Exhibit 10.6
Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 1 of 98
     THIS Agreement (“Agreement”) is entered into effective as of the 19th day
of June 2003 by and among Telesector Resources Group, Inc., d/b/a Verizon
Services Group, a Delaware corporation with offices at 240 East 38th Street New
York, NY 10016 on behalf of itself and for the benefit of their AFFILIATES,
(hereinafter referred to as “Purchaser”) and XEL Communications Inc., a
corporation with offices at 17101 East Ohio Dr., Aurora, CO, 80017 (hereinafter
referred to as “Supplier”). Under the Agreement, Purchaser and any AFFILIATE,
which directly places an Order or for whom Purchaser places an Order, agree to
purchase and Supplier agrees to sell PRODUCTS, SERVICES and DOCUMENTATION and to
license SOFTWARE and RELATED DOCUMENTATION when ordered by Purchaser in
accordance with the terms and conditions stated in this Agreement.
Whereas, based on the presentations, other printed material, correspondence,
discussions, and in reliance upon the expertise of Supplier in developing,
designing and delivering SYSTEMS, Purchaser desires to buy PRODUCTS and SERVICES
from Supplier and Supplier desires to supply PRODUCTS and SERVICES to Purchaser
under the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual promises and conditions set forth
herein, and intending to be legally bound, the parties agree as follows:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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ARTICLE 1
REQUIREMENTS
     Supplier and Purchaser understand and acknowledge that Appendices A through
R, together with the text of this Agreement constitute the specific requirements
and detailed SPECIFICATIONS (“REQUIREMENTS DOCUMENTS”) as contemplated herein.
     1.1 APPENDICES The following appendices are attached hereto and are hereby
made a part of this Agreement:

     
Appendix A
  Affiliates Verizon West
Appendix B
  Products
Appendix C
  Documentation
Appendix D
  Prices
Appendix E
  Delivery Interval
Appendix F
  BVAPP
Appendix G
  Reserved
Appendix H
  Training
Appendix I
  MWDVBE
Appendix J
  Transportation
Appendix K
  Reserved
Appendix L
  Quality, Reliability and Engineering Specifications
Appendix M
  Reserved
Appendix N
  Reserved
Appendix O
  Non-Discrimination Compliance Undertaking

ARTICLE 2
DEFINITIONS
     2.1 ACCEPTANCE ACCEPTANCE shall occur in accordance with Article 13 hereof,
entitled ACCEPTANCE, and the PRODUCT is ready to be placed into service.
          2.1.1 STANDARD ACCEPTANCE applies to purchases Supplier’s PRODUCTS
where Purchaser has determined that the PRODUCT need not undergo a FIRST OFFICE
APPLICATION and shall occur in accordance with Section 13.2 hereof, entitled
STANDARD ACCEPTANCE.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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          2.1.2 FIRST OFFICE APPLICATION (“FOA”) ACCEPTANCE applies to purchases
Supplier’s PRODUCTS where Purchaser has determined that the PRODUCT must undergo
a FIRST OFFICE APPLICATION and shall occur in accordance with Section 13.3
hereof, entitled FOA AND GA ACCEPTANCE.
          2.1.3 GENERALLY AVAILABLE (“GA”) PRODUCT ACCEPTANCE applies to
purchases of Supplier’s PRODUCTS which have passed FOA ACCEPTANCE and thereby
have become generally available and GA ACCEPTANCE shall occur in accordance with
Section 13.3 hereof, entitled FOA AND GA ACCEPTANCE.
     2.2 ACCEPTANCE DATE For any PRODUCT provided hereunder, ACCEPTANCE DATE is
the first day after the applicable PRODUCT successfully completes all ACCEPTANCE
Tests and Purchaser issues a Notice of ACCEPTANCE, provided for in Article 13
hereof, entitled ACCEPTANCE.
     2.3 AFFILIATE means, at any time, and with respect to any corporation,
person or other entity (a) any other corporation that at such time, directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such first corporation, person or other entity; or
(b) any other corporation, person or other entity beneficially owning or
holding, directly or indirectly, 25% or more of any class of voting or equity
interests of the first corporation or any subsidiary or any corporation of which
the first corporation and its subsidiaries beneficially own or hold, in the
aggregate, directly or indirectly, 25% or more of any class of voting or equity
interests. As used in this definition, “Control” means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a corporation, person or other entity whether through the
ownership of voting securities, or by contract or otherwise.
     2.4 DAY Unless indicated otherwise, all references to “day” or “days” in
this Agreement and all appendices thereto are to calendar days.
     2.5 DOCUMENTATION shall mean any and all written materials, drawings, and
specifications, required for or incident to Purchaser’s use and operation of the
PRODUCTS, including but not limited to, full descriptions of planning,
installation, engineering, use, test, maintenance, analysis, repair, training,
operation, and Purchaser ACCEPTANCE testing of the PRODUCT(S), together with any
and all modifications,. revisions, additions, improvements or enhancements to
the above.
     2.6 HARDWARE shall mean the Supplier’s hardware, firmware, additions,
extensions, components, supplies, test equipment, apparatus and parts, as
specified in this Agreement or in an Order, or which are integral to, or
associated with the functioning and
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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performance of Supplier’s PRODUCT, including, without limitation, those set
forth or otherwise identified in Appendix D and all other Appendices to this
Agreement.
     2.7 NETWORK means a combination of interconnected, integrated
telecommunications equipment owned, operated, licensed or leased by Purchaser or
its customers, into which the Supplier’s PRODUCTS will be integrated,
interoperating concurrently and as a whole for the purpose of the transmitting,
switching and receiving signals, such as optical or electrical, containing voice
messages, data, video or images, by wire, fiber or electromagnetic (i.e. through
the air) means.
     2.8 NETWORK ELEMENTS means entities defined by the functionality of the
functional groups they contain and by their interfaces.
     2.9 PRODUCT shall mean any or all HARDWARE, SOFTWARE, LICENSED MATERIALS or
DOCUMENTATION provided or furnished by Supplier, including, without limitation,
those set forth or otherwise identified in Appendix D and all other Appendices
to this Agreement.
     2.10 SERVICES shall mean the engineering, installation, installation
support, technical support, emergency technical assistance, training, and other
related SERVICES associated with any Supplier’s PRODUCT which may be ordered
hereunder, including, without limitation, those set forth or otherwise
identified in Appendix D and all other Appendices to this Agreement.
     2.11 SOFTWARE shall mean on whatever media provided, a program, or
programs, including switch operating systems and network management systems, and
firmware or internal code fixed in, or otherwise incident to, the HARDWARE
consisting of machine readable logical instructions and tables of information,
supplied in object code form, including, without limitation, those set forth or
otherwise identified in Appendix B and all other Appendices to this Agreement,
which guide the functioning of a processor and which are required to provide
Purchaser with the functional and operational performance capabilities and
capacities specified in Appendix B or as may be identified in any Order,
associated Appendices or other document or attachments associated with the
Order. SOFTWARE as used in this Agreement does not include SOURCE CODE. Such
programs include, but are not limited to, control programs, application
programs, operating system programs, base-feature programs, optional-feature
programs, and other programs related to the operation, administration and/or
support of HARDWARE.
          2.11.1 RELATED DOCUMENTATION shall mean DOCUMENTATION, useful in
connection with the SOFTWARE, such as but not limited to, flow charts, logic
diagrams, program listing, program descriptions and
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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specifications; program listings and program descriptions shall incorporate
high-level language-and programmer’s comments.
          2.11.2 LICENSED MATERIALS shall mean the SOFTWARE and RELATED
DOCUMENTATION defined in Section 2.11 and Clause 2.11.1 including the firmware
or internal code fixed in, or otherwise incident to, the HARDWARE and for which
licenses are granted by Supplier under this Agreement.
     2.12 SOURCE CODE shall mean a computer program in the form of high-level
language that generally is not directly executable by a processor.
     2.13 OPERATIONS SUPPORT SYSTEM (“OSS”) shall mean that software, interface
hardware and processor that interfaces with the PRODUCT in the Purchaser’s
Network and which (OSS) is required for the operation, administration and/or
support (including but not limited to testing, surveillance, billing,
provisioning and inventory) of the Purchaser’s Network.
     2.14 SYSTEM shall mean all components of the Supplier’s PRODUCT(S),
purchased hereunder, functioning together, performing and interoperating as a
fully integrated and efficient whole with itself and all other Supplier-provided
switching, transport, transmission elements, other facilities and equipment in
the Purchaser’s network (“OTHER SUPPLIER-PROVIDED EQUIPMENT”) in accordance with
the SPECIFICATIONS contained in this Agreement or any Order(s) issued pursuant
to this Agreement, including, without limitation, those set forth or otherwise
identified in Appendix D and all other Appendices to this Agreement and the
requirements and specifications relating to OTHER SUPPLIER-PROVIDED EQUIPMENT
contained in the agreements pursuant to which Purchaser purchased such OTHER
SUPPLIER-PROVIDED EQUIPMENT and all appendices thereto.
     2.15 WORK shall mean the provision of PRODUCT and DOCUMENTATION and the
performance of SERVICES incident to this Agreement or any Order(s) issued
pursuant to this Agreement, including, without limitation, those set forth or
otherwise identified in Appendix B and all other Appendices to this Agreement.
     2.16 SPECIFICATIONS shall mean those specific requirements and detailed
specifications set forth in the Appendix B.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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ARTICLE 3
AGREEMENT TO PURCHASE
     3.1 SCOPE OF AGREEMENT Purchaser agrees to purchase on an as-ordered basis
and Supplier agrees to sell, PRODUCT(S)and SERVICES and to license SOFTWARE and
RELATED DOCUMENTATION, when ordered by Purchaser in accordance with the terms
and conditions stated in this Agreement at the prices identified in Appendix D.
This Agreement is not intended and shall not be construed as a commitment on the
part of Purchaser to purchase any PRODUCT(S)and SERVICES, or to purchase a
license to any SOFTWARE and RELATED DOCUMENTATION from Supplier.
          3.1.1 APPLICATION OF AGREEMENT Supplier agrees that this Agreement
shall govern all future purchases by Purchaser of those PRODUCT(S)and SERVICES
set forth on Appendix D, as such Appendix may be amended or supplemented from
time to time by the parties in writing during the term of this Agreement.
     3.2 TERM OF AGREEMENT This Agreement shall commence on the date first above
written and, unless otherwise terminated pursuant to the provisions of this
Agreement, shall continue for a three (3) year term. Thereafter, this Agreement
shall be renewable at the option of Purchaser with notice to Supplier sixty
(60) days in advance of the expiration date. This Agreement shall be effective
for PRODUCTS and SERVICES ordered by Purchaser during the term and any extension
thereof.
     3.3 INTERRELATIONSHIP WITH ORDERS Whenever the provisions of an Order
conflict with the provisions of this Agreement, the typewritten provisions of
the Order which have been mutually agreed upon by the parties in writing and
which are not pre-printed as part of a form shall control and take precedence
over the conflicting provisions of this Agreement, but only for purposes of such
Order and, except for the conflicting provisions of such Order, the terms and
conditions of this Agreement shall not be deemed to be amended, modified,
canceled, or waived. Conflicting pre-printed provisions on the reverse or front
of the forms belonging to either party shall be deemed deleted.
     3.4 GOVERNMENT CONTRACT PROVISIONS Orders placed pursuant to this Agreement
containing a conspicuous notation that the PRODUCT is intended for use under
government contracts shall be subject to the then current government provisions
referenced thereon or in attachments thereto, unless Supplier rejects the Order
in writing within the time limit specified in Section 9.1 hereof, entitled
ORDERS, because of its unwillingness or inability to comply with the government
provisions. In the event Supplier rejects such an Order, Purchaser retains the
right to purchase the required product from an alternative supplier.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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     3.5 NON-EXCLUSIVE_MARKET RIGHTS It is expressly understood and agreed that
this Agreement neither grants to Supplier an exclusive privilege to sell or
provide to Purchaser any or all PRODUCTS or SERVICES of the type described in
this Agreement which Purchaser may require, nor does it require the purchase of
any PRODUCTS or SERVICES from Supplier by Purchaser. Supplier understands and
agrees that Purchaser is free to and may contract with other manufacturers and
Suppliers for the procurement of comparable PRODUCTS or SERVICES.
ARTICLE 4
SUPPLIER COMPREHENSIVE RESPONSIBILITIES FOR OVERALL PERFORMANCE
     Supplier represents, warrants and agrees that it has the full and final
responsibility, duty and obligation to provide, perform, deliver and install, to
the extent set forth in Appendix B the SYSTEM, PRODUCT and SERVICES as well as
any ancillary services, facilities, and equipment, set forth any Order(s) issued
by Purchaser and accepted by Supplier pursuant to this Agreement and further
Supplier agrees and acknowledges:
1. that it recognizes that the SYSTEM, PRODUCT and SERVICES which are to be
provided under this Agreement are vital to Purchaser and must be delivered and
installed without interruption, delay, cessation or limitation and in full
compliance with the scheduled developmental dates, and requirements set forth in
the Order(s) perform in full compliance with the SPECIFICATIONS; and that in the
event of any conflict or contention of whatever type or character between a
Purchaser’s Order(s) for SYSTEM, PRODUCT and SERVICES and any order by a third
party, Supplier shall satisfy and fulfill, and shall take any lawful action
necessary, to satisfy and fulfill, the Purchaser’s Order(s) before it satisfies
such third party Order(s);
2. that Supplier has and will maintain an organization staffed by optimally
useful number(s) of qualified personnel, including “key personnel,” with the
knowledge, skill and resources optimally useful to perform and complete the work
and that there are and will be, no impediments to, or commitments legal,
contractual or otherwise which impede Supplier’s timely performance and
completion of the work or its capacity or capability to do so;
3. that should Supplier fail in its performance beyond the cures and remedies in
this Agreement, the cost, and expense required to reprocure the SYSTEM, PRODUCT
and SERVICES, and the time lost and the revenues income and profit jeopardized
could be substantial and material;
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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4. that any such failure in Supplier’s full performance under this Agreement may
under the circumstances set forth in this Agreement constitute a Default by
Supplier which may result in Purchaser invoking remedies under this Agreement,
including but not limited to as set forth in Article 19 hereof, entitled
Default.
ARTICLE 5
ASSIGNMENT
     5.1 ASSIGNMENT BY PURCHASER Purchaser shall have the right to assign this
Agreement or to assign its rights and delegate its duties, obligations or
commitments under this Agreement, either in whole or in part, to any of its
AFFILIATES, parent, and/or subsidiaries upon Notice to Supplier.
     No assignment pursuant to this clause shall either affect or diminish any
rights or duties that Purchaser may then have as to PRODUCT ordered by, or
SOFTWARE licensed to, Purchaser or delivered by Supplier prior to the effective
date of the assignment or as to PRODUCT which is beyond the scope of the
assignment. Upon the acceptance of the assignment and the assumption of the
duties under this Agreement by the assignee, Purchaser shall be released and
discharged, to the extent of the assignment, from all further duties under this
Agreement.
     5.2 ASSIGNMENT BY SUPPLIER Supplier shall not assign any right or interest
under this Agreement, or Orders issued pursuant to this Agreement, without the
prior written consent of Purchaser, which shall not be unreasonably withheld,
except with respect to Engineering and Installation Services, in which Purchaser
may withhold its consent at its sole option. Any attempted assignment in
contravention of the above provision shall be void and ineffective.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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ARTICLE 6
DOCUMENTATION, SUPPLIER’S SPECIFICATIONS, INFORMATION,
RECORDKEEPING AND DISCLOSURE
     6.1 DOCUMENTATION Supplier agrees to furnish DOCUMENTATION including but
not limited to the items set forth or otherwise identified in Appendix C and the
terms and conditions stated within this Agreement, for the SYSTEM or PRODUCT(S)
purchased hereunder, and any succeeding changes thereto, at no additional
charge.
     Supplier shall be responsible for updating the DOCUMENTATION to incorporate
subsequent updates and changes to SYSTEM or PRODUCT. Supplier shall maintain a
list of persons and organizations of Purchaser, to whom the updates shall be
provided. The updates and any subsequent changes shall contain a Supplier
identification reference number and date of issue to facilitate administration.
Such subsequent changes and updates shall be provided within a reasonable time
of their respective effective dates, at no charge to Purchaser.
     Supplier grants Purchaser the right to make copies of DOCUMENTATION
furnished under this Agreement for the exclusive internal use of Purchaser. If
any DOCUMENTATION that is to be copied bears a copyright or proprietary notice,
Purchaser shall reproduce the copyright or proprietary notice on all copies.
Notwithstanding the preceding reference to proprietary markings, Supplier shall
not provide Purchaser with any proprietary information unless previously agreed
to in advance in writing.
     On a continuing basis Supplier shall provide, at no charge to Purchaser,
Installation Alerts and Broadcast Warnings, PRODUCTS Change Notices, Engineering
Change Notices, and documentation for changes to PRODUCT, non-conformance to
SPECIFICATION, service affecting items, ACCEPTANCE failures, and installation
issues. Such of the above referenced documents necessary to support PRODUCT
Supplier shall provide during ACCEPTANCE and thereafter for a period often
(10) years at no charge to Purchaser.
     6.2 SUPPLIER’S SPECIFICATIONS AND DRAWINGS Supplier’s standard commercial
and/or technical specifications (including drawings) or other applicable
documentation, approved by Purchaser relating to the SYSTEM and PRODUCT provided
hereunder and listed in Appendix C shall be considered a part of the
REQUIREMENTS DOCUMENTS. Supplier agrees to provide Purchaser, at no charge, a
total of 20 copies of all such specifications and approved amendments thereto,
as issued.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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     6.3 PERIODIC REPORTS Supplier agrees to render, at such times as may
mutually be agreed upon by the parties, at no charge to Purchaser and in formats
acceptable to Purchaser, those of the following reports, as may be mutually
agreed to by the parties, applicable to the PRODUCTS and SERVICES contemplated
by this Agreement:

  1.   Actual or Potential Event Reports     2.   Repair & Replacement Reports  
  3.   Outstanding Engineering Complaints and EC Tracking Reports     4.  
Reliability and Quality Measurements Product Performance Reports     5.  
Summary Product Troubles Reports     6.   Monthly Custom Product Development
Reports     7.   Monthly Production Schedule Reports     8.   Monthly Committed
Feature Status Reports     9.   Software Development Tracking Reports     10.  
Quarterly Subcontractor Reports     11.   Organization charts     12.   Weekly
Impact/Issues Report     13.   Monthly Quality Performance Reports     14.  
Quarterly Diversified Supplier Subcontracting and Second Tier Reports     15.  
Diversified Supplier (MWBE) Utilization Reports     16.   NTF (No Trouble Found)
Summary Reports     17.   Quarterly Continuous Improvement Reports     18.  
Change Order Reports     19.   Summary of Technical Support Calls     20.  
Document Distribution List     21.   Consignment Inventory Reports     22.  
Monthly Shipment and Order Reports

     In connection with the Monthly Order Reports, listed above as No. 22,
Supplier will provide to Purchaser by the tenth day of each month a report of
Purchaser’s purchasing activity hereunder. The format of this report shall be
mutually agreed upon by both parties. To the extent information is available to
Supplier from Purchaser’s purchase orders, Supplier’s report will identify at a
minimum: (i) the ship to location (state or district), (ii) Purchaser’s Job or
TEO number, (iii) company placing order, (iv) order date, (v) agreed to ship
date, (vi) actual ship date, for completed orders, (vii) quantity of PRODUCT
ordered and shipped (plug-ins, HARDWARE, misc.), and (viii) dollar value for
each order.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose, this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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     Supplier agrees to render other periodic reports for service affecting
conditions or other conditions that affect the operational and administrative
procedures of Purchaser, or as otherwise reasonably requested by Purchaser.
     In the event Supplier fails to specify in writing any problem (an
“Unidentified Problem”) each week in the appropriate Weekly Impact/Issues
Report, listed above as No. 12, it shall be conclusively presumed for the
purposes of this Agreement that no problem arose during such week and Supplier
shall not be entitled to rely upon such Unidentified Problem as a basis for
failing to complete any WORK as required by this Agreement. Except by operation
of such conclusive presumption, submission by Supplier of Weekly Impact/Issues
Reports pursuant to this Section 6.3 shall not alter, amend or modify
Purchaser’s or Supplier’s rights or obligations pursuant to any provision of
this Agreement.
     6.4 RECORDS AND AUDIT Supplier shall maintain, in accordance with standard
recognized accounting practices, accurate and complete records as are necessary
to enable Supplier to demonstrate full compliance with all of the Terms and
Conditions of this Agreement Supplier shall maintain such records for a period
of seven (7) years from the date of termination of this Agreement.
     Supplier agrees to provide reasonable supporting documentation concerning
any disputed amount(s) within twenty (20) days after Purchaser provides written
notification of the dispute to Supplier.
     Purchaser and Supplier shall mutually agree upon an independent auditor
who, at Purchaser’s option, shall audit Supplier’s records of Supplier’s
transactions with its other commercial customers (provided that the identity of
such other commercial customers shall not be disclosed to Purchaser) for
verification of comparable pricing and other commercial elements in accordance
with Section 7.3 hereof, entitled MOST FAVORED NATION and Supplier’s compliance
with all other provisions of this Agreement. Supplier shall be responsible for
all audit/ verification expenses should the audit reveal or determine that there
is a deficiency or violation of Section 7.3 hereof, entitled MOST FAVORED
NATION. At Purchaser’s request, the independent auditor shall have access to the
Supplier’s records, for purposes of audit during normal business hours during
the term of this Agreement and during the respective periods in which Supplier
is required to maintain such records. The accuracy of Supplier’s billing shall
be determined from the results of such audits.
     6.5 COMPATIBILITY INFORMATION Compatibility Information is that technical
information, including but not limited to software interfaces, required to
design equipment and/or software which is functionally interconnectable with the
PRODUCT supplied by Supplier hereunder. For a period of seven (7) years after
providing such
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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PRODUCT, Supplier shall supply such Compatibility Information to such PRODUCT to
Purchaser within thirty (30) days of a request from Purchaser.
     6.6 NETWORK INTERCONNECTION INFORMATION As used in this section, “Network
Interconnection Information” is that information with regard to Supplier’s
PRODUCTS, which Purchaser is required to provide to requesting persons, or as to
which Purchaser is required to provide public notice, pursuant to applicable law
and/or government rules, regulations, or orders, including, but not limited to,
47 USC § 251(c)(5) and the rules, regulations and orders of the Federal
Communications Commission, including, but not limited to, 47 USC §§
51.305,51.307,51.325 through 51.335,64.702(d)(2), or 68.110(b). In establishing
the information that is Network Interconnection Information, Purchaser and
Supplier agree to cooperate with one another in good faith to establish the
specific items of information that constitute Network Interconnection
Information.
     Supplier shall provide all Network Interconnection Information to
Purchaser. Network Interconnection Information shall not be deemed to be
proprietary or confidential information of Supplier or Supplier’s suppliers and
Purchaser shall have the right to disclose the Network Interconnection
Information to any person on a non-confidential and non-proprietary basis and
without Purchaser or the recipient being obligated to make any payment to
Supplier or Supplier’s suppliers in connection with the Network Interconnection
Information.
     Supplier agrees to make available all Network Interconnection Information
to any person requesting such information, within thirty (30) days of receipt of
a request from any such person. Supplier shall notify Purchaser within five
(5) days of both Supplier’s receipt of a request for Network Interconnection
Information and Supplier’s response to such request.
     In the event that Supplier fails to disclose Network Interconnection
Information to the requesting person within thirty (30) days after receiving the
request, Purchaser shall have the right to request a government agency or
judicial authority of appropriate jurisdiction, at Supplier’s expense, to
determine whether the requested information must be disclosed.
     In the event that a person requesting Network Interconnection Information
challenges before a government agency or a judicial authority a refusal by
Supplier to provide such Network Interconnection Information, Purchaser and
Supplier shall reasonably cooperate with one another at their own respective
cost and expense in responding to such challenge.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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     In the instance where an order from an appropriate government agency or
judicial authority requires the disclosure of any portion of requested Network
Interconnection Information, Supplier shall disclose such Network
Interconnection Information under such terms, conditions and prices as shall
have been directed by the agency or authority, or if terms, conditions and
prices have not been directed by the agency or authority, then pursuant to
terms, conditions and prices which are (a) commercially reasonable, and
(b) permit Supplier to meet its obligations under applicable law and government
rules, regulations and orders.
     In the event of Supplier’s failure to disclose Network Interconnection
Information, Purchaser shall have the right to return to Supplier any PRODUCT
delivered to Purchaser which Purchaser is unable to use as a consequence of
Supplier’s failure to disclose Network Interconnection Information. Supplier
shall refund to Purchaser the full purchase price paid by Purchaser for any such
returned PRODUCTS.
     Supplier’s obligations under this section, entitled NETWORK INTERCONNECTION
INFORMATION, shall remain in effect for the term of this Agreement or the term
of the most recent warranty remaining of any PRODUCTS purchased by Purchaser
under this Agreement, whichever is greater.
     6.7 DISCLOSURE OF POTENTIAL OR ACTUAL DEFECTS Supplier acknowledges and
understands the critical importance to Purchaser of avoiding network or other
service degradation, adverse publicity regarding its network services, or the
deterioration or breach of the security of Purchaser’s telecommunications
facilities or network.
     For purposes of this section, “Event” shall mean

  1.   any malfunction of the PRODUCTS or any failure of the PRODUCTS to conform
to the SPECIFICATIONS of Purchaser, or the specifications of Supplier, or the
specifications of any other purchaser or user of the PRODUCTS;     2.   actual
failures or impaired functioning of the PRODUCTS resulting in the disruption of
any service provided by telecommunications facilities, including but not limited
to network access, to Purchaser, to customers of Purchaser or of any other
purchaser or user of the PRODUCTS for a period of ten (10) uninterrupted minutes
per occurrence;     3.   potential, suspected or actual defects in design and/or
manufacturing of the PRODUCTS which are or should be known by Supplier
regardless of whether such potential, suspected or actual defects in design
and/or manufacturing have resulted in any actual malfunctions or failures of the
PRODUCTS, and which have

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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      the potential of causing the disruption of any service provided by
telecommunications facilities, including but not limited to network access, to
Purchaser, to customers of Purchaser, or of Supplier, or of any other purchaser
or user of the PRODUCTS for a period of ten (10) uninterrupted minutes per
occurrence; and,     4.   uses of the PRODUCTS in combination with other goods,
products, or services, whether those of Supplier or others, where such combined
usage could be reasonably predicted to or actually does result in failure or
impaired functioning of the PRODUCTS which cause, or have the potential of
causing, the disruption of any service provided by telecommunications
facilities, including but not limited to network access, to Purchaser, to
customers of Purchaser, or of Supplier, or of any other purchaser or user of the
PRODUCTS for a period of ten (10) uninterrupted minutes per occurrence.

     Supplier agrees to identify and compile reports concerning any actual or
potential Events. Supplier further agrees to notify Purchaser at the address
below of the occurrence of any Event within eight (8) hours of Supplier’s first
knowledge of the Event.
Sourcing Process Leader
Verizon Corporate Sourcing
240 East 38th Street, 14th Floor
New York, NY 10016
(212) 338-6789
     Such notification shall include any and all actions taken by Supplier, its
agents, and contractors and by the owner or user of the PRODUCTS which are
subject to the Event. Within forty-eight (48) hours after such notification,
Supplier shall provide Purchaser with a complete and detailed written
description of the following:

  1.   activities which led up to or preceded the Event;     2.   the cause or
causes of, including any and all known contributing factors to, the event;    
3.   any and all actions taken by Supplier, its agents, and contractors, and by
the owner or user of the PRODUCTS which are subject to the Event to control;    
4.   the date the Event will be resolved, and;     5.   any and all measures
which can be reasonably taken to avoid the occurrence of the Event in
Purchaser’s PRODUCTS.

     Supplier shall continue to provide these written descriptions to Purchaser
every forty-eight (48) hours until such time as the Event has been successfully
resolved or until Supplier and Purchaser agree on their discontinuance.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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If requested by Purchaser, Supplier shall provide identical descriptions to
Telcordia’s National Control Center or such other place of Purchaser’s agent
specified by Purchaser.
          The occurrence of any Event and subsequent failure by Supplier to
fulfill its obligations under this section shall be a material breach of this
Agreement. The reporting of an Event by Supplier to Purchaser as provided herein
shall not relieve Supplier of any of its obligations or liabilities under this
Agreement.
     6.8 DISCLOSURE Supplier represents that it has disclosed, and will continue
to disclose, any issue, element, factor, cause of action, claim or event
incident to its Proposal or the technology upon which the PRODUCT, SERVICES or
SYSTEM is based, which if disclosed would be likely to have a significant
adverse impact upon Purchaser’s decision to accept such Proposal or the
technology upon which the PRODUCT, SERVICES or SYSTEM is based.
ARTICLE 7
PRICES AND TERMS OF PAYMENT
     7.1 PRICES PRODUCTS and SERVICES will be furnished by Supplier in
accordance with the prices stated in Appendix D. All costs and prices identified
are inclusive of the Appendices hereto as well as all terms and conditions of
this Agreement. Such prices shall be applicable to Orders issued to Supplier by
Purchaser at the location and by the method agreed to by the parties. Supplier
shall strive during the Term to reduce prices for all PRODUCT and SERVICES in
accordance with the goal of Continuous Improvement.
          7.1.1 INCREASE DURING TERM Supplier shall not, during the effective
term of this Agreement, increase the prices for any prices for such PRODUCT or
SERVICES specified in Appendix D.
          7.1.2 REDUCTIONS Price reductions may be initiated by Supplier at any
time.
          7.1.3 PRICE COMMITMENT During the effective term of this Agreement,
prices for PRODUCTS and SERVICES not specified in Appendix D Supplier shall
provide a Price Commitment for each Order entered by Purchaser and accepted by
Supplier for PRODUCTS and SERVICES and/or Services according to the following
schedules or as mutually agreed to by Purchaser and Supplier:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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1. For Services only, Supplier shall provide the Price Commitment six (6) weeks
after the Order placement date but in no event later than thirty (30) days prior
to the date of the first invoice.
2. If Supplier is also providing PRODUCT, Supplier shall provide the Price
Commitment eight (8) weeks prior to the scheduled PRODUCT main ship date but in
no event later than thirty (30) days prior to the date of the first invoice.
3. For short interval Orders, i.e., less than Supplier’s published standard
intervals as specified in Appendix E, the Price Commitment must be received
prior to issuance of the applicable invoices.
     If Supplier provides a mechanized detailed summary, the associated data
layouts must conform to American National Standards Institute (ANSI) standards
as interpreted by the Telecommunications Industry Forum (TCIF) and Purchaser’s
supplements to these standards and must be provided in the same format as the
mechanized invoice and transmitted in a mode specified by Purchaser.
     If the mechanized detailed summary is in addition to a manual
(paper) summary provided with the Price Commitment, the mechanized summary must
be provided no later than thirty (30) days prior to the date of the first
invoice. If provided in lieu of a manual (paper) process, the mechanized
detailed summary must be provided in accordance with the dates specified for the
Price Commitment.
     This Price Commitment must reflect any and all applicable discounts and
include the following:
1. A detailed summary of PRODUCT including SOFTWARE to be provided. This
detailed summary must include prices at the “Retirement Unit/Property Record
level” (individual items of PRODUCT having unique functions and identity) as
prescribed in FCC Rules and Regulations for class “A” Telephone Companies, coded
per Telcordia publication TR-ISD-000325 (formerly PUB 52004) and furnished in a
format suitable for direct entry into Purchaser’s applicable mechanized system.
2. Each Service must be priced in sufficient detail to identify costs directly
associated with additions, removals, rearrangements and modifications as well as
to provide costs for each component of the SERVICES (e.g., Installation —
hauling, hoisting, warehousing; Engineering —drafting, computer services.)
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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          7.1.4 CONTINUOUS IMPROVEMENTS Supplier and Purchaser shall identify
and mutually agree on areas for Supplier’s continuous improvement in quality and
service over the term of this Agreement and Supplier shall afford Purchaser the
ability to realize such improvements. Supplier and Purchaser will meet at least
once every six (6) months to assess Supplier’s progress towards implementation
of continuous improvement.
          7.1.5 NEW TECHNOLOGY REPLACEMENT Purchaser and Supplier recognize that
Supplier may develop and market new PRODUCTS (“New Technology”) that are
designed to enhance or replace the PRODUCTS provided for in this Agreement.
Supplier agrees to include the New Technology as part of its PRODUCT offerings
within the terms provided for in this Agreement, at prices to be mutually agreed
to by the parties for comparable, successor, or substitute features and
functionality for PRODUCT or Purchase volumes stated within this Agreement,
subject to the following:
1. Supplier shall strive during the Term to reduce prices for all PRODUCT and
SERVICES in accordance with the goal of Continuous Improvement.
2. New Technology shall only be furnished to Purchaser pursuant to a written
amendment hereto and in accordance with Section 11.2 hereof, entitled CHANGES TO
HARDWARE OR SOFTWARE/PRODUCT CHANGE NOTICES (PCN’s), including the notice
requirements therein, except that price reductions may be made at any time.
3. In the event New Technology will cause the Supplier to incur greater per-unit
costs compared to current PRODUCT but will offer substantially increased
capacity or features which will allow Purchaser to reduce its total costs or
offer more services such that Supplier believes a price increase is justified,
then:
3(i). Supplier shall provide to Purchaser a written detailed explanation of such
proposed price increase including a breakdown of the additional costs incurred
by the Supplier in providing such PRODUCT and how such additional features or
capacity shall help reach the goal of Continuous Improvement.
3(ii). Supplier shall ensure continued availability of the current PRODUCT
during the Term at the same or lower price as stated in Appendix D unless
otherwise agreed to pursuant to a written amendment to this Agreement
4. All such proposed changes to Appendix D shall be subject to Purchaser’s
written Agreement evidenced by a written amendment to this Agreement.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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          7.1.6 NEW TECHNOLOGY ADDITIONS Supplier may propose the addition of
New Technology to Appendix D which is not intended to replace or upgrade current
PRODUCT (“New Technology Addition”). Supplier shall provide a detailed written
explanation of how such New Technology Addition will meet the joint goal of
Continuous Improvement. All proposed New Technology Additions shall only be
furnished to Purchaser pursuant to a written Amendment to this Agreement or
pursuant to a separate written agreement between the parties.
     7.2 FIRM PRICE QUOTE Purchaser may utilize the Firm Price Quote (FPQ) for
any PRODUCT or SERVICES desired including, but not limited to, initial
installations, major rearrangements, Engineering, Installation Services, major
equipment removals or provisioning of complex systems. Purchaser will solicit an
FPQ from Supplier utilizing Supplier provided questionnaire or a complete
description of the PRODUCT and/or SERVICES requested six (6) weeks prior to the
date the Order is to be placed in accordance with the intervals to be mutually
agreed upon at the time of the FPQ.
     Supplier shall analyze the completed questionnaire and/or request and
provide to Purchaser an FPQ consistent with Purchaser’s requirements within four
(4) weeks of receipt of such questionnaire/request. The FPQ shall be detailed
and classified as to PRODUCT and/or SERVICES. Also included with the FPQ shall
be a proposed job schedule.
     Purchaser shall review the FPQ and accept or reject such quote within two
(2) weeks after receipt from Supplier. If the FPQ is acceptable to Purchaser,
Purchaser shall submit to Supplier an Order confirming ACCEPTANCE of such FPQ.
Other necessary engineering information shall be exchanged prior to the
scheduled ship date as mutually determined.
          7.2.2 EXCLUSIONS Exclusions from proposals or firm price quotes shall
be limited to work operations for which Purchaser is unable to provide quantity
until job start, such as the number of cross-connections. Supplier shall
acknowledge all such exclusions in the proposal or firm price quote and include
unit rates for all exclusion items.
     7.3 MOST FAVORED NATION Supplier represents that all of the prices,
warranties, benefits, terms and conditions granted to Purchaser by Supplier
hereunder will be as favorable as the prices, warranties, benefits, terms and
conditions granted to Supplier’s other commercial customers under like or
similar circumstances.
     If at any time during the term of this Agreement, Supplier shall offer more
favorable prices, warranties, benefits, terms, or conditions for substantially
the same or similar PRODUCT or SERVICES as those provided hereunder, then:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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1. Supplier shall, within thirty (30) days after the effective date of such
offering, notify Purchaser of such fact in accordance with Section 27.11 hereof,
entitled NOTICES, and offer Purchaser the more favorable offering and negotiate
any additional differentiating factors; and
2. this Agreement and all applicable Orders shall be deemed to be automatically
amended, effective retroactively to the effective date of the more favorable
offering, and Supplier shall provide the same prices, warranties, benefits,
terms and conditions to Purchaser; and
3. Purchaser shall have the right to decline to accept the offering, in which
event such automatic amendment shall be deemed to be void.
          Supplier’s compliance with this clause shall be subject, at
Purchaser’s option, to independent verification in accordance with the
Section 6.4 hereof, entitled RECORDS AND AUDIT.
     7.4 TERMS OF PAYMENT

  7.4.1   INVOICES FOR PRODUCT Supplier’s invoice for PRODUCT shall be paid net)
thirty (30) days from date of invoice, but in no event shall any invoice be
dated prior to shipment.     7.4.2   INVOICES FOR SERVICES Supplier’s invoice
for SERVICES shall be paid net thirty (30) days from receipt of invoice, but in
no event shall any invoice be dated prior to completion and ACCEPTANCE of
SERVICES.     7.4.3   DISTINGUISH PAYMENT AND ACCEPTANCE Payment by Purchaser of
such invoices does not mean or imply that the PRODUCT has been accepted and does
not impair or limit in any way Purchaser’s full rights and remedies of
ACCEPTANCE which shall be and remain as set forth in Article 13 hereof.    
7.4.4   INVOICES FOR FIRM PRICE QUOTES With respect to invoices for charges
associated with Price Commitment or Firm Price Quotes, Supplier agrees to
invoice Purchaser the applicable price(s), charges and fees, as reduced by any
applicable discounts, according to the following schedules or as mutually agreed
to by Purchaser and Supplier:

(1) One hundred percent (100%) of the charges for Services may be invoiced upon
completion of such Services to the satisfaction of the Purchaser.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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(2) One hundred percent (100%) of the charges for the PRODUCT shipped, including
associated transportation charges, invoiced upon shipping date.
     With respect to invoicing for SERVICES, Supplier agrees to render invoices
to Purchaser monthly, but not prior to the performance and ACCEPTANCE of said
SERVICES.
     With respect to invoicing for PRODUCT which is not associated with a Price
Commitment or Firm Price Quote, Supplier agrees to invoice Purchaser the
applicable price(s), charges and fees, as reduced by any applicable discounts on
the date of shipment of such PRODUCT.
     Supplier agrees to render separate invoices for each shipment or Order in
duplicate unless otherwise specified.
     Supplier shall render a “Records Only” final invoice within ninety
(90) days of job completion for each Order hereunder indicating that the
Purchaser should expect no further billing for the Order. Supplier shall not
render invoices subsequent to the final invoice without prior written approval
from Purchaser.
     Whether manual or mechanized, the invoice must contain the same information
as the detailed summary of Material furnished with Price Commitment/Firm Price
Quote. If the Supplier desires to issue mechanized invoices, the mechanized
invoice must conform to ANSI/TCIF Standards and Purchaser’s supplements to these
standards and transmitted in a mode specified by Purchaser.
     7.5 BILLING VERIFICATION AND AUTHORIZATION FOR PAYMENT PROCESS (“BVAPP”)
Whenever Purchaser issues an Order, the identification number of which is
prefaced by the letter “B,” the provisions of this clause “BVAPP” shall apply.
The required procedures and elements of BVAPP are listed in Appendix F. Whenever
the provisions of this clause conflict with any other clause in this Agreement,
the provisions of this clause shall prevail.
     Supplier shall code central office equipment and render billing as directed
by Purchaser.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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ARTICLE 8
TITLE, TRANSPORTATION & CONSIGNMENT
     8.1 TITLE AND RISK OF LOSS Title and risk of loss or damage to PRODUCT
purchased by Purchaser under this Agreement, or an Order issued pursuant to this
Agreement, shall vest in Purchaser on FOB, Origin or Origin Collect (OC) terms.
     If an Order requires additional SERVICES, such as unloading, hoisting and
rigging, installation or ACCEPTANCE testing to be performed by Supplier,
Supplier shall be responsible for loss or damage to the PRODUCT until such
SERVICES have been performed. Responsibility for such loss or damage shall be
governed by Article 21 hereof, entitled LIABILITY AND INSURANCE.
     When purchasing PRODUCT for shipment directly to an AFFILIATE, Purchaser
shall be acting solely as a purchasing agent for the AFFILIATE to which the
PRODUCT is to be shipped and title shall pass directly to that AFFILIATE.
Similarly, should an Order be issued by an AFFILIATE and accepted by Supplier,
title to direct ship PRODUCT shall pass from Supplier directly to the applicable
AFFILIATE(s). Under both circumstances, the receiving AFFILIATE shall be
entitled to all of the rights otherwise afforded to Purchaser under this
Agreement.
     8.2 F.O.B., Origin PRODUCT ordered by Purchaser’s PICS organization (for
example “B-P” or “B-A” Order numbers) or Material Distribution organization
(CAPP Order numbers) and Purchaser’s Engineering organizations (“TEO” Order
numbers) shall be shipped by Supplier, F.O.B., Origin shall be shipped by
Supplier, F.O.B., Origin from Supplier’s nearest facility capable of meeting
Purchaser’s requirements using the most cost effective common carrier (rail,
truck air or freight forwarder) with transportation charges prepaid by Supplier
and added as a separate item to the invoice to be paid by Purchaser, net of all
discounts, rebates, etc. received by Supplier from the carrier. For shipments
less than 150 pounds, Supplier shall use its approved small package
transportation company. Appendix J sets forth such approved shipping procedures.
     Supplier will use its best effort to ship via its most cost effective
method.
     Deviations from these instructions must be authorized by Purchaser’s
Transportation Organization. Excess transportation charges resulting from
Supplier’s failure to comply with these instructions will be billed back to
Supplier.
     In no event will Purchaser be liable for Premium shipping modes unless
previously authorized. Shipping and routing instructions may be altered, orally
or in writing, as mutually agreed upon by Supplier and Purchaser. If requested
by Purchaser, Supplier agrees
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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to substantiate such charges by providing Purchaser with the original freight
bill or a copy thereof.
          When Purchaser instructs Supplier to ship origin collect (OC),
Supplier will ship PRODUCT via the carrier designated by Purchaser.
          8.3 SCHEDULES Supplier shall establish standard and expedited delivery
schedules for the PRODUCT and SERVICES to be furnished under this Agreement as
set forth in Appendix E
               8.3.1 ACCELERATED DELIVERY In the event that an accelerated
delivery schedule is required by Purchaser in an interval less than that as
established for an expedited delivery (“Accelerated Delivery”), Supplier shall
comply with such requirements to the best of Supplier’s commercially reasonable
ability.
               8.3.2 NOTICE OF DELIVERY Supplier shall give written notice of
delivery to Purchaser at least fifteen (15) days prior to the scheduled date of
delivery of PRODUCT and SERVICES, assuming the Order is placed at least
seventeen (17) days in advance of the requested date for delivery.
               8.3.3 ANTICIPATORY FAILURE TO MEET DELIVERY SCHEDULE In the event
that the scheduled date of delivery will not be met, Supplier shall, within two
(2) days notify Purchaser as stated in Section 27.11 hereof, entitled NOTICES.
          8.4 SHIPPING AND BILLING Unless instructed otherwise by Purchaser,
Supplier shall, for Orders placed hereunder: (1) deliver entire quantity of
items ordered; (2) ship to the destination designated in the Order in accordance
with specific shipping instructions; (3) ensure that all subordinate documents
bear Purchaser’s Order number; (4) enclose a packing memorandum with each
shipment and when more than one package is shipped, identify the one containing
the memorandum; (5) mark Purchaser’s Order number on all packages and shipping
papers; (6) render itemized invoices in duplicate, or as otherwise specified,
showing Order number; (7) render separate invoices for each shipment or Order;
(8) invoice Purchaser by mailing or otherwise transmitting invoices, bills and
notices to the billing address on the Order after shipment of PRODUCT. Shipping
and routing instructions may be altered in writing, as mutually agreed by
Supplier and Purchaser.
          Supplier’s invoicing for SOFTWARE license fee and Application System
must reflect a differentiation between operating system SOFTWARE license fee and
applications SOFTWARE, according to the FCC mandated Uniform System of Accounts;
Part 32 of the FCC Rules and Regulations.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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          In addition, Supplier agrees to provide invoices that include priced
units of PRODUCT for use in the Continuing Property Record, the requirements of
which shall be specified by Purchaser.
          8.5 SHIPPING SCHEDULE The shipping schedule applicable to each Order
will be that set forth in the Order or any Change Order, if applicable. Supplier
agrees not to ship PRODUCT prior to the agreed-upon shipping schedule. Any
variation from the foregoing must be agreed upon by the parties in writing.
          8.6 INEXCUSABLE DELAY In the event Supplier fails to meet the
agreed-upon delivery date of PRODUCT or the agreed-upon completion date for
SERVICES and fails to cure such failure within any applicable cure period
herein, then Supplier shall be considered in breach of contract and subject to
default and Purchaser, at its option, may proceed in accordance with Article 19,
entitled DEFAULT.
          8.7 NOTICE OF DELAY Supplier, having agreed to the delivery date
and/or completion date, whichever is applicable, for any combination of PRODUCT
or SERVICES incorporated into Purchaser’s Order, further agrees to notify
Purchaser in accordance with Section 27.11 hereof, entitled NOTICES, as soon as
any foreseeable delay in that date becomes known to Supplier.
          8.8 PACKING Adequate protective packing and any special packing
required by law or governmental regulation for domestic shipment shall be
furnished by Supplier at no additional charge for PRODUCT purchased, repaired,
replaced or refurbished hereunder.
          The Supplier shall adhere to the following requirements for packaging
of PRODUCT:

1.   ME-000047NX, Purchaser’s Specification, “Packing, Packaging and
Palletization”, Issue 7, November 1991.   2.   GR-1421-CORE, Bell Communications
Research Generic Requirements, “ESD-Protective Circuit Pack Containers”, Issue
2, June 1995. Conditional/Objective Requirements CR4-33, O4-34, O4-41, O4-42,
O4-54, CR4-56, and O4-57 shall be required.

          In addition, all electronic plug-ins shipped separately from their
associated frames or mountings must be packaged at no additional charge using
electrostatic shielded packaging. Electrostatic shielded packaging is defined
herein as packaging that meets the requirements in the sections marked as
“Requirements” and “Conditional Requirements” as prescribed in GR-1421-CORE,
Issue 2,1995 (“Generic Requirements for ESD Protective Circuit Pack Containers”)
with the following exceptions:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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1. Section 4.6 and section 2.13.5: Purchaser does not require flame retardancy
in packaging.
2. Section 4.10.2: This section is a Purchaser requirement with an additional
requirement that the package contain an area to apply a TCIF standard 4”x 6”
adhesive label.
3. Section 4.10.4: This requirement is changed to read “Document Storage - Any
documents shipped with circuit packs must be enclosed in ESD protected material
or isolated from the circuit pack.”
          The Technical Advisory TR-NWT-000870 entitled “Electrostatic Discharge
Control in the Manufacture of Telecommunications Equipment” shall be used as the
model for ESD control techniques.”
          8.9 MARKING All PRODUCT and/or related packaging furnished hereunder
shall be marked for identification purposes with:
1. Model/part number and serial number, if applicable

2. Month and year of manufacture
3. Identification codes specified in Bell Communications Research Practices:
(1) GR-485-CORE, Issue 1, June 1994, entitled “Common Language Equipment Coding
Processes and Guidelines”
(2) TR-TAP-000383, Issue 4, July 1989, entitled “Generic Requirements for Common
Language Bar Code Labels”
4. Containers of MATERIAL shall be marked in accordance with the requirements
set forth in SR-NWT-2759, Issue 3, January, 1995, entitled “A View of Packaging,
Packing, Palletization and Marking Requirements”.
5. If applicable, Supplier shall show the SSI# (nine digit number for the
PRODUCT) on all preliminary and final packaging, packing slip, and invoices. The
SSI# shall be shown directly above the identification marking in the same size
print.
6. Other identification which might be requested by Purchaser.
7. In addition Supplier agrees to adhere to the following:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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(1) NX-00008TRG, Purchaser’s Specification, “Marking Specification”, Issue 7,
September 1993.
(2) NX-00138TRG, Purchaser’s Specification, “PRODUCT Marking Specification”,
Issue 1, September 1993.
(3) ST-STS-000124, Bell Communications Research Technical Reference, “Common
Language Codes for Frame Identification”, Issue 1, February 1989.
(4) TR-STS-000383, Bell Communications Research Technical Reference, “Generic
Requirements for Common Language Bar Code Labels”, Issue 5, January 1991.
(5) GR-485-CORE, Bell Communications Research Generic Requirements, “Common
Language Equipment Coding Processes and Guidelines”, Issue 2, October 1995.
(6) QPS 94.890, Bell Communications Research Quality Program Specification,
“Common Language Equipment Identification (CLEI)/Bar Code Labels”, Issue 4,
February 1990.
          8.10 BAR CODE PACKAGE LABELING Supplier shall label all unit,
intermediate and shipping containers in accordance with:

(1)   The following Telecommunications Industry Forum (TCIF) specifications:

     a. Shipping and Receiving Transaction Bar Code Label specification,
BC/93-001;
     b. Implementation Guideline to Package Labeling, BC/93-002;
     c. Product Package Label Specification, BC/89-003;
     d. Guideline for Identification and Bar Code Labeling of Cable Reels
(8/91), if applicable; and,

(2)   Purchaser’s specification:

          Packaging, Packing, Palletization and Marking Requirements,
specification SR-NWT-002759.
          Copies of the TCIF specifications may be obtained from TCIF/ATIS, 1200
G Street, N.W., Suite 500, Washington, DC 20005, 202-434-8844. A copy of the
Purchaser’s specification may be obtained from Purchaser. Failure by Supplier to
obtain said specifications shall not excuse Supplier from complying with this
section.
Supplier shall bar code all central office equipment which Supplier installs,
moves, removes, audits or otherwise handles (“handles”) in accordance with
Verizon standards. For Verizon
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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West (fGTE), those standards are set forth in Practices 007-220-001 (COE Bar
Code Methods and Procedures), 007-220-002 (COE Bar Code Equipment Movement
Tracking Procedures), and 007-220-003 (COE Bar Code Laptop Program Procedures)
which may be referenced on the Verizon COEI Web Site at
www22.verizon.com/documents/unpublished/coei/practices/. For Verizon East (fBA)
standards are set forth in Document Number 2002-002-COE and the ATS Equipment
Installation Vendor Guide, which may be referenced on the Verizon Vendor Web
Site at www.bellatlantic.com/coe_practices. Hereinafter, collectively Verizon
West and Verizon East standards shall be referred to as “the instructions.” If
Supplier handles central office equipment that requires bar-coding under the
instructions, Supplier shall ensure that each specific equipment item has an
acceptable serial number label applied, scanned and uploaded into the central
office equipment property/central office equipment model (COEP/COEMOD) database.
Supplier shall be responsible to ascertain if bar-coding is required for each
job, and if the required bar-coding is to comply with the Verizon East (fBA) or
the Verizon West (fGTE) requirements. Assistance can be obtained from the
appropriate Verizon/Supplier representative or the Verizon Help Desk.
Supplier shall be solely responsible to obtain the appropriate training for the
serialization program and shall inform VERIZON in writing that it has done so.
Upon VERIZON’s request, Supplier shall provide reasonable documentation of such
training. Supplier shall be solely responsible to obtain their own bar-coding
equipment and may order the required equipment from Verizon’s suppliers.
Supplier must obtain all equipment and software before attending any training
course provided through Verizon.
ARTICLE 9
ORDERS
          9.1 ORDERS Any written Order or statement of work (“Order”) issued by
Purchaser or its AFFILIATE(s) for PRODUCT and SERVICES which reference this
Agreement, shall be deemed to be placed under and incorporate the terms and
conditions of this Agreement.
          An Order for the purchase of PRODUCT and SERVICES shall be written on
a Purchaser’s Purchase Order form and shall contain the following:
1. The incorporation by reference of this Agreement, except that Purchaser’s
failure to specifically incorporate or identify the number of this Agreement on
any Order shall in no manner affect the applicability of these terms and
conditions;
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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2. A complete list of the PRODUCT and SERVICES to be purchased specifying
quantity, type, model, feature, description and purchase price, or, if
applicable, a completed Supplier-provided questionnaire;
3. The locations at which the PRODUCT and SERVICES will be delivered or
installed and to which invoices shall be forwarded;
4. The dates by which the PRODUCT and SERVICES are (a) to be shipped or
performed and (b) installed or completed and ready for use;
5. Any other special terms and conditions agreed upon by the parties.
     Orders placed for PRODUCT and SERVICES which are consistent with the terms
and conditions of this Agreement, shall be deemed accepted by Supplier unless
written notice to the contrary is received by Purchaser or its AFFILIATE(s)
within ten (10) business days of Supplier’s receipt of Order.
     Orders under this Agreement may from time to time be sent to Supplier by
any of Purchaser’s present or future AFFILIATES as are identified in writing.
Unless otherwise specified in writing, all provisions of this Agreement shall
apply to all written Orders for PRODUCTS and/or SERVICES specified herein.
     Supplier shall accept Purchaser’s Orders on any of the following bases:

  1.   Standard interval Orders for PRODUCT and/or SERVICES in accordance with
prices and ordering intervals contained herein, or where such prices do not
exist, then at prices agreed to by Purchaser and Supplier; or     2.   Short
interval Orders for PRODUCT and/or SERVICES required in less than standard
intervals at prices and intervals agreed to by Purchaser and Supplier; or     3.
  Accepted Firm Price Quote (FPQ), in accordance with Section 7.2 hereof,
entitled FIRM PRICE QUOTE; or     4.   Accepted Price Commitment in accordance
with Clause 7.1.3 hereof, entitled PRICE COMMITMENT.

     If Supplier is unable to accept any Order(s) or change to an Order(s),
Supplier shall provide Purchaser and/or its AFFILIATES with a written, verbal or
electronic notice of non-acceptance within ten (10) days of receipt of the
Order(s). Supplier’s notice of non-acceptance shall state the modifications
consistent with the terms of this
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Agreement necessary to make it acceptable. The proposed modifications shall not
be binding upon Purchaser until accepted by Purchaser in writing.
     Purchaser and its AFFILIATES shall have the right to change the locations
at which the PRODUCT and SERVICES will be delivered or installed and/or to which
invoices shall be forwarded at least 3 days prior to shipment at no additional
cost to Purchaser and/or its AFFILIATES. Supplier shall accept such changes and
forward a written acknowledgment of such changes to Purchaser or its AFFILIATE.
     9.2 VARIATION IN QUANTITY Purchaser assumes no liability for any PRODUCT
produced or processed in excess of the amount specified in an Order issued
pursuant to this Agreement, other than to notify Supplier of such excess amounts
and use commercially reasonable means to store such amounts pending collection
by Supplier.
     9.3 CANCELLATION OF ORDER Purchaser may, upon written notice to Supplier,
at any time prior to shipment, unless other terms and conditions have been
agreed to in writing in the applicable Purchase Order pursuant to Section 3.3,
cancel any or all Orders, or portions thereof, placed by Purchaser hereunder,
except with respect to PRODUCT which has already been delivered or SERVICES
which have already been completed and accepted. However the cancellation of any
individual Order(s) shall not affect the obligations of either party to the
other under any other existing Order(s). This Agreement shall continue in full
force and effect with respect to each Order(s) then in effect, and not canceled,
until the expiration of each such Order(s) pursuant to the terms of that
Order(s). The cancellation of any individual Order(s) shall not affect the
obligations of either party to the other under any other existing Order(s)
Purchaser’s liability to Supplier with respect to such canceled Order(s) shall
be limited to Supplier’s purchase price of all components which are not usable
in Supplier’s other operations or marketable to Supplier’s other customers.
Termination charges shall not be applicable to cancellation resulting from
Supplier’s default.
     9.4 [Intentionally Omitted]
     9.5 CHANGE ORDER
          9.5.1 CHANGE ORDER PROCESS Purchaser may at any time upon fifteen
(15) days written notice to Supplier, make any change within the scope of this
Agreement or any unfulfilled Order(s), including, without limitation, the
addition or deletion of SERVICES to be performed, the time and/or place of
performance, delivery or installation thereof. Any such Order shall be
specifically identified as a Change Order pursuant to this Article. Purchaser
may request Supplier to provide a written proposal, the cost of which shall be
solely borne by Supplier, stating the additional requirements or reduction of
existing requirements and the cost and schedule implications incident
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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thereto. Supplier agrees that the cost to Purchaser of the change shall be
mutually agreed to by the parties at the time of such requested change and
Supplier agrees that the cost to Purchaser of the change shall be mutually
agreed upon. If Purchaser is in agreement with the terms, conditions and charges
specified in the proposal, Purchaser will issue a Change Order pursuant to this
Agreement. In the event that Supplier has not identified any schedule
implications in the Proposal and the Change Order is issued at least fifteen
(15) days prior to the scheduled delivery date, the change(s) shall be
accomplished without affecting the original delivery date; unless otherwise
specified in the terms of an agreed upon Change Order if the Change Order is
issued less than fifteen (15) days from the scheduled delivery date, the
delivery date may be subject to change and Supplier will identify, upon receipt
of the Change Order, whether, and to what extent, any change in delivery date
will occur. All SERVICES covered hereunder shall be performed or supplied in
accordance with this Agreement and such changes thereto as are subsequently
authorized by a written Change Order issued by Purchaser. Nothing in this clause
shall excuse the Supplier from proceeding with the Agreement as changed.
          9.5.2 CUSTOM SOFTWARE CHANGE ORDERS For Change Orders incident Custom
Product Development as described in Section 15.2 hereof, entitled to CUSTOM
DEVELOPMENT OR MODIFICATION, Supplier’s proposal shall include (a) a statement
of Purchaser’s functional requirements and the software specifications; (b)
output formats; (c) description of documentation to be furnished; (d) fixed fee,
if any, for development of such custom product; (e) scheduled installation
dates; and (f) a listing which sets forth specifically the nature and goals of
each task to be performed by Supplier, when each shall be performed and the
Order of performance (hereafter “schedule”). Such schedule shall set forth the
amount of the fixed fee applicable to each stage and task and Purchaser shall
retain fifty (50) percent of each such amount until the custom software is
accepted by Purchaser. Purchaser shall render such retainage within thirty
(30) days following acceptance of the completed custom product.
          9.5.3 CHANGE ORDER ADJUSTMENTS Before the issuance of a Change Order
under this Agreement, Purchaser may request Supplier’s written agreement as to
the maximum (in case of an increase) or minimum (in case of a decrease)
adjustments to be made in the price and/or in the time of performance, by reason
of the change. Purchaser may also request an agreement limiting the adjustments
to any other provisions of the Order which may be subject to equitable
adjustment by reason of the change. Any such written agreement shall then be
cited in the Change Order, and upon its issuance shall be deemed to become part
of the Order. In making equitable adjustments pursuant to this clause, in no
event shall the definitive adjustment exceed the maximum price adjustments
and/or time of performance adjustments so established, nor otherwise be
inconsistent with other adjustment limitations so established.
          9.5.4 SUPPLIER’S RESPONSIBILITY Unless expressly stipulated elsewhere
in this Agreement as being excepted from this provision, wherever this
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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Agreement provides for submittal of designs, data including SOFTWARE, elements,
procedures, or other items for approval of Purchaser, such approvals shall not
be construed as a complete check as to the adequacy of said design, procedure,
practice or item, nor as a agreement that the design, procedure, practice or
items will meet the requirements of the Order or Change Order. Such approvals
are for the purpose of ensuring Purchaser’s knowledge of the Supplier’s plans
and progress and will indicate only that the Supplier’s general approach toward
meeting contractual requirements is satisfactory. Such approvals shall in no way
relieve the Supplier of the responsibility for any error or deficiency which may
exist in the submitted design, procedure, or other items, as the Supplier shall
be responsible for meeting all the requirements for the Agreement.
          9.5.5 ASSISTANCE OF PURCHASER’S PERSONNEL Purchaser’s engineering,
technical, and administrative personnel may from time to time render assistance
or give technical advice to, or effect an exchange of information with,
Supplier’s personnel in a liaison effort concerning the SYSTEM, PRODUCT or
SERVICES to be furnished hereunder. However, such exchange of information or
advise shall not vest Supplier with the authority to change the PRODUCT or
SERVICES hereunder or the provisions of the Agreement, and no change in the
PRODUCT or SERVICES or the provisions of the Agreement shall be binding upon
Purchaser unless incorporated as a change in accordance with Section 9.5 hereof,
entitled CHANGE ORDER. Only Purchaser is authorized to make a change to the
Agreement. Only Purchaser is authorized to initiate a Change Order to the
Agreement.
          9.5.6 CHANGE ORDER INFORMATION Requests for information related to
Change Orders shall be directed to:
John Birchler
Sourcing Process Leader
Verizon Corporate Sourcing,
240 East 38th Street, 14th Floor
New York, NY 10016
(212) 338-6789
or to his or her successor as designated by Purchaser.
     9.6 STOP WORK ORDER
          9.6.1 STOP ORDER PROCESS Purchaser may, at any time, by written Order
to the Supplier, delivered in accordance with the notice provisions of
Section 27.11 hereof, entitled NOTICES, unless other terms and conditions have
been agreed to in writing in the applicable Purchase Order pursuant to
Section 3.3, require the Supplier to stop all or any part of the WORK by the
applicable Order(s) for a period of up to ninety
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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(90) days after the Stop Work Order is delivered to the Supplier, and for any
further period to which the parties may agree. Any such Stop Work Order shall be
specifically identified as a Stop Work Order issued pursuant to this clause and
shall automatically extend the time of performance or the delivery date of such
WORK for a period equal to the period of the Stop Work Order.
          9.6.2 SUPPLIER’S RESPONSIBILITY Upon receipt of such a Stop Work
Order, the Supplier shall forthwith comply with its terms and take all
reasonable steps to minimize the incurring of costs allocable to the WORK
covered by the Stop Work Order during the period of work stoppage. Within a
period of ninety (90) days after a Stop Work Order is delivered to the Supplier,
or within any extension of that period to which the parties shall have agreed,
Purchaser shall either: (i) cancel the Stop Work Order and have Supplier resume
the WORK, or (ii) terminate the WORK covered by such Order as provided in
Section 9.3 hereof, entitled CANCELLATION OF ORDER.
          9.6.3 ADJUSTMENTS UPON RESUMPTION OF WORK If a Stop Work Order issued
under this clause is canceled or the period of the Order or any extension
thereof expires, the Supplier shall resume WORK. An equitable adjustment shall
be made in the delivery schedule or in the period of performance and in any
other provisions of the Agreement that may be affected, if the Stop Work Order
results in an increase in the time required for the performance of the WORK
covered by such Order.
     9.7 PURCHASER ADVICE In the course of performing the WORK and providing the
SERVICES, Supplier may receive advice from Purchaser concerning results to be
achieved and requirements to be met in the performance of the WORK. Supplier
shall comply with any advise consistent with the terms of this Agreement, but it
shall be the responsibility of Supplier’s representatives and supervisors to
give such instructions and directions as may be necessary or appropriate to
ensure that the work assignments of Supplier’s employees are properly carried
out in conformity with such advice.
     9.8 ELECTRONIC DATA INTERCHANGE Purchaser shall have the option of issuing
and Supplier shall accept, an Order, through an Electronic Data Interchange
(EDI). Purchaser may also issue a Change Order through an EDI. Potential EDI
transactions, at the discretion of Purchaser, shall include, but not be limited
to, Orders and Functional Acknowledgments. The party receiving any EDI other
than a Functional Acknowledgment shall acknowledge the EDI with a Functional
Acknowledgment. Failure of the sending party to receive a Functional
Acknowledgment of its transaction within seventy-two (72) hours, excluding
weekends and holidays, shall require the sending party to determine if the
transaction has been received. If the transaction has not been received, the
sending party shall retransmit the transaction. Supplier shall
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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acknowledge every transaction from Purchaser which is an Order or a Change Order
with a Positive Acknowledgment. A Positive Acknowledgment is an electronic data
transmission or a tangible written document sent from Supplier to inform
Purchaser that the transaction has been received and that Supplier accepts,
rejects, or accepts with modification the Order or Change Order.
ARTICLE 10
QUALITY ASSURANCE
     10.1 QUALITY COMMITMENT Commitment to quality is a primary requirement of
this Agreement and as used herein shall mean conformance to the terms,
conditions and SPECIFICATIONS of this Agreement. Purchaser will assure continued
Quality Improvement in the PRODUCTS and SERVICES purchased pursuant to this
Agreement. Supplier will demonstrate commitment to a Quality Improvement Process
by providing:
1. A published statement of its quality policy signed by an officer of the
company;

2. An established means of measuring and reporting customer satisfaction;
3. A quality training and awareness program;
4. A continuous Quality Improvement Process;
5. An established means of monitoring conformance to requirements for PRODUCTS
and SERVICES; and
6. An established PRODUCT Quality Inspection Program.
10.2 QUALITY SYSTEM The SUPPLIER shall document, implement and maintain a
quality control, assurance and improvement system which assures that the
SYSTEM(S), PRODUCT(S) and SERVICES provided to Purchaser meet all performance
standards and requirements, and perform in accordance with SPECIFICATIONS,
including, but not limited to those contained in Appendix L entitled “Quality,
Reliability and Engineering Specifications,” together with the following:
Telcordia documents, GR-1252, “Quality System Generic Requirements for
Hardware,” and TR-NWT-000179, “Quality System Generic Requirements for
Software.” Supplier shall be in compliance with all updates to such performance
standards and requirements, including all those listed in this Article 10
hereof, entitled QUALITY ASSURANCE, or in any appendix attached hereto, or as
currently denominated by Telcordia.
     Supplier agrees to allow Purchaser or Purchaser’s Agent to conduct periodic
on-site reviews at Supplier’s HARDWARE manufacturing and SOFTWARE development
facility(s) to verify compliance with SPECIFICATIONS. Supplier also agrees to
develop corrective action plans for any quality system deficiencies that may be
detected during these periodic on-site reviews, and submit such plans to the
Purchaser or Purchaser’s agent within
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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thirty (30) days after the review. Further, Supplier agrees to implement these
corrective action plans within six (6) months after the review.
     10.3 QUALITY PERFORMANCE REPORTING SUPPLIER agrees to provide, at no cost
to Purchaser, regular data reports which demonstrate the performance of the
Supplier’s PRODUCT while in development, manufacture and service, and the
adherence of the Supplier’s PRODUCT to the SPECIFICATIONS. Requirements for
collecting, calculating and reporting data are defined in documents listed in
Appendix L entitled QUALITY, RELIABILITY AND ENGINEERING SPECIFICATIONS.
     All required reports and data shall be delivered to Purchaser’s Supplier
Quality Management Organization at:
Supplier Quality Leader
Verizon Corporate Sourcing
240 E.38th Street, 14th Floor
New York, NY 10016
And to Purchaser’s Sourcing Process Organization at:
John Birchler
Sourcing Process Leader
Verizon Corporate Sourcing
240 E. 38th Street, 14th Floor
New York, NY 10016
     Supplier agrees to render other reasonable periodic reports for service
affecting conditions or other conditions that affect the operations and
administrative procedures of Purchaser or its AFFILIATES, or as otherwise
reasonably requested by Purchaser or its AFFILIATES. All provided information
related to such service affecting conditions shall be proprietary to Purchaser.
     10.4 SOURCE INSPECTION Source Inspection means that Purchaser shall have
the right to conduct due diligence inspection and testing at the Supplier’s, and
any of its subcontractors, facilities at any point(s) or on a continuing basis
as Purchaser may deem appropriate, provided that such inspection shall be during
reasonable business hours and shall be preceded by reasonably notice from
Purchaser of its intent to so inspect stating the locations and times of
inspections. Source Inspection applies to all PRODUCTS. Source Inspection will
be performed upon PRODUCT by a Purchaser’s representative. When requested,
SUPPLIER will furnish Purchaser full access to its facilities and those of its
subcontractors. Supplier will provide appropriate documentation to demonstrate
that the PRODUCT does conform to all
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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SPECIFICATIONS, and the Supplier’s projected failure rate, along with the test
data that substantiates the conformance of PRODUCT prior to shipment. Unless
Purchaser gives Supplier written notice to the contrary, Supplier shall notify
Purchaser when the PRODUCT is ready for inspection and Purchaser or its agent
shall be given reasonable opportunity to inspect the PRODUCT at any time prior
to shipment under agreed upon Quality Program Specifications listed in
Appendix L, entitled QUALITY, RELIABILITY AND ENGINEERING SPECIFICATIONS.
Inspection or failure to inspect on any occasion shall not affect Purchaser’s
rights under Article 14 hereof, entitled WARRANTY or any other provisions of
this Agreement.
     Supplier shall make available at no additional cost to Purchaser, such
production testing facilities, labor, data, specifications, procedures and such
other documents, and assistance as may be reasonably necessary for Purchaser or
its agent to perform inspection, as indicated in
Appendix L, entitled QUALITY, RELIABILITY AND ENGINEERING SPECIFICATIONS, In
addition, Supplier shall make available to Purchaser or its agent at no
additional charge, data obtained through Supplier’s normal routines which show
results of Supplier’s inspection, tests and audits of PRODUCT as specified in
the Quality Program Specifications. Such data shall be sufficient to demonstrate
that the PRODUCT meets all quality and reliability requirements.
     Where Purchaser’s Supplier Quality Management finds received PRODUCTS do
not meet SPECIFICATIONS, the reasonable, out-of-pocket costs of inspection and
testing, replacement and shipping shall be incurred by the Supplier as may be
mutually agreed upon by the parties.
     Purchaser reserves the right to have the Supplier inspect and test 100% of
their PRODUCT at their cost in cases where PRODUCT does not meet SPECIFICATIONS.
     10.5 PRODUCT TESTING All PRODUCT shipped to Purchaser shall receive
Supplier testing to demonstrate functionality, quality and reliability. The
Supplier’s test environment shall emulate or simulate the Purchaser’s actual
PRODUCT application/usage conditions as identified in the SPECIFICATIONS.
Supplier’s testing shall be of a sufficient magnitude and duration to
demonstrate full PRODUCT feature functionality in accordance with
SPECIFICATIONS. If Supplier’s quality level for this final test stage does not
conform to the SPECIFICATIONS, then Supplier shall notify Purchaser immediately
of such no- conformance before PRODUCT shipment, and Purchaser will advise
Supplier as to the disposition of this PRODUCT (accept or not accept).
     10.6 QUALITY SURVEILLANCE Supplier agrees to quality system surveillance
activities through Purchaser or its agent designated by Purchaser to demonstrate
that that the quality system is achieving results consistent with product
quality, engineering and reliability requirements. The scope and frequency of
these surveillance activities will be
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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based on the Supplier achieving and maintaining consistent and stable qualify
and reliability results.
     10.7 [Intentionally Omitted]
     10.8 COMPLAINTS
          10.8.1 ENGINEERING COMPLAINTS The Supplier shall handle all
Engineering Complaints (EC) submitted by Purchaser in accordance with GR230,
Issue 2, as modified below, together with such further and additional
requirements set forth in Appendix L hereto, entitled Quality, Reliability and
Engineering Specifications.
a) Verizon recognizes (Section 2.1.R2-1, Applicable Use of Engineering
Complaints; Section 2.2. CR.-2, Emergency or Special Handling; Section 2.3.R2-3
Non-Applicable Uses of Engineering Complaints: and Section 2.5.3. R2-9 EC
Confirmation Report-EO-150) as guidelines and typical examples, “NOT” as
requirements or objectives:
b) Verizon “DOES NOT” recognize (Section 2.5.4.R2-11, EC Interim Report-EO-151)
the Supplier shall notify Verizon of a proposed Action Plan for the Complaint
within 15 days of receipt.
In addition the following requirements shall be adhered to:
     In the event that a Purchaser’s Engineering Complaint (EC) is marked
“SERVICE EMERGENCY,” then Supplier agrees to exert effort which goes beyond that
which is customarily provided to resolve the EC. Such effort will be consistent
with the level of effort the Supplier will furnish to support Purchaser and its
AFFILIATES under the Section 12.3 hereof, entitled REPAIRS AND REPLACEMENT and
Article 17 hereof, entitled EXTRAORDINARY SUPPORT.
     Upon receipt of Purchaser’s EC identified as a fire or safely hazard,
Supplier agrees to acknowledge receipt of such EC and to respond within
twenty-four (24) hours. This response shall include the proposed remedy or
proposed corrective action to resolve the stated problem, or the date when the
accepted solution will be completed.
     In the event the Supplier anticipates that the proposed solution to the EC
will exceed thirty (30) days, then Supplier shall, once every two weeks, issue
an Interim Report to Purchaser, reporting actions taken and progress made during
the reporting period. In addition, such reports will indicate the date by which
Supplier anticipates that the ongoing EC study will be successfully concluded.
NOTICE; Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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     Supplier shall create and maintain a tracking system that records and
summarizes all event surrounding any EC submitted by Purchaser. Supplier shall
also provide Purchaser with on-going reports at monthly intervals as to what
manifested the EC, what remedial actions were made by Supplier as a result of
the Complaint and what was the result of those remedial actions. The overall
progress and performance results shall be reviewed by Purchaser and Supplier to
evaluate the overall quality of the process.
     Upon ACCEPTANCE of Supplier’s resolution by Purchaser, Supplier shall
implement necessary changes within thirty (30) days.
     If Purchaser or its AFFILIATE disagree with Supplier on the implementation
schedule and/or resolution of Complaint, Purchaser or its AFFILIATE shall have
the right to escalate the matter for review on the implementation schedule,
validity of the complaint, and/or resolution to higher management in accordance
with Article 28 hereof, entitled ALTERNATE DISPUTE RESOLUTION.
          10.8.2 SUPPLIER QUALITY COMPLAINTS In the event Purchaser determines
that PRODUCT furnished hereunder does not perform in a satisfactory manner or is
unsatisfactory in other respects, Purchaser may issue a Supplier Quality
Complaint (SQC) in writing to notify Supplier. Supplier shall provide an
acknowledgment to Purchaser within ten (10) days of receipt. Within twenty
(20) days the Supplier shall provide a final report specifying, as required, the
change in design, manufacturing process or installation and/or engineering
instructions required to address Purchaser’s SQC. The report will include the
root cause of the SQC, condition and a plan for immediate corrective action to
correct the SQC, and a long term plan to ensure continued quality PRODUCTS are
provided.
     Nothing herein shall obviate Supplier’s obligations under Section 11.2
hereof, entitled CHANGES TO HARDWARE OR SOFTWARE/PRODUCT CHANGE NOTICES (PCN’s),
Section 12.3 hereof, entitled REPAIR AND REPLACEMENT, and Article 14 hereof,
entitled WARRANTY.
     Purchaser’s points of contact for all complaints information and
correspondence shall be:
Supplier Quality Leader
Verizon Corporate Sourcing
240 East 38th Street, 14th Floor
New York, New York 10016
     and:
Sourcing Process Leader
Verizon Corporate Sourcing
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed,
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 37 of 98
240 East 38th Street, 14th Floor
New York, New York 10016
     10.9 CONTINUOUS IMPROVEMENT PLAN Supplier shall have a written plan for
continuously assessing and improving the quality and reliability of PRODUCT.
Supplier’s Quality Improvement Plan (QIP) shall incorporate and use a well
defined and written set of metrics, approved by Purchaser’s Supplier Quality
Leader (SQL.) This plan will assess internal development data and field
performance data used to improve Supplier’s performance. Metric collection,
analysis and reporting should be conducted on a continual basis. Both file
performance and in-process data shall be utilized.
     All information, including, but is not limited to, plans, procedures and
results, in Supplier’s QIP shall be made available upon reasonable request from
Purchaser.
ARTICLE 11
TECHNICAL AND ENGINEERING ISSUES
     11.1 CONTROLLED INTRODUCTION Upon Purchaser’s request, Supplier agrees to
submit an evaluation copy of initial SOFTWARE Code Corrections, Upgrades, or
Enhancements intended for introduction in Purchaser’s network to Purchaser’s
Manager - Transport Technology or Purchaser’s Agent, for evaluation purposes at
a mutually agreed to date prior to placing such SOFTWARE Code Corrections,
Upgrades or Enhancements on any PRODUCT covered by the applicable Product
Specific Agreement.
     There shall be no fees associated with the SOFTWARE evaluation copy
provided by Supplier and such evaluation shall in no way oblige Purchaser to
subsequent charges or contingencies regardless of the results of the evaluation.
At the end of the evaluation period, Purchaser will either return the SOFTWARE
evaluation copy and all RELATED DOCUMENTATION to Supplier or issue an Order for
such SOFTWARE.
     Within sixty (60) days of receipt of evaluation SOFTWARE, Purchaser will
advise Supplier in writing of the acceptability or non-acceptability of such
SOFTWARE provided for use in Purchaser’s network. In the event that any
evaluation SOFTWARE is unacceptable to Purchaser, Supplier shall not furnish
such SOFTWARE on any of Purchaser’s Orders during the evaluation or thereafter
without prior written approval from Purchaser’s Manager, Transport Technology.
     11.2 CHANGES TO HARDWARE OR SOFTWARE/PRODUCT CHANGE NOTICES(“PCNs”)
Supplier shall notify Purchaser in writing of any changes to PRODUCT in
accordance with Bell Communications Research, GR-209-
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 38 of 98
CORE, “Generic Requirements for PRODUCT Change Notices”, Issue 2, January 1996.
In addition the following provisions shall apply:
     Supplier shall propose a schedule for the application of these changes at
all PRODUCT locations, which schedule shall be mutually agreed upon with
Purchaser prior to implementation.
     If Supplier develops a Method Of Procedure (MOP) for the change, the MOP
shall be provided to Purchaser with the PCN. Any related Engineering Complaint
Number shall be included on the PCN form.
     If Purchaser disagrees with the nature of, or with the classification which
Supplier assigns to, a change in PRODUCT, Purchaser shall have the right to
escalate the matter for review, reclassification, and resolution to higher
levels of management in accordance with the Article 28 hereof, entitled
ALTERNATE DISPUTE RESOLUTION.
     DOCUMENTATION changes, required to satisfy Supplier’s obligations to
provide Class A and AC changes to PRODUCT as specified herein, shall be provided
by Supplier at no charge to Purchaser.
     For those changes classified as “B” or “D”, Supplier shall notify Purchaser
in writing one hundred and twenty (120) days prior to the effective date of such
change to be made in the PRODUCT furnished under an Order.
     For Class A, Class AC and Class B changes, Supplier shall first notify
Purchaser of the exact nature of the change. Details of the proposed
implementation procedure for PRODUCT which is being or will be manufactured
shall be discussed with Purchaser within the notification time periods stated in
the first section above. Should replacement or modifications be mutually deemed
necessary, Supplier shall make arrangements for the necessary PRODUCT
replacement or modification at prices and schedules to be mutually agreed upon
with Purchaser prior to implementation.
     In the event that Purchaser does not desire any such change, Purchaser
shall notify Supplier in writing within sixty (60) days from the date of receipt
of notification and Supplier shall not furnish any such changed PRODUCT to
Purchaser pursuant to any Orders. Purchaser may extend the sixty (60) day period
if Purchaser is unable to respond within such period.
     Supplier shall notify Purchaser in writing when implementation of each
field change has been completed at all affected locations.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 39 of 98
     All correspondence relating to changes to PRODUCT shall be sent to the
following individuals or their successors as appointed by Purchaser:
Sourcing Process Leader
Verizon Corporate Sourcing
240 East 38th Street, 14th Floor
New York, NY 10016
(212) 338-6789
ARTICLE 12
INSTALLATION AND SUPPORT
     12.1 TECHNICAL SUPPORT Technical Support shall be provided as set forth in
this Section and Appendix B hereto, entitled Statement of Work; provided
however, that the availability or performance of this technical support SERVICE
shall not be construed as reducing Supplier’s obligations as set forth in
Article 14 hereof, entitled WARRANTIES or elsewhere provided for in this
Agreement.
     Supplier’s technical support SERVICES for PRODUCT and SERVICES shall
include telephone and emergency (service affecting) support twenty-four
(24) hours, seven (7) days assistance.
     During the warranty period, Supplier shall provide technical support to
Purchaser without charge to correct warranty defects.
     During any SYSTEM or PRODUCT installations identified by Purchaser,
Supplier shall provide, on an as-requested basis and as mutually agreed upon
on-site technical advisors at each of the wire center sites to assist Purchaser
during the installation and ACCEPTANCE PERIODS to ensure SYSTEM and PRODUCT
performance in accordance with SPECIFICATIONS. Non-Emergency requests fcr
ACCEPTANCE assistance, as required, must be made at least 5 days prior to the
scheduled date.
          12.1.1 FULL SUPPORT DURING ENGINEERING, INSTALLATION AND CONVERSION
PERIODS Prior to installation and during installation, testing and Acceptance
Periods, Purchaser and/or its agent shall be provided installation and technical
support SERVICES, DOCUMENTATION and RELATED DOCUMENTATION as specified below:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 40 of 98
1. Twenty-four (24) hours per day, seven (7) days per week, Supplier shall
provide telephonic technical support SERVICES from its Technical Assistance
Center (TAC) utilizing Supplier’s technical information for installation,
testing, operation, maintenance, use, and analysis, all at no charge to
Purchaser. Supplier shall provide, upon request as may be mutually agreed upon,
on-site technical personnel during cutover/in-service weekend (48 hours post
cutover/in-service), and for three (3) weeks thereafter to ensure SYSTEM and
PRODUCT performance.
2. Supplier agrees that in the event PRODUCT does not perform in accordance with
the SPECIFICATIONS or is otherwise defective, then Supplier will provide on-site
technical support, at no charge to Purchaser.
               12.1.2 POST ACCEPTANCE SUPPORT After ACCEPTANCE by Purchaser,
Supplier shall provide on-going, in-service technical support SERVICES and
DOCUMENTATION as specified below:
12.1.2.1 IN WARRANTY
1. Supplier shall make available telephonic Technical Assistance Center
(TAC) SERVICE, twenty-four (24) hours per day, seven (7) days per week,
utilizing Supplier’s technical information for installation, testing, operation,
maintenance, use, and analysis, all at the no charge to Purchaser.
2. In the event of an emergency or service-affecting condition involving the
SYSTEM or PRODUCT, Supplier shall provide immediate technical support and shall
work continuously until such emergency and/or service-affecting condition is
remedied.
12.1.2.2 OUT OF WARRANTY
1. Supplier shall make available telephonic Technical Assistance Center
(TAC) SERVICE, twenty-four (24) hours per day, seven (7) days per week,
utilizing Supplier’s technical information for installation, testing, operation,
maintenance, use, and analysis, at the rates and charges mutually agreed to as
set forth in Appendix D hereto, entitled Pricing, or if not specifically set
forth thereon, at Supplier’s then current rates for such services, subject to
Supplier’s obligations under Section 7.3 hereof.
2. Non-warranty technical support SERVICE charges shall be as shown in
Appendix D or if not specifically set forth thereon, at
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 41 of 98
Supplier’s then current rates for such services, subject to Supplier’s
obligations under Section 7.3 hereof.
3. In the event of an emergency or service-affecting condition involving the
SYSTEM or PRODUCT, Supplier shall provide immediate technical support and shall
work continuously until such emergency and/or servicing-affecting condition is
remedied.
               12.1.3 ESCALATION PROCEDURE Purchaser may call the following
telephone number(s) for emergency technical assistance or TAC Support, or to
escalate any problem at any time interval: 800-544-6831. In furtherance of this
procedure, Supplier shall provide Purchaser with an escalation procedure and
list within thirty (30) days of execution of this Agreement by Purchaser and
Supplier, that is agreed upon and satisfactory. Furthermore Supplier shall keep
Purchaser updated as to all changes to such procedure and list.
               12.1.4 CONTINUING TECHNICAL SUPPORT In addition to Supplier’s
obligations under Article 14 hereof, entitled WARRANTIES, Purchaser shall be
entitled to technical maintenance and support for a period of ten (10) years
after expiration or termination of this Agreement at Supplier’s then current
standard prices for such service.
     12.2 SOFTWARE SUPPORT After ACCEPTANCE by Purchaser, Supplier shall provide
SOFTWARE support SERVICES and DOCUMENTATION as specified below:
               12.2.1 IN WARRANTY Supplier shall provide the following to
Purchaser, at no cost, during the SOFTWARE warranty period as set forth in
Section Article l4.8 hereof, entitled WARRANTY PERIOD:
CODE CORRECTIONS — Code corrections will be supplied to Purchaser to correct
SOFTWARE malfunctions to bring such SOFTWARE into conformance with the
SPECIFICATIONS.
SOFTWARE UPGRADES — All upgrades by Supplier to the SOFTWARE shall be furnished
to Purchaser at no cost. For the purposes of this paragraph, “upgrades” shall
mean improvements in the SOFTWARE which relate to operating performance but do
not change the basic function of the SOFTWARE. Supplier shall at the same time
provide updated RELATED DOCUMENTATION which reflects such upgrades.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page: 42 of 98
SOFTWARE ENHANCEMENTS — To supply any change in any part of the SOFTWARE and/or
RELATED DOCUMENTATION which improves the basic function of the SOFTWARE.
SOFTWARE RELEASES — The distribution of upgrades and/or enhancements to such
SOFTWARE (“Releases”).
CONSULTING — To supply consulting assistance in the event of difficulties in the
use of the SOFTWARE or in the interpretation of results of such SOFTWARE. If
on-site assistance is required and the problem is the failure of the SOFTWARE to
perform to SPECIFICATIONS, no charge will be made. If the problem is due to the
fault or negligence of Purchaser, Supplier’s then current consulting rates for
such Services will be applicable.
     Supplier shall furnish to Purchaser all code corrections, upgrades and
enhancements made available by Supplier to any of its customers and promptly
correct any defects in workmanship or design or ability in the course of the use
of the SOFTWARE.
          12.2.2 OUT OF WARRANTY Supplier shall provide the following, at the
rates and charges mutually agreed to as set forth in Appendix D hereto, entitled
Pricing, or if not specifically set forth thereon, at Supplier’s then current
rates for such services, subject to Supplier’s obligations under Section 7.3
hereof, to Purchaser following the expiration of the SOFTWARE warranty period as
set forth in Section 14.8 hereof, entitled WARRANTY PERIOD:
CODE CORRECTIONS — Code corrections will be supplied to Purchaser to correct
SOFTWARE malfunctions to bring such SOFTWARE into conformance with the
SPECIFICATIONS.
SOFTWARE UPGRADES — All upgrades by Supplier to the SOFTWARE shall be furnished
to Purchaser. For the purposes of this paragraph, “upgrades” shall mean
improvements in the software which relate to operating performance but do not
change the basic function of the SOFTWARE. Supplier shall at the same time
provide updated RELATED DOCUMENTATION which reflects such upgrades.
SOFTWARE ENHANCEMENTS — To supply any change in any part of the SOFTWARE and/or
RELATED DOCUMENTATION which improves the basic function of the SOFTWARE.
SOFTWARE RELEASES — The distribution of upgrades and/or enhancements to such
SOFTWARE (“Releases”).
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 43 of 98
CONSULTING — To supply consulting assistance in the event of difficulties in the
use of the SOFTWARE or in the interpretation of results of such SOFTWARE. If
on-site assistance is required and the problem is the failure of the SOFTWARE to
perform to SPECIFICATIONS.
     12.3 REPAIRS AND REPLACEMENT The following provisions define the Supplier’s
obligations during the applicable warranty period, as set forth in Article 14
hereof, entitled WARRANTIES, to ensure SYSTEM and PRODUCT performance in
accordance with SPECIFICATIONS of the parties when, under normal and proper use,
a defect or non-conformity appears in PRODUCT.
     Replacement and repaired PRODUCT shall be warranted as set forth in
Article 14 hereof, entitled WARRANTIES.
     Supplier acknowledges that this Agreement does not grant Supplier an
exclusive privilege to repair any or all of the PRODUCT purchased and/or
licensed hereunder for which Purchaser may require repair.
          12.3.1 REPAIR AND REPLACEMENT PROCEDURES During the installation of
PRODUCT ordered under this Agreement, defective PRODUCT will be replaced with
new PRODUCT, at no charge to Purchaser. For purposes of this Agreement, “new
PRODUCT” shall mean PRODUCT directly from the manufacturing assembly line or
from Supplier’s finished goods inventory, provided that said PRODUCT has not
been previously repaired or reconditioned.
     All transportation charges for, and risk of in-transit loss or damage to,
PRODUCT returned to Supplier for repair/replacement under this clause shall be
borne by Purchaser.
     Supplier shall adhere to QPS 82.061, Bell Communications Research Quality
Program Specification, “Repair and Return Operations of Telecommunications
PRODUCTS — General”, Issue 2, March 1985, or the most current issue of Bell
Communications Research Quality Program Specification relating thereto, when
repairing PRODUCT.
     Purchaser shall furnish the following information with PRODUCT returned to
Supplier for repair:
1. Purchaser’s name and complete address;
2. name(s) and telephone number(s) of Purchaser’s employee(s) to contact in case
of questions about the PRODUCT to be repaired;
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 44 of 98
3. reference to Purchaser’s Order number, if applicable;
4. ship to address for return of repaired or replacement PRODUCT if different
from 1.;
5. a complete list of PRODUCTS returned;
6. the nature of the defect or failure, if known.
     PRODUCT repaired by Supplier shall have the repair completion date
stenciled or otherwise identified in a permanent manner at a readily visible
location on the PRODUCT to the extent practicable; otherwise it shall be
indicated in documentation accompanying the PRODUCT. The repaired PRODUCT shall
be returned with a tag or other documentation describing the repairs or
affirming that the required repairs have been made.
     Supplier shall maintain a record of all No Trouble Founds (“NTFs”) which
permits tracking of NTFs to assure that any PRODUCT that has been categorized as
an NTF for the third time is not returned to Purchaser for future deployment.
Supplier shall also publish these results in a monthly summary report and
forward such report to:
John Birchler
Sourcing Process Leader
Verizon Corporate Sourcing,
240 East 38th Street, 14th Floor
New York, NY 10016
(212) 338- 6789
     Supplier shall provide Purchaser’s Supplier Quality Management a monthly
report of PRODUCT repaired and returned by PRODUCT line and CLEI code with
projected Failure in Time (“FIT”) rate of PRODUCT.
     When requested in the Order, Supplier shall hold replaced parts for
inspection or return to Purchaser at prices and terms to be agreed upon.
          12.3.2 IN WARRANTY The following provisions define the obligations of
the parties in the event, under normal and proper use, a defect or
non-conformity appears in PRODUCT during the applicable warranty period, as set
forth in Article 14 hereof, entitled WARRANTIES.
1. Purchaser must notify Supplier in writing of the claimed defect or
nonconformity of PRODUCT not later than thirty (30) days after the expiration of
the applicable warranty period.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 45 of 98
2. Supplier shall provide written instructions covering return of PRODUCT.
3. Supplier shall:
(1) at Purchaser’s option either repair, replace or correct the PRODUCT without
charge at its manufacturing or repair facility within five (5) working days.
Where defective or nonconforming PRODUCT is readily returnable, it shall be
removed and sent to Supplier by Purchaser in accordance with instructions for
return of PRODUCT provided by Supplier in 12.3.2.2 above, at Purchaser’s expense
and Purchaser’s risk of loss or damage.
          12.3.3 OUT OF WARRANTY Supplier agrees to provide repair or
replacement SERVICES and replacement parts for all PRODUCT ordered hereunder at
the prices in Appendix D, or if not specifically set forth thereon, at
Supplier’s then current rates for such services, subject to Supplier’s
obligations under Section 7.3 hereof, for the effective period of the Agreement
and thereafter at Supplier’s then current list prices, as long as Supplier is
still furnishing such PRODUCT or replacement parts, but in no event for less
than the minimum support periods set forth in Section 20.3 hereof, entitled
CONTINUING AVAILABILITY.
     PRODUCT to be repaired under this clause will be shipped by Purchaser to a
location designated by Supplier, and unless otherwise agreed, Supplier shall
return ship the repaired or replacement PRODUCT within thirty (30) days of
receipt of the defective PRODUCT or pursuant to a mutually agreed upon schedule.
     Where defective or non-conforming PRODUCT is readily returnable, it shall
be removed and sent to Supplier by Purchaser in accordance with instructions for
return of PRODUCT provided by Supplier, at Purchaser’s expense and Purchaser’s
risk of loss or damage. Supplier shall return the PRODUCT to Purchaser at a
destination within the contiguous forty-eight United States at Supplier’s
expense.
     If PRODUCT is returned to Supplier for repair as provided for in this
clause, and is determined to be beyond repair, or repair costs are expected to
exceed fifty percent (50%) of the cost of replacement, Supplier shall so notify
Purchaser prior to making the repair.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 46 of 98
     Invoices originated by Supplier for repair SERVICES for PRODUCT out of
warranty must be clearly identified as such, and must contain:
1. a reference to Purchaser’s Order for these repair SERVICES;
2. a description of services rendered by Supplier; and
3. an itemized listing of parts and labor charges, when repairs are done on a
time and material basis.
     If requested by Purchaser, Supplier shall dispose of unrepairable PRODUCT,
consistent with sound commercial practices, and remit to Purchaser the net
salvage value, if any.
     12.4 ENGINEERING SERVICES
          12.4.1 DEFINING ENGINEERING SERVICES Engineering SERVICES used herein
shall include but not be limited to Supplier’s preparation of installation
specifications, preparation and/or updating of office records including drafting
Services, as required, preparation of a Summary of PRODUCT including
Miscellaneous PRODUCT not specifically itemized in Purchaser’s Order but
necessary for the proper functioning of PRODUCT.
     Engineering SERVICES may be ordered separately or in combination with
installation SERVICES and/or PRODUCT.
          12.4.2 OFFICE RECORDS Supplier shall establish and maintain records of
PRODUCT in accordance with Information Publication No. 72008, Central Office
Record Controls and Standards.
          12.4.3 SCHEDULING FOR ENGINEERING SERVICES Supplier will acknowledge
acceptance of Purchaser’s Order within two (2) weeks after receipt Supplier
shall provide a firm schedule for performance of such Engineering SERVICES not
later than six (6) weeks after receipt of an Order, except in cases where the
SERVICES are requested on a short interval basis.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 47 of 98
          12.4.4 STANDARDS FOR ENGINEERING SERVICES Supplier agrees to perform
Engineering SERVICES in accordance with the Installation Standards provided
and/or approved by Purchaser. Such Installation Standards are contained in
Central Office Engineering Standards, Information Publication 72013, and Central
Office Record Controls and Standards, Information Publication 72008, which
Purchaser will make available to Supplier.
          12.4.5 WARRANTY FOR ENGINEERING SERVICES Supplier warrants to
Purchaser that Engineering SERVICES provided hereunder shall be performed in a
fully workmanlike manner to Purchaser’s satisfaction and in accordance with the
specifications and standards incorporated herein. Supplier further warrants that
such Engineering SERVICES shall be free from defects in workmanship for a period
of two (2) years from the date such Engineering SERVICES are completed and
accepted by Purchaser. This warranty shall survive ACCEPTANCE and payment.
     If any Engineering SERVICES provided hereunder prove unacceptable to
Purchaser, Purchaser shall so notify Supplier in writing. Supplier shall, at no
additional charge, promptly take the action required to correct the deficiency.
After the corrective action, Purchaser shall have the right to re-determine
acceptability. ACCEPTANCE of Engineering SERVICES does not constitute a waiver
of Supplier’s responsibility to correct deficiencies which may be found
subsequent to ACCEPTANCE.
          12.4.6 DETAIL ENGINEERING BY SUPPLIER The Supplier shall provide full
Detail Engineering SERVICES as described in Appendix G entitled Detail
Engineering, Office Records, to be mutually agreed to by the parties and be made
part hereof if Detail Engineering Services are to be provided by Supplier, upon
request of Purchaser, consisting of writing a detailed specification, creating
and/or updating central office drawings and records, including the Equipment
Inventory Update (“EIU”) form and the ordering of all materials and equipment
needed to complete the job in compliance to Purchaser’s requirements, methods,
procedures and standards.
          12.4.7 DETAIL ENGINEERING BY SUPPLIER USING A PURCHASER
CERTIFIED/APPROVED SUPPLIER When detail engineering is performed by the
Supplier, the Supplier shall be responsible for all detail engineering and
agrees to use a Purchaser certified or approved detail engineering
sub-contractor to provide full Detail Engineering SERVICES as described in
Appendix G hereto, entitled Detail Engineering, Office Records, to be mutually
agreed to by the parties and be made part hereof if Detail Engineering Services
are to be provided by Supplier, consisting of writing a detailed specification,
creating and/or updating central office drawings and records, including the
Equipment Inventory Update (“EIU”) form and the ordering of all materials and
equipment needed to complete the job in compliance to Purchaser’s requirements,
methods, procedures and standards.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 48 of 98
          12.4.8 DETAIL ENGINEERING BY PURCHASER AND/OR ITS AGENTS When detail
engineering is performed by Purchaser and/or its agents, the Supplier shall
provide engineering support by making available to Purchaser, and/or its agents,
all documentation and drawings as may be necessary to engineer the equipment
into the network, at no additional cost.
     12.5 INSTALLATION BY SUPPLIER Supplier shall provide such installation
SERVICES as are identified in Appendix G, to be mutually agreed to by the
parties and be made part hereof if Detail Engineering Services are to be
provided by Supplier, or as would be carried out under Section 9.5 hereof,
entitled CHANGE ORDER, and which are consistent with Purchaser’s labor
agreements either utilizing its own personnel or a third party supplier,
approved by Purchaser, as a sub-contractor.
          12.5.1 DURING INSTALLATION During installation, Purchaser a shall be
given the opportunity to observe, witness and review the tests performed by
Supplier’s installation forces, and review all test results and trouble reports
to ensure conformity to SPECIFICATIONS. Purchaser shall have early access to the
SYSTEM and PRODUCT to perform joint testing with Supplier, as well as
Purchaser’s own independent testing of work completed by Supplier.
     During the installation and Acceptance Periods, Purchaser shall be provided
installation support SERVICES and technical support SERVICES at no additional
charge by Supplier. Installation and technical support SERVICES provided by
Supplier shall be as follows:
1. Supplier shall provide at no charge to Purchaser telephonic Technical
Assistance Center (TAC) SERVICE, which shall be available twenty-four (24) hours
per day, seven (7) days per week; and
2. Supplier shall provide at no charge, as requested by Purchaser, a project
manager to represent Supplier on all matters; and
3. Supplier shall provide, as requested by Purchaser, technical personnel during
cutover/in-service weekend (48 hours post cutover/in-service) to ensure SYSTEM
and PRODUCT performance, at no charge to Purchaser.
          12.5.2 PRIOR TO CUTOVER Prior to cutover and field installation,
Supplier shall perform heat and load testing approved by Purchaser. Load testing
shall demonstrate to Purchaser that the SYSTEM or PRODUCT meets the traffic
capacity for
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 49 of 98
which the SYSTEM or PRODUCT was specified and to particular service application
engineering specific to the SYSTEM or PRODUCT. This traffic carrying capacity is
specified by the Planning Engineer by Originating and Terminating (O+T), CCS per
main station, call attempts, number of main stations, and service arrangements
including non-switch requirements. Supplier shall meet with Purchaser (Early Job
Conferences, contact meetings, test and analysis meetings) to collect all
essential information needed and to jointly prepare a Method of Procedure (MOP).
Supplier and Purchaser shall plan all aspects of the job and a sequence of
performance to complete the job on schedule, which is understood and mutually
agreeable to both parties. All job requirements shall be discussed, resolved and
approved by Purchaser at these preliminary meetings, including schedules
(Ordering, installation start, in-progress job status, completion, etc.),
quality, technical and performance issues, workmanship, load testing, and
ACCEPTANCE testing. Heat testing on the job or the waiver of such heat testing
due to heat testing performed during manufacture, or the waiver of such heat
testing due to statistical analysis shall be determined in the Method of
Procedure (MOP). Additionally, prior to service cutover, load testing shall
demonstrate to Purchaser that the SYSTEM or PRODUCT meets the parameters for
which the SYSTEM or PRODUCT was specified, including but not limited to traffic
capacity, failure rates, SYSTEM or PRODUCT functionality and performance
objectives.
     When Supplier completes installation SERVICES hereunder, Supplier shall
provide to Purchaser a Notice of Installation Completion, in writing, which may
include electronic transmission or similar communications.
          12.5.3 CONDITIONS NORMALLY PROVIDED BY PURCHASER The following items
and conditions will normally be provided by Purchaser. Should Purchaser fail to
provide the following, Supplier may invoice Purchaser for expenses incurred for
such items in addition to the established installation price. Such expenses
shall be mutually agreed upon.
General Building Conditions — Purchaser shall take such reasonable action as
necessary to insure that the premises will be dry and free from dust in such
condition as not to be injurious to the employees of the Supplier or the PRODUCT
to be installed.
Repairs to Buildings — Purchaser shall make alterations and repairs necessary
for proper installation of PRODUCT, except damage for which Supplier, its
employees or agents are responsible.
Openings in Buildings — Supplier shall provide Purchaser, eight (8) weeks prior
to the main ship date, drawings and designs indicating the necessary openings
and ducts for cable and conductors in floors and walls. Purchaser shall furnish
such suitable openings prior to the main ship date.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
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Ceiling Inserts — Purchaser shall provide ceiling inserts as deemed necessary by
Supplier, or as otherwise mutually agreed upon.
Electric Current, Temperature Control and Light — Purchaser shall provide
electric current for charging storage batteries and for any other necessary
purposes with suitable terminals in rooms where work is to be performed;
temperature and general illumination in rooms in which work is to be performed
or PRODUCT stored, equivalent to that ordinarily furnished for similar purposes
in a working central office.
Toilet Facilities — Purchaser shall make accessible to Supplier such facilities
which are available or Supplier may provide its own at Supplier’s cost.
Access to Existing Facilities — Purchaser shall permit Supplier reasonable use
of such portions of the existing building or equipment as agreed upon prior to
the start of installation, as is necessary for the storage and assembly of
PRODUCT and for performing necessary administration duties associated with the
job.
Use of Available Testing Equipment — Purchaser shall allow Supplier use of such
available apparatus as test equipment, required for the performance of necessary
tests to insure proper functioning of added PRODUCT for which new or complete
testing facilities are not provided. Purchaser and Supplier shall mutually
agree, prior to the start of installation, on testing procedures and the
availability of test apparatus. Such use shall not interfere with maintenance of
operating telephone equipment. Purchaser and Supplier shall mutually determine
that such testing equipment is in proper adjustment.
Grounding — Purchaser shall provide access to suitable central office ground.
Requirements for Purchaser Circuits — Purchaser shall furnish information
covering the proper test and readjustment requirements for apparatus and
requirements for circuit performance associated with special circuits or
standard circuits modified by Purchaser drawings.
Stand-by Engine/Alternator Facilities — Purchaser shall provide suitable fuel
storage, gas, water, sewer and exhaust facilities as required, with piping
terminating within the building and within one hundred feet of the location of
the engine/alternator; or terminating within the engine room if
engine/alternator is housed in a separate room.
Main Distribution Frame (MDF) Cross-Connections and Heat Coils — Purchaser shall
run MDF cross-connections and install heat coils unless otherwise noted in the
Order.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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Designation Strips — Purchaser shall number all designation strips unless
otherwise noted in the Order.
Fire Protection Apparatus — Purchaser shall install the permanent fire
protection apparatus.
Furniture and Fixtures — Purchaser shall provide and/or install all furniture
and fixtures unless otherwise noted in the Order.
          12.5.4 CONDITIONS NORMALLY PROVIDED BY SUPPLIER The following items
and conditions will normally be provided by Supplier (If required by the
conditions of the specific installation) and are to be included in the
installation Services price quote from Supplier, where applicable, unless
otherwise agreed upon in writing by Purchaser and Supplier.
Receipt and Inspection of PRODUCT — Supplier’s installer shall receive and
inspect PRODUCT shipments; report shortages, damaged or defective PRODUCT to
Supplier’s or Purchaser’s organization responsible for replacement; and when
Supplier is responsible for replacement and/or shortages, provide a copy of all
re-orders and/or shortage reports to Purchaser.
Protection of PRODUCT, Equipment or Buildings — Supplier shall provide
protection for equipment or buildings in accordance with the practices of
Purchaser. Supplier shall make repairs necessary for damage to equipment or
buildings for which Supplier is responsible.
Coverage for Returned PRODUCT — Notwithstanding the provisions of the Article 14
hereof, entitled WARRANTIES, and Clause 12.3.3 hereof entitled REPAIRS AND
REPLACEMENT - OUT OF WARRANTY, when Supplier provides PRODUCT, Supplier shall
bear cost and risk of in-transit loss for PRODUCT returned by Supplier’s
installer to Supplier for repair or replacement of defective or damaged PRODUCT.
General Method of Procedure — Installer shall provide for Purchaser’s approval a
General Method Of Procedure (MOP) for each job. Such General MOP shall specify
whether detailed MOP(s) are required or not.
Detailed Method of Procedure — Before starting work operations, Supplier’s
installer will provide, for Purchaser’s approval, a detailed MOP for work on
live/working equipment and for work operations requiring detailed MOPs as
outlined in the General MOP.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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Monthly Progress Report — Supplier’s Installer shall provide to Purchaser a
monthly progress report indicating percent (%) of work completed.
Removed/Disconnected Equipment — Supplier’s Installer shall advise Purchaser of
all equipment removed/disconnected within five (5) days of performing such work.
Disposition of surplus and removed Purchaser-owned equipment shall be as
directed by Purchaser.
Determination of Working Equipment — Supplier’s Installer shall determine that
working equipment is in satisfactory condition prior to performing additions,
modifications and/or change work. All such equipment shall be returned to
Purchaser in an acceptable working condition.
Maintenance of PRODUCT — Supplier shall assume the risk of damage and loss to
PRODUCT and the costs of maintaining PRODUCT until accepted by Purchaser.
Frame and Aisle Lighting — Supplier shall install conduit, wire, fixtures, and
other necessary material for frame and aisle lighting as specified by Purchaser.
Cross-Connections other than on MDF — Supplier shall run cross-connections on
Distributing Frames other than the MDF in accordance with Purchaser’s
cross-connection list if requested.
Engineering Errors — When Supplier also provides the engineering Services for
PRODUCT, Supplier shall be responsible for correcting engineering errors at no
additional charge to Purchaser and for issuing of credit for any excess PRODUCT
and/or SERVICES resulting from such engineering errors.
Hauling and Hoisting — Supplier shall provide all warehousing, hauling and
hoisting necessary to complete installation SERVICES.
     12.6 INSTALLATION BY PURCHASER Except as may mutually agreed to by the
parties in writing, all Installation will be performed by Purchaser or a
certified supplier contracted by Purchaser.
          12.6.1 INSTALLATION SUPPORT SERVICES Prior to installation and during
the installation and Acceptance Periods, Purchaser shall be provided
installation support SERVICES and technical support SERVICES at no additional
charge by Supplier. Installation and technical support SERVICES and
DOCUMENTATION provided by Supplier shall be as follows:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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1. Supplier shall provide, at no charge to Purchaser, telephonic Technical
Assistance Center (TAC) SERVICE, which shall be available twenty-four (24) hours
per day, seven (7) days per week; and
2. Supplier shall provide, at such rates as mutually agreed upon between the
parties, as required by Purchaser, to provide a project manager to represent
Supplier on all matters; and
3. Supplier shall provide, at such rates as mutually agreed upon between the
parties, upon request, technical personnel during cutover/in service including
weekends, (48 hours post cutover/in-service) to ensure SYSTEM and PRODUCT
performance.
4. Supplier shall provide, at such rates as mutually agreed upon between the
parties, on-site technical support during the installation and Acceptance
Periods, to be dispatched within 24 hours of request by Purchaser.
5. Supplier shall replace defective PRODUCT with new PRODUCT, as set forth in
Section 12.3 hereof, entitled REPAIRS AND REPLACEMENT.
6. Supplier agrees that in the event PRODUCT does not perform in accordance with
the SPECIFICATION, or is defective, then Supplier shall provide on-site
technical assistance.
7. Supplier shall furnish at no charge to Purchaser current, updated relevant
and complete DOCUMENTATION to support Purchaser and/or its agent’s installation,
heat testing, load testing, ACCEPTANCE, turnover, cutover/in-service, and
maintenance.
          12.6.2 METHOD OF PROCEDURE Supplier shall meet with Purchaser (Early
Job Conferences, contact meetings, test and analysis meetings) to collect all
essential information needed and to jointly prepare a Method of Procedure (MOP).
Supplier, Purchaser and/or its agent shall plan all aspects of the job and a
sequence of performance to complete the job on schedule, which is understood and
mutually agreeable to both parties. All job requirements should be discussed,
resolved and approved by Purchaser at these preliminary meetings, including
schedules (ordering, installation start, in-progress job status, completion,
etc.), quality, technical and performance issues, workmanship, load testing, and
ACCEPTANCE testing. Heat testing on the job or the waiver of such heat testing
due to heat testing performed during manufacture, or the waiver of such heat
testing due to statistical analysis, shall be determined in the MOP. Load
testing shall demonstrate to Purchaser that the SYSTEM or PRODUCT meets the
parameters for which the SYSTEM or PRODUCT was
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 54 of 98
specified, including but not limited to traffic capacity, failure rates, SYSTEM
or PRODUCT functionality and performance objectives.
ARTICLE 13
ACCEPTANCE
     ACCEPTANCE shall be within the exclusive control of Purchaser. ACCEPTANCE
of the SYSTEM, PRODUCT and/or SERVICES provided by Supplier pursuant to Order(s)
issued under this Agreement shall not occur prior to Purchaser‘s ensuring that
the SYSTEM, PRODUCT and/or SERVICES perform in accordance with Purchaser’s
SPECIFICATIONS, which shall include all functional requirements set forth in the
Purchaser’s Request for Proposal. ACCEPTANCE of any SYSTEM, PRODUCT or SERVICES
shall only occur upon Purchaser’s issuance of a Notice of ACCEPTANCE.
     13.1 TYPES OP ACCEPTANCE The PRODUCT and SERVICES to be furnished or
delivered pursuant to Order(s) issued under this Agreement shall be subject to
ACCEPTANCE in accordance with one of the following procedures:

  1.   PRODUCTS and SERVICES that Purchaser determines must go through
Purchaser’s FIRST OFFICE APPLICATION and subsequent purchases of SERVICES that
have successfully completed FOA ACCEPTANCE and have become GENERALLY AVAILABLE
PRODUCT (“GA”) (see Section 13.3).     13.2   [Intentionally Omitted.]

     13.3 FIRST OFFICE APPLICATION (“FOA”) and GENERALLY AVAILABLE PRODUCT
(“GA”) ACCEPTANCE
          13.3.1 FIRST OFFICE APPLICATION (“FOA”) ACCEPTANCE Except as otherwise
agreed to by the parties on a case-by-case basis, in the event that a First
Office Application ACCEPTANCE procedure is required by Purchaser, such an
ACCEPTANCE procedure shall occur in two phases, denoted as Phase I and Phase II.
Purchaser shall have a sixty (60) day period (“FOA Phase I Acceptance Period”)
to determine whether or not the PRODUCT or SERVICE initially meets the
parameters for which the PRODUCT or SERVICE was specified including but not
limited to traffic carrying capacity, failure and report rate, functionality,
including System functionality, operational definitions and performance
objectives in conformance with SPECIFICATIONS utilizing Supplier’s standard
ACCEPTANCE test procedures and Purchaser’s own independent requirements,
standards and testing procedures. Upon
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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successful completion of such testing, Purchaser will issue a Notice of Initial
ACCEPTANCE to Supplier; or if the Product fails ACCEPTANCE in such a way as to
be service affecting, a Notice of Defect, in accordance with Section 27.11
hereof, entitled NOTICES.
          13.3.2 FOA PHASE II ACCEPTANCE Except as otherwise agreed to by the
parties on a case-by-case basis, FOA Phase II ACCEPTANCE shall commence when in
the judgment of Purchaser the PRODUCT or SERVICE is fully operational and loaded
with sufficient traffic in order to determine whether or not the PRODUCT or
SERVICE operates and functions in a fully compatible mode, functioning together,
performing and interoperating as a fully integrated and efficient whole with
itself and with all other switching, transport and transmission elements and
other facilities and equipment in the Purchaser network for a continuous thirty
(30) day period (“FOA Phase II Acceptance Period”), in accordance with the
SPECIFICATIONS incident to this Agreement or any Order(s) issued pursuant to
this Agreement. Upon successful completion of FOA Phase II ACCEPTANCE, Purchaser
will issue a Notice of FOA ACCEPTANCE signifying that full and final ACCEPTANCE
of the FOA portion of the PRODUCT or SERVICE has occurred; or in the event the
FOA fails ACCEPTANCE in such a way as to be service affecting, a Notice of
Rejection in accordance with Section 27.11 hereof, entitled NOTICES.
          13.3.3 FOA CORRECTIVE ACTION PLAN Except as otherwise agreed to by the
parties on a case-by-case basis, in the event that the Supplier’s SYSTEM,
PRODUCT, or SERVICE does not meet the SPECIFICATIONS for Phase I or Phase II of
the FOA, the Supplier shall respond with a documented FOA Corrective Action
plan. The plan shall address the unacceptable condition with a root cause
analysis of the problem, the proposed solution, the process modification to
prevent reoccurrence, the time frame for the changes, and the person(s)
responsible for Supplier’s implementation of the plan.
     The FOA Corrective Action plan shall be presented to the Purchaser
Representative for concurrence prior to implementation, and such concurrence
shall not be unreasonably withheld or delayed. Upon completion of the Corrective
Action Plan by Supplier, Purchaser shall reinitiate its ACCEPTANCE procedures
and the applicable ACCEPTANCE Period shall start anew. In the event that the
SYSTEM, PRODUCT, or SERVICE in the FOA fails Phase I or Phase II ACCEPTANCE in
such a way as to be service affecting, Purchaser may reject, in whole or in
part, the SYSTEM(s), PRODUCT, or SERVICE and Supplier shall promptly refund any
payment which Purchaser may have made for the rejected SYSTEM, PRODUCT, or
SERVICE and Purchaser may procure through a third party or other sources
substitute functionally similar or comparable SYSTEM, PRODUCT, or SERVICE as may
be deemed necessary to replace that which has been rejected in such a manner and
under such terms as Purchaser may deem
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
Page 56 of 98
appropriate. If the installation was provided by Supplier, Supplier shall be
responsible for the immediate removal of the rejected equipment.
13.4 SERVICES ACCEPTANCE
     All Services shall be subject to Acceptance by Purchaser after completion
to determine conformity with the Specifications and Statement of Work. Unless
otherwise mutually agreed, Purchaser shall have a period of thirty (30) days
following completion of any Supplier Service within which to complete Acceptance
testing. Following notification by Purchaser that the Services have failed
Acceptance, if Supplier is unable to reperform such Services, in whole or in
part, within five (5) business days or such lesser time as is determined by
Purchaser to be reasonable, then Purchaser may reject such Services, and receive
a refund of all amounts paid with respect to such Services.
ARTICLE 14
WARRANTIES
     WARRANTIES & SPECIFICATIONS Supplier represents and warrants that all
PRODUCT will be free from defects in material or workmanship and will conform
to, comply, function and perform in accordance with the SPECIFICATIONS, and that
Supplier will make all necessary modifications, adjustments, repairs and
replacements to maintain all PRODUCT in such condition during the applicable
warranty period and in accordance with this Agreement.
     14.1 WARRANTY OF TITLE Supplier warrants that it shall have, as of the date
of each Order, and as of the ACCEPTANCE DATE of each PRODUCT thereunder, and
throughout any applicable license term thereunder, including any renewals or
extensions thereof, free and clear title to, and the right to possess, use,
sell, transfer, assign, license, or sub license, any and all PRODUCT(S) that are
sold, licensed or otherwise provided to Purchaser by Supplier pursuant to such
Order. Supplier shall not create or permit the creation of any lien,
encumbrance, or security interest in any PRODUCT licensed to Purchaser, or sold
to Purchaser and for which title has not yet passed to Purchaser, without the
prior written consent of Purchaser. Title to any PRODUCT licensed-by Purchaser
hereunder shall remain with Supplier through the applicable license term, unless
otherwise specified in this Agreement or any amendment hereto. For all PRODUCTS,
title to and risk of loss for any PRODUCT purchased by Purchaser hereunder shall
pass to Purchaser, in accordance with Section 8.1 hereof entitled TITLE AND RISK
OF LOSS. Passing title to any PRODUCT shall not constitute ACCEPTANCE on the
part of Purchaser.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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          14.1.1 QUIET ENJOYMENT With respect to any PRODUCT or SERVICES
furnished hereunder, Supplier agrees that Purchaser shall be entitled to possess
and use such PRODUCT or SERVICES during the Initial term, including any
extensions or renewals thereof, without interruption by Supplier or any person
claiming by or through Supplier, provided only that Purchaser shall duly perform
its obligations pursuant to this Agreement and the applicable Order.
     14.2 BASIC WARRANTY Supplier represents and warrants that all PRODUCT will
be free from defects in material or workmanship and will conform to, comply,
function and perform in accordance with the requirements and SPECIFICATIONS
stated in the REQUIREMENTS DOCUMENTS and as stated in Section 14.8 of this
Agreement, entitled WARRANTY PERIOD, and that Supplier will make all necessary
adjustments, repairs and replacements to maintain all PRODUCT in such condition
during the term of the applicable warranty, in accordance with the terms and
conditions hereof. Supplier further warrants that each PRODUCT furnished under
this Agreement will perform such general and specific operations and have such
general and specific characteristics as described and claimed for them in any of
Supplier’s published literature, descriptions and specifications whether or not
such literature, descriptions and specifications are included in or referenced
by an Order or this Agreement.
     14.3 [Intentionally Omitted.]
     14.4 [Intentionally Omitted.]
     14.5 ADDITIONAL COMMITMENTS AND WARRANTIES Any written commitment after the
effective date of this Agreement by Supplier under the terms of any Order or of
this Agreement shall be binding upon Supplier whether or not incorporated into
said Order or this Agreement. For purposes of this Agreement, a commitment by
Supplier shall include: (i) prices and options committed by Supplier or its
agent to remain in force during the term of this Agreement; (ii) any warranty or
representation made by Supplier or its agent in a written proposal to Purchaser
as to PRODUCT performance, total SYSTEM’S performance, or any other physical,
design, or functional characteristics of SYSTEM or PRODUCT; (iii) any warranty
or representation made by Supplier or its agent concerning the characteristics
or items described in above, made in any literature, descriptions, drawings or
specifications accompanying or referred to in a proposal or presentation to
Purchaser; and (iv) any representation by Supplier or its agent in a written
proposal, in supporting documents or in negotiations subsequent thereto as to
training to be provided, services to be performed, prices and options committed
to remain in force over a fixed period of time, or any other similar matter
regardless of the fact that the duration of such commitment may exceed the
duration of this Agreement.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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     14.6 SURVIVAL All Warranties shall survive inspection, ACCEPTANCE and
payment. Any additional terms and conditions to this Warranty and this Agreement
will be of no effect unless such additional terms and conditions are in the form
of an amendment to this Agreement and signed by both parties
     14.7 [Intentionally Omitted]
     14.8 WARRANTY PERIOD
          14.8.1 HARDWARE
     14.8.1.1 The term “warranty period” as used in this Agreement, and any
amendment thereto, means the period of time listed below unless the parties have
agreed in writing to a different warranty period. The warranty period for
HARDWARE commences upon shipment of equipment.
     14.8.1.2 The warranty period for HARDWARE is as follows:
WARRANTY PERIOD

                 
 
  HARDWARE TYPE   NEW HARDWARE       REPAIR/REPLACEMENT HARDWARE  
 
  PRODUCTS   36 months       Remainder of NEW
 
              HARDWARE Warranty or
 
              90 days, whichever is
 
              longer.
 
               
 
  TEST EQUIPMENT   ”    ”   ”   ”
 
               
 
  APPARATUS   ”    ”   ”   ”
 
               
 
  PARTS   ”    ”   ”   ”

     14.8.1.3 Third Party materials other than HARDWARE (including extensions or
additions), limited to materials purchased by Supplier at the specific written
request of Purchaser which are not normally furnished by Supplier as part of the
specified HARDWARE, will have the manufacturer’s warranty. Such manufacturer’s
warranty is supplementary to Supplier’s commitment to warrant the PRODUCT,
including all third
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
Page 59 of 98
party products that are components of the PRODUCT or are used in conjunction
with the PRODUCT. The provision of a manufacturer’s warranty in no way limits
Supplier’s warranty obligations as set forth herein. If the manufacturer’s
warranty cannot be passed through to Purchaser or cannot otherwise be enforced
by Purchaser Supplier will be responsible for providing at a minimum the same
warranty protection as the manufacturer’s warranty and/or shall be liable for
any and all costs incurred By Purchaser to correct or have corrected by a third
party a warranty defect in such third party materials.
     14.8.1.4 The warranties set forth in this clause shall not apply to
components of the HARDWARE which are normally consumed in operation or which
have a normal life inherently shorter than the applicable warranty period such
as light bulbs and fuses.
             14.8.2 SOFTWARE
     14.8.2.1 The Warranty Period for SOFTWARE commences upon Purchaser’s
issuance of a Notice of ACCEPTANCE.
The Duration of the WARRANTY PERIOD is as follows:

NEW SOFTWARE   REPAIR/REPLACEMENT SOFTWARE   36 Months                 
Remainder of NEW
SOFTWARE Warranty or ()
90 days, whichever is
longer.

     14.8.2.2 The warranty shall apply to all Software Releases, upgrades,
enhancements, fixes, modifications and the like made by Supplier or by
Purchaser, for the current full release and prior full releases, as well as
third party software within the SOFTWARE and Supplier’s firmware. Exercise of
Purchaser’s right to make modifications to the SOFTWARE or to combine the
SOFTWARE with other software, as set forth in Section 15.1 hereof, entitled
RIGHTS IN SOFTWARE, shall have no effect upon the warranties contained in this
Article.
     14.8.2.3 In the event the SOFTWARE fails to perform as warranted Supplier
shall promptly correct or replace the SOFTWARE.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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     14.8.2.4 The transportation expense associated with returning SOFTWARE to
and from Supplier shall be borne by Supplier.
     14.8.2.5 Supplier shall notify Purchaser of defects in Supplier’s SOFTWARE
of which Supplier becomes aware and Supplier shall immediately initiate
corrective actions and make its best efforts to correct all defects. Where the
defect is service affecting, the warranty period shall be temporarily suspended
during the period needed to correct the defect and upon correction shall restart
for the remaining warranty period or ninety (90) days whichever is greater.
     14.8.2.6 Software Release Warranty Supplier hereby represents and warrants
that it will support the current full release of SOFTWARE and two full versions
back. Supplier hereby additionally represents and warrants to Purchaser that,
for a period of twenty-four (24) months following the ACCEPTANCE DATE for such
any PRODUCT:
Supplier will continue support for older releases more than two full releases
back if the subsequent releases eliminate, reduce or degrade functionality used
by Purchaser or requires additional hardware to maintain that same
functionality.
     14.8.2.7 Supplier also shall perform a Post Mortem analysis after each
major Software Release. Such analysis should determine which development stage
activities were accomplished smoothly and which activities contributed to
problems that effected quality or scheduling. Results of the analysis should
yield documented process improvement plans which will be implemented before
development of the next release begins.
14.9 Year 2000 — REPRESENTATION AND WARRANTY
     14.9.1 SOFTWARE In addition to and without limitation of any other right or
remedy of Purchaser, Supplier represents and warrants that all SOFTWARE
delivered hereunder will record, store, process, and present calendar dates
falling on or after January 1, 2000, in the same manner, and with the same
functionality, as such SOFTWARE record, store, process and present calendar
dates falling on or before December 31, 1999. Supplier further represents and
warrants that in all other respects such SOFTWARE shall not in any way lose
functionality or degrade in performance as a consequence of such SOFTWARE
operating at a date later than December 31, 1999. Without limitation of the
foregoing, Supplier’s representative will consult with Purchaser’s designated
representative for century date change requirements, to ensure that such
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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SOFTWARE will lose no functionality with respect to the introduction of records
containing dates falling on or after January 1, 2000, and to ensure that such
SOFTWARE will be interoperable with other equipment used by Purchaser which may
deliver records to such SOFTWARE, receive records from such SOFTWARE, or
interact with such SOFTWARE in the course of processing data.
     14.9.2 HARDWARE In addition to and without limitation of any other right or
remedy of Purchaser, Supplier represents and warrants that all HARDWARE
delivered hereunder will record, store, process, and present calendar dates
falling on or after January 1, 2000, and with the same functionality, as such
Systems record, store, process and present calendar dates falling on or before
December 31, 1999. Supplier further represents and warrants that in all other
respects such HARDWARE shall not in any way lose functionality or degrade in
performance as a consequence of such HARDWARE operating at a date later than
December 31, 1999. Without limitation of the foregoing, Supplier’s
representative will consult with Purchaser’s designated representative for
century date change requirements, to ensure that such HARDWARE will lose no
functionality nor will they degrade in performance with respect to the
introduction of records containing dates falling on or after January 1, 2000,
and to ensure that such HARDWARE will be interoperable with other equipment used
by Purchaser which may deliver records to such HARDWARE, receive records from
such HARDWARE, or interact with such HARDWARE, in the course of processing data.
     14.9.3 SYSTEMS In addition to and without limitation of any other right or
remedy of Purchaser, Supplier represents and warrants that all SYSTEMS,
consisting of all components of the Supplier’s PRODUCT(S), purchased hereunder,
and all other Supplier-provided switching, transport, transmission elements,
other facilities and equipment in the Purchaser’s network will record, store,
process, and present calendar dates falling on or after January 1, 2000, and
with the same functionality, as such SYSTEMS record, store, process and present
calendar dates falling on or before December 31, 1999, whether operating
separately or functioning together, performing and interoperating as a fully
integrated and efficient whole. Supplier further represents and warrants that in
all other respects such SYSTEMS shall not in any way lose functionality or
degrade in performance as a consequence of such SYSTEMS operating at a date
later than December 31, 1999. Without limitation of the foregoing, Supplier’s
representative will consult with Purchaser’s designated representative for
century date change requirements, to ensure that such SYSTEMS will lose no
functionality nor will they degrade in performance with respect to the
introduction of records containing dates falling on or after January 1, 2000,
and to ensure that such SYSTEMS will be interoperable with other equipment used
by Purchaser which may deliver records to such SYSTEMS, receive records from
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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such SYSTEMS, or interact with such SYSTEMS, in the course of processing data.
     14.9.4 SERVICES In addition to and without limitation of any other right or
remedy of Purchaser, Supplier represents and warrants that all SERVICES and all
services, tools, products and components (including without limitation any
computing devices, software, firmware and processes) (“MATERIALS”) used by or on
behalf of Supplier or its permitted subcontractors to perform or provide any and
all of the WORK required to be performed hereunder will record, store, process,
and present calendar dates falling on or after January 1,2000, in the same
manner, and with the same functionality, as such MATERIALS record, store,
process and present calendar dates falling on or before December 31, 1999.
Supplier further represents and warrants that in all other respects such WORK
shall not in any way lose functionality and shall not degrade, suffer defects,
or provide incorrect results or data as a consequence of the provision of such
WORK at a date later than December 31, 1999 or processing, receiving or
transmitting data containing or including dates falling after December 31, 1999.
In addition, Supplier represents and warrants that such WORK shall not in any
manner cause the SOFTWARE, HARDWARE and SYSTEMS affected by the WORK to lose
functionality in any way or to degrade, suffer defects, or provide incorrect
results or data. Without limitation of the foregoing, Supplier will regularly
consult with Verizon’s designated representative for century date requirements
and to insure continued interoperability between Supplier systems and any
applicable Purchaser systems used in connection with the WORK.
          14.10 ILLICIT CODE Supplier warrants (a) unless authorized in writing
by Purchaser or (b) necessary to perform valid duties under this Agreement and
authorized in writing by Purchaser, any SOFTWARE provided to Purchaser by
Supplier for use by Supplier or Purchaser shall: (a) contain no hidden files;
(b) not replicate, transmit, or activate itself without control of a person
operating computing equipment on which it resides; (c) not alter, damage, or
erase any data or computer programs without control of a person operating the
computing equipment on which it resides; (d) contain no encrypted imbedded key
unknown to Purchaser, node lock, time-out or other function, whether implemented
by electronic, mechanical or other means, which restricts or may restrict use or
access to any programs or data developed under this Agreement, based on
residency on a specific hardware configuration, frequency of duration of use, or
other limiting criteria (“Illicit Code”). Should any program have any of the
foregoing attributes, and notwithstanding anything elsewhere in this Agreement
to the contrary, Supplier shall be in default of this Agreement, and no cure
period shall apply. In addition to any other remedies available to it under this
Agreement, Purchaser reserves the right to pursue any civil and/or criminal
penalties available to it against the Supplier.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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          14.11 SERVICES Supplier warrants to Purchaser that SERVICES provided
hereunder shall be expertly performed in a manner which meets or exceeds the
prevailing standards in the industry, and in accordance with applicable
SPECIFICATIONS. All warranties shall survive inspection, ACCEPTANCE and payment.
          14.12 EMPLOYEES AND SUBCONTRACTORS BOUND Supplier represents that it
has and will maintain an appropriate agreement(s) with its employees, or
(without altering the restrictions against subcontracting set forth elsewhere in
this Agreement) others whose services Supplier may require, sufficient to enable
it to comply with all provisions of this Agreement, including, without
limitation, the provisions relating to intellectual property. Upon request by
Purchaser, Supplier shall make such agreements available for inspection by
Purchaser. Supplier shall be in all aspects liable for any acts or omissions of
its employees and subcontractors as well as any breaches of this Agreement
arising from such acts or omissions.
ARTICLE 15
SOFTWARE
     IRREVOCABLE SOFTWARE RIGHTS In the event Purchaser fails to meet its
uncontested payment obligations in connection with LICENSED MATERIALS provided
by SUPPLIER, Supplier may cancel only the license for such LICENSED MATERIALS
for which payment has not been made. In no way shall such cancellation act to
terminate, cancel or otherwise impair Purchaser’s rights under this agreement
for LICENSED MATERIALS which have been purchased and paid for. In the event
Purchaser otherwise breaches the license, Supplier may be entitled to seek
damages which result from such breach and to injunctive relief intended to end
the breach; provided however that no such injunction, nor the payment of
damages, shall enjoin or have the effect of enjoining the use of the LICENSED
MATERIALS in accordance with the terms and conditions of the license nor act to
otherwise impair Purchaser’s rights to LICENSED MATERIALS which have been
purchased hereunder.
          15.1 RIGHTS IN SOFTWARE Unless otherwise specified in an Order,
Supplier hereby grants to Purchaser as to any LICENSED MATERIALS, including all
feature releases/upgrades, patches, fixes, corrections, enhancements,
improvements and updates relating to such LICENSED MATERIALS, in any form known
or unknown, a perpetual, irrevocable, royalty-free, world-wide, non-exclusive,
unrestricted, except as provided herein, right and license, under any
intellectual property or license rights now or hereafter acquired by Supplier or
its affiliates:
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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  (i)   to use, execute and operate the LICENSED MATERIALS, in whole or in part,
on any computer system or processor on which the LICENSED MATERIALS will
function, and on any number of computer systems or processors, provided the use,
execution or operation is in the normal course of business; notwithstanding
anything to the contrary in the Agreement, use by or for Purchaser’s direct or
lower tier customers, as incident to, arising out of, or as reasonably necessary
to comply with, the Telecommunications Act of 1996 or any FCC orders
implementing same, or any similar unbundling, resale or interconnection
requirements imposed by any state or local public service authority shall be
deemed to be use, execution or operation in the normal course of business and
shall be included, without additional charge, within the scope of the license
granted under this Agreement;     (ii)   to perform, display, transmit and
integrate the LICENSED MATERIALS, subject to the limitations in Section 15.1;  
  (iii)   to sublicense, transfer, or assign solely in connection with the sale,
rental, lease, transfer, or assignment of PRODUCT; and     (iv)   to authorize
any third party to exercise any of the foregoing rights and licenses, provided
such exercise is in support of or arises out of Purchaser’s normal course of
business.

          Purchaser acknowledges Supplier’s representation that LICENSED
MATERIALS are the property of Supplier or its suppliers and that Purchaser shall
not have any ownership interest in LICENSED MATERIALS.
          Purchaser shall hold LICENSED MATERIALS as they treat their own
confidential information of similar type and value. Purchaser’s obligations
hereunder shall not extend to any information or data relating to LICENSED
MATERIALS which are now available to the public or become available by reason of
acts or omissions not attributable to Purchaser. Supplier shall hold Purchaser’s
Developed Information as they treat their own confidential information of
similar type and value.
          Purchaser shall have the right to transfer the right to use LICENSED
MATERIALS furnished under this Agreement without the payment of an additional
right to use fee by transferee (“Transfer Rights”). The transferee shall have
the same right to warranty, as set forth Article 14 hereof, entitled WARRANTIES.
          The license term for SOFTWARE shall commence upon the issuance by
Purchaser of a notice of ACCEPTANCE of such SOFTWARE and shall continue
perpetually, unless terminated by Purchaser by giving Supplier sixty (60) days
prior
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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written notice. Termination of such license term shall also automatically
terminate any maintenance services for such SOFTWARE
          Where circumstances of the Software allow, Purchaser shall have the
right, at no additional charge, to access the Software by means of remote
electronic access. With each license of SOFTWARE ordered hereunder, Supplier
shall provide Purchaser with RELATED DOCUMENTATION and DOCUMENTATION identified
in Article 6 hereof, entitled DOCUMENTATION, SUPPLIER’S SPECIFICATIONS,
INFORMATION, RECORDKEEPING AND DISCLOSURE, together with documentation which
either is provided by Supplier to any of its other customers for the Software or
is reasonably necessary to enable Purchaser to adequately use such SOFTWARE. All
documentation shall be in English and shall comply with commonly accepted
industry standards with respect to content, size, legibility and
reproducibility.
          Supplier agrees that RELATED DOCUMENTATION obtained by Purchaser
hereunder may be disclosed to a third party solely for the purpose of
installing, repairing, and maintaining the system for which software hereunder
is licensed, or operating software provided that the third party agrees in
writing (a copy of which will be provided to Supplier) to treat such RELATED
DOCUMENTATION in confidence and to the corresponding conditions respecting use
of such software documentation herein.
ARTICLE 16
INTELLECTUAL PROPERTY — GENERAL OBLIGATIONS
          INFRINGEMENT Supplier acknowledges that Purchaser is a provider of
telecommunications services and does not manufacture any of the component parts
of its network. Supplier further acknowledges that Purchaser intends to use
Supplier’s PRODUCTS in combination with Suppliers’ other products and the
products of others. As a consequence, Purchaser’s decision to deploy Supplier’s
PRODUCTS within its network is made in reliance on Supplier’s assurance that
such use of PRODUCTS does not infringe the intellectual property rights of
others. Furthermore, Purchaser requires that Supplier will indemnify, hold
harmless and defend Purchaser from and against any loss, cost, damage, claim,
expense or liability that may arise out of, or result by reason of such
infringement or claim of infringement, whether arising out of Purchaser’s use of
such PRODUCTS or the acts of Supplier. In the event Supplier’s PRODUCTS is found
to be infringing, Purchaser requires Supplier to make every effort to license,
modify or replace the infringing PRODUCTS to avoid removal of such PRODUCTS from
Purchaser’s network. In the event Supplier is unable to license, modify or
replace the infringing PRODUCTS and Purchaser must remove the infringing
PRODUCTS from it network, Supplier shall provide a full refund and shall be
liable for all costs associated
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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with a full refund, removal and replacement including but not limited to excess
cost of reprocurement.
          16.1 INFRINGEMENT OF PATENTS, COPYRIGHTS, AND TRADEMARKS The following
terms apply to any infringement, claim of infringement or other misappropriation
of any patent, trademark, copyright, trade secret or other proprietary interest,
breach of fiduciary relationship or breach of contract related to the existence
of a fiduciary relationship (“Claim”) based on or arising out of the disclosure,
development, manufacture, use, reproduction, possession, distribution, sale,
transfer, resale, misuse or misappropriation of any PRODUCT or SERVICES
furnished under this Agreement.
          Supplier shall indemnify, hold harmless and defend Purchaser
(“Indemnitee”) from and against any loss, cost, damage, claim, expense,
including without limitation court costs and reasonable attorney fees, or
liability that may arise out of, or result by reason of, any such infringement
or claim, including without limitation any claim or cause of action of whatever
type or nature arising out of any claim, cause of action or litigation, between
Supplier, any of its subsidiaries, affiliates or successors in interest whether
currently pending or during the term of this Agreement. Supplier shall defend or
settle, at its own expense, any action, suit or proceeding against any
Indemnitee arising in connection with a Claim, and shall pay any damages, costs
or expenses awarded therein or payable in settlement; provided, however, that no
such settlement shall compromise, impede or limit in any manner Purchaser’s
possession, use or distribution of the SYSTEM, PRODUCT or other item subject to
the Claim. Purchaser shall notify the Supplier promptly, in accordance with
Section 27.11 hereof, entitled NOTICES, of any claim of infringement for which
Supplier is responsible, and shall cooperate with Supplier in every reasonable
way to facilitate the defense of any such claim.
          Without limitation of the foregoing, should Purchaser’s use of, or
full benefit from, the SYSTEM, PRODUCT, and/or SERVICES be impeded, prevented or
limited by injunction or other court order arising out of any such infringement
or other cause of action for which Supplier is responsible, Supplier shall, in
addition to the above indemnity, at no expense, loss or damage to Purchaser and,
at Supplier’s option:
1. replace such PRODUCT and/or SERVICES which Supplier can demonstrate to
Purchaser’s reasonable satisfaction are equally suitable PRODUCTS and/or
SERVICES and which are free of any infringement; or
2. modify such PRODUCTS and/or SERVICES without reduction or loss of
functionality so that it or they will be free of infringement; or
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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3. by license or other release from claim of infringement, procure for
Purchaser’s benefit the right to use, install, sell, or resell such PRODUCTS
and/or SERVICES; or
4. i) if none of the foregoing can be rapidly and effectively accomplished such
that the Purchaser’s implementation schedules will be delayed by more than one
hundred and twenty (120) days or such longer period as may be agreed to by the
Parties; or
     ii) should Supplier fail to use its best efforts to develop, support or
market the PRODUCTS in a commercially reasonable manner; or
     iii) if Supplier discontinues the development or manufacture, or otherwise
exits the business of providing the PRODUCT or acts in such a way as to support
a determination by Purchaser that Supplier plans to so discontinue manufacture
or exit the business, provided, however, that the terms “discontinue” and
“exit,” as used in this Clause 16.1.4(iii) shall not include
(a) advances by Supplier in the technology of the PRODUCT so long as such
advances in technology are backward compatible with, and so long as Supplier
continues to support, the PRODUCT and
(b) the sale or transfer of that part of Supplier’s business that includes the
subject matter of this Agreement to a third party approved by Purchaser, which
approval shall not be unreasonably withheld, who agrees to assume the
obligations of this Agreement; and provided, further, that Supplier’s
obligations under this Article 16.1.4(iii) shall terminate (except for
Supplier’s obligations to support the PRODUCT) and
(c) at such time that Purchaser discontinues ordering PRODUCTS in accordance
with its commitments under the Agreement, other than replacement parts for
PRODUCTS already installed;
Supplier shall, if directed by Purchaser,
(1) remove the PRODUCTS from the premises of Purchaser or such other location,
and refund to Purchaser the full PRODUCT purchase price and any non-recurring
reasonable amount paid for the use of any associated SOFTWARE and the reasonable
costs associated with removal thereof, and shall, at its own expense, restore
the premises as nearly to their original condition as is reasonably possible,
unless otherwise directed in writing by Purchaser;
(2) pay to Purchaser an amount equal to all reasonable charges, costs and
expenses
(i) to reprocure similar generally available PRODUCTS and SERVICES from a third
party on an expedited basis, it
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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being understood that any such costs associated with such PRODUCTS and SERVICES
will be net of the refund of the purchase price referred to above,
(ii) to retrofit the Purchaser’s network and its infrastructure, including
substantiated installation costs, whether any of the foregoing damages in items
(i) and (ii) are general or special in nature; and Purchaser may terminate the
Agreement without liability of any type or character to SUPPLER.
          If either Purchaser or Supplier is directed by a court of competent
jurisdiction, after all permissible appeals have been taken, to cease further
use or deployment of, or remove the PRODUCTS from the premises of Purchaser or
such other location, then Supplier shall
1. remove the PRODUCTS from the premises of Purchaser or such other location,
and refund to Purchaser the full PRODUCT purchase price paid to date and any
non-recurring reasonable amount paid for the use of any associated SOFTWARE and
the reasonable costs associated with removal thereof, and shall, at its own
expense, restore the premises as nearly to their original condition as is
reasonably possible, unless otherwise directed in writing by Purchaser;
2. pay to Purchaser an amount equal to all reasonable charges, costs and
expenses
(i) to reprocure similar commercially available PRODUCTS and SERVICES from a
third party on an expedited basis, it being understood that any such costs
associated with such PRODUCTS and SERVICES will be net of the refund of the
purchase price referred to above,
(ii) to retrofit the Purchaser’s network and its infrastructure, including
substantiated installation costs, and
(iii) any assessments or penalties imposed by regulatory agencies as a
consequence of such removal of PRODUCTS, whether any of the foregoing damages in
items (i) through (iii) are general or special in nature; and Purchaser may
terminate the Agreement without liability of any type or character to Supplier.
          16.2 INTELLECTUAL PROPERTY RIGHTS Supplier pursuant to this Agreement
and the relationship created herein will provide PRODUCTS and SERVICES including
without limitation previously developed HARDWARE and SOFTWARE, firmware,
internal code, materials and services based upon or utilizing inventions,
discoveries, know-how, techniques, data, reports, records, research,
information, software and documentation developed, acquired or owned by
Supplier, or to which Supplier holds a license, prior to and independent of this
Agreement (“Information”); and furthermore Supplier may develop, acquire or
obtain a license for additional material, data, records, research, information,
software, firmware and documentation (“Information”) which will
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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be used or useful in the provision of PRODUCT, SOFTWARE or SERVICES pursuant to
this Agreement, but which Information was not initially developed, acquired or
licensed in order to perform or satisfy the requirements of this Agreement.
Supplier shall retain its right, title and ownership interest in all such
Information; provided, however, that if, and to the extent that, such
Information is provided to Purchaser or contained within a PRODUCT provided
pursuant to this Agreement, Supplier hereby grants to Purchaser a license and
right as set forth in Article 15 hereof, entitled SOFTWARE.
          Supplier recognizes that Purchaser possesses superior knowledge and
experience, incident to the construction, operation and management of a complex
local exchange network, cable systems and other telecommunications networks
(“Purchaser’s NETWORKS”) and that Purchaser has made substantial investments of
time, personnel and money in the development of a broad range of technical
information and expertise relating to the Purchaser’s NETWORKS, and the
hardware, equipment, facilities, and software used and useful in the
construction, provision, operation and management of telecommunications
services, including without limitation inventions, discoveries, know-how,
techniques, data, reports, records, research, information, software, including
source code and documentation developed, acquired or owned by Purchaser, or to
which Purchaser holds a license, prior to and independent of this Agreement
(“Purchaser’s Information”); and furthermore Purchaser may develop, acquire or
obtain a license for additional data, records, research, information, software,
including source code and documentation (“Purchaser’s Information”) which will
be used or useful in the provision of telecommunications services, and
associated Services. Purchaser shall retain its right, title and ownership
interest in all such Purchaser’s Information.
          16.3 RIGHTS TO INNOVATIONS AND INVENTIONS Supplier and Purchaser
acknowledge that new or proprietary or trade secret concepts, methods,
techniques, processes, know-how, adaptations, ideas, inventions, discoveries,
improvements, including without limitation patented or patentable concepts
(“Innovations”) may be conceived, first reduced to practice, made or developed
as a result of performance under this Agreement.
          Supplier and Purchaser agree that any Innovations developed, or
otherwise made, during the course of this Agreement and which are exclusively
related to performance of this Agreement shall be treated as follows: (a) if
made by Purchaser’s personnel, it shall be the property of Purchaser; (b) if
made by Supplier personnel, it shall be the property of Supplier; (c) if made
jointly by personnel of Supplier and Purchaser, it shall be jointly owned
without accounting, distribution or sharing of revenues of any kind between
Supplier and Purchaser. This Agreement shall not preclude Supplier or Purchaser
from developing materials which are competitive, irrespective of their
similarity, to materials which might be delivered to Purchaser pursuant to this
Agreement.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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16.3.1 PROSECUTION OF PATENTS Supplier and Purchaser further agrees that, each
will sign and cause to be signed all papers and do and cause to be done all acts
which may be necessary, desirable or convenient to enable the other, at the
other’s expense, to file and prosecute applications for jointly owned patents on
such inventions, discoveries and improvements, and to maintain patents granted
thereon. Supplier shall have and acquire from Supplier’s and any subcontractor’s
employees, agents and contractors who perform services under this Agreement,
such assignment and rights as to assure that Purchaser shall receive all of the
rights provided for in this Agreement. Supplier shall provide a copy of all
documents to show that all Innovations and intellectual property developed by
its and its subcontractor’s employees, agents and contractors have been
transferred to Purchaser.
          16.4 LICENSES Except as set forth in Section 16.2 hereof, entitled
INTELLECTUAL PROPERTY RIGHTS, no licenses, express or implied, under any
patents, copyrights, trade secrets, trademarks or otherwise are granted by
Purchaser to Supplier hereunder.
          16.5 IDENTIFICATION No Purchaser’s identification or simulation
thereof, references to Purchaser or references to its respective trademarks,
service marks, codes, drawings, or specifications will be used in any of
Supplier’s advertising or promotional efforts in reference to activities
undertaken by Supplier under this Agreement without Purchaser’s prior written
permission. Supplier shall remove any identification, trade names, trademarks,
insignia, symbols or evidences of Purchaser’s inspection prior to any sale, use
or disposition of material or equipment rejected or not purchased by Purchaser.
Supplier agrees to indemnify Purchaser against any claim arising out of
Supplier’s failure to do so. This clause does not modify Section 16.8 hereof,
entitled USE OF INFORMATION.
          16.6 INSIGNIA Upon Purchaser’s written request Supplier shall, at
mutually agreed to charges, properly affix to HARDWARE certain of Purchaser’s
trademarks, trade names, insignia, symbols, decorative designs, (hereafter
“Insignia”) provided such insignia do not adversely affect the operation of the
PRODUCTS. PRODUCTS rejected or not purchased by Purchaser which has been
identified or marked with Purchaser’s insignia or evidences of Purchaser’s
inspection, shall have all such insignia and evidences of Purchaser’s inspection
removed, mutilated, destroyed or disposed of or as otherwise agreed upon, prior
to any sale, use or dispositions thereof. Supplier agrees to indemnify and hold
Purchaser harmless and if requested defend Purchaser from and against any claim,
loss, damage or lawsuit arising out of Supplier’s failure to do so. This clause
shall in no way modify the provisions of Section 16.8 hereof, entitled USE OF
INFORMATION.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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          16.7 PUBLICITY Supplier agrees (i) to submit to Purchaser all
advertising, sales, and promotional materials, press releases and other
publicity materials relating to the SYSTEM, PRODUCT, or SERVICES under this
Agreement wherein the name, marks, or the name or mark of the other is mentioned
or containing language from which the connection of said names or marks may be
inferred or implied; (ii) not to publish or use such advertising, sales and
promotional materials, press releases, or other publicity materials before
receiving the prior written approval from Purchaser. Such approval may be
withheld by Purchaser at its sole discretion, and Supplier understands that
Purchaser will not approve issuance of a press release to announce this or other
Agreements in which the Supplier is providing products or services to Purchaser,
other than in exceptional situations where Purchaser determines that a release
would significantly benefit Purchaser.
          16.8 USE OF INFORMATION Any specifications, drawings, sketches,
models, samples, tools, computer or other apparatus programs, technical or
business information or data, written, oral or otherwise (all hereinafter
designated “Information”) which Purchaser furnished, or shall furnish, to
Supplier under this Agreement or in contemplation of this Agreement shall remain
Purchaser’s. All copies of such Information in written, graphic or other
tangible form shall be returned to Purchaser upon request. Unless such
Information was previously known to Supplier free of any obligation to keep it
confidential, or has been or is subsequently made public by Purchaser or a third
party, it shall be kept confidential by Supplier, shall be used only in
performing under this Agreement, and may not be used for other purposes except
upon such terms as may be agreed upon in writing by Purchaser.
          16.9 SUPPLIER’S INFORMATION Except as mutually agreed upon in writing
and in advance of such information being provided by Supplier no specifications,
drawings, sketches, models, samples, tools, computer or other apparatus
programs, technical or business information or data, written, oral or otherwise,
furnished by Supplier to Purchaser under this Agreement shall be considered by
Supplier to be confidential or proprietary whether or not marked as such.
ARTICLE 17
EXTRAORDINARY SUPPORT
          In addition to the provisions for repair or replacement of PRODUCT set
forth in Section 12.3 hereof, entitled REPAIRS AND REPLACEMENT and Article 14
hereof, entitled WARRANTIES, Supplier agrees, in any event, if any natural or
other disaster or emergency causes an out of service condition, Supplier shall
use commercially reasonable efforts to provide best efforts to locate or provide
(i.e. procure or
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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manufacture) and ship to Purchaser replacement PRODUCT, and make available
necessary manpower within twenty four (24) hours of verbal notification by
Purchaser.
     Such emergency support shall be available twenty four (24) hours a day,
seven (7) days a week during the term of this Agreement and for a period of ten
(10) years after the expiration of this Agreement or survival of the technology,
whichever is greater.
     Charges for replacement PRODUCT AND SERVICES shall be at the prices
contained in Appendix D or if not specifically set forth thereon, at Supplier’s
then current rates for such services, subject to Supplier’s obligations under
Section 7.3 hereof, for the term of this Agreement. This clause shall not be
construed to require Supplier to maintain any inventories whatsoever nor
maintain any position of readiness to perform in the future nor require breach
of Supplier’s contractual obligations to third parties.
ARTICLE 18
[Intentionally Omitted]
ARTICLE 19
DEFAULT AND TERMINATION
     19.1 SUPPLIER DEFAULT Supplier shall be in default as defined in this
Article, if Supplier fails to:
1. individually, or in the aggregate over time, in any material respect, make
delivery of any PRODUCT or to perform any SERVICES within the time specified
herein or in any applicable Order(s), including without limitation development
dates, or any extension thereof by change order or amendment; or
2. individually, or in the aggregate over time, in any material respect, replace
or correct defective PRODUCT or SERVICES in accordance with the provisions of
Article 4 hereof, entitled SUPPLIER COMPREHENSIVE RESPONSIBILITIES FOR OVERALL
PERFORMANCE, Article 10 hereof, entitled QUALITY ASSURANCE, Article 12 hereof,
entitled INSTALLATION AND SUPPORT, Article 14 hereof, entitled WARRANTIES, and
Section 18.1 hereof, entitled WORKAROUND.
3. perform, in any material respect, any of its other material obligations under
this Agreement; or
4. make progress so as to endanger performance of this Agreement or any Order(s)
in accordance with its terms; and, in any of the circumstances specified
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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in this Article, Supplier cannot demonstrate that the PRODUCTS or SERVICES will
conform to this Agreement or any Order(s) and satisfy the ACCEPTANCE Criteria,
or that the Supplier’s employees as a group assigned to the work are not capable
of producing PRODUCTS which will conform to this Agreement or any Order(s) and
satisfy the ACCEPTANCE Criteria; Purchaser may give Supplier written notice
citing the areas believed to be inadequate or deficient.
     19.2 DEFAULT CURE PERIOD In the event of any Supplier Default under
Section 19.1 or other failure to perform any duty or obligation under this
Agreement or any Order(s) issued pursuant to this Agreement (“Default”),
Purchaser shall provide Supplier with written Notice thereof identifying in
reasonable detail the nature and extent of the Default, in accordance with
Section 27.11 hereof entitled NOTICES, and Supplier shall have thirty (30) days
from the mailing, or other issuance, of said notice by Purchaser to cure the
Default (“Cure Period”). Should an occasion(s) of Default arise which the
parties agree is of such a nature that it cannot be remedied within the Cure
Period through the application of Supplier’s best efforts, Supplier shall
present within such Cure Period a plan of action to remedy same, which plan
shall have, in Purchaser’s judgment, a reasonable opportunity for success. If,
at the end of the thirty (30) day period, the Default has not been remedied to
the reasonable satisfaction of Purchaser, or a plan to remedy reasonably
acceptable to Purchaser is not presented, as the case may be, then Purchaser may
cause Supplier to be in Default hereunder by giving Supplier at least ten
(10) business days prior written notice of the effective date of such Default.
     19.3 TERMINATION PURSUANT TO DEFAULT In the event of Default, then in
addition to and independent of all other rights and remedies at law or in equity
or as provided in this Agreement, Purchaser shall have the right to, and at its
option may, terminate this Agreement or cancel any such Order(s) placed by
Purchaser without any charge, obligation or liability whatsoever, except as to
the payment for PRODUCTS already installed and accepted in those instances where
an Order(s) only is canceled, provided such PRODUCTS was not the subject matter
of the Default nor was its effectiveness affected by such Default. In no way
shall such termination act to impair Purchaser’s right, title, and interest to
the PRODUCT(S) purchased hereunder, its rights under Article 15 hereof, entitled
SOFTWARE, under Section 16.2 hereof, entitled INTELLECTUAL PROPERTY RIGHTS, and
under Section 16.3 hereof, entitled RIGHTS TO INNOVATIONS AND INVENTIONS.
     19.4 PURCHASER’S RIGHT TO DEVELOPED INFORMATION UPON TERMINATION If this
Agreement, or any Order(s), is terminated pursuant to this Article, Purchaser,
in addition to any other rights provided in this Article, may require the
Supplier to transfer title and deliver to Purchaser, in the manner and to the
extent directed by Purchaser, (i) any completed PRODUCTS, and (ii) such
partially completed PRODUCTS and developed PRODUCTS as specified in this
Agreement or any Order(s)
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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(hereinafter called “Developed Information”) as the Supplier has specifically
produced or acquired for the performance of such part of this Agreement as has
been terminated; and Supplier shall, upon direction of Purchaser, protect and
preserve such property, as enumerated in the paragraph, in the possession of the
Supplier. Payment for PRODUCT delivered to and accepted by Purchaser shall be at
the Agreement or Order price. Payment for Developed Information delivered to and
accepted by Purchaser and for the protection and preservation of property shall
be in the amount agreed upon by the Supplier and Purchaser; however, Supplier’s
obligation hereunder to carry out Purchaser’s direction as to such shipment,
protection and preservation shall not be contingent upon prior agreement of the
parties as to such amount. Purchaser may withhold from amounts otherwise due the
Supplier for such completed contract Work or developed materials, such sums as
Purchaser determines to be necessary to protect Purchaser against loss.
Purchaser shall continue to hold a perpetual, worldwide, royalty-free license to
all Software previously delivered hereunder by Supplier, Information in
accordance with and subject to the limitations of Section 16.2 hereof, entitled
INTELLECTUAL PROPERTY RIGHTS, in accordance with Section 16.3 hereof, entitled
RIGHTS TO INNOVATIONS AND INVENTIONS pursuant to the terms of such license as
set forth herein, and Supplier shall use its best commercial efforts to support
such license as set forth herein.
     19.5 TERMINATION FOR CONVENIENCE Notwithstanding any other provisions of
this Article 19, Purchaser may terminate this Agreement for convenience upon
thirty (30) days notice to Supplier in accordance with Section 27.11 hereof,
entitled NOTICES; at its option Purchaser may rebid all or part of the PRODUCTS
or SERVICES hereunder.
          19.5.1 EFFECT OF TERMINATION Termination for convenience of this
Agreement shall also cancel any and all Order(s) under this Agreement. Unless
otherwise specified herein, Purchaser’s liability to Supplier with respect to
such termination under Section 19.5 shall be limited to (1) Supplier’s purchase
price of all components not usable in Supplier’s other operations or salable to
Supplier’s other customers, plus (2) the actual cost incurred by Supplier in
procuring and manufacturing material in process at the date of giving notice of
termination, less any salvage value thereof, and (3) actual engineering costs
incurred by Supplier in providing engineering Services hereunder. If requested,
Supplier agrees to substantiate such costs with proof satisfactory to Purchaser.
Such payment will constitute a full and complete discharge of Purchaser’s
obligations under this Agreement. However, no such termination charges shall be
invoiced, if within six (6) months of notice of termination, PRODUCT equivalent
to that being terminated is ordered by Purchaser.
     19.6 TERMINATION FOR INSOLVENCY, BANKRUPTCY, ASSIGNMENT, EXPROPRIATION,
AND/OR LIQUIDATION Purchaser may
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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terminate this Agreement immediately by giving written Notice in accordance with
Section 27.11 hereof, entitled NOTICES, without liability to the Supplier,
except for such PRODUCT and SERVICES already delivered, installed and accepted
in the event the Supplier:

  1.   is declared insolvent or bankrupt, or makes an assignment or other
arrangement for the benefit of its creditors;     2.   has all or any
substantial portion of its capital stock or assets expropriated by government
authority; or     3.   is dissolved or liquidated (except as a consequence of a
merger, consolidation, or other corporate reorganization not involving the
insolvency or expropriation of that party).

     If Supplier is involved in any of the events described in subsections (1.),
(2.) or (3.) it shall promptly notify Purchaser in accordance with Section 27.11
hereof, entitled NOTICES.
     19.7 TRANSFER OF CONTROL In the event of the direct or indirect sale or
transfer of control of Supplier or substantially all of its assets to any third
party (other than a third party approved by Purchaser, which approval shall not
be unreasonably withheld), Purchaser shall have the right to terminate this
Agreement at any time thereafter upon giving written notice thereof to Supplier
or its successor in interest and upon the giving of such Notice in accordance
with Section 27.11 hereof, entitled NOTICES, this Agreement shall terminate
forthwith and Purchaser shall have no liability to Supplier except for PRODUCT
and SERVICES already delivered, installed and accepted.
     19.8 TERMINATION BY SUPPLIER Supplier may not terminate this Agreement, or
cancel an Order(s) except for non-payment of the purchase price and then only if
after sixty (60) days of receipt of written notice of non-payment in accordance
with Section 27.11 hereof, entitled NOTICES, Purchaser fails to pay such
purchase price and thereupon Supplier issues its written notice of default and
Purchaser fails to pay such purchase price within ten (10) business days of
receipt of such notice of default. In no way shall such termination act to
impair Purchaser’s right, title and interest to the PRODUCT purchased hereunder,
its rights under Article 15 for SOFTWARE licenses which have been purchased
hereunder, and under Sections 16.2 hereof, entitled INTELLECTUAL PROPERTY RIGHTS
and under Section 16.3 hereof, entitled RIGHTS TO INNOVATIONS AND INVENTIONS.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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ARTICLE 20
SUPPLIER’S CONTINUING OBLIGATIONS
     20.1 INDEPENDENT OBLIGATION OF SUPPLIER TO CONTINUE PERFORMANCE Because of
the critical importance of the obligations undertaken by Supplier hereunder to
the operations of Purchaser and the substantial expertise and manufacturing
capability and capacity (not otherwise possessed by Purchaser) which Supplier
has represented it will utilize in connection with the fulfillment of its
obligations and the reliance of Purchaser on such expertise, capability and
capacity, Supplier assumes an independent obligation to continue performance of
its obligations hereunder in all respects regardless of any dispute which may
arise between Purchaser and supplier in connection with any claims by Supplier
that Purchaser has materially breached its obligations hereunder. Such
independent obligation shall continue for ninety (90) days from the date upon
which Purchaser receives written notice of such alleged breach from Supplier.
Supplier undertakes this independent obligation without prejudice to any rights
or remedies it may otherwise have in connection with any dispute between
Supplier and Purchaser.
     20.2 POST TERMINATION/NON-RENEWAL In the event of any termination or
non-renewal of this Agreement, Supplier shall assist and cooperate in a
commercially reasonable manner with Purchaser and any replacement provider in
the transition to a replacement provider. Such assistance shall include, but not
be limited to, the delivery to Purchaser of any technical information,
DOCUMENTATION, RELATED DOCUMENTATION and Purchaser’s information, and shall be
provided in accordance with the provisions of Section 9.5 hereof entitled CHANGE
ORDER, including provisions for the payment of additional fees for any
additional work.
     20.3 CONTINUING AVAILABILITY Supplier agrees to offer for sale, or locate
for sale, functionally equivalent or superior maintenance, support, replacement
and repair parts for PRODUCT ordered pursuant to this Agreement for ten
(10) years commencing from Supplier’s last shipment of such PRODUCT to
Purchaser. In addition to Supplier’s obligation to offer PRODUCT support for ten
(10) years from Supplier’s last shipment of PRODUCT, or as long as the
technology survives, whichever is greater, Supplier agrees to provide SOFTWARE
support for maintenance, replacement or updates for twenty (10) years from
Supplier’s last shipment of SOFTWARE . Supplier agrees to support PRODUCT for
ten (10) years from Supplier’s last shipment. Under this Paragraph, Supplier
shall also give Purchaser one (1) year prior written notice of the
discontinuance of the sale of maintenance, replacement and repair parts for
PRODUCT. Charges for support SERVICES provided pursuant to this paragraph shall
be mutually agreed upon at time of discontinuance notice. Supplier may locate a
third party that will
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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fulfill Supplier’s support obligations hereunder; however, such third party must
be approved by Purchaser, such approval not to be unreasonably withheld, and
should such third party fail to perform such support, Supplier shall be
obligated to resume direct provision of such support or once again locate a
third party subject to the same terms.
     When Supplier has given Purchaser such discontinuance notice, or if for any
other reason Supplier is unable to provide such PRODUCT, Supplier shall, if
requested by Purchaser, endeavor to arrange for a third party to continue to
furnish the discontinued maintenance, replacement and repair parts to Purchaser.
In the event Supplier is not requested or, if requested, is unable to find a
third party to furnish such maintenance or replacement or repair of PRODUCT to
Purchaser, Supplier shall, upon request by Purchaser, provide Purchaser with
existing technical information and rights to the extent Supplier has such
rights, including SOURCE CODE and DOCUMENTATION, at no additional charge,
sufficient for Purchaser to manufacture, or have manufactured the PRODUCT and
maintain, modify and upgrade the SOFTWARE. In no event shall the provision of
such rights and technical information to a third party or to Purchaser be
delayed beyond six (6) months after Supplier’s date of notice of discontinuance.
     Supplier shall protect against the loss or damage of the existing technical
information required for the manufacture of the discontinued parts with the same
degree of care that Supplier uses to protect its own valuable technical
information. In addition, Supplier shall advise Purchaser in writing at least
six (6) months in advance of its decision to discontinue maintenance of any
technical information, so that Purchaser may acquire such technical information
in accordance with the provisions of this clause.
     The technical information includes, by example and not by way of
limitation: (a) manufacturing drawings and specifications of raw materials and
components comprising such parts; (b) manufacturing drawings and specifications
covering special tooling and the operation thereof; and (c) a detailed list of
all commercially available parts and components purchased by the Supplier on the
open market disclosing the part number, name, and location of the Supplier and
price lists for the purchase thereof, including SOURCE CODE and DOCUMENTATION.
ARTICLE 21
LIABILITY AND INSURANCE
     21.1 LIABILITY All WORK or SERVICES furnished by Supplier or by persons
furnished by Supplier, including its subcontractors (if any) pursuant to this
Agreement shall be performed in a proper and workmanlike manner and as an
Independent Contractor and not as the agent of Purchaser. All persons furnished
by Supplier and its subcontractors (if any) shall be considered solely
Supplier’s and its
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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subcontractors’ (if any) employees or agents, and Supplier and its
subcontractors (if any) shall be responsible for compliance with all laws,
rules, and regulations including, but not limited to employment of labor, hours
of labor, working conditions, worker’s compensation, payment of wages, and
payment of taxes, such as unemployment, social security and other payroll taxes,
including applicable contributions from such persons when required by law.
Supplier and its subcontractors (if any) shall indemnify, hold harmless, and
defend Purchaser from and against any claim or lawsuits arising out of
Supplier’s and its subcontractors’ (if any) failure to comply with any such
laws, rules or regulations.
     Supplier shall indemnify, hold harmless and defend Purchaser from and
against any loss, cost, liabilities, claims or demands (including the costs,
expenses and attorney’s fees) that may be made: (a) by anyone for injuries
including death to persons or damage to property including theft, resulting from
its acts or omissions or those of persons furnished by Supplier; (b) by persons
furnished by Supplier and its subcontractors (if any) under Worker’s
Compensation or similar acts; (c) by anyone in connection with WORK, PRODUCTS or
SERVICES provided by Supplier; and (d) under any federal securities laws or
under any other statute, at common law or otherwise arising out of or in
connection with the performance by Supplier contemplated by this Agreement or
any information obtained in connection with such performance; except in all such
cases (a) through (d) to the extent losses result from the negligence or
intentional acts of Purchaser; and Supplier further agrees to bind its
subcontractors (if any) to similarly indemnify, hold harmless and defend
Purchaser. Supplier shall not implead or bring any action against Purchaser and
its AFFILIATES, their respective directors, officers, employees, agents in
connection with any action by any of Supplier’s employees for any personal
injury (including death) or property damage that occurs in the course or scope
of employment of such person, except to the extent any such action resulting
from or arising out of the negligence or intentional acts of Purchaser.
Purchaser will notify Supplier of any written claims or demands against it for
which Supplier is responsible hereunder.
     21.2 INSURANCE Supplier and its subcontractors (if any) agree to purchase
and maintain during the term hereof all insurance and/or bonds required by law
on this Agreement including without limitation: (a) Workers’ Compensation and
related insurance as prescribed by the law of the State in which the work is
performed; (b) Employers Liability insurance with limits of not less than
$2,000,000 per occurrence and in the aggregate; (c) Commercial General Liability
insurance, including Product Liability and Completed Operation endorsements for
a combined single limit of not less than $5,000,000 per occurrence and in the
aggregate; and (d) if the use of a motor vehicle is required, Automobile
liability coverage for a combined single limit of $2,000,000. Supplier shall
furnish certificates of insurance evidencing placement of such insurance.
Purchaser shall be named as Additional Insureds in the policies referred to
above.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement

 

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Contract No. C0302362
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     Certificates furnished by Supplier shall provide that Purchaser is to be
notified in writing, in accordance with Section 27.11 hereof, entitled NOTICES,
at least twenty (20) days prior to cancellation of, or any material change in
the policy. Supplier and its subcontractors (if any) shall assume responsibility
for such notification being given to:
Manager, Customer Support
Verizon Corporate Sourcing
240 East 38th Street,15th Floor
New York, New York 10016
     21.3 LIMITATION OF LIABILITY Except for personal injury, property damage
and Supplier’s indemnification obligation hereunder with respect to which there
shall be no limitation of liability, neither party shall be liable to the other
party for any incidental, special, indirect, consequential damages, including,
but not limited to, lost profits, data or revenue, however caused or on any
theory of liability, by reason of any act, occurrence or non-occurrence arising
out of the business contemplated by this Agreement; provided, however, Supplier
agrees that, without limiting the general meaning of the term direct damages,
the following shall be considered direct damages or losses of Purchaser for
which Supplier shall be liable and Supplier shall not assert that such damages
are indirect, special, incidental or consequential losses or damages:

A)   a complete refund of all moneys paid by Purchaser for defective PRODUCTS
and SERVICES;   B)   any costs, charges and expenses associated with the
installation, de-installation and removal of rejected defective PRODUCTS;   C)  
any incremental costs, charges and expenses incurred by Purchaser to obtain,
provide and implement a workaround incident to a failure to provide the PRODUCT
or SERVICES in accordance with SPECIFICATIONS;   D)   any costs, charges and
expenses of replacing lost or damaged property, equipment, SOFTWARE and HARDWARE
caused by Supplier or Supplier’s PRODUCTS and SERVICES;   E)   any costs,
charges and expenses incurred to correct defects, deficiencies or defaults
related to the failure or malfunction of PRODUCTS or SERVICES;   F)   any excess
costs, charges and expenses to reprocure similar commercially available PRODUCTS
and SERVICES from a third party on an expedited basis, it being understood that
any such costs associated with such PRODUCTS and SERVICES will be net of the
refund of the purchase price;

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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G)   any other type of damages normally considered direct or general damages in
the procurement of telecommunications technology.

     The foregoing limitation of liability shall apply with respect to any
action or proceeding by either party or their affiliates or their respective
assignees howsoever arising, whether in equity or law and whether based in
contract or tort even if such a party has been advised of the possibility of
such damages or losses.
ARTICLE 22
[Intentionally Omitted.]
ARTICLE 23
WORK PERFORMED ON PURCHASER PREMISES
     23.1 CLEAN UP Upon completion of any work performed under this Agreement or
pursuant to Orders placed hereunder, Supplier shall promptly remove all
implements, surplus materials and debris.
     23.2 HARMONY Supplier shall be entirely responsible for all persons
furnished by it working in harmony with all others working on Purchaser
premises.
     23.3 PLANT AND WORK RULES Supplier’s employees, agents and contractors
shall, while on Purchaser’s premises, comply with all plant rules and
regulations, including, where required by government regulations, submission of
satisfactory clearance from the US Department of Defense and other Federal
authorities concerned.
     23.4 RIGHT OF ACCESS Each party shall permit access to the other’s
respective facilities as reasonably required in connection with work hereunder.
No charge shall be made for such access. It is agreed that reasonable advance
notice will be given when access is required.
     23.5 TOOLS AND EQUIPMENT Unless otherwise specifically provided in this
Agreement, Supplier shall provide labor, tools and equipment necessary for
performance pursuant to an Order under this Agreement.
     23.6 WORK HEREUNDER It is understood that visits by Supplier’s
representatives or Supplier’s contractor’s representatives to perform Supplier’s
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Contract No. C0302362
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obligations under this Agreement shall for all purposes be deemed “work
hereunder” and shall be at no charge to Purchaser unless otherwise specifically
provided in this Agreement or in another writing signed or duly acknowledged by
authorized representatives of both parties.
     Supplier’s employees, contractors, and/or agents shall all be considered
Supplier’s employees, and Supplier shall be solely responsible for work
performed by its employees, agents, and/or contractors. Supplier shall, upon
notification from Purchaser of completion of work performed by others, upon
whose completion Supplier’s own work depends, promptly inspect and advise
Purchaser of any impediment that prevents the Supplier’s proper performance.
Supplier’s silence shall constitute approval of such other work as fit, proper,
and suitable for Supplier’s performance of work.
     23.7 IDENTIFICATION CREDENTIALS Purchaser may, at its discretion, require
Supplier’s employees to exhibit identification credentials, which Purchaser may
issue, in order to gain access to Purchaser’s premises for the performance of
the work. If, for any reason, any of Supplier’s employees are no longer
performing work, Supplier shall immediately inform Purchaser’s representative in
the most expeditious manner possible. Notification shall be followed by the
prompt delivery to Purchaser’s representative of the identification credentials
involved.
ARTICLE 24
ENVIRONMENTAL AND SAFETY
     24.1 ENVIRONMENTAL COMPLIANCE
24.1.1 SUPPLIER ENVIRONMENTAL WARRANTY Supplier hereby warrants, represents and
certifies that Supplier’s performance of this Agreement, Supplier’s PRODUCTS and
the result of Supplier’s SERVICES rendered hereunder conform to and shall
conform and comply with all climatic, weather and environmental factors and
requirements identified in Appendices B and L hereto, , and shall comply in all
material respects with all applicable Federal, State, County and Municipal laws,
statutes, regulations, and codes which relate to environmental protection and
employee protection including, but not limited to, the Atomic Energy Act, Clean
Air Act, Clean Water Act, Comprehensive Environmental Response, Compensation and
Liability Act, Federal Insecticide, Fungicide and Rodenticide Act, Hazardous
Materials Transportation Act, Marine Protection, Research and Sanctuaries Act,
National Environmental Policy Act, Noise Control Act, Occupational Safety and
Health Act, Safe Drinking Water Act, Solid Waste Disposal
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Act, Toxic Substances Control Act, and any equivalent or similar state, county,
or local law, regulation, statute, code, or ordinance.
24.1.2 STATE “State” refers to the State of New York, the state where, or in
which, Supplier’s Performance occurs and any other state or subdivision of a
state asserting jurisdiction over Supplier’s performance hereunder.
24.1.3 PERFORMANCE “Performance” as used herein refers to Supplier’s
installation, dismantling, segregation, staging, loading, removal, processing,
transportation, disposal, treatment, reclamation or other handling methods used
in performing under this Agreement.
24.1.4 SUPPLIER’S CERTIFICATION AND INDEMNIFICATION Supplier further agrees to
recertify compliance herewith at Purchaser’s request. Supplier will indemnify
and save Purchaser harmless from any violation or breach of this Section 24.1,
entitled ENVIRONMENTAL COMPLIANCE.
24.1.5 LICENSES AND PERMITS Supplier certifies that it shall obtain all
licenses, permits, and authorizations necessary to perform this Agreement from
the appropriate State, Federal and Local governments and agencies prior to
commencement (performance) of WORK hereunder.
24.1.5.1 Supplier shall notify Purchaser immediately if any permit, license,
certificate or identification number required for working on the PRODUCT shall
have been revoked, not been renewed, expired or been suspended.
24.1.6 SAFETY PRECAUTIONS AND MANAGEMENT PRACTICES Supplier shall use its best
efforts to exercise every reasonable safety precaution and best management
practice, whether or not required by law, in dealing with the material.
     24.2 HAZARDOUS CHEMICAL INFORMATION Supplier shall provide Material Safety
Data Sheet(s) in the event that the PRODUCT (including electronic components) to
be provided is or contains any substance designated:

  1.   as a toxic/hazardous substance, as defined by the Occupational Safety and
Health Administration, Environmental Protection Agency, and/or all state “Right
to Know” laws; and/or

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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  2.   as a carcinogen or potential carcinogen by the National Toxicology
Program or the International Agency for Research on Cancer; and/or     3.   a
hazardous material as defined in the Hazardous Material Transportation Act;
and/or     4.   a regulated material under the Federal Insecticide, Fungicide
and Rodenticide Act; and/or     5.   as a hazardous waste in the Resource
Conservation and Recovery Act or the Superfund Amendment Reauthorization Act;
and/or     6.   as radioactive; and/or     7.   under the Clean Air Act or Clean
Water Act.

     A Material Safety Data Sheet must also be provided if the PRODUCT
(including components) could be a hazard to human health and/or the environment
in a fire/combustion or spill situation.
          24.2.1 HAZARDOUS MATERIALS COMPLIANCE PROVISION Supplier represents
and warrants that all PRODUCTS provided hereunder will be packaged, labeled,
handled and shipped in accordance with all applicable federal, state, county and
local laws, rules, regulations, orders and other lawfully mandated requirements.
This obligation shall include but not be limited to compliance with the
following:

  1.   all product labeling and other requirements imposed by the New Jersey
Worker and Community Right-to-Know Act, N.J.S.A. 34:5A-1, et. seq., and all
regulations adopted pursuant thereto;     2.   all product labeling and other
requirements imposed by the Occupational Safety and Health Act of 1970 (OSHA),
as amended, and all regulations adopted pursuant thereto, including the Hazard
Communication Standard regulations;     3.   all requirements of the Hazardous
Material Transportation Act, the Toxic Substance Control Act, as amended, the
Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) and the New Jersey
Pesticide Control Code (N.J.A.C. 7:30).

     24.3 OCCUPATIONAL SAFETY AND HEALTH ACT (O.S.H.A.) Supplier in performing
work under this Agreement will fully comply with the provisions of the Federal
Occupational Safety and Health Act of 1970 and with any and all applicable rules
and regulations issued pursuant to the Act.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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ARTICLE 25
TRAINING
     If requested by Purchaser, Supplier agrees to provide training in the
courses referenced in Appendix H, on the terms and prices set forth therein, and
any changes thereto, training in any courses subsequently developed by Supplier,
and any training equipment and instructional documentation required in support
of PRODUCTS and/or SERVICES to be furnished by Supplier under this Agreement.
     The training, training equipment and instructional documentation to be
furnished by Supplier under this Agreement shall be suitable to train
Purchaser’s personnel in the area of systems planning, application engineering,
practices, operation, installation, maintenance and repair, as well as marketing
of system or product features as required.
     Such training, training equipment and instructional documentation shall be
configured to provide at Purchaser’s option, either/or both of the following:

  1.   Instructors, training equipment and instructional DOCUMENTATION suitable
to train Purchaser’s personnel at either Supplier’s or Purchaser’s location.    
2.   Provide instructor training, training equipment and instructional
DOCUMENTATION suitable to sufficiently train Purchaser’s training staff, so that
they, in turn, may conduct training programs related to the SYSTEM and/or
PRODUCT and qualify other Purchaser’s personnel in the appropriate use, or
application of the SYSTEM and/or PRODUCT.

     The training, training equipment and instructional DOCUMENTATION furnished
by Supplier under this Agreement, shall be developed and furnished in accordance
with the requirements, formats and procedures set forth in Appendix H. Purchaser
shall have the right to reproduce such instructional DOCUMENTATION for internal
use only and not for distribution to any third parties.
ARTICLE 26
CONSULTING
     Purchaser shall have the option to contract for specialized consulting
assistance from Supplier on a project basis to be described in documents
specifying the consulting services and deliverables to be provided by Supplier
(“Statement(s) of Work”). Statements of Work will be executed from time to time,
and upon acceptance by both
NOTICE: Recipient acknowledges that the information contained herein
is’proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to-the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 85 of 98
parties will be incorporated into this Agreement by reference thus describing
the specifications for each engagement (“Engagement”). If there are any terms or
conditions specified in a Statement of Work that conflict with this Agreement,
the terms and conditions of this Agreement will prevail unless those terms are
expressly noted as overriding the terms and conditions of the Agreement and then
only for that specific Statement of Work. Supplier understands that time is of
the essence and will endeavor to place the appropriate personnel on a timely
basis.
ARTICLE 27
GENERAL PROVISIONS
     27.1 SEVERABILITY If any of the provisions of this Agreement shall be
invalid or unenforceable, such invalidity or unenforceability shall not
invalidate or render unenforceable the entire Agreement, but rather the entire
Agreement shall be construed as if not containing the particular invalid or
unenforceable provision or provisions. If the invalid or unenforceable provision
or provisions shall be considered an essential element of this Agreement, the
parties shall promptly attempt to negotiate a substitute therefor.
     27.2 CHOICE OF LAW The construction, interpretation and performance of this
Agreement shall be governed by and construed in accordance with the domestic
laws of the State of New York, and all actions under this Agreement shall be
brought in a court of competent subject matter jurisdiction of the State of New
York and both parties agree to accept and submit to the personal jurisdiction of
such court. Supplier also agrees to submit to the jurisdiction of any court in
the United States wherein an action is commenced against Purchaser based on a
claim for which Supplier has indemnified Purchaser hereunder.
     27.3 COMPLIANCE WITH LAWS Supplier and all persons furnished by Supplier
shall comply with the applicable EEO, Fair Labor Standards Act and all other
federal, state, county and local laws, ordinances, regulations and codes
(including procurement of required permits or certificates) in its or their
performance under this Agreement or an Order issued pursuant hereto.
     This Agreement is subject to applicable laws and executive orders relating
to equal opportunity and nondiscrimination in employment. Supplier and all
persons furnished by Supplier shall not unlawfully discriminate in its
employment practices against any person by reason of race, religion, color, sex,
disability or national origin and agrees to comply with the provisions of said
laws and orders to the extent applicable in the performance of this Agreement
and as set forth in the attached Appendix O — Non-Discrimination Compliance
Undertaking.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
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     Supplier agrees to indemnity and hold harmless Purchaser for, from and
against and defend Purchaser against, any loss or damage sustained because of
Supplier’s noncompliance hereunder.
     27.4 COMPLIANCE WITH FEDERAL RULES
          27.4.1 RADIO FREQUENCY ENERGY STANDARDS PRODUCT furnished hereunder
shall, at time of shipment, comply to the extent applicable with the
requirements of Subpart J of Part 15 of the Federal Communications Commission’s
Rules and Regulations, as they may be amended from time to time, including those
Sections concerning the labeling of such PRODUCT and the suppression of radio
frequency and electro-magnetic radiation to the specified levels. Should the
PRODUCT during use fail to meet relevant parts of the FCC Rules and Regulations
for spurious emission and interference to radio communications, Supplier shall
provide to Purchaser information relating to methods of suppressing such
interference. In the event such interference cannot reasonably be suppressed,
then all remedies as provided by Article 14 hereof, entitled WARRANTIES shall
apply.
          27.4.2 REGISTRATION When PRODUCT furnished under this Agreement is
subject to registration under Part 68 of the Federal Communications Commission’s
Rules and Regulations as they may be amended from time to time (“Part 68”),
Supplier warrants that such PRODUCT furnished under this Agreement is registered
under and complies with Part 68 including, but not limited to, all labeling and
customer instruction requirements unless such PRODUCT is furnished as part of a
technical field trial or unless the PRODUCT is provided for services not covered
or exempt under Part 68. Supplier agrees to defend and hold Purchaser harmless
from any liability, claim or demand (including the costs, expenses and
reasonable attorney’s fees on account thereof) that may arise out of Supplier’s
non-compliance with Part 68. Purchaser agrees to promptly notify Supplier of any
liability, claim or demand against Purchaser for which Supplier is responsible
under this clause and gives Supplier full opportunity and authority to assume
the defense, including appeals, and to settle such liability, claims and
demands, provided that if Purchaser reasonably believes that Supplier is not
adequately handling such defense or settlement, Purchaser reserves the right to
assume the defense or settlement.
     27.5 MINORITY AND WOMEN-OWNED BUSINESS ENTERPRISES Supplier agrees to
provide equal opportunity to Minority and Women-Owned Business Enterprises
(M/WBE) in accordance to requirements set forth in Appendix I hereto, entitled
MWDVBE.
     Purchaser has established a subcontracting plan to encourage the use of
minority (MBE), women-owned (WBE) and protected class (PC) subcontractors
utilized by
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
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Supplier. As a part of this plan, Supplier shall provide quarterly reports to
Purchaser of Supplier’s expenditures with MBE/WBE/PC subcontractors (“M/WBE
Expenditures”). Such quarterly reports shall be received by Purchaser by the
15th of the month immediately following the end of the quarter during which the
M/WBE Expenditures were made. To make such quarterly reports, Supplier shall
complete the Purchaser’s M/WBE/PC Summary Subcontract Report., Appendix I
hereto, entitled MWDVBE hereto and forward to Purchaser’s M/WBE representative
at the address below.
Diversified Process Coordinator
Verizon Corporate Sourcing
240 East 38th Street, 15th Floor
New York, New York 10016
     Supplier’s compliance with this clause shall be subject, at Purchaser’s
option to independent verification in accordance with Section 6.4 hereof,
entitled RECORDS AND AUDIT.
     27.6 EXPORT CONTROL
27.6.1 Supplier hereby certifies to Purchaser that unless Supplier has received
the prior written authorization of the Office of Export Licensing of the US
Department of Commerce, Washington, DC, Supplier will not transmit, by any
means, either directly or indirectly, any technical data or information in any
form whatsoever (whether written, oral or otherwise) acquired from Purchaser, or
any direct PRODUCT of such data or information, to any “Q,” “S,” “T,” “V,” “W,”
“Y” or “Z” country enumerated in the Export Control Regulations of the US
Department of Commerce or to Afghanistan or the People’s Republic of China
including Inner Mongolia, the provinces of Tsinghsi and Sikang, Sinkiang, Tibet
and Manchuria (includes the former Kwantung Leased Territory, the present Port
Arthur Naval Base Area, and Lianong Province), but excluding the Republic of
China (Taiwan, also known as Formosa).
27.6.2 Supplier further covenants and agrees with Purchaser that in performing
under this Agreement Supplier will, at all tunes, comply with The Export
Administration Amendments Act of 1985 (P.L. 99-64); The Department of Defense
Authorizations Act of 1984 (P.L. 98-94); The Arms Export Control Act (22 USC
1234 §§ 2551 et seq.); The Department of State International Traffic in Arms
Regulations (22 CFR §§ 121 et seq.); The Department of Commerce Technical Data
Regulations (15 CFR Pt. 179) and all Regulations promulgated under any of the
foregoing Acts.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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     27.7 TAXES Purchaser shall be liable for and shall reimburse Supplier only
for the following tax payments, including related charges, except for any
related charges that may be imposed as a result of Supplier’s failure to timely
file an accurate tax return required to be filed by it, with respect to
transactions under this Agreement: Federal manufacturers and retailers excise
and New York state and local sales or use taxes, including any privilege or
excise taxes in the nature of sales or use taxes, as applicable. Such taxes
shall be billed to Purchaser as separate items on Supplier’s invoices, unless a
valid exemption certificate is furnished by Purchaser to Supplier. Purchaser
shall have the right to have Supplier cooperate with Purchaser in contesting
with the imposing jurisdiction, at Purchaser’s expense, any such taxes that
Purchaser deems are improperly levied.
     27.8 REGULATORY ASSISTANCE If requested by Purchaser, Supplier shall, to
the best of its ability, provide assistance by supplying an expert witness, if
required, with regard to regulatory matters in connection with PRODUCTS and/or
SERVICES provided hereunder, provided that Purchaser shall pay Supplier for such
assistance at a reasonable rate to be specified and shall reimburse Supplier for
all travel and per-diem living expenses reasonably incurred by the expert
witness.
     27.9 SURVIVAL All Right and obligations hereunder granted or incurred prior
to and which by their nature would continue beyond the cancellation,
termination, or expiration of this Agreement or any Order placed hereunder by
Purchaser shall survive such cancellation, termination, or expiration.
     27.10 NON-WAIVER Purchaser’s failure at any time to enforce any of the
provisions of this Agreement or any right or remedy available hereunder or at
law or equity, or to exercise any option herein provided will in no way be
construed to be a waiver of such provisions, rights, remedies or options or in
any way to affect the validity of this Agreement. The exercise by Purchaser of
any rights, remedies or options provided hereunder or at law or equity shall not
preclude or prejudice the exercising thereafter of the same or any other rights,
remedies or options.
     27.11 NOTICES Any Notice or demand which under the terms of this Agreement
or under any statute shall be made by Supplier or Purchaser in writing which may
take the form of facsimile, electronic transfer, overnight courier or certified
or registered mail, with return receipt requested, addressed to the respective
parties. A Notice shall be deemed delivered upon record of transmission receipt
or return receipt, as applicable, or one (1) day after shipment via overnight
courier or three (3) days after mailing by certified or registered mail.
     Notices to Purchaser shall be addressed to the following (unless this
Agreement provides otherwise):
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
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Verizon Corporate Sourcing
240 East 38th Street, 14th Floor
New York, New York 10016
Attn.: John Birchler
Sourcing Process Leader
Telecopier No: 212-476-5262
with a copy to:
Peter Plaut
Assistant General Counsel
Verizon Corporation — HQE03H52
700 Hidden Ridge
Irving, TX 75038
Telecopier No. 972-718-1251
Verizon
Notices to Supplier shall be addressed to:
XEL Communications, Inc.
17101 East Ohio Dr.,
Aurora, CO, 80017
Attn: Chief Executive Officer
Telecopier No.: (303)369-7007
     27.12 FORCE MAJEURE Neither party shall be held responsible for any delay
or failure in performance of this Agreement caused by fires, strikes, embargoes,
requirements imposed by government regulations, civil or military authorities,
acts of God, beyond the control of Supplier or Purchaser and which could not
have been avoided through the application of reasonable foresight or diligent
effort, but excluding the effects of environmental factors identified in
Appendices B and L hereto, on the performance or durability of PRODUCTS or
SERVICES. If such contingency occurs, the party delayed or unable to perform
shall provide notice to the other party and if the delaying causes continue for
a period of fifteen (15) days, the party injured by the other’s inability to
perform may elect to:

  1.   terminate such order or part thereof as to PRODUCTS not already shipped
or SERVICES not already performed;

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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  2.   suspend such order for the duration of the delaying causes, buy or sell
elsewhere PRODUCTS to be bought or sold hereunder and deduct from any order
commitment the quantity bought or sold or for which such commitments have been
made elsewhere; or     3.   resume performance under such order once the
delaying cause ceases with an option in the injured party to extend the delivery
or performance date up to the length of time the contingency endures.

     Unless written notice is given no later than fifteen (15) days from when
the injured party is notified, (b) shall be deemed selected.
     27.13 RELEASES VOID Neither party shall require waivers or releases of any
personal rights from representatives of the other in connection with visits to
their respective premises and no such releases or waivers shall be pleaded by
Supplier or Purchaser in any action or proceeding.
     27.14 SECTION HEADINGS The headings of the sections herein are inserted for
convenience only and are not intended to affect the meaning or interpretation of
this Agreement.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 91 of 98
ARTICLE 28
ALTERNATE DISPUTE RESOLUTION
     28.1 REFERRAL Should any disagreement, dispute, disputed claim of breach,
nonperformance, or repudiation arising from, related to or connected with this
Agreement or any of the terms or conditions hereof, or any transactions
hereunder (“Dispute”)., arise between Purchaser and Supplier either during this
Agreement or after termination or expiration of this Agreement, either party may
give to the other notice of the Dispute, specifically referencing this provision
and request resolution of the Dispute. At the expiration of ten (10) business
days, unless it shall have been settled, either party may refer such Dispute to
Alan Polonsky, Director/Sourcing Process — Verizon Corporate Sourcing and Mike
Hull, Vice President-Supplier for resolution. If within an additional ten
(10) business days such Dispute shall not have been settled, then either party
may refer it to George Dowell, Senior Vice-President/Corporate Sourcing —
Verizon Corporate Sourcing and Mike Hull, Vice President- Supplier for
resolution. The parties agree to exchange relevant information and cooperate in
good faith to resolve the Dispute under this provision. If within an additional
ten (10) business days, such dispute shall not have been settled, the parties
agree to resort to the dispute mediation remedies set forth below. The parties
will not be prohibited from seeking injunctive relief to preserve the status quo
while the mediation is pending.
     28.2 MEDIATION A formal mediation procedure may be commenced by either
party under the then current Public Resources (“CPR”) Model Procedure for
Mediation of Business Disputes by notice to CPR to select an experienced neutral
mediator and a proposed time and date for mediation. All mediators shall be
selected from the CPR Panel of Neutrals unless the parties mutually agree to a
difference neutral mediator. All mediator fees shall be equally shared by the
parties. Each party will pay its own costs and other expenses associated with
the mediation, except that the reasonable travel expenses, as outlined in the
Verizon Travel Guidelines, incurred by the party, which is more distant from the
site of the mediation, shall be shared equally by Supplier and Purchaser. The
parties shall participate in good faith in the mediation and if the parties
reach a resolution of the Dispute, it shall be reduced to writing and shall be
enforceable in accordance with its terms.
     If the procedures set forth above do not result in a resolution of the
dispute satisfactory to both parties within thirty-one (31) days of the first
notice to CPR to select a mediator, either party may give notice in writing to
the other party that the mediation procedure is terminated. Upon the issuance of
such notice, either party shall have the right to pursue such remedies as may be
available at law or in equity or under this Agreement.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
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     ALL DISCUSSIONS AND DOCUMENTS PREPARED PURSUANT TO ANY ATTEMPT TO RESOLVE A
DISPUTE UNDER THIS PROVISION ARE CONFIDENTIAL AND FOR SETTLEMENT PURPOSES ONLY
AND SHALL NOT BE ADMITTED IN ANY COURT OR OTHER FORUM AS AN ADMISSION OR
OTHERWISE AGAINST A PARTY FOR ANY PURPOSE INCLUDING THE APPLICABILITY OF FEDERAL
AND STATE COURT RULES.
ARTICLE 29
TL 9000 REPRESENTATION AND WARRANTY
29.1 Definitions. As used in this Section, the term:

  (a)        “TL 9000 Registration” is a certification of TL 9000 Compliance and
indicates the successful completion of a Registration Audit by a TL 9000
Registrar, including the receipt of a TL 9000 Certificate TL 9000 Registration
(i) may apply to the quality management system for Hardware, Software, Services,
and/or Documentation or any combination thereof and (ii) may cover an entire
company, a business unit, facility or a limited, defined product line as
mutually agreed by Supplier and the Registrar. The scope of TL 9000 Registration
will be clearly defined within the TL 9000 Certificate. TL 9000 Registration
lasts for 3 years, covers 100% of the scope of the entity being registered
(i.e., company, organizational unit, facility or limited, defined product line)
and the TL 9000 Quality Management System Requirements.     (b)        “TL 9000
Certificate” defines the scope of TL 9000 Registration and certifies that
Supplier’s applicable quality management system is TL 9000 Compliant and has
successfully completed a TL 9000 Registration Audit by a TL 9000 Registrar.    
(c)        “TL 9000 Registration Audit” means a planned, independent and
documented assessment of a supplier’s quality management system that is
performed by a TL 9000 Registrar to determine TL 9000 Compliance of such system.
    (d)        “TL 9000 Registrar” means an organization that meets the
requirements established by the QuEST Forum and affirmed by the accreditation
body for the purpose of administering the TL 9000 Registration process.
Registrars perform TL 9000 Registration Audits under a contractual arrangement
with the supplier (the “Registration Contract”). Registrars are responsible for
verifying that a contracting supplier has implemented a quality management
system that complies with TL 9000 Requirements for as long as the Registration
Contract is in effect.

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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FLEXGROW
Contract No. C0302362
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  (e)   “TL 9000 Quality Management System Requirements,” referred to herein as
“TL 9000 Requirements,” mean the telecommunications quality system requirements
that are common to the design, development, production, delivery, installation
and maintenance of hardware, software and/or services established by the QuEST
Forum. In addition to common quality requirements, the QuEST Forum has also
established separate quality system requirements that are specific to hardware,
software and services, respectively, as part of the TL 9000 Requirements. TL
Requirements also include such Requirements as updated or amended from time to
time by the QuEST Forum.     (f)   “TL 9000 Compliant” or “TL 9000 Compliance”
means that Supplier’s applicable quality management system fully meets the TL
9000 Requirements as documented by the receipt of either:

(i) TL 9000 Certificate; or

(ii)TL 9000 Compliance Statement
as such terms are defined herein.

  (g)   “TL 9000 Compliance Statement” is an affirmative indication in writing
that Supplier’s quality management system has met the TL 9000 Requirements from
any quality auditor who is independent of Supplier, is certified to perform TL
9000 audits and is not a TL 9000 Registrar (“Quality Auditor”).     (h)   “TL
9000 Product Category Table” means the auditable TL 9000 Requirements (which are
referred to herein as the TL 9000 Quality System Measurements) as published in
TL 9000 Quality Management System -Measurements Handbook by the Quality
Excellence for Suppliers of Telecommunications Leadership Forum (the “QuEST
Forum”).

               29.2 (a) Supplier represents, warrants and agrees that within one
year from execution of this Agreement, or sooner if possible, it will use
commercially reasonable efforts to ensure that the processes it utilizes to
produce Hardware, Software, Services, and/or Documentation or any combination
thereof under this Agreement will be under quality management system(s) that
shall have undergone TL 9000 Registration. Supplier shall maintain its TL 9000
Registration for the term of this Agreement. Supplier shall provide Purchaser
written documentation’of its TL 9000 Registration, consisting of copies of
Supplier’s TL 9000 Certificate(s) within thirty (30) days from the date of
issuance of such written documentation of TL 9000 Registration.
               (b) If Supplier has not provided documented evidence of its TL
9000 Registration, i.e., the TL 9000 Certificate, within one year, or sooner if
possible, from the execution of
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon—XEL
FLEXGROW
Contract No. C0302362
Page 94 of 98
this Agreement, then, Supplier shall provide Purchaser upon Purchaser’s request
and at no additional charge, the following for each of Supplier’s quality
management systems described above that have not achieved TL 9000 Registration:
A TL 9000 quality plan that conforms to the most current versions of (i) the TL
9000 Requirements and (ii) the TL 9000 Quality System Measurements.
     The elements to be detailed in such quality plan shall include (at
minimum): (i) a schedule for achieving TL 9000 Registration; and
(ii) designation of Supplier’s quality representative and of the Supplier senior
executive with quality responsibility.
     (c) Supplier shall provide Purchaser upon Purchaser’s request or on the
reporting basis stated herein and at no additional charge, the following
information for each of Supplier’s quality management systems described above
whether such systems have achieved TL 9000 Registration or not:
(i) TL 9000 Registration Audit results, if any;
(ii) quality management system review goals and objectives on an annual basis;
and

(iii) the TL 9000 Registration Audit results for any business unit which has
achieved TL 9000 Registration and received the TL 9000 Certificate.
     (d) Prior to achievement of TL 9000 Registration, Purchaser and Supplier
will mutually agree on the format for delivery of quality performance
measurements. Supplier shall provide Purchaser with these measurements for each
of Supplier’s quality management systems described above, which shall be
submitted on a quarterly basis (within 20 working days after the end of each
quarter) in conformance with the measurements required by Appendix X.
     (e) After the achievement of TL 9000 Registration, Supplier shall provide
Purchaser with quality performance measurements for each of Supplier’s quality
management systems described above. These measurements shall be submitted on a
quarterly basis in conformance with the TL 9000 Quality System Measurements,
including the TL 9000 Product Category Table, as required by TL 9000
Registration.
29.3 Periodic Review. If Supplier allows its TL 9000 Registration to lapse or if
Supplier is not compliant with the most current TL 9000 Requirements, Supplier
agrees to allow Purchaser or Purchaser’s agent to conduct periodic on-site
reviews at Supplier’s Hardware production/Software development facility(s) to
verify compliance with TL 9000 Requirements or any such other industry-wide
quality requirements that replaced TL 9000. Supplier also agrees to develop
corrective action plans for any of its quality systems that fail to comply with
TL 9000 Requirements, or any such other industry-wide
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon—XEL
FLEXGROW
Contract No. C0302362
Page 95 of 98
quality requirements that replaced TL 9000, that may be detected during these
periodic on-site reviews, and submit such plans in writing to the Purchaser or
Purchaser’s agent for Purchaser’s agreement within thirty (30) days after any
such on-site review. Further, Supplier agrees to implement these corrective
action plans within a time frame as agreed to by Purchaser within such
corrective action plan.
29.4 Order of Precedence. In the event of conflict between the TL 9000
Representation and Warranty and any corresponding term of this Agreement, the
terms of TL 9000 Representation and Warranty will take precedence.
29.5 Subcontractors. Supplier represents, warrants and agrees that within
180 days from execution of this Agreement, or sooner if possible, it will use
commercially reasonable efforts to ensure that the processes utilized by each of
its subcontractors, if any, to produce component part(s) of the Hardware,
Software, Services, and/or Documentation or any combination thereof provided
under this Agreement will all be under quality management systems that are
mutually agreeable to the parties. Supplier shall monitor and audit such quality
management systems and share the results of such monitoring and auditing with
Purchaser on a quarterly basis to the extent such reporting would be allowed by
the applicable subcontracts and in a format and on a reporting basis as are
mutually agreed to by the parties.
29.6 At such time that the TL 9000 Requirements for subcontractors have been
established, Supplier shall assure that each of its subcontractors that produce
component part(s) of the Hardware, Software, Services, and/or Documentation or
any combination thereof provided under this Agreement is performing under a
quality management system that is TL 9000 Compliant and shall provide to
Purchaser on a quarterly basis: (1) such measurements regarding the quality
systems of subcontractors as is mandated by the TL 9000 Requirements; (2) an
identification of key subcontractors, their respective TL 9000 Compliance status
and schedule for achieving TL 9000 Compliance; and (3) the designation of
Supplier’s subcontractors’ quality representative.
29.7 Term of TL 9000 Representations and Warranties. The representations,
warranties and remedies set forth in this Section: (a) shall be in effect for
the Term of this Agreement; and (b) are in addition to any other rights or
remedies available to Purchaser under this Agreement or otherwise at law or
equity. Notwithstanding anything to the contrary herein, the TL 9000
Registration Audit results, any information required to be disclosed under this
Section, and the TL 9000 Certificate provided by Supplier under this Section
shall not be deemed proprietary to Supplier.
ARTICLE 30
REPAIRS BY BUYER
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 96 of 98
30.1 Buyer may elect to repair Products purchased under this Agreement, either
during or after the Warranty Period, as established by this Agreement, for such
Products. For those Products for which Buyer elects such repair option, Supplier
agrees to furnish initial and supplemental documentation necessary for the
repair of Supplier’s manufactured Products covered by this Agreement, within
thirty (30) days of Buyer’s notice of such election and request for such
documentation. Upon such notice and request, transfer of such repair
documentation shall:
(i) be at reasonable and actual cost to produce such documentation,
(ii) include Licensed Material (Software and Related Software Documentation for
which licenses are granted by Supplier to Buyer under this Agreement; no Source
Code versions of Software are included in Licensed Materials), if required, with
pricing and licensing of such repair documentation to be mutually agreed to,
(iii) be for the sole use of Buyer in repairing the Products, and
(iv) not include the right to sub-license, disclose or transfer such repair
documentation to a third party.
30.2 Supplier agrees to sell to Buyer the necessary components for said repairs,
as available, through third party distribution, or at Supplier’s cost plus
profit not to exceed fifteen (15%) percent.
30.3 Repair documentation to be provided by Supplier to Buyer under this Section
shall include such documentation as may be reasonably necessary for Buyer to
perform the required repairs, in the mutual determination of the parties, so
long as such documentation is of the type generally made available to Supplier’s
customers, and shall in no instance include any confidential or proprietary
documentation unless the parties agree to an acceptable non-disclosure agreement
concerning such documentation.
Notwithstanding anything to contrary in any other provision of this Agreement,
should Buyer elect hereunder to perform repairs to any Product during the
Warranty Period for such Product, such election and performance of repairs by
Buyer shall negate and void Buyer’s Warranty and other contractual rights and
Supplier’s Warranty or other contractual obligations related to such Product on
which the repairs were performed.
ARTICLE 31
[Intentionally Omitted.]
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. C0302362
Page 97 of 98
ARTICLE 32
LAB TESTING
32.1.1 With respect to Laboratory Testing, Supplier shall comply with the
separate Lab
Testing Agreement executed by the parties.
ARTICLE 33
ENTIRE AGREEMENT
     This instrument, the Appendices and Schedules attached and the Order(s)
attached hereto, or hereafter issued under this Agreement, constitute and embody
the entire Agreement by and between the parties hereto and supersede all prior
oral or written agreements or understandings, if any, between them with respect
to the subject matter of this Agreement. In the event of a direct conflict
between a specific term or condition of this Agreement and a specific term or
condition in an Order, issued and accepted by the parties, the specific term or
condition in the Order shall take precedence and control, but only for purposes
of that individual Order. All Orders placed by Purchaser shall be deemed to
incorporate the terms and conditions of this Agreement as well as any
supplemental terms and conditions agreed to by the parties in writing. This
Agreement shall not be modified or amended except by a writing signed by
authorized representatives of both parties.
NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.

 

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Verizon — XEL
FLEXGROW
Contract No. xxxxxx
Page 98 of 98
     IN WITNESS WHEREOF, the parties have set their hand and seal intending to
be legally bound on the dates set forth below.

              SUPPLIER:   TELESECTOR RESOURCES GROUP, INC.
 
            XEL COMMUNICATIONS, INC.   D/B/A VERIZON SERVICES GROUP
(A VERIZON COMPANY)
 
           
By:
  Michael Hull   By:   George S. Dowell
 
           
Name:
  Michael Hull   Name:   George S. Dowell
Title:
  Vice-President   Title:   Sup Corporate Sourcing
Date:
  June 19, 2003   Date:   7/21/03

NOTICE: Recipient acknowledges that the information contained herein is
proprietary to Purchaser
and that Recipient may not use or disclose this information except under and
pursuant to the executed
Non-Disclosure Agreement.