Confidential: Use or disclosure of this document is subject to the restriction
on the Confidentiality Statement.
iDEN(R) INFRASTRUCTURE EQUIPMENT PURCHASE AGREEMENT
This Agreement ("Agreement") is between Motorola, Inc., a Delaware corporation,
by and through its Network Solutions Sector, Customer Solutions Group with
offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Motorola") and
Nextel Partners Operating Corp., a Delaware Corporation, with offices at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Customer").
RECITALS:
Customer has obtained or will obtain the right to use all required licenses
authorizations, and approvals to construct and operate an iDEN System in the
Area as defined below in Section 1.
Customer or it's wholly owned subsidiaries desire to purchase and Motorola
desires to sell, install and integrate an iDEN System pursuant to the terms and
conditions of this Agreement.
The Exhibits to this Agreement are incorporated by reference into the Agreement,
and include the following:
Exhibit "A" Project Order Form
Exhibit "B" Technical Overview: Notes On The iDEN System **
Exhibit "C" System Performance Criteria and Acceptance Test Plan
Exhibit "D" Implementation Engineering, Site Preparation, Installation
and Integration
Exhibit "E" System Maintenance
Exhibit "F" Object-Code Computer Program License
Exhibit "G" Training
Exhibit "H" Documentation
Exhibit "I" Implementation Schedule
Exhibit "J" Price Book, **
Exhibit "K" Listing of "Year 2000 Compliant" Products
The parties shall enter into a separate agreement for the sale by Motorola and
purchase by Customer of Subscriber Units for use on the iDEN System (the
"Subscriber Agreement").
AGREEMENT:
Now therefore, in consideration of the mutual obligations herein contained, the
parties agree as follows:
1.0 DEFINITIONS
Capitalized terms used in this Agreement and the Exhibits shall have the
following meanings:
--------
(R) Registered U.S. Patent & Trademark Office.
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
1
ACCEPTANCE TEST PROCEDURE - ATP
Exhibit "C" describes the types of tests included in the ATP. The
Acceptance Test Procedure will be performed accordingly.
AFFILIATE
As defined in Rule 12b-2 under the Securities Exchange Act of 1934, as
amended.
AGREEMENT
As defined in the preamble hereof.
AREA
The geographic area of any of the metropolitan and rural market areas
throughout the United States, U.S. metropolitan markets, as listed in
the initial Exhibit "A" or any subsequent Exhibit "A".
BUSINESS DAY
Any day other than a Saturday, Sunday or a day on which commercial
banking institutions are authorized or required by law, regulation or
executive order to be closed in New York, New York.
CHANGE ORDER
Any change agreed to in writing, by Customer and Motorola, that modifies
the type or quantity of equipment or services purchased under this
Agreement.
COMMERCIAL SERVICE
The point at which the iDEN System or any portion thereof is functional
and operative and has one or more Subscribers.
CONDITIONAL ACCEPTANCE AND FINAL ACCEPTANCE
Conditional Acceptance of an iDEN System shall occur as follows:
Conditional Acceptance shall occur and be evidenced by a notice signed
by Customer at the completion of the ATP, which shall not be
unreasonably withheld or upon Commercial Service. Final Acceptance shall
occur and be evidenced by a notice signed by Customer when all material
Punchlist items have been resolved.
2
With respect to Expansion Product, in the event Customer purchases
Installation and Integration Services from Motorola prior to the date of
shipment, Conditional and Final Acceptance shall occur in the same
manner as provided in the "Conditional Acceptance and Final Acceptance"
definition above with respect to the iDEN System.
For Expansion Product purchased without Installation and Integration
Services, Final Acceptance shall occur concurrently with the shipment of
each such Expansion Product.
CONFIDENTIAL INFORMATION
That information marked as confidential or proprietary and transferred
pursuant to this Agreement which may include, without implied
limitation, formulas, processes, designs, photographs, plans, samples,
equipment, equipment performance reports, Subscriber lists, pricing
information, studies, findings, inventions, ideas, drawings, schematics,
sketches, specifications, parts lists, technical data, databases,
Software in any form, flow charts, algorithms and other business and
technical information. Excluded from Confidential Information is that
which (i) the recipient had in its possession without confidential
limitation prior to disclosure, (ii) which is independently developed by
either party, (iii) which is known or becomes known to the general
public without breach of this Agreement, or (iv) which is received
rightfully and without confidential limitation from a third party.
Confidential Information shall be subject to the requirements of Section
14 of this Agreement.
CUSTOMER PROGRAM MANAGER
Customer Program Manager shall have the meaning set forth in Section
2.3.
DATE OF SHIPMENT
The date of shipment as shown on the relevant Motorola invoice for the
product shipped from Motorola to Customer.
DIGITAL MOBILE NETWORK
Digital Mobile Network means a wide-area network of specialized mobile
radio base stations that employs digital and other advanced, spectrally
efficient communications technologies to provide a full range of
wireless communication services that may include voice, dispatch,
interconnected telephone and data services employing iDEN technology.
DOCUMENTATION
The documentation described in Exhibit "H".
3
EBTS
"EBTS" is defined as the base radio units as specified in Exhibit "B".
EVENT OF FORCE MAJEURE
"Event of Force Majeure" is as defined in Section 18.
EXPANSION PRODUCT
All Fixed Network Equipment, Software, and other products purchased to
add to or expand an iDEN System.
FOB
When used herein shall mean that Motorola shall deliver to Customer's
carrier at a manufacturing site or Motorola facility located within the
Continental United States.
FIXED NETWORK EQUIPMENT - FNE
The Motorola supplied equipment described generally in Motorola's Price
Book (including the iDEN Switch). Non-Motorola-supplied equipment which
is not integral to the iDEN Switch or to the Sites is excluded from FNE,
as are Subscriber Units.
FUNDING AFFILIATE
"Funding Affiliate" is as defined in Section 7.7.
iDEN
iDEN is the trademark for Motorola's advanced integrated radio-telephone
and dispatch communications system that is the subject of this
Agreement. It is an integrated wireless telecommunications system that,
among other things, incorporates handover control and mobility
management, dispatch subsystem, full telephone interconnect capability,
short message service capability, and circuit switched and packet data
capabilities that architecturally and functionally operates as
designated by Motorola.
iDEN SWITCH
The Switch equipment that routes calls from Subscriber Units to the
called party (and vice versa), coordinates the handoff process and
records System interconnect traffic.
iDEN SYSTEM
iDEN System shall have the meaning set forth in Section 2.5.
4
IMPLEMENTATION SCHEDULE
The schedule set forth in the Exhibit "I" for the installation of the
iDEN System.
INITIAL PROGRAM LOAD (IPL)
The Initial Program Load (IPL) Software is delivered with the iDEN
System, shall be the most current version of iDEN Software and includes
the Software necessary to support all major subsystems or components of
the iDEN System. A license fee for the System IPL is identified in
Exhibit "A" or set forth in the Price Book. Any re-sale of equipment
other than to Nextel Communications, Inc. or its wholly owned
subsidiaries is subject to Motorola's approval and will require a
relicensing of the Software from Motorola, including payment of an IPL
license fee by the new owner.
INSTALLATION AND INTEGRATION SERVICES
Installation and Integration Services shall mean the services set forth
in Exhibit "D" "Implementation Engineering, Site Preparation,
Installation and Integration".
INTERCONNECTED CARRIER
Any local exchange carrier, inter-exchange carrier, or reseller of local
or inter-exchange service that is connected to the iDEN System.
INTERCONNECTION FACILITIES
The medium connecting the iDEN Switch to the switched network of any
Interconnected Carrier including termination facilities such as
protected termination blocks, end office termination repeaters and
Customer service units to permit direct connection to the iDEN System.
MSO
An MSO shall be defined as a Mobile Switching Office that consists of
the iDEN Switch (with or without a Home Location Register "HLR"), the
Dispatch Application Processor ("DAP"), Metro Packet Switch ("MPS"),
Base Station Controller ("BSC"), and Operation Maintenance Console
("OMC") Equipment.
MOTOROLA PROGRAM MANAGER
Motorola Program Manager shall have the meaning set forth in Section
2.3.
5
OTHER EQUIPMENT
Other Equipment shall be defined as any products supplied by or through
Motorola under the Agreement that are not included as part of an iDEN
System or System Expansion as defined herein, excluding iDEN System
engineering, Other Software, Other Services, and Subscriber Units.
OTHER SERVICES
Other Services shall be defined as services supplied by Motorola under
the Agreement that are not included as part of an iDEN System or System
Expansion of the types defined herein
OTHER SOFTWARE
Other Software shall be defined as software supplied by or through
Motorola under the Agreement that is not included as part of an iDEN
system or System Expansion of the types defined herein, excluding System
engineering and Other Services.
PRICE BOOK
Motorola's iDEN(R) Infrastructure Price Book, which is kept by Motorola
on the iDEN web site for use in the United States and updated
periodically by Motorola.
PUNCHLIST
The list, prepared during the ATP and the 14 day period subsequent to
the date of Conditional Acceptance and finalized no later than 14 days
subsequent to the date of Conditional Acceptance, which sets forth those
items, if any, identified by Customer in good faith and agreed to by
Motorola (which agreement Motorola shall not unreasonably withhold or
delay) where the iDEN System or Expansion Product fail to comply with
the applicable specifications and performance standards set forth in
Exhibit B1 and the ATP, to be resolved by Motorola before Final
Acceptance of the iDEN System or Final Acceptance of Expansion Product,
as the case may be.
RF
Radio Frequency.
RSO
RSO means Remote Switch Operation.
6
SITE
Each of the locations comprising an iDEN System, which contains FNE,
including the geographic location that houses the iDEN Switch.
SMP
The Software Maintenance Program defined in Exhibit "E".
SOFTWARE
The object-code computer programs furnished by Motorola to Customer for
use solely in conjunction with the FNE under the terms of the Software
License, Exhibit "F".
SUBSCRIBER
A person who uses the iDEN System entitling the iDEN System operator to
revenue.
SUBSCRIBER UNIT
Any manufactured and assembled, mobile or portable, iDEN
telecommunications unit intended for use by any Subscriber.
SYSTEM EXPANSION
"System Expansion" is defined below in Section 2.6. The definition of
System Expansion shall apply only to the System Expansion in each unique
Area.
TIME FRAME
The interval between the start date and the completion date for a
particular activity as set forth in the Implementation Schedule.
2.0 SCOPE OF AGREEMENT; IMPLEMENTATION
2.1 From time-to-time during the term of this Agreement, Customer
agrees to purchase from Motorola and Motorola agrees to sell to
Customer the iDEN System, Expansion Product, FNE, Other
Equipment, Other Services and/or the Other Software in accordance
with the terms and conditions set forth in this Agreement.
Customer and Motorola shall complete an Exhibit A for each iDEN
System ordered and will complete an Exhibit A for any and all
Expansion Product or Other Equipment, Other Services and Other
Software ordered. Exhibit A may, depending on Customer's needs,
include an order for any or all of the following: an iDEN System
and related services, Expansion Product and related services,
FNE, Other Equipment, Other Services and/or Other Software. Once
completed,
7
an Exhibit A may be modified thereafter by mutual agreement of
the parties by amendment or Change Order.
Purchases may be made hereunder by any wholly owned subsidiary of
Customer as long as the obligation is guaranteed by the Funding
Affiliate. By executing Exhibit A for an iDEN System, a wholly
owned subsidiary of Customer shall be deemed to have agreed to
all of the terms and conditions of this Agreement with respect to
such iDEN System. References in this Agreement to Customer shall
be deemed to refer to any such wholly owned subsidiary which is
the purchaser of an iDEN System.
2.2 This Agreement (including a completed Exhibit A) constitutes an
order and is considered a notice to proceed with the placing of
subcontracts, ordering of non-Motorola manufactured equipment,
and the manufacture of equipment as necessary to deliver timely
the products and services in Exhibit "A" as specified herein,
and, with respect to an iDEN System, in accordance with the
Implementation Schedule, Exhibit "I", attached.
2.3 Motorola and Customer shall each appoint a Program Manager who
shall have the responsibility to make good faith efforts to
resolve problems and disputes prior to initiating the dispute
resolution procedures set forth in Section 31. Their respective
responsibilities are as follows:
2.3.1 The responsibilities of the Motorola Program Manager shall
include:
a. Serve as the primary Customer contact for the
equipment and services purchased hereunder.
b. Serve as the focal point for all Motorola internal
plant and field issues.
c. Oversee deliveries, subcontracts, installation, iDEN
System testing and integration, documentation,
training and all duties required to coordinate the
work of the various Motorola team members.
d. Determine the final definition of all Customer and
project requirements.
e. Establish a detailed project schedule and oversee
accomplishment of project milestones.
f. Establish the project team structure and staffing.
g. Establish and maintain project reporting and
measurement procedures.
8
h. Meet regularly with Customer's Program Manager to
review progress and project issues.
i. Facilitate Customer's order placement and order
acceptance procedures.
j. Insure that adequate resources, including adequate
personnel, are dedicated to each project undertaken
pursuant to this Agreement such that the project is
completed in a timely, efficient manner.
2.3.2 The responsibilities of the Customer Program Manager shall
include:
a. Serve as primary Motorola contact for the iDEN System.
b. Serve as the focal point for all Customer internal
and field issues.
c. Schedule and oversee accomplishment of Customer
project milestones.
d. Review and approve accomplishment of project
milestones.
e. Disseminate project reports and measurement
procedures within Customer's organization.
f. Approve all modifications to specifications.
g. Approve and acquire all Sites, notify the Motorola
Program Manager of Site availability, and coordinate
Motorola's access to the Sites.
h. Meet regularly with the Motorola Program Manager to
review progress and project issues.
2.4 Operational Understandings
2.4.1 The providing by Customer of digital wireless
communications to meet the changing market needs in a
given Area requires that the make up of the equipment
and/or services designated for, and located in that Area,
be ongoing and continually enhanced, such that Customer
has the opportunity to meet its continuing business goals.
These understandings are not intended to modify, expand,
or change, in any way, the warranties provided under the
Agreement, as amended from time to time.
2.4.2 In order to support the goals of Customer in a given Area,
a series of projects must be implemented from time to time
as required. These projects will range in scope from the
construction and installation of a
9
grouping of equipment, hardware, and software to allow
Customer to provide initial digital wireless
communication services in an Area, to enhancements and
expansion of that initial grouping, to the procurement
and provision of stand alone equipment, software, and
services.
2.4.3 Projects in a given Area are separate and distinct,
although they may be subject to adjustments or revisions
as contemplated herein prior to completion, provided that
such adjustments or revisions do not affect the
Implementation Schedule. Such projects may be based on,
among other things, the amount of Motorola provided
services included and the relative technical complexity of
the project. They are categorized into an iDEN System and
System Expansions of the type defined herein and into the
definitions herein of Other Equipment, Other Services, and
Other Software.
2.4.4 Each iDEN System or System Expansion project undertaken
for a given Area shall be governed by a specific beginning
and completion date. Such projects shall include the
agreement by both parties as to the project requirements,
make up of goods and/or services to be provided, and a
specific implementation schedule defining in detail the
required activities of both Motorola and Customer, and the
time frame in which it is anticipated in the
Implementation Schedule that they will be accomplished.
2.4.5 Each project may stand alone or may build on previous
projects in a given Area. All such projects in a
particular Area, taken in total, represent the state and
level of Customer capabilities to provide integrated
digital communication services in such Area at a given
point in time.
2.5 "iDEN System" Defined
An "iDEN System" shall be defined as a specified grouping
of equipment, software and related services ordered by
Customer from Motorola for the construction of a Digital
Mobile Network to provide mobile integrated services for
an Area utilizing the basic iDEN technology platform,
including the six-time-slot TDMA technology and any
advancements or improvements in such technology.
The specified grouping shall be ordered, delivered,
installed and acceptance tested in accordance with the
Implementation Schedule(s) mutually agreed to between the
parties, and shall include, at Customer's option, some or
all of the following items, that are scheduled for
delivery to Customer prior to the commencement date of
acceptance testing defined in the relevant Implementation
Schedule for such iDEN System:
10
a) FNE Equipment (to include, as
appropriate, MSO, CSO or RSO equipment and/or
modifications and the related Enhanced Base
Transceiver System ("EBTS") sites and equipment, to
the extent ordered for installation in and
reasonably identified with the Digital Mobile
Network to be constructed in a specific Area),
Software and other products supplied by or through
Motorola, excluding Subscriber Units, essential to
compliance with the performance specifications
contained in Motorola's Price Book or set forth in
Exhibit "J" or otherwise reasonably necessary to
the achievement of Conditional Acceptance by the
relevant iDEN System; and
b) Motorola supplied services relating to
the above equipment, Software and other products,
including but not limited to:
** as appropriate to the FNE
Equipment ordered;
** (except those to be
performed at Motorola's cost), as
appropriate to the FNE Equipment ordered;
Motorola ** which Motorola
furnishes in order to perform **.
** and the ** which Motorola
furnishes in order to perform ** (except
those to be performed at Motorola's cost).
Except as stated below, the parties acknowledge that
Motorola must supply services as defined in sub-paragraph
(b) above, in conjunction with a grouping of equipment and
software defined in sub-paragraph (a) above, in order to
be defined as an iDEN System.
The parties acknowledge that an iDEN System may be subject
to alteration or revision during the design and/or build
out phase to address particular opportunities or
difficulties reasonably expected to be encountered in the
construction of a Digital Mobile Network. The parties
further acknowledge that so long as such alterations,
revisions or similar matters
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
11
do not adversely affect the project scope and/or
schedule, such alterations, revisions or similar matters
(together with related equipment, service and software
orders or change orders) shall be deemed to constitute
the originally defined and specified iDEN System in
question.
The parties also recognize that Customer may procure
services other than those outlined in sub-paragraph (b)
above, from qualified third parties or from within
Customer's employee ranks, and that such internal or third
party service arrangements, provided in connection with
Motorola supplied equipment, Software and related
services, are consistent with the definition of an iDEN
System provided that such services comply with Motorola
published installation and engineering standards.
If the acceptance testing of such iDEN System does not
result in achievement of ATP-Conditional Acceptance, and
if such failure is the result of Motorola's actions or
failure to act or is due to circumstances within its
reasonable control, then the additional items of
equipment, Software and related services which are
required to be provided by Motorola for such iDEN System
to achieve Conditional Acceptance also shall be deemed to
be a part of, and governed by the terms of the originally
defined and specified iDEN System in question and shall be
provided to Customer at no additional charge.
2.6 "System Expansion" Defined
A " System Expansion" shall be defined as a specified
grouping of equipment, Software and related services
ordered by Customer from Motorola utilizing the basic iDEN
technology platform, and purchased as a single order or a
group of related orders which are received by Motorola
from Customer within a thirty (30) day period from the
date on which Motorola received the first of such related
orders from Customer, unless otherwise mutually agreed to,
and having an aggregate purchase price of at least **. The
specific grouping shall be ordered for the modification of
the existing design of, or any increase in the
capabilities or capacities of, and constructed in, around,
or adjacent to, an existing iDEN System.
The specified grouping shall be ordered, delivered,
installed and acceptance tested in accordance with the
Implementation Schedule(s) mutually agreed to between the
parties, and shall include at Customer's Option all of the
following items, that are scheduled for delivery to
Customer prior to the commencement date of acceptance
testing defined in the relevant Implementation Schedule
for such System Expansion:
----------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
12
a) FNE Equipment (to include, as
appropriate, MSO, CSO or RSO equipment and/or
modifications and the related EBTS sites and
equipment, to the extent ordered for installation
in and reasonably identified with the Digital
Mobile Network that is the subject of such System
Expansion), Software and other products supplied by
or through Motorola, excluding Subscriber units,
essential to compliance with the performance
specifications or otherwise reasonably necessary to
the achievement of Conditional Acceptance by the
relevant System Expansion; and
b) Motorola supplied services relating to
the above equipment, Software and other products,
including but not limited to:
** as appropriate to the FNE
Equipment ordered;
** (except those to be
performed at Motorola's cost), as
appropriate to the FNE Equipment ordered;
Motorola ** which Motorola
furnishes in order to perform **.
** and the ** which Motorola
furnishes in order to perform ** (except
those to be performed at Motorola's cost).
Except as stated below, the parties acknowledge that
Motorola must supply services as defined in sub-paragraph
(b) above, in conjunction with a grouping of equipment and
software defined in sub-paragraph (a) above, in order to
be defined as a System Expansion.
The parties acknowledge that a System Expansion may be
subject to alteration or revision during the design and/or
build out phase to address particular opportunities or
difficulties reasonably expected to be encountered in the
construction of a Digital Mobile Network. The parties
further acknowledge that so long as such alterations,
revisions or similar matters do not adversely affect the
project scope and/or schedule, such
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
13
alterations, revisions or similar matters (together with
related equipment, service and Software orders or change
orders) shall be deemed to constitute the originally
defined and specified System Expansion in question.
The parties also recognize that Customer may procure
services other than those outlined in sub-paragraph (b)
above, from qualified third parties or from within
Customer's employee ranks, and that such internal or third
party service arrangements, provided in connection with
Motorola supplied equipment, Software and related
services, are consistent with the definition of a System
Expansion provided that such services comply with Motorola
published installation and engineering standards.
If the acceptance testing of such System Expansion does
not result in achievement of ATP-Conditional Acceptance,
and if such failure is the result of Motorola's actions or
failure to act or is due to circumstances within its
reasonable control, then the additional items of
equipment, Software and related services which are
required to be provided by Motorola for such System
Expansion to achieve Conditional Acceptance also shall be
deemed to be a part of, and governed by the terms of the
originally defined and specified System Expansion in
question and shall be provided to Customer at no
additional charge..
3.0 RESPONSIBILITIES OF CUSTOMER
Customer is responsible for the following:
3.1 Design the RF coverage plan and frequency plan for each Area
including but not limited to Site location, frequencies at each
Site, RF coverage from each Site, co-channel interference caused
from one Site to another Site, co-channel interference from
non-Customer sites.
3.2 Procure the right to use necessary station licenses together with
such other authorizations as may be required to construct and
operate the iDEN System, including without implied limitation,
Site building permits, zoning variances, and any other required
approval or authorizations from appropriate government and other
authorities, including but not limited to the FCC, and any
required authorizations from any local agencies. Assume the
responsibility for interfacing with appropriate carriers and
other providers for the provision of Interconnection Facilities,
electrical power and Customer-supplied equipment in accordance
with the Implementation Schedule.
14
3.3 Make all legal arrangements and pay all expenses, that may be
required, to Site owners or to others, to construct and operate
each Site in accordance with the provisions of this Agreement.
3.4 Bear the costs of its own legal fees, as well as charges for Site
acquisition, Interconnection Facilities, telephone and utility
charges and other services and items being supplied by Customer
under this Agreement.
3.5 Provide ingress and egress to Sites, as necessary and as
reasonably requested by Motorola, and have Sites available for
timely installation of iDEN System equipment.
3.6 Negotiate in good faith the Implementation Schedule and adhere to
the schedule for performance of the responsibilities set forth
therein.
3.7 Negotiate in good faith the Punchlist for the iDEN System and
Expansion Product prior to the expiration of the ** period
following the date of Conditional Acceptance.
3.8 Not unreasonably withhold either Conditional or Final Acceptance
or any other approvals required under this Agreement.
3.9 Assume responsibility for diagnosis, analysis, isolation, and
remedy of problems in the Interconnection Facilities or at the
Interconnected Carrier side of the interface with the iDEN
System.
3.10 Furnish necessary databases to Motorola in accordance with the
Implementation Schedule, subject to the confidentiality
provisions set forth herein.
3.11 Make payments according to the schedule set forth in Section 7
of this Agreement.
3.12 Purchase or provide those required services set forth in Exhibit
"D".
3.13 Assume responsibility for lawful operation of the iDEN System.
3.14 Be responsible for the timely transportation of all equipment
from the FOB shipment point to the sites
3.15 After shipment by Motorola, provide and assume all associated
costs for warehousing, storage, inventory, and staging of
equipment prior to transport to the installation sites.
3.16 As necessary, provide secure covered storage areas at each Site.
To the extent required for installation and warranty work,
provide access to each Site by authorized Motorola personnel
during reasonable business hours.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
15
3.17 As necessary, furnish and install suitable environmental control
facilities in each building.
3.18 Provide telephone company network configuration including dial
plan and design.
3.19 If required by Motorola in order to complete installation, make
available the technical details of any and all Customer-supplied
equipment to which the iDEN System must be interfaced. Also
provide technical liaison personnel as needed with the knowledge
of Customer-supplied equipment.
3.26 Provide any outside cable support bridges required, coaxial, and
transmission line access ports into the buildings, inside conduit
or cable ducts, any necessary inside floor trenches and cable
raceways required for installation.
3.27 Be responsible for risk of loss for all equipment from FOB point.
3.22 In response to Motorola's reasonable request, provide Motorola
with information as may be required to enable Motorola to comply
with all applicable laws and regulations.
3.23 Provide all Site development services and engineering drawings as
set forth in Exhibit "D", in order to enable Motorola to install
and integrate the iDEN System in accordance with the agreed upon
schedule set forth in Exhibit "I".
3.24 Provide capable technical personnel in order to be trained in the
operation and maintenance of the System and to interface with
Motorola with regard to operational and maintenance issues.
3.25 In the event Customer fails to perform any of its
responsibilities or fails to adhere to the Implementation
Schedule and such failure causes a Motorola delay, Motorola shall
document all extra work or reasonable expense incurred as a
result of the delay and Customer shall compensate Motorola for
such work or reasonable expense. Extra expense shall include, but
not be limited to, reasonable expenses associated with travel and
living expenses, warehouse charges, transportation charges,
vehicle and equipment rentals.
3.26 Provide Motorola with reasonable notice of any anticipated delay
in Customer's performance hereunder.
4.0 OBLIGATIONS OF MOTOROLA
Motorola shall:
4.1 Determine the required material, effort, and services necessary
for Installation and Integration at no extra cost.
4.2 Negotiate in good faith the Implementation Schedule and timely
perform according to the Schedule.
16
4.3 Negotiate in good faith the Punchlist for the iDEN System and
Expansion Product prior the expiration of the ** period following
the date of each respective Conditional Acceptance.
4.4 Install the MSO equipment (if applicable) and adjust the iDEN
System to the standards set out in Exhibits "B" and "C" and in
compliance with Exhibit "D".
4.5 Timely advise Customer of modifications required.
4.6 Timely offer, at a reasonable cost to Customer, a retrofit
package for any change in standards subsequently put into effect
by the industry, the government, regulatory agencies, as well as
those promulgated by Motorola.
4.7 Give reasonable assistance to Customer in its acquisition of
Interconnection Facilities as set forth in Section 3.2 above as
may reasonably be requested by Customer.
4.8 Review the frequency plan prepared by Customer or Customer's
consultant at no additional charge to Customer. Because of
differences in radio coverage and interference models and the
timeframe of implementation, this review will not be a complete
detailed alternate engineering of the system design, but rather a
review of selected design elements in sample areas. It is
understood that Motorola's obligation is only to review the
frequency plan as an accommodation to Customer. Motorola shall
not recalculate or verify the frequency plan preparer's work and
shall have no responsibility or liability whatsoever based on
this review.
4.9 Not divert to another customer any equipment scheduled for
delivery to Customer pursuant to an accepted purchase order
without Customer's approval.
4.10 Make spares and replacement parts available for ** from the date
of this Agreement.
4.11 Install and integrate the iDEN System and Expansion Product in
compliance with all applicable laws, rules and regulations.
4.12 Use commercially reasonable efforts to accept Customer's orders,
to make timely delivery and to install and integrate the iDEN
System according to the terms and conditions of this Agreement.
4.13 Remedy all Punchlist items, defects and problems during the
warranty and maintenance periods.
4.14 Obtain necessary work permits and visas to enable Motorola
personnel to perform under this Agreement.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
17
4.15 In response to Customer's reasonable request, provide Customer
with information reasonably known to Motorola which may be
required to enable Customer to comply with all applicable laws
and regulations.
4.16 Use skilled personnel, properly trained and competent to perform
assigned tasks.
4.17 Provide Customer with reasonable notice of any anticipated delay
in Motorola's performance hereunder.
4.18 Prior to shipment Motorola will obtain type approval for any
equipment sold herein that requires type approval in the Area.
4.19 Bear the cost of its own legal fees and other charges that are
its responsibility in connection with the performance of its
obligations under this Agreement.
4.20 Construct and install the iDEN System and other equipment in
conformity with all applicable federal laws and regulations in
effect at the time the applicable Exhibit A for the iDEN System
is agreed to by the parties.
5.0 SITES
This Agreement, and the prices listed or to be listed on Exhibit "A" are
predicated on the use of certain Site configurations provided by
Customer. Customer is free to alter Site locations during the course of
performance of this Agreement. However, should alternate locations cause
Site-reconfigurations or increased costs to Motorola, Motorola shall
timely provide Customer with a quote for price adjustments to reflect
the increased costs to Motorola and modify Exhibit "I" as appropriate.
6.0 CHANGES
6.1 After execution of this Agreement, either party may request
changes to the specifications or other requirements of this
Agreement. Motorola shall submit a Change Order to Customer
within thirty (30) days after receipt of such request.
6.2 If the Change Order is acceptable to Customer, Customer will
execute the Change Order and return to Motorola within ten (10)
days of submittal. In no event shall any changes be implemented
without written authorization from Customer.
7.0 PAYMENT AND PRICING
7.1 General Payment Terms
Customer shall pay to Motorola the price of the iDEN System and
related services, the Expansion Project, the Other Equipment, the
Other Services and the
18
Other Software as set forth in the applicable Exhibit "A" or
Change Order in U.S. dollars, and according to the following
terms and payment schedules:
7.1.1 Payment Terms
Payment Terms for an iDEN System or System Expansions of
the types defined herein, shall be as follows:
o ** of total order price upon **.
o ** of total order price upon **.
o ** of total order price upon ** of an iDEN
System or System Expansion.
o ** of total order price upon ** of an iDEN
System or System Expansion.
Notwithstanding the above, if Customer intentionally
delays the implementation of an iDEN System or System
Expansion of the types defined herein, then ** shall be
deemed to be granted ** after the implementation date set
forth in the Implementation Schedule for such System or
System Expansion and all payments associated with ** shall
be due and payable as of this date. Additionally, any
warranties for such System or System Expansion set forth
elsewhere in this Agreement which commence upon ** also
shall be deemed to commence ** after the implementation
date set forth in the Implementation Schedule for such
System or System Expansion. ** shall be deemed to be
granted ** after the implementation date set forth in the
Implementation Schedule for such iDEN System or System
Expansion and all payments associated with ** shall be due
and payable as of this date.
Other Equipment Payment Terms shall be as follows:
** of Other Equipment price upon **.
Other Software Payment Terms shall be as follows:
** of Other Software price upon **.
Other Services Payment Terms shall be as follows:
Invoices will be issued ** for Other Services
completed.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
19
All invoices due net ** from date of invoice.
7.1.2 Prices do not include applicable sales, use, excise or
similar taxes. To the extent Motorola is required by law
to collect such taxes, one hundred percent (100%) thereof
shall be added to invoices and paid in full by Customer.
7.1.3 The licensing fee for Software, licensed as set out in
Exhibit "F" and provided for use with the iDEN System is
or shall be set forth in Exhibit "A".
7.1.4 Any costs required to modify the iDEN System in order to
comply with local codes or regulations shall be Customer's
responsibility.
7.1.5 For any amount due hereunder which remains unpaid for more
than **, the Customer shall pay Motorola a service fee at
the rate of ** of the amount due for ** or portion thereof
that the amount remains unpaid.
7.2 Specific Payment Terms
7.2.1 Method of Payment
Payment shall be made by wire/telegraphic transfer to the
following address:
**
Routing No.: **
Account No.: **
Address: **
**
Motorola is responsible for timely notifying Customer of
any change in the foregoing wire/telegraphic transfer
instructions. Customer shall not be liable for any late
payment or missed payment caused by Motorola's failure to
notify Customer of any such change.
7.2.2 Subject to Section 7.5, any volume purchases price
reductions shall be based on **.
7.3 Training
In 1998 and 1999, Motorola agrees to make available to Customer's
employees the training program described on Exhibit "G" and
Customer agrees to pay **
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
20
of the program price for each of Customer's personnel attending
such training, provided, that for each **, Customer shall ** and
for each **, Customer shall **.
7.4 Changes in Exhibit "A"
Customer may **, pursuant to a Change Order, the specific
equipment and services ordered or to be ordered herein subject to
the below:
a. All changes must be made before ** in advance of the
ship date shown in the agreed upon or to be agreed
upon project schedule, as modified hereafter; and
b. The total dollar value of equipment and services
(excluding drop ship items) set forth or to be set
forth in Exhibit "A" may not be reduced to ** of the
originally ordered amount.
7.5 Prices Generally
Provided that **, prices for FNE equipment, Software,
maintenance plans and training sold hereunder shall be **,
adjusted only for additional costs of unique engineering,
special implementations or differences based upon Customer's
market conditions.
If **, all prices hereunder shall be renegotiated. Prices for
equipment and software sold hereunder shall be **.
7.6 In-Kind Capital Contribution
The closing of an equity investment by Motorola in Customer is a
condition precedent to this Agreement. As a result of the
issuance of equity to Motorola, Customer will have an **
equipment credit (the "Equipment Credit") in the amount of
Eighteen Million Three Hundred Sixty Six Thousand Four Hundred
Ninety Dollars ($18,366,490) that may be used as set forth below:
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
21
Upon the placing of each order, the parties shall calculate the
percentage of the total dollar value of the order comprised by
the dollar value of the ** equipment in the order. Each payment
thereafter on such order, for as long as the Equipment Credit is
still in existence, shall be made by a combination of cash and
Equipment Credit. The cash amount shall be ** x payment due. The
Equipment Credit shall be the ** x payment due, and the Equipment
Credit shall be reduced by a like amount. Customer may at any
time choose to apply less than the above stated maximum Equipment
Credit amount to any order and increase the cash portion.
7.7 Assurance of Payment
As to each order placed hereunder, Customer represents that it is
authorized to make the purchase that the intended use is within
Customer's authority, that the Customer's Board of Directors has
authorized the entering into this Agreement and the purchases to
be made hereunder, and that Customer has access to adequate funds
to pay any and all outstanding orders from Motorola when due.
With respect to any purchase, Motorola may reasonably request and
Customer shall provide reasonable assurances of its ability to
pay. At no point in time shall Customer's outstanding account
balance exceed **; if it ever does or is expected to, Customer
shall, make one or more payments to an escrow account or
prepayments to Motorola that reduce its outstanding balance below
the above-referenced threshold, or provide a letter of credit
from a commercial bank or equivalent financial institution, or
such other additional assurances of payment or security for
payment as Motorola and Customer may mutually agree upon. The
above credit may be revoked and any outstanding payments shall
immediately become due and payable if there is a material adverse
change in Customer's financial condition. Customer shall notify
Motorola of any material adverse change in its financial
condition.
If Customer is not the party that receives the major funding from
the capital markets, Nextel Communications, Eagle River or
Motorola, the party that receives such funding ("Funding
Affiliate") shall guarantee all obligations of Customer.
8.0 ACCEPTANCE TESTING
8.1 A full ATP is performed only when a System is purchased. When
Other Equipment is purchased, a limited ATP covering only the
Equipment purchased shall be performed if such service is
requested and paid for separately by Customer. The parties agree
that the acceptance testing shall be done pursuant to the ATP
which shall be developed by Motorola as set forth below. Motorola
shall review the ATP with Customer. Attached as Exhibit "C" is an
ATP that the parties agree sets forth the type of tests that may
be made to determine Final Acceptance of an iDEN System. This ATP
is generic in nature and tests
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
22
operational features. Should a certain feature or option not be
purchased then it is agreed that portion of the ATP shall be
deleted and will not be performed.
8.2 Motorola shall conduct an ATP for an iDEN System and for
Expansion Product when Installation and integration Services are
purchased by Customer. Seven (7) days prior to the scheduled date
for tests, Motorola shall notify Customer of the time and place
at which such tests will be conducted and Customer shall have the
right to observe ATP tests and the results thereof. Should
Customer request additional testing above and beyond the ATP,
these tests shall not be considered until after Conditional
Acceptance of the System. Motorola shall prepare and present to
Customer a quotation detailing the time and material charges that
such additional testing may require.
8.3 The ATP is divided into three (3) parts:
8.3.1 The System Test which verifies that the iDEN System's
components function correctly together and interface with
the Interconnected Carrier and that hand-offs between
Sites and the dial plan work correctly.
8.3.2 The Site Test which checks that each Site is operating
according to specifications.
8.3.3 The Switch Test which verifies the proper functioning of
the iDEN Switch.
8.4 Individual Site Tests and the Switch Test shall be performed in
accordance with the ATP as soon as the individual Sites and iDEN
Switch are completed. The System Test shall be performed as soon
as the iDEN Switch and Site Tests are completed. If all the Sites
are not available and operational due to Customer's failure to
obtain the Sites by the required scheduled time as contained in
Exhibit "I" hereto ("Unavailable Sites"), the tests shall still
take place.
8.5 The Areas served by the Unavailable Sites shall not be included
in the System Test. When the Unavailable Sites are operational
and available, the Site Test shall be completed. As long as all
other items required for ATP or Final Acceptance are complete,
the existence of Unavailable Sites shall not hold up the ATP or
Final Acceptance.
8.6 Additional Testing Costs
The cost of obtaining a passing test for each of the items in the
ATP is included in the purchase price of the iDEN System. Any
additional testing shall be billed to Customer as set forth in
Section 8.2. This includes, but is not limited to, testing due
to:
23
a. Customer's desire for testing not included in the ATP; and
b. Retesting that is needed because Customer's Site team causes
the need for the retest either by the failure to do what is
required of them under the Agreement or because of any action
they take that necessitates the retesting; and
c. RF interference from outside sources; and
d. The need to respond to complaints of third parties alleging
Customer's iDEN System interferes with their systems, unless
the equipment sold hereunder is not operating within licensed
parameters.
9.0 FNE WARRANTY AND SOFTWARE MAINTENANCE PROGRAM
9.1 FNE Warranty
9.1.1 Motorola represents and warrants that all products,
Software and items delivered under this Agreement conform
in design, materials and workmanship to the appropriate
Motorola Technical Specifications set forth in Exhibit
"B".
Hardware Warranty: Motorola radio communications infrastructure
products and FNE, except EBTS, are warranted to meet the
specifications set forth in Exhibit "B1" and to be free from
defects in material and workmanship for a period of ** from the
date of Conditional Acceptance. All hardware and software
associated with EBTS equipment are warranted to meet the
specifications set forth in Exhibit "B1" and to be free from
defects in material and workmanship for a period of ** from the
Date of Shipment.
9.1.2 Other Equipment Warranty Start Date
Other Equipment warranty and any associated software
warranty shall commence upon the Date of Shipment of the
Other Equipment plus five (5) days.
9.1.3 Customer shall be responsible for the initial level of
diagnosis (i.e., for identification and isolation of FNE
problems to the board level), for hardware, firmware and
Software removal and replacement, and for sending the
malfunctioning product, packed in a manner to prevent
damage, to the designated Motorola repair depot within the
Continental United States. Customer shall be responsible
for associated shipping charges. When such products or
their replacements are being returned to Customer,
Motorola shall bear such charges.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
24
9.1.4 Parts and labor at the ** to repair or replace defective
FNE will be **.
9.1.5 In the event a defect occurs during the warranty period
Motorola, at its option, will either repair or replace the
product. Any item replaced will be deemed to be on an
exchange basis, and any item retained by Motorola through
replacement will become the property of Motorola. Repaired
or replaced parts shall have a warranty of the greater of
the remainder of this warranty period or **.
9.2 This Warranty does not cover defects, damage, or malfunctions
resulting from:
9.2.1 Use of the products in other than their normal and
customary manner.
9.2.2 Misuse, accident, neglect, environmental or Site
conditions not conforming to the specifications for the
product as set out in the current equipment
specifications, or unauthorized access to source or object
code or manipulation of software elements
9.2.3 Unauthorized alterations or repairs, use of unapproved
parts in the products or the combination or interfacing of
the products, in each case in a manner not approved by
Motorola.
9.2.4 An event of Force Majeure.
9.2.5 Installation, integration, or movement of products from
their original installation Site by anyone other than
Motorola or anyone not approved in writing by Motorola, or
not in accordance with Motorola standards and guidelines.
9.2.6 Failure of antennas, lines, (provided the warranty, if
any, from the manufacturer of such products is passed
through to Customer) or any part of the Interconnection
Facilities.
9.2.7 Failure of Customer to maintain or provide maintenance for
the iDEN System pursuant to Motorola equipment and
Software maintenance agreements, or other maintenance,
substantially in accordance with the Documentation and
under the supervision of one or more individuals who shall
have completed appropriate Motorola training.
9.2.8 Damage which occurs during shipment of the product to
Motorola for warranty repair.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
25
9.3 Except as associated with an agreed-to or permitted assignment,
this express warranty is extended by Motorola, Inc. to Customer
and it's wholly-owned subsidiaries only and is valid only in the
Area.
9.4 Software Maintenance Program (SMP)
Motorola Software provided in connection with the Initial System
is expressly warranted to be free from defects which result in
reproducible malfunctions for a period of ** from the date of
Conditional Acceptance (the "Warranty Period") of the iDEN System
when used on FNE sold hereunder. Motorola agrees to provide all
labor at ** necessary to correct any service affecting Software
defects for the full Warranty Period without charge to the
Customer.
9.4.1 For ** from Conditional Acceptance, Motorola shall provide
to Customer a Software Maintenance Program, the terms of
which are fully set forth in Exhibit "E". Motorola shall
provide all labor at ** necessary to correct service
affecting Software defects. At the expiration of this **
period Customer may renew the SMP at Motorola's then
current rate. Payments shall be made quarterly, in
advance.
9.4.2 Other Software Warranty Start Date
Other Software warranty and SMP shall commence upon the
Date of Shipment of the Other Software plus five (5) days.
9.4.3 Failure by Motorola to provide support under this SMP
shall not be construed as conveying any rights which are
in addition to those already granted herein, nor shall
such failure be construed as conveying any rights of
ownership of Software.
9.4.4 Motorola represents and warrants that Software supplied
under this Agreement does not have "Software Traps"
designed to permit unauthorized access, to disable or
erase Software, hardware or data or to perform any other
such actions.
9.4.5 Motorola shall timely perform all warranty work hereunder
in a manner that minimizes service disruption to
Customer's Subscribers.
9.5 Non-Motorola-Manufactured Products
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
26
Non-Motorola-manufactured products are warranted only to the
extent provided to Motorola by the manufacturer or supplier
thereof. Non-Motorola-manufactured products are defined to
include antennas, transmission lines and combining equipment.
9.6 Motorola warrants that each hardware, software, and firmware
product delivered under this Agreement and listed on Exhibit "K"
as "Year 2000 Compliant" shall be able to accurately process date
data (including, but not limited to, calculating, comparing, and
sequencing) from, into, and between the year 1999 and the year
2000, including leap year calculations, when used in accordance
with the product documentation provided by Motorola, provided
that all listed or unlisted products (e.g., hardware, software,
firmware) used in combination with such listed product properly
exchange date data with it. This warranty shall extend through
June 1, 2000. Customer must notify Motorola, in writing, no later
than July 1, 2000 of Product that does not conform to this
Express Warranty. The remedies available for breach of this
warranty shall be as defined in, and subject to, the terms and
limitations of Sections 9.1 through 9.5 and Section 9.7. Except
as provided herein, nothing in this warranty statement shall be
construed to limit any rights or remedies provided elsewhere in
this Agreement with respect to matters other than Year 2000
performance.
9.7 THE WARRANTIES IN THIS AGREEMENT ARE GIVEN IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, WHICH ARE SPECIFICALLY EXCLUDED,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL MOTOROLA BE
LIABLE FOR INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES
TO THE FULL EXTENT SUCH MAY BE DISCLAIMED BY LAW.
THIS WARRANTY EXTENDS ONLY TO INDIVIDUAL PRODUCTS; BATTERIES ARE
EXCLUDED BUT CARRY THEIR OWN SEPARATE LIMITED WARRANTY FROM THEIR
MANUFACTURER. MOTOROLA DISCLAIMS LIABILITY FOR RF COVERAGE UNDER
THIS WARRANTY.
10.0 PRODUCT CHANGES OR SUBSTITUTIONS
At any time during its performance of this Agreement, Motorola may
implement changes in the products set forth or to be set forth in
Exhibit "A", modify the drawings and specifications relating thereto, or
substitute products of more recent design; provided, however, that any
such changes, modifications or substitutions, under normal and proper
use shall not materially or adversely affect physical or functional
interchangeability or performance of the product within the iDEN System
or result in additional cost to Customer, unless Customer has been
notified of and agreed to such additional cost, and shall not detract
from the safety of the product and shall be FCC type accepted, if
27
required, and shall not cause Customer's iDEN System to be incompatible
with the Digital Mobile Network operated by Nextel Communications.
11.0 DELAY
In the event Customer fails to perform any of its responsibilities or
fails to adhere to the Implementation Schedule and such failure will
cause Motorola delay and subsequent additional costs, Customer agrees to
notify Motorola, in writing, reasonably in advance, of the time Motorola
will begin to incur additional expenses and the steps Customer will take
to rectify the situation. Motorola has the right, at its option, to take
steps necessary to minimize additional cost that would be incurred by
the delay including, but not limited to, reductions of personnel or
suspension of work. Motorola will provide written notice to Customer in
advance of such steps.
12.0 DISCLAIMER OF PATENT LICENSE
Nothing contained in this Agreement shall be deemed to grant, either
directly or by implication, any license under any patents or patent
applications of Motorola, except that Customer shall have the limited
right to use which arises from the sale of goods.
13.0 INTELLECTUAL PROPERTY INDEMNITY
13.1 Motorola shall indemnify defend Customer against claims that
Motorola-supplied products supplied hereunder directly infringe a
patent, trademark, copyright or trade secret that is legally
enforceable in the U.S., provided that;
a. Customer promptly notifies Motorola in writing of the claim
provided, however, that Customer's failure to provide such
notice shall not relieve Motorola of liability under this
Section 13 except to the extent Motorola was prejudiced
thereby;
b. Customer grants Motorola sole control of the defense and all
related settlement negotiations;
c. Customer gives Motorola reasonable information and assistance
for the defense, including appeal, all at Motorola's expense.
13.2 Subject to the conditions and limitations of liability stated in
this Agreement, Motorola shall indemnify and hold Customer
harmless from all payments which by final judgments in such suits
may be assessed against Customer on account of such infringement
and shall pay resulting settlements, costs, and damages finally
awarded against Customer by a court of law.
13.3 If Motorola-supplied products or Software become, or in
Motorola's opinion are likely to become, the subject of such a
claim, Motorola, at its option and expense,
28
shall either (i) procure the right for Customer to continue using
such products or Software, or (ii) replace or modify same so that
they become non-infringing without affecting the function,
capability or cost to Customer. If neither of the foregoing
alternatives is available on terms which are reasonable in
Motorola's judgment, Customer can return Motorola-supplied
products and/or Software for full credit on the entire unusable
portion thereof.
13.4 Motorola has no liability for any claim of patent or copyright
infringement to the extent based upon adherence to
specifications, designs, or instructions furnished by Customer,
nor for any claim based upon the combination, operation, or use
of any Motorola-supplied products or Software supplied hereunder
with products, software, or data not supplied by Motorola, nor
for any claim to the extent based upon alteration of the products
or modification of any software supplied by entities other than
Motorola.
13.5 IN NO EVENT SHALL MOTOROLA BE LIABLE TO CUSTOMER FOR INCIDENTAL
OR CONSEQUENTIAL DAMAGES ARISING FROM INFRINGEMENT OR ALLEGED
INFRINGEMENT OF PATENTS, COPYRIGHTS, OR TRADEMARKS. THIS SECTION
13.5 SHALL NOT LIMIT IN ANY MANNER MOTOROLA'S OBLIGATIONS TO
INDEMNIFY AND DEFEND CUSTOMER AS SET OUT ABOVE.
14.0 CONFIDENTIALITY
14.1 During the performance of this Agreement, the parties may deem it
necessary to provide each other with Confidential Information.
The parties agree:
14.1.1 To maintain the confidentiality of such Confidential
Information and not disclose same to any third party,
except as authorized by the original disclosing party in
writing.
14.1.2 To restrict disclosure of Confidential Information to
employees and technical, legal and financial consultants
who have a "need to know" or in connection with a public
or private debt or equity offering of securities, or as
required by law or a court or as required for compliance
with the appropriate securities laws, provided no
documents shall be given to any third parties until the
disclosing party has had a reasonable opportunity to
review them. Any such information that the disclosing
party believes is confidential the receiving party will
use reasonable efforts to get confidential treatment from
such third parties. Such Confidential Information shall be
handled with the same degree of care which the receiving
party applies to its own confidential information but in
no event less than reasonable care.
29
14.1.3 To take precautions necessary and appropriate to guard the
confidentiality of Confidential Information, including
informing its employees and consultants who handle such
Confidential Information that it is confidential and not
to be disclosed to others and as to all consultants obtain
a signed non-disclosure agreement consistent herewith.
14.1.4 That Confidential Information is and shall at all times
remain the property of the disclosing party. Except as
otherwise provided herein, no use of any Confidential
Information is permitted and no grant under any
proprietary rights is hereby given or intended, including
any license implied or otherwise.
14.1.5 To use such Confidential Information only as required in
performance of this Agreement.
14.2 Except as may be required by applicable law or regulatory
authority, neither party shall disclose to any third party
Confidential Information, the contents of this Agreement, the
Exhibits, or any Amendments without the prior written consent of
the other.
15.0 TRADEMARK AND PUBLICITY
Nothing contained in this Agreement shall be construed as conferring any
right to use any name, trademark or other designation of either party
hereto, including any contraction, abbreviation, or simulation of any of
the foregoing, in advertising, publicity or marketing activities. No
publicity, advertising, etc. with regard to this Agreement or the iDEN
System which mentions the other party shall be released without prior
written consent of the other party.
16.0 SHIPMENT, DELIVERY AND PACKING
16.1 Motorola may ship products at any time during the Time Frame for
that activity set forth in the Implementation Schedule and may
invoice Customer upon shipment as provided in Section 7 of this
Agreement. No shipment of products during said Time Frame shall
be considered early for purposes of invoicing.
16.2 Customer shall select the carrier and notify Motorola in writing.
16.3 Motorola shall use all reasonable efforts to ship products
directly to the Site where it will be permanently installed, or
such other location as designated by Customer.
16.4 In the event that the Site is not available because Customer has
not met its obligations hereunder to receive the products when
shipped, Motorola, at its option, may ship said products to a
warehouse in or near the area as designated by Customer, and
Customer shall bear the costs of warehousing, reloading,
30
transporting, off-loading and moving the products onto the Site
when such Site becomes available.
16.5 Shipping documentation shall be drawn in accordance with
Motorola's standard practices. Shipping terms are FOB
manufacturing site or Motorola facility within the continental
United States.
16.6 Motorola shall have the equipment securely packed so as to
withstand numerous handlings and loading as appropriate for
inland, sea and/or air transportation. Motorola shall take
reasonable protective measures to protect equipment from weather
and shock, considering the different shapes and special features
of the equipment.
17.0 TITLE, INDEMNITY, INSURANCE
17.1 Good title, free and clear of all liens or other encumbrances to
the FNE and other products supplied hereunder and risk of loss
for all such products shall pass to Customer upon delivery FOB
point of shipment.
17.2 The above notwithstanding, title to Software and underlying
intellectual property rights (i.e., patents, copyrights,
proprietary and confidential information, and know-how ) supplied
by Motorola shall remain with Motorola.
17.3 All equipment sold to Customer hereunder is new and Motorola will
provide any documents which may be reasonably requested by
Customer evidencing this fact.
17.4 During the term of this Agreement the parties shall indemnify and
hold harmless each other together with their directors, officers,
agents, employees, affiliates, parent corporations and
subsidiaries from any and all loss, damage, expense, judgment,
lien, suit, cause of action, demand or liability (collectively,
"loss") for personal injury (including death) and tangible
property damage which may be imposed on or incurred by one party
arising directly out of the intentional misconduct or negligent
acts or omissions of the other, its agents, subcontractors, or
employees during the performance of any work hereunder. The
indemnifying party shall, at its sole expense, defend any suit
based upon a claim or cause of action within the foregoing
indemnity provision and satisfy any judgment that may be rendered
against the other resulting therefrom, provided that the
indemnifying party shall be given (i) prompt notice of any such
claim or suit; and (ii) full opportunity to defend such claim or
suit; provided, however, that failure to provide such notice
shall not relieve the indemnifying party of liability under this
Section except to the extent the indemnifying party was
prejudiced thereby. The indemnified party may, at its election,
participate in the defense of any suit, and shall cooperate fully
in defending any claim or suits. The indemnifying party shall pay
all costs, expenses, and reasonable attorney's fees incurred by
the
31
indemnified party in connection with any such suit or in
enforcing this indemnity provision.
Without limiting the foregoing paragraph, Customer shall
indemnify and hold harmless Motorola, its directors, officers,
agents, employees, affiliates and subsidiaries from any and all
loss, as defined in that paragraph, which is based upon or
alleged to arise from, any statement, representation, information
or other communication made by Customer, its officers, employees,
underwriters, or agents to offerees and purchasers of Customer
stock or other securities, including but not limited to any
statement, representation, information or other communication
concerning this Agreement, the iDEN System, Motorola or iDEN
systems or technology in general and including but not limited to
any loss arising under applicable securities laws. Customer shall
provide to Motorola advance copies of prospectuses and securities
and exchange commission filings in connection with an initial
public offering and other material filings, however, Motorola
shall have no responsibility to review them nor for the contents
thereof.
17.5 Customer and Motorola each shall be named as additional insured
under the other's comprehensive general liability policy for
claims arising out of work performed hereunder (which includes
but is not limited to product and public liability, property and
all risk insurance).
18.0 FORCE MAJEURE - EXCUSABLE DELAY
18.1 Neither party shall be liable for delays in delivery or
performance, or for failure to manufacture, deliver or perform
when caused by any of the following which are beyond the
reasonable control of the delayed party:
18.1.1 Acts of God, acts of the public enemy, acts or failures to
act by the other party, acts of civil or military
authority, governmental priorities and regulatory actions,
strikes or other labor disturbances, hurricanes,
earthquakes, fires, floods, epidemics, embargoes, war,
riots, delays in transportation not caused by the shipping
party, and loss or damage to goods in transit provided
such goods were packaged as described herein, or;
18.1.2 Inability on account of causes beyond the reasonable
control of the delayed party or its suppliers to obtain
necessary products, components, services, or facilities.
18.2 In the event of any such delay, the date of delivery or
performance shall be extended for a period equal to the period of
time lost by reason of the delay. If any such delay lasts for
more than one hundred eighty (180) days, the parties shall
consult with one another for the purpose of agreeing upon the
basis on which the
32
delayed party shall resume work at the end of the delay. If no
reasonable solution to the delay is available, then either party
may, by written notice, cancel that portion of the Agreement
which is delayed, and adjust the Agreement price appropriately.
19.0 TERMINATION
19.1 Either party may terminate this Agreement without liability by
the giving of notice, in accordance with Section 24, if (i) the
other makes a general assignment for the benefit of creditors or
goes into compulsory or voluntary liquidation, (ii) if a petition
in bankruptcy or under any insolvency law is filed by or against
the other and such petition is not dismissed within sixty (60)
days after it has been filed, or (iii) the other shall commit any
material breach of its obligations hereunder.
In the case of any material breach, neither party shall terminate
this Agreement unless and until the other shall have failed to
cure such breach within ** after it shall have been served with a
notice, in accordance with Section 24, (i) stating the nature of
the breach, (ii) requiring that the breach be cured, and (iii)
stating its intention to terminate the Agreement if compliance
with the notice is not met.
19.2 The termination of this Agreement shall not affect or prejudice
any provisions of this Agreement which are expressly or by
implication provided to continue in effect after such
termination.
20.0 LIMITATION OF LIABILITY
Neither party, whether as a result of breach of Agreement, warranty,
tort (including without limitation negligence), patent infringement,
copyright infringement, or otherwise, shall have any liability for
incidental or consequential damages, including, but not limited to, loss
of profit or revenues, loss of use of the products or any associated
equipment, cost of capital, cost of substitute products, (except
replacement products under Sections 9 and 13), or downtime costs or
claims of third parties to the full extent such may be disclaimed by
law.
21.0 ASSIGNMENT - RESALE OF EQUIPMENT
21.1 The Agreement shall accrue to the benefit of and be binding upon
the parties hereto and any successor entity into which either
party shall have been merged or consolidated or to which either
party shall have sold or transferred all or substantially all its
assets. Specifically, Motorola may assign this Agreement,
provided that Motorola, Inc. shall remain liable for performance
hereunder. Customer may assign this Agreement to its parent
company or any wholly-owned
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
33
subsidiary provided Customer remains obligated for the payments
set forth herein. Furthermore, Customer may assign this Agreement
to Nextel Communications or any of its wholly-owned subsidiaries.
This Agreement shall not be otherwise assigned by either party
without the prior written consent of the other party. In
conjunction with any agreed to assignment of this Agreement,
Motorola agrees to license the assignee pursuant to the terms set
forth in Exhibit "F". A reasonable new Software License Fee may
be required.
21.2 Notwithstanding anything to contrary elsewhere in this Agreement,
Customer may pledge, mortgage or otherwise assign all or any
portion of this Agreement or any orders hereunder (or any
combination thereof) to one or more providers of debt or equity
financing (provided any such intended assignee is not a person or
entity listed on the U.S. Department of Commerce Denied Parties
List or to a person or entity residing in a country to which
export of the iDEN equipment is prohibited under U.S. law) upon
terms and conditions satisfactory to Customer, provided that (i)
Customer will remain liable for all obligations arising out of
this Agreement, (ii) the assignee agrees in writing that the
terms and conditions of this Agreement shall apply to and be
binding upon the assignee to the same extent as Customer, to the
extent that the assignee is exercising any right under this
Agreement, (iii) in addition to any rights conferred on the
assignee, and Customer shall be treated as having placed the
order and paid for purchases for purposes of all rights and
benefits available to Customer under this Agreement.
21.3 Motorola retains the right to subcontract, in whole or in part,
any effort required to fulfill its obligations under this
Agreement, provided Motorola shall remain liable for performance
hereunder. Motorola shall provide Customer with a list of
intended subcontractors and use commercially reasonable efforts
to accommodate any objections Customer may have.
21.4 Any ** to a third party ** shall be subject to Motorola's
approval, which shall not be unreasonably withheld and shall
require **.
22.0 GOVERNING LAW
The validity, performance, and all matters relating to the effect of
this Agreement and any amendment hereto shall be governed by the laws of
state of Illinois without regard to its conflicts of laws provisions.
Venue for disputes shall be the Federal District Court for the District
of Delaware and the parties waive all objection to this venue.
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
34
23.0 ORDER OF PRECEDENCE
In the event of an inconsistency in this Agreement, the inconsistency
shall be resolved by giving precedence in the following order:
23.1 This Agreement and duly executed Amendments or Change Orders to
this Agreement, with the latest Amendment or Change Order taking
precedence over earlier Amendments or Change Orders;
23.2 Exhibit "A" and all duly executed Amendments or Change Orders to
Exhibit "A";
23.3 Exhibit "F" and all duly executed Amendments to Exhibit "F";
23.4 All other Exhibits in alphabetical order and all duly executed
Amendments or Change Orders to said Exhibits.
24.0 NOTICE
24.1 Notices required to be given by one party to another shall be
deemed properly given if reduced to writing and personally
delivered or transmitted by recognized courier or overnight
delivery service, express mail, registered or certified post to
the address below, postage prepaid, or by facsimile with a
confirmation of transmission printed by sender's facsimile
machine, and shall be effective upon receipt if a Business Day,
or otherwise, on the next Business Day.
24.1.1 Motorola shall send notices as follows:
Nextel Partners Operating Corp.
4500 Carillon Pt.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Technical Officer
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Nextel Partners, Inc.
4500 Carillon Pt.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Fax: ▇▇▇-▇▇▇-▇▇▇▇
35
24.1.2 Customer shall send notices as follows:
Motorola, Inc.
iDEN Infrastructure Division
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Attention: **
Fax #: **
With a copy to:
Motorola, Inc.
iDEN Infrastructure Division
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Attention: **
FAX #: **
24.2 Either party may change the addresses for giving notice from time
to time by written instructions to the other of such change of
address.
25.0 SURVIVAL OF PROVISIONS
The parties agree that where the context of any provision indicates an
intent that it shall survive the term of this Agreement then it shall
survive.
26.0 COVENANT NOT TO SOLICIT EMPLOYMENT
The parties hereto agree that during the period of time beginning with
the execution of this Agreement and ending one year after the
termination hereof, neither party shall, without the consent of the
other party, solicit any employee of the other involved in providing
engineering, installation, integration, maintenance, and/or warranty
service for the iDEN System to encourage such employee to work for the
other. If, at any time, this provision is found to be overly broad under
the laws of an applicable jurisdiction, this provision shall be modified
as necessary to conform to such laws rather than be stricken herefrom.
27.0 GENERAL
Failure or delay on the part of Motorola or Customer to exercise any
right, power, or privilege hereunder shall not operate as a waiver. If
any provision of this Agreement is contrary to, prohibited by or held
invalid by any law, rule, order, or regulation of any government or by
the final determination of any state or federal court, such invalidity
shall not affect the enforceability of any other provisions not held to
be invalid to the extent such remaining provisions provide the parties
the benefits reasonably contemplated
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
36
by this Agreement when taken as a whole. Section and paragraph headings
used in this Agreement are for convenience only and are not to be used
to construe the provisions of this Agreement.
28.0 AUTHORITY
Each party hereto represents and warrants that:
28.1 It has obtained all necessary approvals, consents and
authorizations of third parties and governmental authorities to
enter into this Agreement and has obtained or will obtain all
necessary approvals, consents and authorizations of third parties
and governmental authorities to perform and carry out its
obligations hereunder;
28.2 The persons executing this Agreement on its behalf have express
authority to do so, and, in so doing, to bind the party thereto;
28.3 The execution, delivery, and performance of this Agreement does
not violate any provision of any bylaw, charter, regulation, or
any other governing authority of the party; and;
28.4 The execution, delivery, and performance of this Agreement has
been duly authorized by all necessary partnership or corporate
action and this Agreement is a valid and binding obligation of
such party, enforceable in accordance with its terms.
29.0 TERM
The term of this Agreement shall be for three years from the Effective
Date. Provided, however, that if ** of this Agreement, Motorola and
Customer shall **.
30.0 RE-EXPORTATION OF TECHNICAL DATA OR PRODUCTS
Customer understands that all equipment, proprietary data, know-how,
Software, or other data or information obtained by Customer from
Motorola is considered to be United States technology and is licensed
for export and re-export by the United States Government. Customer
therefore agrees that it will not, without the prior written consent of
Motorola and the Office of Export Control, United States Department of
Commerce, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇, knowingly export, re-export, or
cause to be exported or re-exported, either directly or indirectly, any
such equipment, proprietary data, know-how, Software, or other data or
information, or any direct or indirect product thereof, to any
destination prohibited or restricted under United States law. Customer
understands that the list of prohibited or restricted destinations may
be amended from time to time by the
---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
37
United States Department of Commerce and that all such amendments shall
be applicable to this Agreement.
31.0 DISPUTES AND DISPUTE RESOLUTION
Motorola and Customer will attempt to settle any claim or controversy
arising out of this Agreement through consultation and negotiation in
good faith and a spirit of mutual cooperation. If those attempts fail,
then, except for disputes related to alleged patent, copyright, or
trademark infringement, the dispute will be mediated by a mutually
acceptable mediator to be chosen by Motorola and Customer within thirty
(30) days after written notice by the other demanding mediation. Neither
party may unreasonably withhold consent to the selection of a mediator,
and Motorola and Customer will share the costs of the mediation equally.
Venue for mediation shall be in a location within the United States that
is mutually convenient and acceptable to the parties. By mutual
agreement, however, the parties may postpone mediation until they have
each completed some specified but limited discovery about the dispute.
The parties may also agree to replace mediation with some other form of
alternative dispute resolution (ADR), such as neutral fact-finding or a
mini-trial.
Any dispute which the parties cannot resolve through negotiation,
mediation, or other form of ADR within four (4) months of the date of
the initial demand for it may then be submitted to the Federal District
Court for the District of Delaware for resolution. The use of any ADR
procedures will not be construed under the doctrines of latches, waiver,
or estoppel to affect adversely the rights of either party. And nothing
in this section will prevent either party from resorting to judicial
proceedings if (a) good faith efforts to resolve the dispute under these
procedures have been unsuccessful or (b) interim relief from a court is
necessary to prevent serious and irreparable injury to one party or to
others.
32.0 GOVERNMENT CONTRACTS
In the event that Customer elects to provide goods or services to a
Governmental Entity (defined herein), Customer does so solely at its
option and risk and agrees not to obligate Motorola as a subcontractor
or otherwise to such Governmental Entity. Customer remains solely and
exclusively responsible for compliance with all statutes, regulations,
and provisions governing sales to such entity. Motorola makes no
representations, certifications, or warranties whatsoever with respect
to the ability of its goods, services, or prices to satisfy any statues,
regulations, or provisions governing sales of goods or services to such
Governmental Entity. The term "Governmental Entity" as used above
includes any U.S. federal, state, or local government, agency, or
instrumentality as well as any non-U.S. government, agency, or
instrumentality.
38
33.0 SEVERABILITY
In the event that any one or more of the provisions contained in the
Agreement or in any of the Exhibits hereto should be determined to be
invalid, illegal, or unenforceable in any respect, the validity,
legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired. The parties shall endeavor in good
faith to replace any invalid, illegal, or unenforceable provision with a
valid provision, the economic effect of which comes as close as possible
to that of the invalid, illegal, or unenforceable provision.
34.0 ENTIRE AGREEMENT
This Agreement and the Exhibits hereto constitute the entire
understanding between the parties concerning the subject matter hereof
and supersede all prior discussions, agreements, and representations,
whether oral or written, and whether or not executed by Motorola and
Customer. No modification, Amendment, Change Order, or other change may
be made to this Agreement or any Exhibit unless reduced to writing and
executed by authorized representatives of both parties.
The terms and conditions of this Agreement shall prevail notwithstanding
any variance with the terms and conditions of any order submitted by
Customer following execution of this Agreement. In no event shall the
preprinted terms and conditions found on any Customer purchase order,
acknowledgment, or other form be considered an Amendment, or
modification of this Agreement. Such preprinted terms and conditions
shall be null and void and of no force and effect, provided, however,
additional purchase orders in the form of Exhibit "A" shall be valid and
enforceable when signed by both parties.
35.0 COUNTERPARTS
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original and all of which taken together shall
constitute one and the same instrument.
[Remainder of page left blank intentionally.]
39
36.0 COMMENCEMENT OF WORK
Motorola's obligations to commence work hereunder shall begin upon the
date which Motorola receives the down payment as stipulated in Section
7.2.1, or to the extent that no downpayment is required, on the date
that Customer orders any service or equipment hereunder. All time
periods for completion of Motorola's obligations shall commence on such
date.
THIS AGREEMENT IS EFFECTIVE AS OF THE 29TH DAY OF JANUARY, 1999
("EFFECTIVE DATE").
MOTOROLA, INC. NEXTEL PARTNERS OPERATING CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------- -------------------------------
(Authorized Signatory) (Authorized Signatory)
Name ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------- -------------------------------
Title: Corporate VP and General Manager Title: V.P. General Counsel
-------------------------------- -------------------------------
40