Exhibit 10.94
IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
This amendment and its attachments, which are incorporated by reference,
(“Amendment # 6”) is entered into and made effective on September 13, 2005, by
and between Brocade Communications and International Business Machines
Corporation, whereby Brocade and IBM (“the Parties”) mutually agree to the
following terms and conditions.
The Parties hereby agree to modify and amend agreement number SOW 4903RL1112
dated December 15, 2003 (“Agreement”) as set forth herein in exchange for good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged. All other terms and conditions of the Agreement shall apply and
remain in full force and effect.
Amend Agreement by adding a new Product Unique Attachment #2, which is hereby
incorporated by reference.
PRODUCT UNIQUE ATTACHMENT #2, EFFECTIVE BEGINNING SEPTEMBER 13, 2005
1.0 PRODUCT DESCRIPTION
The Product is a [**]. The Fibre Channel (FC) Switch Module will provide 14
separate internal F ports to service each Blade Center processor slot plus 6
external ports that support FL_Port, F_Port, and E_Port; self-discovery based on
switch type (U_Port) peripherals running at 1Gbps , 2Gbps or 4Gbps rates.
Incorporated with the Fibre Channel Switch Module is Fabric OS, Web Tools,
Zoning and documentation will be available in the following languages: English.
1.1 Additional Description of Products.
Products must conform to the following specifications (including any subsequent
revisions, as mutually agreed to between the parties), which are hereby
incorporated by reference, and sold exclusively to IBM including providing
supporting Services:

•   “Brocade 4Gb Fibre Channel Switch Module for IBM eServer BladeCenter ”,
Product Requirements Document (“PRD”) Version 1.0, May, 2005, Owner, Patrick
Caporale, IBM.   •   IBM/Intel BladeServer Base Specification for Switch Module
Subsystems, Version 1.02, August 25,2003, Owner: Intel /IBM Collaboration
Architecture Review Board, provided to Supplier under the terms of the Technical
Information License Agreement. (“TILA”} dated August 5, 2003 between the
parties.

2.0 DEVELOPMENT REQUIREMENTS
2.1 Product Testing
Product Qualification and Test Plans shall be performed as documented in the PRD
and agreed to by both parties.
2.2 Deliverables
Seller shall, at its cost, use commercially reasonable efforts during the
Development Phase to provide deliverables requested by Buyer in conformance with
the development schedule that has been documented and mutually agreed to by both
parties.
2.3 Development
Buyer will provide WA’s to Supplier for [**] each P0.1 development modules
(SDV) and for [**] each P.1 development modules (SIT) at a price not to exceed
those identified in the table below. P0.1 and P1 development modules will comply
with the PRD specification agreed to in writing by the parties and will
incorporate all of the design change requests mutually agreed to by the parties
in writing. No later than [**] days following Supplier’s delivery of P1
development modules to Buyer, Supplier shall at its sole expense modify, replace
or otherwise upgrade all P0.1 level switches previously provided to be
functionally equivalent to a P1 Product. For the upgrade, Buyer shall pay all
freight, duties, and bare the risk of loss for the shipment of the Products to
Supplier for upgrade and Supplier shall pay all freight, duties, and bare risk
of loss for the shipment of the Products back to Buyer. The parties agree that
those software features included in this Product Attachment
 
  [**]   Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.        

Form Title: Agreement Title
Form Owner: Global Procurement   Page 1 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
will be available for the P0.1 and P1 switches at the currently available level
of code and will be included as part of the prices listed below.

          Product   Quantity   Not to Exceed Expense per Unit(USD)
P0.1 Level Switches
       
(SDV Switches)
  [**]   [**]
P1 Level Switches
       
(SIT Switches)
  [**]   [**]

3.0 PROPRIETARY OWNERSHIP
3.1 Buyer Proprietary Ownership.
Buyer will own rights to the following technology contained in the Blade Center
Fibre Channel Switch Module:

•   Molex Connector is Buyer proprietary as long as Buyer controls the design of
this connector, and the connector is not publicly available as an off the shelf
item [**]   •   Buyer Mechanicals:

[**] Blade Switch Mechanical Assembly
[**] OEM Generic Switch Module Cover
[**] OEM Generic Switch Module Blade Opening
[**] OEM Generic Switch Module Cover
[**] OEM Generic Switch Module Enclosure Assembly Drawing
[**] OEM Generic Switch Module Shield

•   Buyer’s Cosmetic Customization, which includes Buyer logo, Buyer name and
Buyer product names.   •   Buyer’s two unique signals (I2C Bus Reset signal and
I2C Interrupt signal) added to the I2C industry standard protocol, and the
contents specified by Buyer for the I2C Register interfaces and Vital Product
Data (VPD) table.

•   Buyer’s Standard BladeCenter and eServer Documentation and CD Contents

•   Common BladeCenter Labeling and Artwork

•   IBM Director SDK Interface Requirements

The I2C signal protocol is an industry standard and not proprietary to Buyer or
Supplier. Nothing in this Agreement should be construed as: (1) prohibiting or
restricting either party from independently developing, having independently
developed, acquiring, licensing, marketing, or distributing products, services,
or other materials which compete with products or services offered by the other
party. Each party is free to enter into similar agreements with third parties.
3.2 Seller’s Proprietary Ownership
Seller Proprietary Ownership.
Except for the proprietary information provided by Buyer under the TILA, the
items listed in Section 3.1 above and Buyer patents that read on the
implementation, Buyer makes no further claims of ownership.
4.0 PART NUMBER UNIQUE TERMS
4.1 PRODUCT PRICE LIST AND DESCRIPTION

                                          Fulfillment                          
      hub           Ship             Buyer Part   Supplier Part   locations (if
      Unit Price   group       **Software   Total Number   Number *   required)
*   Product Description   of Product   adder   Freight   Maintenance   Price  
[**]
  [**]   [**]   Option, FC Switch Module (20   [**]   [**]   [**]   [**]   [**]

 
[**]   Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.        

Form Title: Agreement Title
Form Owner: Global Procurement   Page 2 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005

                                          Fulfillment                          
      hub           Ship             Buyer Part   Supplier Part   locations (if
      Unit Price   group       **Software   Total Number   Number *   required)
*   Product Description   of Product   adder   Freight   Maintenance   Price
 
          port), includes Fabric OS, Advance Zoning, Web Tools and ship group  
                 
[**]
  [**]   [**]   Option, FC Switch Module (20 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module (20 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   CRU, FC Switch Module (20
port)   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module (10 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module (10 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module (10 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   CRU, FC Switch Module (10 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   10 Port POD (SW4020)   [**]                
[**]
  [**]   [**]   Fabric Watch   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Performance Bundle (Performance Monitor and Trunking)   [**]  
[**]   [**]   [**]   [**]
[**]
  [**]   [**]   ISL Trunking   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Advance Performance Monitor   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Extended Fabrics   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Fabric Manager v5.x   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Advanced Security Activation   [**]   [**]   [**]   [**]   [**]

 
**   For purpose of calculating the fees for the annual Software Maintenance
Support Program as described in Section 2.5, the annual Software Maintenance Fee
per Unit for each part number where it is applicable is as follows:

              Buyer Part           Annual Software Maintenance Fee per Number  
Supplier Part Number   Product Description   Unit
[**]
  [**]   Option, FC Switch Module (20 port), includes Fabric OS, Advance Zoning,
Web Tools and ship group   [**]
[**]
  [**]   Option, FC Switch Module (10 port), includes Fabric OS, Advance Zoning,
and Web Tools   [**]
[**]
  [**]   Fabric Manager v5.x   [**]
[**]
  [**]   Advanced Security Activation   [**]

4.2 PRODUCT UNIT TERMS & REPAIR PRICING —

                                          Hub                                
Warehouse       Lead   Warranty   Repair Price         Buyer P/N   Supplier P/N
  Location   Description   Time   Period   (USD)*   TAT   Yield
[**]
  [**]   [**]   Option, FC Switch Module (20 port), includes Fabric OS, Advance
Zoning, Web Tools and ship group       [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module
(20 port)       [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module
(20 port)       [**]   [**]   [**]   [**]
[**]
  [**]   [**]   CRU, FC Switch Module (20
port)   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module
(10 port)       [**]   [**]   [**]   [**]

 
[**]   Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.        

Form Title: Agreement Title
Form Owner: Global Procurement   Page 3 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005

                                          Hub                                
Warehouse       Lead   Warranty   Repair Price         Buyer P/N   Supplier P/N
  Location   Description   Time   Period   (USD)*   TAT   Yield
[**]
  [**]   [**]   Option, FC Switch Module
(10 port)       [**]   [**]   [**]   [**]
[**]
  [**]   [**]   Option, FC Switch Module
(10 port)       [**]   [**]   [**]   [**]
[**]
  [**]   [**]   CRU, FC Switch Module (20
port)   [**]   [**]   [**]   [**]   [**]
[**]
  [**]   [**]   10 Port POD (SW4020)       [**]   [**]        
[**]
  [**]   [**]   Fabric Watch       [**]   [**]        
[**]
  [**]   [**]   Performance Bundle (Performance Monitor and Trunking)       [**]
  [**]        
[**]
  [**]   [**]   ISL Trunking       [**]   [**]        
[**]
  [**]   [**]   Advance Performance Monitor       [**]   [**]        
[**]
  [**]   [**]   Extended Fabrics       [**]   [**]        
[**]
  [**]   [**]   Fabric Manager v5.x       [**]   [**]        
[**]
  [**]   [**]   Advanced Security Activation       [**]   [**]        

 
* Repair Price applies only to Products sent to Supplier for Repair, which are
not covered by the warranties in the Agreement.
5.0 WA FLEXIBILITY

                  Increase of Product Quantity to a WA   Cancellation of Product
Quantity to a WA   Rescheduling of Product Quantity to a WA Number of Days prior
to a WA   Scheduled Delivery Date   Scheduled Delivery Date   Scheduled Delivery
Date Scheduled Delivery Date   (% of WA Quantity)   (% of WA Quantity)   (% of
WA Quantity)
[**]
  [**]   [**]   [**]
[**]
  [**]   [**]   [**]
[**]
  [**]   [**]   [**]
[**]
  [**]   [**]    

While the above flexibility terms also apply to Pull Products, in the event the
relevant Pull Profile has more favorable terms, then such more favorable terms
shall take precedence.
6.0 RESERVED
7.0 SUPPLY OF PRODUCTS
In the event that materials or capacity is in such short supply, Supplier will
notify Buyer immediately upon knowledge of such supply deficiencies. If Supplier
is unable to fill Buyer’s WAs in full (“Scarce Resources”), at a minimum Brocade
agrees to allocate Scarce Resources to Buyer and to utilize any materials in
short supply to manufacture Supplier Products under Supplier’s then-current
standard allocation formula, which as of the Effective Date, is as follows:
(a) [**];
(b) [**];
(c) [**].
In addition, Supplier will provide in writing to Buyer a supply strategy along
with timeline to correct such Scarce Resources within [**] after such
notification to Buyer.
8.0 COMMUNICATIONS
All communications between parties will be carried out through the following
designated coordinators. All notices required in writing under this Agreement
will be made to the appropriate contact listed below at the following addresses
and will be effective upon actual receipt. Notices may be transmitted
electronically, by registered or certified mail, or courier. All notices, with
the exception of legal notices, may also be provided by facsimile.
 
[**]   Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.        

Form Title: Agreement Title
Form Owner: Global Procurement   Page 4 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
8.1 Business Coordinators.

             
SUPPLIER
      BUYER      
Name
  Daniel Cohen   Name   Daniel Wesolowski
Title
  Business Development Executive   Title   Global Commodity Manager,
Communications & Networking Products
Address
  1745 Technology Drive
San Jose, CA   Address   3039 Cornwallis Road
Raleigh, NC 27709-2195
Phone
  540-554-4250   Phone   919-543-6822
Fax
  540-554-4809   Fax   919-254-9751
E-mail
  dcohen@brocade.com   E-mail   dwesolow@us.ibm.com

8.2 Technical Coordinators.

             
SUPPLIER
      BUYER      
Name
  Mark Leidstrand   Name   Cedric Cook
Title
  Program Manager   Title   BladeCenter Fibre Channel Technical Manager
Address
  1745 Technology Drive
San Jose, CA   Address   3039 Cornwallis Rd
RTP, NC 27709
Phone
  408-333-1753   Phone   919-254-4904
Fax
      Fax   919-543-0391
E-mail
  mleidstrand@brocade.com   E-mail   cookced@us.ibm.com

All legal notices will be sent to the following addresses and will be deemed
received (a) two (2) days after mailing if sent by certified mail, return
receipt requested or (b) on the date confirmation is received if sent by
facsimile transmittal, to the party set forth below.

             
SUPPLIER
      BUYER      
Name
  John Shinn   Name   Daniel Wesolowski
Title
  General Counsel, Legal Department   Title   Global Commodity Manager
Address
  1745 Technology Drive
San Jose, CA 95110   Address   3039 Cornwallis Road Raleigh, NC
27709-2195
Phone
  408-333-6002   Phone   919-543-6822
Fax
  408-333-5630   Fax (Fax notice shall be valid only when verbal confirmation of
receipt is obtained.)   919-254-9751
E-mail
  jshinn@brocade.com   E-mail   dwesolow@us.ibm.com
 
           

Form Title: Agreement Title
Form Owner: Global Procurement   Page 5 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
MONTHLY WARRANTY ANALYSIS REPORT
Supplier Name: ____________________________
Month: ___________________________________

                                          Actual   Explanation     Buyer P/N  
Description   Barcode   Symptoms   Finding   Code   Root Cause Analysis Action
Taken to Fix
 
                       

     
SUMMARY REPORT
   
 
   
Total Units Repaired in Current Month o
   
 
   
Total Warranty Claims Received
   
 
   
Actual Warranty Accepted
   
 
   
Warranty %
   
 
   
High Flyers (more than ___%)
  High Flyers Require a Corrective Action Plan and Date of Implementation.

      EXPLANATION     CODE   DESCRIPTION
Code 03
  Warranty Expired
 
   
Code 04
  Missort
 
   
Code 07
  Cannibalized or Missing Parts
 
   
Code 08
  Warranty Product Received
 
   
Code 09
  Physical Damage
 
   
Code 10
  No Defect Found
 
   
Code 11
  Other
 
   

Form Title: Agreement Title
Form Owner: Global Procurement   Page 6 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
ATTACHMENT 2
SUPPLIER QUALITY ATTACHMENT
This Supplier Quality Attachment (“SQA”) adopts and incorporates by reference
the terms and conditions of SOW # (“SOW”) and Goods Agreement # ROC-P-68
(“Agreement”) between Buyer and Supplier.
1.0 INCORPORATION OF SQA DOCUMENTS
The SQA consists of this document, and applicable product specification
documents and specifications as referenced in Section 2.0 of SOW# 4903RL1112 and
Section 1.0 of Attachment 1, SOW# 4903RL1112, which were in effect upon
execution of this SQA.
2.0 QUALITY REQUIREMENTS
The requirements of this SQA shall constitute Supplier’s quality program which
must be implemented and maintained during the term of the SOW.
Supplier will set forth the yearly quality and reliability performance
commitments for the current year and through the remainder of the initial term
of the SOW in a product quality report (“PQR”). The PQR shall include the
mutually agreed product monitoring plan to be used to validate the effectiveness
of process control limits and the Product meets the quality and reliability
defined in such PQR. It is Buyer’s expectation that Supplier will use e-business
platforms (Web based applications) for ongoing real time quality management,
including but not limited to information associated with Supplier Quality
Management Systems (“SQMS”) and Product Change Notification (“PCN”), etc. or as
specified in the PQR.
3.0 ISO REQUIREMENTS
For ISO compliance, Supplier’s contracted manufacturer is ISO 9001* compliant
(“Compliant”).
 

*   Note: ISO 9001 & 9004 have been developed as a consistent pair of quality
management system standards. ISO 9001 is considered the standard by which the
Supplier is expected to be compliant with; it is understood ISO 9004 provides a
wider range of guidelines of objectives than ISO 9001, particularly for the
continuous improvement of an organization’s overall performance and efficiency.
ISO 9004 is recommended as a guide to assist those suppliers who wish to move
beyond the basic requirements of ISO 9001.

4.0 AUDITS
On a periodic basis, upon reasonable prior written notice, the Buyer or Buyer’s
quality representative shall conduct audits/visits at the Supplier’s and
Supplier’s contract manufacturer’s manufacturing locations. The Supplier shall,
at Buyer’s request, permit access to the auditors to manufacturing operations
and/or inspection of Products for Buyer, including access to the contract
manufacturer’s facilities. Any such audit is subject to the contract
manufacturers security requirements and shall not allow access to contract
manufacturer’s proprietary or confidential information. Periodic audits shall
include process control, quality inspection test data, internal audit reports,
and other information solely related to Products to verify compliance to the
terms of this SQA. Under normal circumstances, Supplier shall be given at least
a two weeks advance written notice by Buyer’s representatives of their intent to
visit. Buyer’s inspection of Product at the Supplier or contract manufacturer
shall not relieve the Supplier’s responsibility to furnish Product compliant
with the applicable written specifications as set forth in the SOW. Any
Confidential Information exchanged in connection with the audit shall be handled
in accordance with Section 14.6 of the Goods Agreement (ROC-P-68, dated
April 15, 1999).
5.0 DOCUMENT CONTROL
Supplier shall use commercially reasonable efforts to ensure that all documents
such as software/firmware, engineering drawings, specifications, contracts,
policies, procedures, manufacturing process flow chart, and work instructions
(including test procedures) to be under revision control and available to all
necessary Supplier personnel in Supplier’s manufacturing environment. Supplier
shall have a system for the effective updating/removal of any obsolete
documentation from all manufacturing areas.
6.0 RECORDS
Supplier shall establish and maintain procedures for identification, collection,
indexing, filing, storage, maintenance, and disposition of all quality records
including, but not limited to: Statistical Process Control (“SPC”) data. This
includes raw data or control charts, Cp and Cpk for critical/identified process
parameters, and all records which provide evidence of sub-tier supplier
activity, such as source inspections and First Article inspections, and records
of all inspection and test activity to provide objective evidence that Products
have passed acceptance criteria. Records shall be maintained for the life of the
SOW

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 7 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
plus the entire warranty period, as set forth in the SOW. All records shall be
maintained in a central location and shall upon request be made available to
Buyer’s quality representative for review only. All such documents shall be
deemed to be the Confidential Information of Supplier.
7.0 CONTINUOUS IMPROVEMENT PROCESS
Supplier shall develop and implement a continuous improvement process that will
provide for a cost-effective reduction in process-related excursions. The
program, at a minimum, shall include: the supplier management strategy;
manufacturing process controls (i.e., Maverick Product Elimination); a
documented, systematic approach for identifying focus areas for continuous
improvement for the current year, through the end of the term of the SOW, or for
three years from the start of the SOW, whichever is shorter; and Early Failure
Rate, Intrinsic Failure Rate, Shipped Product Quality Level and Failure Rate
commitment and reduction plans to achieve Buyer goals. Supplier shall provide,
at Buyer’s request, status of the continuous improvement process and results.
8.0 QUALITY PROBLEM NOTIFICATION TO BUYER
Supplier must notify Buyer of any quality or reliability problem which may
affect Products, that have been identified by Supplier’s internal testing (i.e.,
process control data, internal test data, burn-in data, etc.), by contract
manufacturers which produce Products on behalf of Supplier, or by another
customer (see ISO 9001). In case of problems, Supplier shall provide Buyer with
the requested traceability data (p/n, lot number, date code, volumes, ship to
locations, etc.) within [**]. The notification should include an immediate
containment plan and a schedule for definition and implementation of permanent
corrective actions. [**].
9.0 PRODUCT RE-QUALIFICATION COSTS
Following Buyer qualification of the Product, Buyer reserves the right to
re-qualify any product if the Supplier changes the manufacturing process or
product (form, fit or function), or; raw materials or specifications which may
affect performance, function, quality or reliability. Supplier shall bear the
reasonable costs of any re-qualifications required for changes made without
Buyer’s approval in accordance with Section 6.0 of the SOW.
10. PART HISTORY
Supplier shall maintain a history file for each Product part number manufactured
that tracks: materials and/or design changes controlled by the supplier; design
changes controlled by Buyer (engineering changes, etc.), and; and purchased part
manufacturer source changes.
11. PART QUALITY
Unless otherwise specifically agreed upon within the SOW, Supplier shall be
responsible for the quality levels of each of Supplier’s components that
comprise the Product or final assembly, except with respect to GBICs or SFPs, if
any. If applicable, Supplier agrees to make available to Buyer third party
warranties for GBICs or SFPs, to the extent Supplier is permitted to pass
through such warranties to Buyer.
12. CORRECTIVE ACTION PROCESS
Following a lot rejection by Buyer under Section 6.0 of the Goods Agreement, or
a quality problem notification under Section 8 of this SQA, Supplier shall
implement a corrective action process which shall provide documentation to
identify the following: a) Specific defect description and failure mechanism; b)
Containment of affected Product; c) Technical investigation/root cause analysis;
d) Corrective action plan and preventive actions to preclude a recurrence, and;
e) Verification of effectiveness of actions. With the exception of safety
defects which Supplier shall provide a complete failure analysis not to exceed
[**]from notification, failure analysis response times from Supplier will be
within [**] of Buyer’s lot rejection or the quality problem notification for
preliminary analysis and [**] for detailed analysis. The corrective action
process shall include a checkpoint to determine if additional Products are
exposed and the corrective action process and documentation specified within
this Section.
13. EXCEPTION APPROVAL PROCESS
Supplier shall not knowingly ship nonconforming Product to Buyer without written
approval from Buyer’s quality representative. In certain cases, Buyer’s quality
representative may approve shipment of suspected nonconforming Product if an
evaluation plan pre-approved by the quality representative is executed with
results acceptable to the representative.
 
(**) Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested has been requested with respect to the omitted portions.

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 8 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
14. REVIEW AND DISPOSITION OF NONCONFORMING PRODUCTS
If Supplier intends to ship nonconforming Product to Buyer, then Supplier shall
implement a Material Review Board (“MRB”) to review and determine the
disposition of nonconforming materials. At a minimum, the MRB shall consist of
representatives from Manufacturing, Engineering and Quality Engineering. The
Supplier’s process shall include the following dispositions: a) Rework — Product
reworked to meet specified requirements; b) Use As Is — No actions taken on
Product, Product does not meet specified requirements but is functional; c)
Repaired — Product has been reworked to be functional but does not meet
specified requirements; d) Scrap — Product not useable and does not meet
specified requirements, or; e) Screen — Additional product test/inspection to
meet specification. Any plans to rework or repair nonconforming materials shall
be subject to final approval by Buyer’s quality representative, such approval
not to be unreasonably withheld. Any plans to use as-is must be pre-approved by
Buyer’s quality representative. All MRB records shall be maintained by Supplier
and upon request, made available to Buyer for review. All MRB records shall be
deemed the Confidential Information of Supplier.
15. PRODUCT IDENTIFICATION AND LOT TRACEABILITY
Supplier shall establish and maintain procedures and processes for the
identification and lot traceability of critical components during all stages of
production, delivery, and installation per applicable ISO standards.
Identification must be traceable through to the finished Product by serial
numbers or equivalent methods. Both forward and backward traceability shall be
available. Response time for traceability requests shall not exceed [**].
16. QUALITY REPORTING
Monthly executive summary reports in a format mutually agreed upon format shall
be forwarded to Buyer at a mutually agreeable time or as specified in specific
PQRs. Continuous quality reporting real time will be via SQMS or as specified in
specific PQRs.
17. SUPPLIER QUALITY & RELIABILITY (“SQR”) REVIEW MEETINGS
Buyer requires regular Supplier quality/reliability meetings determined by a
mutually agreeable schedule, to increase visibility into product and field
performance. The intent is to conduct timely meetings in preparation for future
business reviews/contractual negotiations. The agenda for the meeting shall be
as set forth in exhibit 1 unless otherwise mutually agreed by the parties.
18. APPLICABLE PRODUCT SPECIFICATIONS & TESTS

  a.   ISO 2859-1 (Sampling Procedures for Inspection by Attributes)     b.  
ISO 3951 (Sampling Procedures for Inspection by Variables)

 
[**] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 9 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
SUPPLIER QUALITY ATTACHMENT (Cont.)
Exhibit 1. Quality Review Meeting Agenda
The following typical meeting agenda has been formulated to address all the
pertinent quality/reliability topics.
a) Supplier facility and subcontractor locations where BUYER product is
fabricated, assembled and tested
Physical addresses and line id’s
Review Group A, B, C test results
b) Average Outgoing Quality (AOQ) fallout for SUPPLIER and total customer
database
Defect and root cause analysis
Pareto distribution of fails
Corrective action and data verification
Point of origin and incidence contributions associated with internal, assembly
and final test operations.
c) Field Return data for BUYER and total customer database
EFR/IFR estimates
Defect and root cause analysis
Pareto distribution of fails and associated POH distribution for Buyer and total
customer database
Failure mechanism driven corrective actions
d) In-Process monitoring data
Defect monitoring, elimination and analysis results
Modeling techniques — Experimental, Analytical Analysis
SPC parameter and control limits — data review
Maverick Product Elimination occurrences (if applicable) and related data
Yield cut limit compliance
e) Internal Audit Results
Last internal audit findings and corrective action of one manufacturing location
& future audit plans
f) PCN activity since last BUYER meeting
Product, process, materials or specifications affecting form, fit or function
Traceability history for date code inception
g) Continuous Improvement Program for entire fab, assembly, test and field
performance
AOQ and Failure Rate Improvement targets for next 3 years
h) Specification Compliance/Commitment to “ BUYER Specifications”
Any deviations/exceptions? If so, provide details and traceability information.
i) Joint discussion followed by a summary wrap-up and activities

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 10 of 14   Form Release: 8/98
Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
ATTACHMENT 3
[**]
The [**] questionnaire may be used to cover one complete [**], even if that
[**]includes multiple modules. Write “not applicable” or “N/A” if a question is
not relevant to the furnished software material.

  •   The following [**] applies to all [**]described in this Statement of Work.
    •    

1)   [**]:

  a)   [**]:     b)   [**]?     c)   :

2)   [**]?

  •   [**].     •   [**].     •   [**]?     •   [**].

Although the answers above are correct to the best of our knowledge, they are
provided for informational purposes only. Any warranties on the software and
associated hardware products shall be as provided in the Goods Agreement between
Supplier and Buyer. Accordingly, provision by Supplier of the information in
this document shall create no additional warranties of any kind beyond those in
the Goods Agreement, and Supplier shall have no liability, unless otherwise
expressly provided in the Goods Agreement, related to the provision of this
information.

         
Authorized Signature:
       
 
 
 
   
Name:
       
 
         
Title:
       
 
         
Date:
       
 
       

 
[**] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          Form Title: Agreement Title   Page 11 of 14   Form Release: 8/98
Form Owner: Global Procurement       Revision: 05/02      

 

--------------------------------------------------------------------------------

 

IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
(BROCADE LOGO) [f15961f1596102.gif]

Brocade Communications Systems, Inc.
1745 Technology Drive
San Jose CA 95110
408-487-8000
[**]
AFFIDAVIT OF MANUFACTURER
I declare that the following products are manufactured by Brocade Communications
Systems, Inc. or a sub-contractor of Brocade, at one the following locations:

         
Solectron Corp.
  Solectron Corp.   Solectron Corp.
1000 Technology Drive
  260 South Milpitas Blvd.   3803 Cherry St.
West Columbia SC 29170
  Milpitas CA 95035   Newark CA 94560
USA
  USA   USA

     
Hon Hai Precision/Foxconn-NSG Tech.
  Hon Hai Industries-Foxconn
1705 Junction Ct. #205
  8801 Fallbrook Drive
San Jose CA 95112
  Houston, TX 77064
USA
  Long

Hon Hai Industries- Foxconn
No. 2, 2nd Donghuan Road
10th You Song Industrial District
Long Hua Town, Baoan, Shenzhen, Gua, China
Products:

       
 
(signature)
   
 
     
 
(printed name)
   
 
     
 
(title)
   
 
     
 
(date)
   

 
[**] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          Form Title: Agreement Title   Page 12 of 14   Form Release: 8/98
Form Owner: Global Procurement       Revision: 05/02      

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
ATTACHMENT 5 — FULFILLMENT
1.0 Product Hubbing/Consignment
1.1 Hub Arrangement The parties hereby agree that “Hub Product” is defined as
any Supplier Product for which a portion of sales of such Product are subject to
a hubbing arrangement. The following terms and conditions will apply to any Hub
Product(s) for which an agreement has been executed between and among Supplier,
Buyer, and/or a third party (“Hub Provider”) to allow such Hub Product to be
shipped to and held in a third party’s warehouse (or warehouses) (“Hub(s)”). The
parties agree that, as of the Effective Date of Amendment Number 1 to the
Agreement, the Brocade SAN Switch Module for IBM BladeCenter will be a Hub
Product.
Hubs will be established with IBM’s third party fulfillment partner [**]. The
parties reserve the right to discuss the addition of a Hub in other location(s),
subject to the mutual written agreement of the parties.
The parties will mutually agree to any cost adders associated with the hubbing
arrangement, such as freight cost to hub destinations and warehousing fees prior
to any performance, which Supplier may include in the Product price and update
in SOW3 PUA Section 4.1 Product Price List and Description, and for other
products will be added to the applicable price list. The parties agree to
periodically review a breakdown of such cost adders to determine if changes in
the logistics will change this cost.
1.2 Hub Stocking On a [**] Buyer, or Hub Provider, will provide a [**] rolling
forecast to Supplier showing the demand for the Hub Products to be sent to the
Hub(s), such quantities shall be identified by the specific geographic locations
of the Hubs (“Hub Forecast”). Supplier agrees to ship quantities of such Product
to the Hubs sufficient to meet at least [**] of demand, and at most [**] of
demand, both of which are based on the [**] period forecast (“Minimum Stock
Level”). Should Buyer pull more than the Hub Forecast amount, Supplier will have
[**] to restock the Hub to the Minimum Stock Level. The Minimum Stock Level will
include the balance of the material physically in the hub location available for
immediate sale (“On-Hand Balance”) plus the material en route to the hub
location scheduled for arrival within the transit lead time for that hub
(”In-Transit Balance”). Supplier may reduce Hub inventory to [**] only when
there is [**] reflected in [**] of the Hub Forecast for the [**] period.
1.3 Ship Performance Supplier’s goal will be to satisfy a [**] product
availability rate at each Hub location. Product Availability is defined as Hub
Products being available for pull by Hub Provider at the time a valid pull
notification is received. At the beginning of [**], Buyer and Supplier may
discuss the above Product Availability rate goal. Should the parties agree that
the Product Availability rate goal was not achieved, Supplier will immediately
acknowledge the deficiency. Within [**] of such acknowledgement, Supplier will
begin the Corrective/Preventive Action Process to determine the root cause, and
will develop an appropriate corrective action. Hub Product pull requests in
excess of Hub Forecast will not be used in the calculation of the product
availability rate, nor in the determination of root cause. In addition, should
Supplier experience an allocation situation, the allocation provisions of SOW3
PUA Section 7.0 “Supply of Products” shall apply.
1.4 Shipping Supplier will be responsible for shipping charges of the Hub
Product from Supplier’s point of origin to the Hub. Pursuant to Section 1.0 of
this Amendment, these costs may be included in the Product price. All shipments
from the Hub will be EXW the Hub, and Buyer is responsible for all shipping
charges thereafter. Buyer will act as the importer of record for all Hub Product
shipped from the Hub and will be responsible for associated customs, duty, and
Value Add Tax (VAT) administration. Title to and risk of loss of the Hub Product
will pass to Buyer upon physical removal of such Hub Product from Brocade’s
designated area within the applicable Hub.
1.5 Product Discontinuance for Products Held in Hub. Discontinuance of any Hub
Product shall be in accordance with the terms set forth in the SOW. The parties
agree to work together to minimize the liability of each party upon end-of-life
notice of a Hub Product.
 
[**] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 13 of 14   Form Release:8/98
Revision: 05/02     

 

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IBM Corporation/ Brocade Communications Corporation
Amendment # 6 to SOW 4903RL1112
Date: September 13, 2005
2.0 CTO Fulfillment Processes The Parties agree to negotiate in good faith any
changes to these terms and conditions that may be required to support Buyer’s
CTO (Configure to Order) process. Any such changes will to be added by amendment
to SOW3.
This Amendment 6 may be signed by each Party’s respective duly authorized
representative in one or more counterparts, each of which shall be deemed to be
an original and all of which when taken together shall constitute one single
agreement between the Parties. Any signed copy of this Amendment 6 made by
reliable means (e.g. photocopy or facsimile) shall be considered an original.
The Parties hereto have caused this Amendment 6 to be signed by their respective
duly authorized representatives.

         
ACCEPTED AND AGREED TO:
  ACCEPTED AND AGREED TO:    
 
       
INTERNATIONAL BUSINESS
MACHINES CORPORATION
  BROCADE COMMUNICATIONS SYSTEMS, INC.    
 
         
 
       
Authorized Signature
  Authorized Signature    
 
         
 
       
Date
  Date    
 
         
 
       
Printed Name
  Printed Name    
 
         
 
       
Title
  Title    

          Form Title: Agreement Title
Form Owner: Global Procurement   Page 14 of 14   Form Release:8/98
Revision: 05/02