PURCHASE AND LICENSE AGREEMENT
Exhibit
10.1
This
Purchase and License Agreement ("Purchase and License Agreement") is between
Nortel Networks Inc. ("Nortel Networks") and Grande Communications Networks, Inc.
("Customer"), effective as of the last date signed and continuing for a
period of three (3) years therefrom ("Term"). Additional terms related to
Customer's purchase or license of Products or Services may be added by written
agreements ("Supplements") referencing the Purchase and License Agreement,
collectively referred to as the "Agreement". The Services Supplement is attached
hereto and incorporated by reference.
1. Definitions
a) "Furnish-only"
means Products, which Customer is responsible for installing.
b) "Hardware"
means a Nortel Networks machine or components.
c) "Products"
means any Hardware, Software or Third Party Vendor Items provided under this
Agreement.
d) "Services"
mean the activities to be undertaken by Nortel Networks pursuant to an Order,
including, but not limited to, engineering, maintenance and installation,
implementation, design, consulting, business planning, network planning and
analysis.
e) "Software"
means computer programs in object code form or firmware which is owned or
licensed by Nortel Networks, its parent or one of its subsidiaries or
affiliates, and is copyrighted and licensed, not sold. Software consists of
machine-readable instructions, its components, data, audio-visual content (such
as images, text, recordings or pictures) and related licensed materials
including all whole or partial copies.
f) "Statement
of Work" is a document prepared by Nortel Networks and accepted by Customer via
a signed Order, describing the deliverables, estimated timelines, assumptions,
responsibilities and other relevant terms specific to a project and an Order. A
Statement of Work shall be governed by the terms and conditions of, and
constitute a part of, this Agreement.
g) "Third
Party Vendor Item" includes "Third Party Hardware" and "Third Party Software"
and means any non-Nortel Networks hardware and/or software supplied to Customer
under this Agreement.
2. Orders/Volume
Commitments
a) Customer
may acquire Products or Services by issuing a written purchase order signed by
an authorized representative or, if Customer is enrolled in any then current
Nortel Networks electronic commerce program, by submitting electronic orders
(collectively, "Orders"). All Orders shall reference this Agreement and specify
the quantity, price, Nortel Networks quotation number, billing instructions,
identification of any Services being ordered, installation location, requested
delivery dates, requested commencement date for Services, any Statement of Work,
and any other special instructions. All Orders will be governed by and cannot
alter the terms and conditions of this Agreement. Nortel Networks' written or
electronic communication accepting the Order, shipment of Products or
commencement of Services will be Nortel Networks' acceptance of Customer's
Order. Orders not rejected by Nortel Networks within fifteen (15) days from
Order receipt shall be deemed accepted.
b) If
Customer cancels an Order, Customer will be invoiced in accordance with the
following: (i) cancellations that occur between sixty (60) up to
thirty-six (36) days prior to the earliest scheduled Product ship date will
result in a cancellation fee of ten percent (10%) of the total price of such
Order; (ii) cancellations that occur between thirty-five (35) up to fourteen
(14) days prior to the earliest scheduled Product ship date will result in a
cancellation fee of fifteen percent (15%) of the total price of such Order; and
(iii) cancellations that occur less than fourteen (14) days prior to the
earliest scheduled Product ship date will result in a cancellation fee of
twenty-five percent (25%) of the total price of such Order. Customer may cancel
an Order sixty (60) calendar days prior to the earliest scheduled ship date
without incurring a cancellation fee. Orders may not be cancelled after shipment
of any Product or commencement of any Service under an Order. Customer shall
notify Nortel Networks in writing in the event Customer decides to cancel an
Order.
c) During
the Term, Customer agrees to purchase and make full payment to Nortel Networks
for Products and Services to delivered during the Term in an amount (i.e., price
less any applicable discounts, credits or other similar incentives and exclusive
of taxes, shipping, handling or other similar charges) totaling not less than
five million six hundred thousand dollars ($5,600,000.00USD) ("Volume
Commitment"). In the event that Customer fails to achieve such Volume Commitment
prior to the expiration or termination of this Agreement, whichever occurs
first, Customer shall pay to Nortel Networks a charge equal to thirty percent
(30%) of the amount of the Volume Commitment that remains unfulfilled. Customer's
purchase/license of Third Party Items shall not count towards the satisfaction
of Customer's Volume Commitment.
3. Consideration
for Optical Products and Services.
a) During
the first year of the Term and in consideration of the discounts, terms and
conditions provided to Customer in this Agreement, Customer hereby agrees that
it will provide Nortel Networks with unbiased consideration with respect to its
purchase/license of any optical products and services that Customer purchases
for use in its U.S. network ("Consideration for Optical Products and
Services").
b) Prior
to a purchase/license of any other vendor's optical products and services that
it proposes to purchase/license, Customer shall consider Nortel Networks'
optical Products and Services based upon the features, prices, speed of
delivery, maintenance, relationship, performance, functionality, delivery and
other relevant information and specifications ("Requirements"). If Nortel
Networks' optical Products and/or Services substantially meet all of the
Requirements, then Customer shall purchase Nortel Networks' optical Products
and/or Services. If Customer reasonably and good faith believes that Nortel
Networks' optical Products and/or Services do not substantially meet all of the
Requirements, then Customer may purchase such other vendor's solution without
breach of this provision.
c) For
the purposes of this Section 3 (Consideration for Optical Products and
Services), optical products shall include, but not be limited to, the following
components: optical amplifiers, switches, regenerators, add/drop multiplexers,
transmitters and receivers, wavelength translators and combiners, dense wave
division components, network processors, maintenance interfaces, and the
associated infrastructure (e.g., shelves, bays and support
structures).
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d) Nortel
Networks may partially or wholly accept or refuse any Order for optical Products
or Services without liability of any kind. Following any partial or whole
refusal of such an Order, Customer shall receive a full credit toward its Volume
Commitment proportionate to the amount refused unless such refusal was based
upon Customer's then-current financial condition. If Nortel Networks refuses
more than three unrelated Orders for optical Products and Services during the
first year of the Term, excluding refusals based upon Customer's then-current
financial condition, this Consideration for Optical Products provision shall no
longer apply for future Orders and will be considered null and void. If any
refusal described above is based upon Customer's then-current financial
condition, Customer shall be afforded a reasonable opportunity to address any
such concern with Nortel Networks.
e) In
the event that Customer breaches the Consideration for Optical Products and
Services, Customer shall promptly pay Nortel Networks, as a liquidated damage
and not as a penalty, an amount equal to ten percent (10%) of the value of the
optical products and services purchased from the other vendor for each such
breach. Subject to confidentiality requirements, if any, Customer shah provide
adequate documentation relating to such purchases to Nortel Networks upon Nortel
Networks' request.
4. Consideration
for Switch Products and Services
During
the Term of this Agreement and in consideration of the discounts, terms and
conditions provided to Customer in this Agreement, Customer hereby agrees that
it will provide Nortel Networks with unbiased consideration with respect to its
purchase/license of any switch products and services it requires or uses in the
operation of any portion of its U.S. network ("Switch Exclusivity Requirement").
For the purposes of this Section, the switch products for such network shall
include, but not be limited to, voice services type equipment. Used switch
products that Customer acquires via total corporate mergers or total company
acquisitions shall not be considered breaches of this provision; provided such
used switch products were originally acquired directly from Nortel
Networks.
b) Prior
to a purchase/license of any other vendor's switch products and services that it
proposes to purchase/license, Customer shall consider Nortel Networks' switch
Products and Services based its Requirements (as defined above). If Nortel
Networks' switch Products and/or Services substantially meet all of the
Requirements, then Customer shall purchase Nortel Networks' switch Products
and/or Services. If Customer reasonably and good faith believes that Nortel
Networks' switch Products and/or Services do not substantially meet all of the
Requirements, then Customer may purchase such other vendor's solution without
breach of this provision.
c) Nortel
Networks may partially or wholly accept or refuse any Order for switch Products
or Services without liability of any kind. Following any partial or whole
refusal of such an Order, Customer shall receive a full credit toward its Volume
Commitment proportionate to the amount refused unless such refusal was based
upon Customer's then-current financial condition. If Nortel Networks refuses
more than three unrelated Orders for switch Products and Services during the
Term, excluding refusals based upon Customer's then-current financial condition,
this Consideration for Switch Products provision shall no longer apply for
future Orders and will be considered null and void. If any refusal described
above is based upon Customer's then-current financial condition, Customer shall
be afforded a reasonable opportunity to address any such concern with Nortel
Networks.
e) In the
event that Customer breaches the Consideration for Switch Products and Services,
Customer shall promptly pay Nortel Networks, as a liquidated damage and not as a
penalty, an amount equal to ten percent (10%) of the value of the switch
products and services purchased from the other vendor for each such breach.
Subject to confidentiality requirements, if any, Customer shall provide adequate
documentation relating to such purchases to Nortel Networks upon Nortel
Networks' request.
5. Changes
to Orders
a) The
parties may, by mutual agreement, make changes to an Order ("Change"). The party
asking for a Change shall describe in writing the details of the requested
Change ("Change Order Request"). Nortel Networks shall provide in writing to
Customer a summary of any and all adjustments to the charges and other
changes/charges resulting from the Change Order Request.
b) Customer
may request a Change sixty (60) calendar days prior to the earliest scheduled
ship date without incurring a Change Order fee. Requests for Change during the
period (i) sixty (60) up to thirty (30) days prior to earliest scheduled ship
date is subject to a Change Order fee equivalent to ten percent (10%) of the net
price of the Products impacted by any such Change; and (ii) less than thirty
(30) calendar days prior to the earliest scheduled ship date is subject to a
Change Order fee equivalent to twenty (20%) of the net price of the Products
impacted by any such Change. c) If a Customer-initiated Change Order Request
affects work already performed, including, but not limited to, engineering or
installation of Products, Nortel Networks shall invoice Customer for any
associated expenses.
d) In
no event shall any Change be effective or acted upon in any way until such time
as (i) an authorized representative of each party has agreed to the terms of the
Change Order Request in writing based on the charges set forth in this Section
and (ii) Nortel Networks receives an Order from Customer for any additional
charges resulting from the Change Order Request.
6. Electronic
Commerce Programs
By
enrolling in any Nortel Networks electronic commerce program, Customer agrees to
comply with the terms of such program. The parties agree that all electronic
Orders issued are equivalent to a written Order, are governed by the terms and
conditions of this Agreement and that in the event of any conflict between this
Agreement and the information contained in Customer's or Nortel Networks'
electronic commerce website, this Agreement governs. Customer is responsible for
the use and protection of all electronic commerce passcodes provided by Nortel
Networks and agrees that all Orders submitted using such passcodes are valid and
binding Orders authorized by Customer; provided, however, Customer shall not be
responsible for the use of passcodes after Nortel Networks has received written
notice from Customer that such passcodes have been misappropriated or are
otherwise no longer secure. Nortel Networks shall have no liability to Customer
due to Customer's failure to access Customer's or Nortel Networks' electronic
commerce website or errors or failures relating to its
operation.
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7. Licensed
Use of Software
Nortel
Networks grants Customer a nonexclusive license to use a copy of the Software
with the Products to the extent of the activation or authorized usage level. To
the extent Software is furnished for use with designated Products or Customer
furnished equipment ("CFE"), Customer is granted a nonexclusive license to use
Software only on such Products or CFE, as applicable. Software contains trade
secrets and Customer agrees to treat Software as Information as defined in
Section 13. Customer will ensure that anyone who uses the Software does so only
in compliance with the terms of this Agreement. Customer shall not a) use, copy,
modify, transfer or distribute the Software except as expressly authorized; b)
reverse assemble, reverse compile, reverse engineer or otherwise translate the
Software; c) create derivative works or modifications unless expressly
authorized; or d) sublicense, rent or lease the Software. Licensors of
intellectual property to Nortel Networks are beneficiaries of this provision.
Upon termination or breach of the license by Customer or in the event designated
Product or CFE is no longer in use in Customer's network, this license
terminates and Customer will promptly return the Software to Nortel Networks or
certify its destruction. Nortel Networks may audit by remote polling or other
reasonable means to determine Customer's Software activation or usage levels.
With respect to Third Party Software, Customer agrees to abide by the terms
provided by Nortel Networks with respect to any such software. Customer further
agrees that the terms contained in any Nortel Networks or third party "shrink
wrap" or "click" licenses shall govern the use of such
software.
8. Charges
and Payment
a) Amounts,
less any disputed amounts, are due and shall be paid by Customer within thirty
(30) days from receipt of invoice. Invoicing disputes must be identified in
writing within thirty (30) days of invoice receipt. Any disputed amounts that
are determined to be validly billed by Nortel Networks are due for payment based
upon the original invoice date. In the event of non-payment of undisputed
amounts, Nortel Networks may suspend performance, product shipments or otherwise
terminate an Order or this Agreement; provided that, Nortel Networks has
provided Customer with written notice of such non-payment and afforded Customer
five (5) business days to cure prior to taking any such action. Customer shall
pay interest on any late payments (excluding validly disputed amounts) at the
rate of 18% per annum (1 l/2 % per month). Additional
charges shall apply for shipping, insurance and special handling. Charges for
Software may be based on extent of use authorized as specified in a Supplement
or invoice. Customer agrees to pay the charges applicable for any activation or
usage beyond the authorized level. If any authority imposes a tax, duty, levy or
fee, excluding those based on Nortel Networks' income or personal property taxes
assessed for each Product prior to initial delivery to Customer, upon a Product
or Service supplied by Nortel Networks under this Agreement, Customer agrees to
pay that amount as specified in the invoice, or supply exemption documentation
at the time of Order submission. Customer is responsible for personal property
taxes for each Product from the date of initial delivery to Customer. Customer
consents without qualification to the sale of receivables, in whole or in part,
including all or any part of any associated rights, remedies, and obligations,
by Nortel Networks without further notice and authorizes the disclosure of this
Purchase and License Agreement and Supplements as necessary to facilitate such
sale.
b) Except
for Orders for DMS Switch Products that include associated installation
Services, Nortel Networks shall invoice Customer one hundred percent (100%) of
the price of the Products upon shipment of the Products and one hundred percent
(100%) of the Services upon completion unless the Service continues beyond
thirty days, in which case Nortel Networks shall invoice Customer at the end of
each month for Services performed in that month.
c) Certain
reoccurring Services (for example, Maintenance Services) may be invoiced in
advance of the performance of such Services.
d) With
respect to Orders for DMS Switch Products that include installation Services
therefor, Nortel Networks shall invoice Customer in accordance with the
following schedule: (i) one hundred percent (100)% of the DMS Switch Products
shall be invoiced at shipment; and ; (ii) one hundred percent (100%) of the
Services upon completion unless the Service continues beyond thirty days, in
which case Nortel Networks shall invoice Customer at the end of each month for
Services performed in that month.
9. Warranty
a) Nortel
Networks warrants that Hardware i) is free from defects in materials and
workmanship and ii) substantially conforms to Nortel Networks' specifications.
If Hardware does not function as warranted during the warranty period, Nortel
Networks will use commercially reasonable efforts to respond promptly and in any
event Nortel Networks will commence to cure in accordance with Nortel Networks'
standard response times, to either i) make it do so, or ii) replace it with
equivalent Hardware.
b) Nortel
Networks warrants that when Software is used in the specified operating
environment it will substantially conform to its specifications and is free from
material and service-affecting defects. If Software does not function as
warranted during the warranty period, Nortel Networks will provide a suitable
fix or workaround or will replace the Software; provided Software is within one
software release level of the then-current software.
c) Services
will be performed in a professional and workmanlike manner. If Services are not
performed as warranted and Nortel Networks is notified in writing by Customer
within 30 days, Nortel Networks will re-perform the non-conforming Services and
use commercially reasonable efforts to respond promptly to such notification.
Nortel Networks will commence to cure in accordance with Nortel Networks'
standard response times.
d) The
warranty period for Hardware and Software shall be the warranty period
identified in the Nortel Networks Warranty Matrix in effect at the time of
Customer's Order. In the event Nortel Networks determines that, during an
applicable Warranty Period, repair or replacement as set forth in this Section
cannot be made using commercially reasonable efforts, Nortel Networks will give
Customer a credit equal to the amount Customer paid for such Hardware or
Software, as applicable.
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e) No
warranty is provided for i) supply items normally consumed during
Product operation; ii) failures caused by non-Nortel Networks products; iii)
failures caused by a Product's inability to operate in conjunction with other
Customer hardware or software unless, prior to delivery of the respective
Product, the parties have agreed in a formal written amendment to this Agreement
that such Product will so operate; or iv) performance failures resulting from
services, including installation, not performed by Nortel Networks or Customer's
use of unauthorized parts or components. Warranty will be voided by any of the
following that was not caused directly by Nortel Networks: misuse, accident,
damage, alteration or modification, failure to maintain proper physical or
operating environment, use of unauthorized parts or components, or improper
Customer installation or maintenance. Software is not warranted to operate
uninterrupted or error free.
f) Nortel
Networks provides Third Party Vendor Items on an "AS IS" BASIS WITHOUT
WARRANTIES OF ANY KIND, unless Nortel Networks specifies otherwise. However,
such Third Party Vendor Items may carry their own warranties and Nortel Networks
shall pass through to Customer any such warranties to the extent
authorized.
THESE
WARRANTIES AND LIMITATIONS ARE CUSTOMER'S EXCLUSIVE WARRANTIES AND SOLE REMEDIES
AND REPLACE ALL OTHER WARRANTIES OR CONDITIONS, EXPRESS OR IMPLIED, INCLUDING,
BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE.
10. Warranty
Service
During
the warranty period, Nortel Networks provides certain types of warranty services
without charge for specified Products to correct Product defects or to bring
them up to conformance with Nortel Networks published specifications. Nortel
Networks will inform Customer of the types of warranty services available to
Customer, which are consistent with Nortel Networks standard practices and
response times. Customer will obtain Nortel Networks' concurrence prior to
returning any Product and must reference a return material authorization number
issued by Nortel Networks on documentation accompanying such returned Product.
Customer agrees to ship Product prepaid and suitably packaged to a location
Nortel Networks designates. Nortel Networks will return the Hardware to Customer
at Nortel Networks' expense. Nortel Networks is responsible for loss of, or
damage to, Customer Hardware while it is a) in Nortel Networks' possession or b)
in transit back to Customer. Any returned Hardware becomes Nortel Networks'
property and, subject to Nortel Networks' receipt of the exchanged Hardware, its
replacement becomes the Customer's property. The replacement Hardware may not be
new, but will be in working order and equivalent to the item exchanged. If
Nortel Networks provides Customer with replacement Product in advance of
receiving the Product requiring repair, Customer agrees to return the Product
requiring repair within thirty (30) calendar days from the ship date of the
replacement Product. Title and risk of loss for replacement Product(s) will pass
upon the earlier of delivery to the Customer or prior to importation to
destination country. If Customer fails to return such Product within thirty (30)
days of receipt of the replacement Product, Nortel Networks will not accept such
returned Product and will invoice Customer the then-current list price for the
replacement Product received. Customer shall make payment within thirty (30)
days from Nortel Networks' invoice therefor. The warranty period for the
Hardware shall be the greater of ninety (90) days from the date of repair or
replacement or the remaining Hardware warranty period. Customer agrees to ensure
that exchanged Hardware is free of any legal obligations or restrictions that
prevent its exchange and represents that all returned items are genuine and
unaltered. Where applicable, before Nortel Networks provides warranty services,
Customer agrees to a) follow the problem determination, problem analysis, and
warranty services request procedures that Nortel Networks provides; b) secure
all programs and data contained in Hardware; and c) inform Nortel Networks of
changes in the Hardware's location. Services to supplement the warranty and
Post-warranty Services, including advance shipment of replacement parts, may be
available at Nortel Networks' then-current prices and
policies.
11. Title
and Risk of Loss
Title and
risk of loss for ordered hardware shall pass from Nortel Networks to Customer
upon delivery to the carrier. Until receipt of the applicable amounts due from
Customer hereunder, Customer grants to Nortel Networks a continuing purchase
money security interest ("PMSI") in the Products sold and/or licensed under this
Agreement and agrees to support Nortel Networks in the perfection of such
interest. Customer authorizes Nortel Networks to file financing or continuation
statements, including amendments thereto, relating to the Products without the
signature of Customer where permitted by law. The PMSI so granted in each
Product shall terminate upon Nortel Networks' irrevocable receipt of payment in
full for such Product and no PMSI shall continue or attach to any Product or
other good sold to Customer for which Vendor has received full payment. Upon
written request by Customer and Nortel Networks' receipt of the applicable
amounts due from Customer hereunder, Nortel Networks will initiate removal of
the associated UCC-1 for such Products pursuant to applicable
law.
12. Implementation
and Installation Services
Unless
otherwise agreed to by the parties, Customer agrees to provide, during normal
business hours, free, safe and reasonably sufficient access to Customer's
facilities, data information and personnel and a suitable physical environment
meeting Nortel Networks' reasonably specified requirements to permit the timely
delivery and installation of Products and/or performance of Services, including
the recovery of Nortel Network tools. Nortel Networks may subcontract any
portion or all of the Services to subcontractors selected by Nortel Networks,
but no such subcontract shall relieve Nortel Networks of its responsibilities
hereunder. Nortel Networks will perform its responsibilities in accordance with
the standard Nortel Networks Statement of Work where applicable. Nortel Networks
will successfully complete its standard installation and commissioning
procedures before it considers Products installed. Nortel Networks may make
alterations to any Product and Service as necessary to comply with
specifications, changed safety standards or governmental regulations, to make a
Product non-infringing with respect to any patent, copyright, trade secret or
other proprietary interest, or to otherwise improve a Product or
Service. Customer is responsible for i) the results obtained
from the use of Products and Services; ii) integration and interconnection with
and configuration of Customer's hardware and/or third party hardware and/or
systems; and iii) installation of Furnish-only Products. All configuration
assistance provided by Nortel Networks is without warranty or guarantee of any
kind. Customer shall be responsible for the accuracy and completeness of all
data and information that it provides or causes to be provided to Nortel
Networks. In the event that there are any delays by either party in fulfilling
its responsibilities as stated above, or there are errors or inaccuracies in the
information provided, the other party shall be entitled to appropriate schedule
and pricing adjustments, including, but not limited to any warehousing and other
resulting costs.
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13. Confidential
Information
a) Confidential
information ("Information") means i) Software and Third Party Software; and ii)
all business, technical, marketing, information related to network architecture
and financial information and data that is clearly marked with a restrictive
legend of the disclosing party ("Discloser").
b) The
party receiving Information ("Recipient") will use the same care and discretion,
but not less than reasonable care, to avoid disclosure, publication or
dissemination of Information as it uses with its own similar information that it
does not wish to disclose, publish or disseminate. The Recipient may disclose
Information only to i) its employees and employees of its parent, subsidiary or
affiliated companies who have a need to know for purposes of carrying out this
Agreement; and ii) any other party with the Discloser's prior written consent.
Customer hereby consents and permits Nortel Networks to disclose this Agreement
to Flextronics Telecom Systems Ltd. Before disclosure to any of the above
parties, the Recipient will have a written agreement with such party sufficient
to require that party to treat Information in accordance with this
Agreement.
c) The
Recipient may disclose Information to the extent required by law. However, the
Recipient must give the Discloser prompt notice and make a reasonable effort to
obtain a protective order.
d) No
obligation of confidentiality applies to any Information that the Recipient i)
already possesses without obligation of confidentiality; ii) develops
independently; or iii) rightfully receives without obligations of
confidentiality from a third party. No obligation of confidentiality applies to
any Information that is, or becomes, publicly available without breach of this
Agreement.
e) The
release of any advertising or other publicity relating to this Agreement
requires the prior approval of both parties.
14. Patents
and Copyrights
If a
third party claims that Nortel Networks Hardware or Software or Services
provided to Customer under this Agreement infringes that party's intellectual
property rights, Nortel Networks will indemnify, defend and hold Customer
harmless against that claim at Nortel Networks' expense and pay all costs,
external expenses, reasonable attorney's fees, and damages that a court finally
awards or are agreed in settlement, provided that Customer a) promptly notifies
Nortel Networks in writing of the claim and b) allows Nortel Networks to
control, and cooperates with Nortel Networks in, the defense and any related
settlement negotiations. If such a claim is made or
appears likely to be made, Nortel Networks agrees to secure the right for
Customer to continue to use the Hardware or Software or Services, or to modify
it, or to replace it with equivalent Hardware or Software or Services. If Nortel
Networks determines that none of these options is reasonably available, Customer
agrees to return the Hardware or Software or the deliverable associated with the
Services to Nortel Networks on Nortel Networks' written request. Nortel Networks
will then give Customer a credit equal to Customer's net book value for the
Hardware or Software or Services provided Customer has followed
generally-accepted accounting principles. Additionally, in the event Customer
agrees to return the Products or the deliverable associated with the Services to
Nortel Networks as a result of an alleged claim as described in this Section,
then, if applicable, and to the extent of the impacted Products and/or Services
only (i) Customer will be excused from further obligation to satisfy the
commitment(s) as set forth in either Section 3 (Consideration of Optical
Products and Services) and 4 (Consideration for Switch Products and Services),
as applicable; and (ii) Customer's Volume Commitment shall be reduced
proportionately by the forecasted amount of purchases to be made by Customer for
such Products and Services. Any such claims against the Customer or liability
for infringement arising from use of the Hardware or Software following a
request for return by Nortel Networks are the sole responsibility of Customer.
This represents Customer's sole and exclusive remedy regarding any claim of
infringement. Nortel Networks has no obligation regarding any claim based on any
of the following: a) anything Customer provides which is incorporated into the
Hardware or Software; b) compliance by Nortel Networks with the Customer's
specifications, designs or instruction; c) the amount of revenues or profits
earned or other value obtained by the use of a Product by Customer; d) the lost
revenues or profits of third parties arising from the Customer's use of a
Product; e) Customer's modification of Hardware or Software; f) the combination,
operation, or use of Hardware or Software with other products not provided by
Nortel Networks as a system, or the combination, operation, or use of Hardware
or Software with any product, data, or apparatus that Nortel Networks did not
provide unless, prior to delivery of the respective Product, the parties have
agreed in a formal written amendment to this Agreement that such Product will so
operate; g) the Customer's failure to install or have installed changes,
revisions or updates as instructed by Nortel Networks; or h) infringement by a
Third Party Vendor Item alone, as opposed to its combination with Products
Nortel Networks provides to Customer as a system. If Third Party Vendor Items
carry their own patent and copyright infringement protections, Nortel Networks
shall pass through to Customer any such protections to the extent
authorized.
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15. Limitation
of Liability
In no
event shall either party or its agents or suppliers be liable to the other party
for more than the amount of any actual direct damages up to the greater of U.S.
$100,000 (or equivalent in local currency) or the charges for the Product or
Services paid or payable hereunder, including any associated interest that may
accrue pursuant to this Agreement, that are the subject of the claim, regardless
of the cause and whether arising in contract, tort (including negligence) or
otherwise. This limitation will not apply to (i) claims for damages for bodily
injury (including death) and damage to real property and tangible personal
property for which a party is legally liable, (ii) breaches by either party of
the confidentiality provisions of this Agreement, (iii) breach by Customer of
the software licensing provisions of this Agreement, and (iv) payments as set
forth in Section 12 Patents and Copyrights. IN NO EVENT SHALL NORTEL NETWORKS OR
ITS AGENTS OR SUPPLIERS BE LIABLE FOR ANY OF THE FOLLOWING: a) DAMAGES BASED ON
ANY THIRD PARTY CLAIM EXCEPT AS EXPRESSLY PROVIDED HEREIN AND IN SECTION 12; b)
LOSS OF, OR DAMAGE TO, CUSTOMER'S RECORDS, FILES OR DATA; OR c) INDIRECT,
SPECIAL, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS
OR SAVINGS), EXCEPT FOR A BREACH BY NORTEL NETWORKS OF THE CONFIDENTIALITY PROVISIONS OF THIS
AGREEMENT, EVEN IF NORTEL NETWORKS IS INFORMED OF THEIR POSSIBILITY. EXCEPT FOR
BREACHES OF THE CONFIDENTIALITY OR SOFTWARE LICENSING PROVISIONS OF THIS
AGREEMENT, CUSTOMER SHALL NOT BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL,
PUNITIVE, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS OR SAVINGS), EVEN IF
CUSTOMER IS INFORMED OF THEIR POSSIBILITY.
16. Training
Credits
a) Nortel
Networks shall make training available to Customer with respect to the
operation, configuration, installation, service, maintenance and support of the
Products at current Nortel Networks prices and at Nortel Networks facilities,
subject to course and class availability. Upon the request of Customer, Nortel
Networks shall provide to Customer such training as Customer requests, at a time
and place mutually agreed upon and at the prices to be quoted for such training.
Nortel Networks training products and services are listed at the Nortel Networks
website for technical training http:
//www.nortelnetworks.
com/knowledgeservices ("Nortel Networks Website for
Technical Training"). The training policies as listed at the Nortel Networks
Website for Technical Training shall apply. Nortel Networks may change, modify,
update and/or add training programs as new Products or Product features/releases
are made available. Prices shall be subject to change by Nortel
Networks.
b) Customer
shall bear the cost of transportation, meals, lodging or other incidental
expenses of Customer's personnel to, from and during
training.
c) Nortel
Networks shall provide Customer with "Training Bank Dollars" that Customer may
apply toward tuition costs for Nortel Networks training products and services,
provided that Customer notifies Nortel Networks of its intent to apply Training
Bank Dollars toward tuition costs for training prior to Nortel Networks'
issuance of invoices for such training. The "Training Bank
Dollars" may be applied to all training media offerings, including (but not
limited to) Nortel Networks instructor-led classroom training at a Nortel
Networks facility, Nortel Networks instructor-led classroom training at the
Customer location (Customer site training), self-paced training, and eLearning
training medias. The "Training Bank Dollars" will be allocated to the Training
Bank quarterly and the amount of "Training Bank Dollars" Customer accrues during
the Term shall equal five thousand, two hundred and fifty dollars ($5,250.00)
for every one million dollars ($l,000,000.00USD) Customer spends on Nortel
Networks' optical and DMS Products, excluding Third Party Vendor Items. Customer
shall not accrue Training Bank Dollars for Services, other Products or for any
Third Party Vendor Items, including, without limitation, optical and DMS Third
Party Vendor Items. The "Training Bank Dollars" will expire twenty-four (24)
months after allocation to the Training Bank.
d) Any
training tuition charges which Customer does not satisfy by application of
"Training Bank Dollars" shall be payable by Customer to Nortel Networks at the
prices quoted at the Nortel Networks Website for Technical Training and Customer
shall render payment within thirty (30) days of receipt of such invoice. The
payment method identified in the student registration record on the first day of
class is the payment method that will prevail for course
charges.
e) Nortel
Networks may, at its sole and exclusive discretion, attempt to meet any
reasonable request by Customer for a course other than the courses listed at the
Nortel Networks Website for Technical Training, ("Customized Training"). The
price for Nortel Networks to modify existing training courses/materials or to
design new training materials for Customer will be quoted to Customer on a per
request basis. Customer may pay for "Customized Training" with "Training Bank
Dollars" or Nortel Networks shall invoice the value of the Customized Training
and Customer shall render payment within thirty (30) days of receipt of such
invoice.
f) The
availability of any training course to Customer as set forth above shall be
subject to the prerequisite policy identified by Nortel Networks at the Nortel
Networks Website for Technical Training. Nortel Networks training materials are
proprietary and copyrighted information. Any use or replication of this material
must have written consent by Nortel Networks' Knowledge Services
organization.
THE
TRAINING MATERIALS AND ANY SUPPORT OR OTHER SERVICES WHICH MAY BE PROVIDED BY
NORTEL NETWORKS SHALL BE PROVIDED WITHOUT WARRANTY OF ANY KIND OR NATURE,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. NORTEL NETWORKS DOES NOT WARRANT THAT THE TRAINING MATERIALS
WILL BE ERROR-FREE OR THE STUDYING OF THE TRAINING MATERIALS WILL QUALIFY ANY
PERSON TO PERFORM ANY FUNCTIONS COVERED BY THE INSTRUCTIONAL MATERIALS. NORTEL
NETWORKS SHALL HAVE NO OBLIGATION TO UPDATE OR MONITOR THE USE, REPRODUCTION, OR
DISTRIBUTION BY CUSTOMER OR ANY THIRD PARTIES OF SUCH TRAINING MATERIALS. EXCEPT
FOR A BREACH OF THE CONFIDENTIALITY PROVISIONS SET FORTH IN THIS AGREEMENT, IN
NO EVENT SHALL NORTEL NETWORKS BE LIABLE FOR ANY INCIDENTAL, CONSEQUENTIAL,
SPECIAL OR INDIRECT DAMAGES OF ANY NATURE WHATSOEVER RELATED TO TRAINING
MATERIALS AND ANY SUPPORT OR OTHER RELATED SERVICES.
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17. Certification
a) Customer
shall, at its expense, ensure that any Nortel Networks switch that (i) consists
of non-Nortel Networks provided equipment, either in whole or in part, or (ii)
was not acquired directly from Nortel Networks, has an acceptable Nortel
Networks software release and has a current baseline Nortel Networks software
release (to the circuit pack level). Such Nortel Networks switch must also be in
a fully Nortel Networks-supported Hardware configuration. If non-Nortel Networks
provided equipment is added to a previously certified or warranted switch, the
switch must be re-certified by Nortel Networks, at Customer's cost and expense,
after each such addition. Customer's performance of any installation services
invalidates the previous certification and any warranties. A Nortel Networks
switch must have a Nortel Networks software load within one (1) of the current
release as well as the hardware required to support the load. If such software
load is a lower release than required, the Nortel Networks switch must be
certified on the lower release load first, with the Customer's agreement to
purchase the current Nortel Networks Generally Available (GA) software release
if the certification is successful.
b) Customer
is responsible for the cost of the certification as well as the following: (i)
any costs associated with ensuring that the Nortel Networks products to be
certified meet pre-certification requirements; (ii) any costs for replacement
hardware required due to a failure of such hardware during the certification
process; (iii) any costs associated with correcting issues identified during the
certification; (iv) subsequent certifications by Nortel Networks after Customer
corrects issues identified during the previous certification; and (v) any other
costs that are outside the scope of work described herein.
CERTIFICATION
SERVICES DO NOT IMPLY ANY WARRANTIES ON THE SWITCH. COMPLETION OF CERTIFICATION
DOES NOT TRANSFER THE RIGHT TO USE ANY PREVIOUSLY UNLICENSED
SOFTWARE.
18. Force
Majeure
If the
performance of this Agreement, or of any obligation hereunder except for the
obligations set forth in Section 8 (Charges and Payment) is prevented,
restricted or interfered with by reason of fires, breakdown of plant, labor
disputes, embargoes, government ordinances or requirements, civil or military
authorities, acts of God or of the public enemy, acts or omissions of carriers,
inability to obtain necessary materials or services from suppliers, or other
causes beyond the reasonable control of the party whose performance is affected
("Force
Majeure"), then the party affected, upon giving prompt notice to the
other party, shall be excused from such performance on a day-for-day basis to
the extent of such prevention, restriction, or interference (and the other party
shall likewise be excused from performance of its obligations on a day-for-day
basis to the extent such party's obligations relate to the performance so
prevented, restricted or interfered with); provided that the party so affected
shall use reasonable efforts to avoid or remove such cause of
nonperformance and both parties shall proceed to perform their obligations
with dispatch whenever such causes are removed or cease.
19. Termination
a) Either
party may terminate this Agreement, and in whole or in part, by providing sixty
(60) day advance written notice (a "Termination Notice") to the other party,
upon the occurrence of any of the following events: (i) if the other party
becomes insolvent or subject to any proceeding under the federal bankruptcy laws
or other similar laws for the protection of creditors and such proceeding shall
not have been dismissed prior to the termination date; (ii) if the other party
materially breaches a material provision or obligation of this Agreement and
such breach is not commenced to be cured within ninety (90) days of receipt of
written notice. Notwithstanding, the party in breach shall use commercially
reasonable efforts to cure any such material breach as soon as reasonably
practicable from its receipt of written notice. Such rights of termination are
in addition to Nortel Networks' other rights of termination as set forth
elsewhere in this Agreement.
b) In
the event of a termination as described in this Section or elsewhere in this
Agreement, Nortel Networks may invoice Customer for any fees related to
Customer's failing to satisfy any of its purchase obligations as set forth in
the Agreement, including, without limitation, the Volume Commitment, the
Consideration for Optical Products and Services and the Consideration for Switch
Products and Services. Nothing contained in this Section shall preclude Nortel
Networks from invoicing Customer for any other amounts that are due and owing,
including, but not limited to, fees related to any Products or other
deliverables provided or Services performed up to the termination
date.
20. General
a) Customer
agrees not to assign, or otherwise transfer this Agreement or Customer's rights
under it, or delegate Customer's obligations, without Nortel Networks' prior
written consent, and any attempt to do so is void. Notwithstanding anything to
the contrary contained herein, Customer may transfer or assign this Agreement to
any entity that acquires all or substantially all of its capital stock and
assets; provided that, such transferee or assignee (i) is not a competitor of
Nortel Networks; (ii) has not materially breached past agreements with Nortel
Networks or its parent or affiliated companies and is not otherwise engaged with
Nortel Networks or its parent or affiliated companies in an agreement for the
purchase, license and/or supply of Nortel Networks products or services; (iii)
agrees in writing to abide by all of the terms of this Agreement, including, but
not limited to, the software licensing and confidentiality provisions; and (iv)
satisfies Nortel Networks' credit criteria. Customer represents and warrants
that it is buying Products and/or Services for its own internal use and not for
resale. Both parties agree to comply with all applicable laws including all
applicable export and import laws and regulations. Except for non-payment,
neither Customer nor Nortel Networks will bring a legal action under this
Agreement more than two years after the cause of action arose. In the event that
any provision of this Agreement or portions thereof are held to be invalid or
unenforceable, the remainder of this Agreement will remain in full force and
effect.
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b) The
terms and conditions of this Agreement, including any Supplement(s) and Annexes,
form the complete and exclusive agreement between Customer and Nortel Networks
and replace any prior oral or written proposals, correspondence or
communications regarding the subject matter hereof. In the event of a conflict
between this Purchase and License Agreement and a Supplement, the terms in any
Supplement(s) prevail. In the event of a conflict between this Purchase and
License Agreement and a Statement of Work, the terms in this Purchase and
License Agreement shall prevail. Any changes to this Agreement must be made by
mutual agreement in writing. All Customer's rights and all of Nortel Networks'
obligations are valid only in the country in which the Products and Services
were supplied; the laws of the State of Texas govern this Agreement, exclusive
of its conflict of laws provisions; and nothing in this Agreement affects any
statutory rights of consumers that cannot be waived or limited by contract. This
Agreement may be executed by one or more of the parties to this Agreement on any
number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.
c) The parties
hereby agree to terminate the existing Master
Purchase Agreement, dated November 23, 1999, between the parties, as amended
(the "MPA"), as of the effective date of this Agreement, except for any
surviving terms and conditions; provided that, the terms of the MPA will
continue to apply to any outstanding purchase orders and unresolved claims
thereunder. Notwithstanding the preceding, the parties herby agree that all
provisions related to minimum purchase commitments of Customer under such MPA
(including, without limitation, Sections 2, 3, and 6 of such MPA) are declared
void and shall be unenforceable. Upon full execution of this Agreement by the
parties, Nortel Networks hereby waives all claims related to any failure of
Customer to satisfy its such purchase commitments under the MPA; provided that,
such waiver shall not release Customer from any of its other obligations of the
MPA, including, without limitation, its payment obligations and associated
responsibilities for purchase orders issued under the
MPA.
GRANDE
COMMUNICATIONS NETWORKS, INC.
By: /s/ ▇▇▇
▇▇▇▇
Name: ▇▇▇
▇▇▇▇
Title: President
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇
State of
Incorporation:
Delaware
Tax I.D.
Number:
▇▇-▇▇▇▇▇▇▇
Date: 1/11/05
NORTEL
NETWORKS INC.
By: /s/ ▇▇▇▇▇
▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇
Title: Counsel
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Date: 1-24-05
OCD#
▇▇▇▇▇
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