and be binding
upon the Parties hereto and any purchaser or any successor
entity into which either Party has been merged or consolidated
or to which either Party has sold or transferred all or
substantially all of its assets.
(b) Neither Party may, or shall have the power to, assign this
Agreement or delegate such Party's obligations hereunder
without the prior written consent of the other, which consent
shall not be unreasonably withheld, except that either Party
may assign its rights and obligations under this Agreement
without the approval of the other Party to
(i) an entity which acquires all or substantially all of the
assets of the Party,
(ii) to any Affiliate, or
(iii) to a successor in a merger or acquisition of the Party;
provided, however, that in the event that the financing
provided by Lucent under the Credit Agreement is terminated as
a result of such assignment, then Lucent's consent to such
assignment shall be required if the entity has credit
worthiness less than that of Diveo.
19.2. Entire Agreement.
This Agreement, including any attached Schedules, constitutes the
entire agreement between the Parties with respect to the subject
matter in this Agreement, and supersedes all prior agreements,
whether written or oral, with respect to the subject matter
contained in this Agreement.
19.3. Notices.
All notices, requests, demands, and determinations under this
Agreement (other than routine operational communications), shall be
in writing and shall be deemed duly given (i) when delivered by
hand, (ii) one (1) business day after being given to an express,
overnight courier with a reliable system for tracking delivery,
(iii) when sent by confirmed facsimile with a copy delivered by
another means specified in this Section, or (iv) four (4) business
days after the day of mailing, when mailed by United States mail,
registered or certified mail, return receipt requested, postage
prepaid, and addressed as follows:
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Master Supply Agreement 42 Diveo / Lucent Confidential
If to Diveo: If to Lucent:
Diveo, Inc. Lucent Technologies World Services Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇.
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▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ Attn: Managing Director, Business Development
Attn: Contract Administration Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
With a copy to: Lucent Technologies World Services Inc.
Diveo, Inc. ▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ Avenue, NW Coral Gables, FL 33134
Suite 320 Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: General Counsel's Office
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
A Party may from time to time change its address or designee for
notification purposes by giving the other prior written notice of
the new address or designee and the date upon which it will become
effective.
19.4. Counterparts.
This Agreement may be executed in several counterparts, all of which
taken together shall constitute one single agreement between the
Parties hereto.
19.5. Relationship of Parties.
Lucent, in furnishing Products and Services hereunder, is acting as
an independent contractor, and Lucent personnel (including its
subcontractors) shall not be considered or represented as employees
or agents of Diveo. Lucent is not otherwise an agent of Diveo and
has no authority to represent Diveo as to any matters, except as
expressly authorized in this Agreement. Lucent is solely responsible
for: (a) performing its responsibilities under this Agreement, (b)
management and control of its personnel; (c) the payment of all
compensation owed to its personnel, including payment of
employment-related taxes, benefits, and worker's compensation
insurance; (d) the filing of all required employment returns and
reports; and (e) the withholding and payment of all applicable
federal, state, and local taxes and other wage or employment
assessments, including but not limited to income tax, social
security tax, and unemployment insurance premiums for its personnel.
19.6. Severability.
In the event that any provision of this Agreement conflicts with the
law under which this Agreement is to be construed or if any such
provision is held invalid by an arbitrator or a court with
jurisdiction over the Parties, such provision shall be deemed to be
restated to reflect as nearly as possible the original intentions of
the Parties in accordance with applicable law. The remainder of this
Agreement shall remain in full force and effect.
19.7. Consents and Approval.
Except where expressly provided as being in the sole discretion of a
Party, where agreement, approval, acceptance, consent, or similar
action by either Party is required
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Master Supply Agreement 43 Diveo / Lucent Confidential
under this Agreement, such action shall not be unreasonably delayed
or withheld. An approval or consent given by a Party under this
Agreement shall not relieve the other Party from responsibility for
complying with the requirements of this Agreement, nor shall it be
construed as a waiver of any rights under this Agreement, except as
and to the extent otherwise expressly provided in such approval or
consent.
19.8. Waiver of Default.
No waiver or discharge hereof shall be valid unless in writing and
signed by an authorized representative of the Party against which
such amendment, waiver, or discharge is sought to be enforced. A
delay or omission by either Party hereto to exercise any right or
power under this Agreement shall not be construed to be a waiver
thereof. A waiver by either of the Parties hereto of any of the
covenants to be performed by the other or any breach thereof shall
not be construed to be a waiver of any succeeding breach thereof or
of any other covenant herein contained.
19.9. Cumulative Remedies.
Except as otherwise expressly provided herein, all remedies provided
for in this Agreement shall be cumulative and in addition to and not
in lieu of any other remedies available to either Party at law, in
equity or otherwise.
19.10. Survival.
Any provision of this Agreement which contemplates performance or
observance subsequent to any termination or expiration of this
Agreement (in whole or in part) shall survive any termination or
expiration of this Agreement (in whole or in part, as applicable)
and continue in full force and effect. Without limiting the
generality of the foregoing, Diveo shall have the right to extend
any Warranty Period or Extended Warranty Periods in accordance with
the terms of this Agreement and purchase Products and Services
pursuant to Section 2.2, and each Party's obligations with respect
to such Products and Services shall survive expiration or
termination of this Agreement (in whole or in part, as applicable)
and continue in full force and effect.
19.11. Public Disclosures.
All media releases, public announcements, and public disclosures
relating to this Agreement or the subject matter of this Agreement,
including promotional or marketing material, but not including
announcements intended solely for internal distribution or
disclosures to the extent required to meet legal or regulatory
requirements beyond the reasonable control of the disclosing Party,
shall be coordinated with and shall be subject to approval by the
non-disclosing Party prior to release. In the event Diveo is going
to file this Agreement as part of public securities filing, Diveo
will notify Lucent to enable Lucent to provide prompt input to limit
the extent of the disclosure; provided, however, Diveo shall not be
required to delay any required filings and Diveo shall ultimately
determine what will be disclosed.
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Master Supply Agreement 44 Diveo / Lucent Confidential
19.12. Service Marks.
Each Party agree that it shall not, without the other Party's
written consent, use the name, service marks or trademarks of the
other Party or its Affiliates.
19.13. Third Party Beneficiaries.
Except as otherwise provided in this Agreement, this Agreement shall
not be deemed to create any rights in third parties, including
suppliers and customers of a Party, or to create any obligations of
a Party to any such third parties.
19.14. Amendment.
This Agreement shall not be modified, amended or in any way altered
except by an instrument in writing signed by both Parties.
19.15. Interpretation
(a) Terms other than those defined in this Agreement shall be
given their plain English meaning, and those terms, acronyms
and phrases known in the telecommunications and information
technology services industries shall be interpreted in
accordance with their generally known meanings. Unless the
context otherwise requires, words importing the singular
include the plural and vice-versa. Terms defined in the Credit
Agreement shall not be superceded by the same terms defined in
this Agreement.
(b) References to "Article", "Section", "Subsection" and
"Schedule" mean references to an article, section, subsection
or schedule of this Agreement, as appropriate, unless
otherwise specifically stated.
(c) The article and section headings in this Agreement are
intended to be for reference purposes only and shall in no way
be construed to modify or restrict any of the terms or
provisions of this Agreement.
(d) The words "include," "includes", and "including", when
following a general statement or term, are not to be construed
as limiting the general statement or term to any specific item
or matter set forth or to similar items or matters, but rather
as permitting the general statement or term to refer also to
all other items or matters that could reasonably fall within
its broadest scope.
(e) All dollar amounts set forth herein are in United States
dollars.
(f) Unless otherwise specified as "business days", reference to
"days" in this Agreement shall refer to calendar days.
19.16. Incorporation by Reference and Order of Precedence.
(a) All Schedules attached hereto are hereby incorporated by
reference into this Agreement. Subject to Section 19.14, any
amendments to this Agreement (including with respect to
Schedules), and any additional Schedules that are
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Master Supply Agreement 45 Diveo / Lucent Confidential
agreed upon by the Parties subsequent to the Effective Date,
shall likewise be incorporated by reference into this
Agreement.
(b) Any conflict among or between the documents making up this
Agreement will be resolved in accordance with the following
order of precedence (in descending order of precedence):
(i) This Agreement;
(ii) The Schedules;
(iii) The Exhibits to the Schedules; and
(iv) Purchase Orders.
19.17. Right of Access
Diveo shall provide Lucent or its representatives access to its
facilities reasonably required in connection with Lucent's
performance of its obligations under this Agreement. No charge shall
be made for such access.
19.18. Export Control
The Parties acknowledge that any Products provided under this
Agreement are subject to U.S. export laws and regulations, and any
use or transfer of such Products must be authorized under those
regulations. Each Party agrees that it will not ship, Deliver, use,
distribute, transfer, or transmit the Products (even if incorporated
into other Products) in violation of such laws and regulations. If
requested by a Party, the other Party shall sign written assurances
and other export-related documents as may be required by the
requesting Party to comply with such laws and regulations.
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
undersigned officers, thereunto, duly authorized, as of the date first written
above.
DIVEO, INC. LUCENT TECHNOLOGIES WORLD SERVICES, INC.
By: By:
--------------------------- ---------------------------
Name: Name:
--------------------------- ---------------------------
Title: Title:
--------------------------- ---------------------------
Date: Date:
--------------------------- ---------------------------
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Master Supply Agreement 46 Diveo / Lucent Confidential
GLOSSARY OF DEFINED TERMS
Set forth below is a listing of the defined terms used in the Agreement. Unless
otherwise specifically referencing a Schedule to the Agreement, Section
references set forth below refer to sections in the terms and conditions portion
of the Agreement.
(a) "Acceptance" has the meaning set forth in Section 6.3.
(b) "Acceptance Criteria" mean the criteria used to determine whether a
Product or combination of Products installed, recommended or
implemented by Lucent is ready for Acceptance. The Acceptance
Criteria require, unless otherwise mutually agreed in writing, that
the Product or combination of Products:
(i) Meets or exceeds the Specifications applicable to such
Product(s);
(ii) Integrates in accordance with the approved Diveo Network
design, architecture and technology as required pursuant to an
applicable, mutually approved City Plan;
(iii) Complies with Applicable Standards and Documentation;
(iv) Complies with the Diveo requirements set forth in Schedule L,
where applicable;
(v) Complies with all additional mutually agreed-upon testing
criteria and plans as may be developed and agreed upon by the
Parties in accordance with the terms of this Agreement; and
(vi) Interoperates with the Diveo Network as set forth in the
product technical specifications or other engineering or
design documents prepared by Lucent.
(vii) For Product(s) that Diveo has not also ordered installation or
implementation Services to be provided by Lucent ("furnish
only" Products), the sole Acceptance Criteria shall be (A) the
verification of the corresponding inventory against the
Purchase Order and (B) the criteria specified in (i), (iii),
(iv) and (v), as applicable, such verification to occur within
five (5) business days from delivery of the Product to the
inside of the designated site or destination specified in the
Purchase Order.
(c) "Acceptance Test Period" for a Product or Products shall mean the
applicable period specified in the Purchase Order or Schedule J, as
applicable. For Purchase Orders with installation, implementation
and/or engineering Service the Acceptance Test Period shall mean the
period of time until actual Acceptance. In the event an Acceptance
Test Period for a particular Product is not specified in Schedule J
and is not otherwise mutually agreed upon, the Acceptance Test
Period shall be: (i) twenty (20) days from Lucent Certification, if
installed or implemented with Acceptance testing by Lucent, or (ii)
thirty (30) days from (A) Lucent's completion of the installation or
implementation Services without Acceptance testing or (B) the
delivery of the Product at the designated site or destination
specified in the Purchase Order, if not installed or implemented by
Lucent. The aforesaid 20-day and 30-day Acceptance Test Periods
shall be in addition to (and not included in) the lead times or
execution times specified in Schedule J, such that the credits
described in Section 3.3 (c)
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shall not begin to accrue until after all of the following time
periods shall have elapsed: (I) the applicable lead time or
execution time, (II) the 20-day or 30-day Acceptance Test Period, as
applicable, and (III) the five-day grace period specified in Section
3.3(c).
(d) "Acceptance Test Plan" refers to the Acceptance testing plan
utilized to test the Product. The process for Acceptance Test Plans
is attached as Schedule F, and includes generic forms.
(e) "Affiliate" means, with respect to any entity, any other entity
Influencing, Influenced by or under common Influence with such
entity.
(f) "Agreement" has the meaning set forth in the preamble to this
Agreement.
(g) "Applicable Standards" means (i) all industry standards (whether
domestic or international) applicable to the Product, all as may be
amended from time to time, and (ii) all domestic and international
federal, state and local laws, regulations, ordinances, codes and
requirements applicable to the Product, all as may be amended from
time to time.
(h) "City Plan" means a plan that addresses the timing, network
topology, functionality and scope of implementation (including
Milestones and the System Acceptance Test Plan) for a particular
part of the Diveo Network design.
(i) "Provisional Acceptance" has the meaning set forth in Section 6.1.
(j) "Confidential Information" has the meaning set forth in Section
12.1.
(k) "Commitment" has the meaning given in Section 10.4.
(l) "Contract Year" shall refer to each twelve month period of the Term
of this Agreement, with the initial Contract Year commencing on the
Effective Date.
(m) "Credit Agreement" shall refer to that certain Credit Agreement,
dated as of November 22, 1999 between Diveo and Lucent.
(n) "Customer Co-location" means the existence of Diveo customer
equipment and associated software and peripherals interconnected
with a Diveo network and located in Diveo's premises (whether owned,
leased or licensed by Diveo).
(o) "Customer Virtual Colocation" means the existence of Diveo customer
equipment and associated software and peripherals interconnected
with a Diveo network and not located in Diveo's premises (whether
owned, leased or licensed by Diveo).
(p) "Delivery" means:
(i) with respect to a Product or Products only Purchase Orders,
delivery and Acceptance of such Product or Products under the
Purchase Order; and
(ii) with respect to Purchase Orders that include Services, (A)
where the Service is related to the installation of a Product,
completion of the Service and Acceptance of the Product, (B)
where the Service is not related to the installation of a
Product,
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Master Supply Agreement Diveo / Lucent Confidential
Glossary - 2
reasonable completion of the Service, and (C) where the
Service is for civils, upon mutual agreement, but in no event
longer than market practice where the civils are being
performed
(q) "Delivery Pricing Adjustment" has the meaning set forth in Section
3.3(c).
(r) "Demarcation Point" means the physical and logical interface between
the Products that Diveo operates in providing its services and the
telecommunications equipment that (i) in the case of a tributary,
Diveo's customer utilizes to connect to such Products and (ii) in
the case of a service gateway, the other service provider utilizes
to connect to such Products.
(s) "Developed Deliverable" has the meaning set forth in Section 8.2.
(t) "Disabling Code" has the meaning set forth in Section 13.12.
(u) "Disclosing Party" has the meaning set forth in Section 12.1.
(v) "Disengagement Period" has the meaning set forth in Section 14.4(a).
(w) "Diveo" or "Buyer" has the meaning set forth in the preamble to this
Agreement.
(x) "Diveo Network" means the physical, transport and application
network layers of the communication infrastructure used by Diveo
(including its Affiliates) to connect to its customers and central
offices in a variety of combinations up to Demarcation Points. It is
anticipated that the Diveo Network will include domestic intra-city
networks, inter-city networks, international networks and
international intra-city networks.
(y) "Documentation" has the meaning set forth in Section 8.1(f).
(z) "Effective Date" has the meaning set forth in the preamble to this
Agreement.
(aa) "Equipment" means the equipment, hardware, firmware, cabling and
embedded Software components that may be purchased, or with respect
to embedded Software, licensed by Diveo from or through Lucent under
this Agreement. As of the Effective Date, the categories of
Equipment include the categories identified as such in Schedule A.
(bb) "Extended Term" has the meaning set forth in Section 2.2.
(cc) "Extended Warranty Period" means Diveo's extension of the Warranty
Period for a Product one or more times in its sole discretion upon
payment of the maintenance fees set forth in Schedule C.
(dd) "Incremental DDP Costs" has the meaning set forth in Section 10.1.
(ee) "Influence" and its derivatives means (i) legal, beneficial, or
equitable ownership, directly or indirectly, of more than an
Interest of outstanding capital stock (or other ownership interest,
if not a corporation) of an entity ordinarily having voting rights
or (ii) with respect to entities incorporated or principally
operating in the United States, management or operational control
over such entity.
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Master Supply Agreement Diveo / Lucent Confidential
Glossary - 3
(ff) "Initial Term" has the meaning set forth in Section 2.1.
(gg) "Interest" means fifty percent (50%) or more, or the maximum
percentage interest permitted by law if less than fifty percent
(50%).
(hh) "Key Lucent Positions" has the meaning set forth in Section 5.2(a).
(ii) "Licenses" has the meaning set forth in Section 8.1(a).
(jj) "Lucent" or "Seller" has the meaning set forth in the preamble to
this Agreement. With respect to the obligation to fulfill Purchase
Orders, "Lucent" shall also include Lucent's distributors; provided,
however, Lucent shall remain fully responsible for the performance
of such distributors.
(kk) "Lucent Certification" shall mean Lucent's written certification to
Diveo that (i) it has fully and successfully tested the Product in
accordance with the developed test plan (individually and as
integrated into the Diveo Network), (ii) the Product has met the
Acceptance Criteria to Lucent's satisfaction and (iii) the Product
is available for Diveo's testing in accordance with the applicable
test plan.
(ll) "Lucent Product" means any product, equipment or software created,
manufactured and/or developed by Lucent or its Affiliates or third
party products, equipment or software branded or logoed by Lucent or
its Affiliates, and shall include those products, equipment and
software identified in this Agreement as Lucent Products and
otherwise made commercially available by Lucent or its Affiliates.
(mm) "Milestone" has the meaning set forth in Section 5.3(a).
(nn) "Milestone Date" has the meaning set forth in Section 5.3(a).
(oo) "Network Architecture" means the overall design and architecture
specification for the Diveo Network, including sizing and
engineering requirements, from which the Network Technology is
developed.
(pp) "Network Element" means any product or transport service necessary
for the proper operation of the Network, which will be set forth in
the Network Technology.
(qq) "Network Technology" means the deliverable developed from the
Network Architecture by Lucent for review and approval by Diveo, all
as set forth in Schedule A, that identifies the Product and
transport specifications for implementation as part of the City
Plan.
(rr) "Non-conformity" means the failure of a Product to comply with the
Acceptance Criteria and such other criteria as are set forth in this
Agreement.
(ss) "Notice of Election" has the meaning set forth in Section 16.4(a).
(tt) "Out-of-Pocket Expenses" means reasonable and actual out-of-pocket
expenses incurred by a Party, but not including that Party's
overhead costs (or allocations thereof), administrative expenses or
other ▇▇▇▇-ups.
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Master Supply Agreement Diveo / Lucent Confidential
Glossary - 4
(uu) "Party" means either Diveo or Lucent, as appropriate, and "Parties"
means Diveo and Lucent.
(vv) "Product" means Lucent Products and Third Party Products.
(ww) "Provisional Acceptance" has the meaning set forth in Section 6.1.
(xx) "Purchase Order" has the meaning specified in Section 3.1(a).
(yy) "Receiving Party" has the meaning set forth in Section 12.1.
(zz) "Service" means Third Party Services and the services provided by
Lucent pursuant to this Agreement and (i) described in any Purchase
Order, or (ii) not specifically described in a Purchase Order, but
implied by or required for the proper performance and provision of
services included in a Purchase Order. For purposes of this
Agreement, "Service" shall also include those services that result
in a deliverable (e.g., documentation, designs, engineering
reports). As of the Effective Date, the Services that Diveo may
purchase from Lucent include those services identified as such in
Schedule A. Lucent shall also provide those training services
described in Schedule G.
(aaa) "Service Level" has the meaning given in Section 7.1.
(bbb) "Software" means software, in object code form, including applicable
documentation, that may be licensed by Diveo from Lucent under this
Agreement or that is developed by Lucent as a Product pursuant to
this Agreement.
(ccc) "Source Code" means both machine-readable and human-readable copies
of Software consisting of instructions to be executed upon a
computer in the language used by its programmers (i.e., prior to
compilation or assembly) in a form in which the program logic of the
Software is deducible by a human being, fully commented, and
including all related flow diagrams and all other documentation and
manuals which would allow Diveo to properly effect modifications and
support for Software Products provided under this Agreement.
(ddd) "Specifications" means Diveo Network design standards provided to
Lucent in writing and accepted by Lucent and Lucent's or the
relevant Product manufacturers' published specifications for
particular Products furnished hereunder.
(eee) "Technical Materials Trigger Event" has the meaning given in Section
8.4.
(fff) "Term" has the meaning set forth in Section 2.2.
(ggg) "Territory" shall mean those countries listed in Schedule D, as such
list may be added to from time to time in accordance with Section
1.2(b) of the Agreement.
(hhh) "Third Party Content" means Third Party Products and Third Party
Services.
(iii) "Third Party Product" means any product ordered hereunder that is
not a Lucent Product.
(jjj) "Third Party Service" means any services ordered hereunder that is
not a Lucent Service.
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Master Supply Agreement Diveo / Lucent Confidential
Glossary - 5
(kkk) "Virus" means: (i) program code, programming instruction or set of
instructions intentionally constructed with the ability to damage,
interfere with or otherwise adversely affect computer programs, data
files or operations; or (ii) other code typically designated to be a
virus.
(lll) "Warranty Period" means, for each Product or Service, the applicable
period set forth in Schedule H measured from the date of Acceptance.
(mmm) "Year 2000 Compliant" means the ability of a Product provided or
developed by Lucent pursuant to this Agreement to (i) correctly
process, provide, interpret, manipulate and receive date data within
and between the twentieth and twenty-first centuries, without
causing logical or mathematical inconsistencies, processing errors,
loss of functionality or performance, or other failures, and (ii)
interoperate with other technical systems (including but not limited
to hardware and software) having the characteristics described in
(i) and with date data of the twentieth and twenty-first centuries.
With respect to any data that is generated or provided in
conjunction with the Products, such data shall contain such
information or be so formatted as to permit hardware or software
with the characteristics described in (i) of the foregoing sentence
to correctly process, provide, interpret, manipulate and receive
such data within and between the twentieth and twenty-first
centuries, without causing logical or mathematical inconsistencies,
processing errors, loss of functionality or performance, or other
failures with respect to such Products.
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Master Supply Agreement Diveo / Lucent Confidential
Glossary - 6