EX-10.8



 





Exhibit 10.8



Agreement #4998RL1168

SOW #4904RL1344




This Statement of Work (“SOW”) #4904RL1344 adopts and incorporates by reference the terms and
conditions of Goods Agreement #4998RL1168 (“Base Agreement” or “BA”) between International
Business Machines Corporation (“Buyer”) and Voltaire, Inc. (“Supplier”). This SOW is effective
beginning on November 19, 2004 and will remain in effect until November 19, 2007. Transactions
performed under this SOW will be conducted in accordance with and be subject to the terms and
conditions of this SOW, the Base Agreement and any applicable Work Authorizations (“WAs”). Any
provisions of this SOW that by their nature extend beyond its termination or expiration will remain
in effect until fulfilled, and apply to respective successors and assignees. This SOW is not a WA.



Product Unique Attachments and any changes thereto must be in a writing signed by both parties, and
the terms of a Product Unique Attachment will apply only to the Products identified in such Product
Unique Attachment. The initial Product Unique Attachment is attached hereto as “Product Unique
Attachment # 1” and incorporated herein by reference. Subsequent Product Unique Attachments or
changes to existing Product Unique Attachments will take effect on the effective date provided
therein and will be incorporated herein upon execution by the parties.



1.0 Definitions




“APAR” means the form used to report suspected Problems to Supplier, and to request their
resolution.



“APAR Closing Codes” means the established set of codes used to denote the final resolution of an
APAR.



“APAR Correction Times” means the objectives that Supplier will achieve for resolution of Problems.




	 	•	 	“Severity 1” Problems will be resolved by Supplier within seven (7) days of its receipt
of the APAR, and Supplier will use best efforts to provide relief to affected Customers
within twenty-four (24) hours of Supplier’s receipt of the APAR.
	 
	 	•	 	“Severity 2” Problem will be resolved by Supplier within fourteen (14) days of its receipt of the APAR;
	 
	 	•	 	“Severity 3” Problem will be resolved by Supplier within twenty-one (21) days of its receipt of the APAR; and
	 
	 	•	 	“Severity 4” Problem will be resolved by Supplier within twenty-eight (28) days of its receipt of the APAR.





“Certified Service Product” or “CSP” means Repaired Products. Notwithstanding the relevant “Ongoing
Warranties” provision in the BA, CSP may contain used or reconditioned part(s), provided that such
part(s) are properly marked as “SERVICEABLE USED PART(S)” as further described in this SOW.



“Consigned Material” means materials that Buyer owns and continues to own that are entrusted to
Supplier.



“Customer(s)” mean Buyer’s customer(s)



“Developer Test Systems” means a configuration of installed hardware and software that Supplier
maintains which is representative of typical Customer installations for the Product and, at a
minimum, contains current and current minus 1 level of the Product and any prerequisite and
co-requisite hardware and software specified by Buyer.



“Emergency Order” or “EO” means a WA placed by Buyer for FRUs with a Lead Time not to exceed twenty
four (24) hours.



“End of Service” or “EOS” means date when Buyer officially discontinues Customer service and
support for a Product. EOS dates are only addressed for the purposes of defining the date through
which Supplier will make Repair Services available for Products, and do not affect Supplier’s
obligations with respect to FRU or other Product availability. In no event shall the date of EOS
be more than 5 years after Supplier discontinues such Product.



“Engineering Change” or “EC” means any change(s) to Product .



“Epidemic Defects” shall mean Products and their associated Engineering Changes that experience one
or more of the following: (a) a similar confirmed defect of the same root cause at a rate of *
(*) or more or other rate as may be specified in the PUA in any given    * ( * ) day rolling
period over the life of the Products and three or more similar confirmed defects of the same root
cause must exist, (b) a similar confirmed defect of the same root cause at a rate of *     ( * ) or more (or other rate that may be specified in the Product Unique Attachment)
of total purchases over the life of the Products and three or more similar confirmed defects of the
same root cause must exist, (c) recalls , or (d) safety defects



“Field Replaceable Unit” or “FRU” means a Product, Product component, Product subassembly,
Product documentation, Product code, or other Product part used to service a Customer system.



“Lead Time” means the minimum length of time prior to a specific delivery date that Supplier must
receive and accept a WA from Buyer to ensure delivery by such date.





 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.





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“Maintenance Level Service” means the service provided, as set forth below, when a Customer
identifies a Problem:




	 	•	 	“Level 1” is initial service provided by Buyer in response to Customer’s request for
support in connection with a suspected Problem;
	 
	 	•	 	“Level 2” is service provided by Buyer to diagnose and resolve or assist Level 3 in
resolving Problems identified by Level 1; and,
	 
	 	•	 	“Level 3” is service provided by Supplier to develop final resolutions for Problems not
resolved by Level 1 and Level 2.





“Problem” means any Product defect, including, without limitation, any defects arising as a result
of the failure of the Products to function in accordance with their specifications and other
requirements, or other failures or errors or other defects arising as a result of the failure of
the Products to function in accordance with their specifications and other requirements, “Problem
Management Record” or “PMR” means a record documenting support actions taken in response to a
Customer’s request for support in connection with a suspected Problem.



“Product Unique Attachment” is a document entitled Product Unique Attachment which contains the
terms and conditions unique to a specific Product.



“Repair” or “Repaired” means all required repair activity including, disassembly, failure analysis,
testing, component recovery, rework, warranty process, packaging, final testing, and all other
processes reasonably necessary to ensure Products, which are sent to Supplier for repair within or
outside of the relevant Product warranty, meet all the functional performance requirements
applicable to newly manufactured Products in accordance with this SOW or relevant WA.



“Turn Around Time” or “TAT” means the elapsed time from the date of receipt acknowledgment of a
Product arriving at Supplier’s location for Repair until shipment notice of Repaired Product back
to Buyer.



“Yield” means the relationship between Product sent to Supplier for Repair and the CSP returned to
Buyer.



2.0 Product Definition




2.1 Product Description.



The Products are described in the Product Unique Attachment(s). Products also include all FRUs,
CSPs, Product code, and Product documentation.



2.2 Product Specifications & Certifications.




Products will comply with all the requirements set forth below:




	 	•	 	CS1-1121-015, IBM Corporate Standard “Automatic Identification (AI) for Packaging,
Distribution and Manufacturing - Bar Coded Labels”
	 
	 	•	 	GA21-9261-11a, “Packaging and Handling - Supplier and Interplant Requirements”
	 
	 	•	 	IBM Engineering Specification 46G3772 entitled, “IBM Environmental Requirements for
Materials, Parts, and Products as found at
http://www.ibm.com/ibm/environment/products/especs.html
	 
	 	•	 	ISO 2859, Sampling Procedures for Inspection by Attributes
	 
	 	•	 	ISO 3951, Sampling Procedures for Inspection by Variables
	 
	 	•	 	EIA - 599 - A, Continuous Improvement
	 
	 	•	 	EIA - 659 - A, Failure, Mechanism, Driven Reliability Monitoring
	 
	 	•	 	EIA - 670, Quality System Assessment
	 
	 	•	 	EIA - 671- A, Problem Analysis and Corrective Actions
	 
	 	•	 	EIA - JESD - 38, Standard for Failure Analysis Report Format
	 
	 	•	 	EIA - JESD - 46, Product Change Notice
	 
	 	•	 	EIA - JESD - 50, Maverick Product Elimination
	 
	 	•	 	Supplier’s published specifications, marketing materials, and other documentation,
including references in such materials to future upgrades or performance
	 
	 	•	 	FAA Certification, Supplier certifies that Products and their packages do not contain
explosives, hazardous materials, incendiaries and/or destructive devices as defined by the
FAA
	 
	 	•	 	All Product claims, descriptions, specifications, and other requirements described in
the Product bill of material elsewhere in this Agreement, and via other written or
electronic communications sent form or approved by Buyer referencing this SOW.




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2.3 COO Product Certification.




Supplier certifies that the Products have the country(ies) of origin specified in the Product
Unique Attachment(s) to this SOW. If there are any changes to this information, Supplier will
notify Buyer by providing a new country of origin certification signed by an authorized Supplier
representative before shipping any affected Products. If any part number has more than one country
of origin, Supplier certifies that each country of origin is specified in the Product Unique
Attachment(s), and Supplier will deliver to Buyer, instructions regarding how Buyer can distinguish
each country of origin for part numbers with more than one country of origin prior to shipping the
affected Products.



2.4 Engineering Changes.




ECs submitted by Buyer will be implemented by Supplier upon mutual agreement in a manner
consistent with the Product’s original design (e.g., a missing “caution” label will be replaced by
the same type of label and in the same location as originally specified). Supplier will provide
documentation illustrating its performance of Buyer or Supplier -submitted ECs upon Buyer’s
request. If Buyer places requirements or limitations on a particular Product that result in an
increase in Price as compared to the prices of similar products offered without such requirements,
then Supplier shall notify Buyer of the opportunity to lower Price, and Buyer shall have the option
of modifying the requirements so that its Products can be purchased at this lower price. Supplier
may implement other ECs in Products from time to time at its discretion, and will give Buyer
written notice in advance prior to delivering any Product that incorporates an EC not suggested by
Buyer. Buyer’s approval shall not be unreasonably withheld.



2.5 Product Software and Documentation




Supplier will deliver, at the earlier of a date requested by Buyer or prior to its first shipment
of Product, (i) a fully completed and signed certificate of originality (in a form to be reasonably
specified by Buyer) for all Product code and documentation originally developed by Supplier, and
(ii) all Product object code, publications, and documentation in a common format and media as
reasonably specified by Buyer. Additionally, Supplier will promptly deliver to Buyer all updates
(hereinafter “Updates”, such Updates to include, without limitation, all error corrections,
enhancements and new versions) to such Product code (including all code in, or provided for use
with, Products), publications, and documentation in the same format and media as specified by
Buyer. During the term of this Agreement and subject to all terms hereof, Supplier grants Buyer a
nonexclusive, worldwide, a perpetual irrevocable fully paid up, license to prepare and have
prepared derivative works of Product code and documentation, and to use, have used, execute,
reproduce, transmit, display, perform, transfer, distribute and sublicense Product code and
documentation and such derivative works, in any medium or distribution technology, and to grant
others the rights granted herein, in each solely for use with the Products. Buyer will not be
obligated to preserve any copyright management information included in the Product code or
documentation.



2.6 Tamper Evident Protection.




To the extent that Supplier ships new Product in its final Customer ready form, Supplier shall
apply tamper evident protection on the finished Product packaging in the form of an “IBM” logo tape
in such a manner that if removed or tampered with, it would be evident that the finished Product
packaging has been opened. Supplier will have controls to prevent unauthorized use or dissemination
of “IBM” logo tape (including tracking the purchase, internal use, application, and destruction),
and to limit access to such materials to only those responsible for the tamper evident sealing on
the Products. Supplier will only use the “IBM” logo tape in connection with new Product. Buyer
shall acquire and deliver to Supplier all its requirements for “IBM” logo tape.



3.0 Purchasing




3.1 WA Issuance




Buyer is under no obligation to purchase any Products and/or Services, except as ordered in WAs and
within the liability limits addressed elsewhere in the Agreement, including those addressed in the
Product Unique Attachment(s) to this SOW. Supplier will comply with Buyer’s requested changes to
delivery of Products specified in a WA as described in the Product Unique Attachment(s) to this
SOW), without additional charge to Buyer If Buyer decreases Product quantities specified in a WA
outside of allowances described in the Product Unique Attachment(s)) to this SOW, Supplier will use
all reasonable efforts to mitigate Buyer’s liability. The parties acknowledge that WAs may be
placed on Supplier under this SOW by entities other than the Buyer, or its Affiliates, but only to
the extent expressly authorized by Buyer in writing and subject to the credit worthiness of such
authorized third party by Supplier r and Supplier agrees that for such purchases that (a) the Buyer
authorized third party purchaser under this SOW shall have extended to it all the protections,
rights, and other benefits of the Agreement; (b) Buyer is a third party beneficiary and has the
right to enforce the terms of this Agreement on such purchases on a joint and several basis; and
(c) Buyer and its Affiliates shall not be liable to Supplier with regard to such purchase
transactions.



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3.2 Spare Parts Availability.




Supplier will maintain the capability to supply, and shall provide Product spare parts (i.e., the
entire Product or reasonable portions of the Product as described herein or as may be subsequently
described by Buyer, including, without limitation all FRUs), technical support for the Product as
described in this SOW during the term of this SOW (or if earlier, the announced end of life date
for such Product) and for a period of five (5) years thereafter (or longer period as may be
required by law upon Supplier) under the terms and conditions of the Agreement. Supplier will give
Buyer a last time buy option which may be exercised once at any time prior to 180 days before the
end of such five (5) year period, and shall also offer any follow on products that are compatible
with Products herein. Supplier will notify Buyer prior to Supplier’s withdrawal of any Product(s),
and such withdrawal will not occur during the term of the SOW upon less than 90 days prior notice,
and will not affect Supplier’s responsibilities under this section related to spare parts
availability or technical support.



3.3 Use of Subcontractors.




Supplier’s use of subcontractors will not relieve Supplier of the responsibility for the
subcontractor’s performance, and Supplier’s responsibilities assumed under this SOW will be equally
applicable to such subcontractors, as must be agreed upon between Supplier and such subcontractors.
Buyer reserves the right to review both the Supplier’s management system for the operations of its
subcontractors and to review with Supplier, their subcontractor’s management system for operations
for the purposes of this SOW. Should a Supplier’s subcontractor’s performance fail to materially
comply with the responsibilities under this SOW, Buyer reserves the right to request corrective
action from Supplier



3.4 Taxes and Duties.




All Products will be delivered by Supplier DDU (Incoterms 2000). Supplier will ensure that the
Prices do not include any sales, use or other similar taxes that do not apply to Buyer as a
reseller of Products and/or Services. In accordance with applicable delivery terms, Supplier will
be responsible for all legal, regulatory, and administrative requirements, in addition to all
associated duties and fees, associated with importation of Products into the country where the
Product is received by Buyer.



3.5 Invoices & Payments.




The terms of payment are net * days either after receipt of Supplier’s valid invoice or after
delivery of the Products or Services, whichever is later, Supplier will not invoice Buyer until
after Product delivery and Buyer shall make such payments twice per month. Invoices to Buyer must
include, at a minimum, the following: (i) applicable WA line item numbers; (ii) SOW and WA numbers;
(iii) terms of payment as provided herein; (iv) billing period dates; (v) applicable Product unit
Prices; (vi) total amount invoiced; (vii) where applicable, the Harmonized Tariff Code of the
importing country for every Product and (viii) Product descriptions with sufficient detail to
enable verification of associated Product categorical classifications.



3.6 Electronic Commerce.




Buyer may issue scheduling documents (“Blanket Purchase Orders”) which may have the appearance of a
normal WA, but do not include a delivery date. Such Blanket Purchase Orders are issued only as a
logistical processing document to enable the use of electronic purchase order communications and
are not binding in any manner and shall not be considered as WAs by the parties, regardless of
quantities or prices that may be included in such Blanket Purchase Orders. Unless previously
submitted by Supplier, in order to initiate electronic transfer of payments associated with this
SOW, Supplier will complete the form entitled “Authorization for Electronic Funds Transfer” as
provided to Supplier by Buyer and fax the completed form to Accounts Payable at the number included
on the form.



3.7 Participation by Buyer’s Affiliates




Each of Buyer’s Affiliates may have all rights, benefits, protections, and remedies of Buyer based
on the Agreement by: (i) issuing a WA referencing the Agreement, that is accepted by Supplier or
Supplier Affiliate, provided that the rights, benefits, protections, and remedies available to the
issuing Affiliate in this case will be those in effect on the date the WA was issued or last
amended; or (ii) executing a PA that is mutually agreed with Supplier or Supplier’s Affiliates that
incorporates by reference the terms and conditions of the Agreement and any unique terms or
conditions required by the Buyer Affiliate, provided that any changes to the Price(s) set forth in
the Agreement, or any additions or deletions of Products set forth in the Agreement will be
incorporated by reference in those PAs which are concurrently effective with the incorporation of
such changes, additions, or deletions to the Agreement.



3.8 Disaster Recovery Plan




Before the first shipment of Products, Supplier shall have a disaster recovery plan in place to
protect the supply of Products to Buyer. At Buyer’s request, Supplier will provide the disaster
recovery plan to Buyer. Supplier’s disaster recovery plan (and any subsequent changes thereto)
must be reasonably acceptable to Buyer. Supplier, however, remains solely responsible for





 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.





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the performance of its responsibilities under the Agreement and the adequacy of the disaster
recovery plan regardless of whether Buyer has reviewed and approved the plan.



4.0 Technical Support




Technical support includes the Level 1, Level 2, and Level 3 responsibilities defined below,
Product code, documentation and updates arising out of technical support responsibilities, and all
Updates created or made available by Supplier.



4.1 Level 1.




Supplier will assist Buyer as reasonably required by Buyer, in Buyer performing the following Level
1 support responsibilities:




	 	•	 	create the PMR;
	 
	 	•	 	obtain from Customer a description of the Problem;
	 
	 	•	 	search for any known resolution(s) relevant to the Problem;
	 
	 	•	 	if a resolution to the Problem is known, specify such resolution to Customer;
	 
	 	•	 	if no resolution to Problem is known, generate APAR, assign APAR Correction Time,
forward APAR to Level 2; and
	 
	 	•	 	pass the PMR to Level 2, and update the PMR documenting Level 1 actions.





4.2 Level 2.




Supplier will assist Buyer, as reasonably required by Buyer, in performing the following Level 2 support responsibilities:




	 	•	 	receive the PMR/APAR from Level 1;
	 
	 	•	 	analyze Problem symptoms and gather additional data from Customer as required;
	 
	 	•	 	recreate Problem on the Developer Test System;
	 
	 	•	 	determine if Problem is due to improper installation of the Product by Customer;
	 
	 	•	 	determine if Problem is due to operationally related hardware or software at the Customer location;
	 
	 	•	 	attempt a bypass or circumvention for high impact Problems (i.e., Severity 1 and 2);
	 
	 	•	 	create APAR record if no resolution to Problem is attained; and
	 
	 	•	 	update the PMR documenting Level 2 actions.





4.3 Level 3.




Supplier will perform the following Level 3 support responsibilities, which shall be provided to Buyer:




	 	•	 	receive the APAR/PMR and supporting documentation and materials from Level 2;
	 
	 	•	 	analyze Problem symptoms and diagnose Problem;
	 
	 	•	 	notify Level 2 if additional information, materials or documentation are required;
	 
	 	•	 	attempt to recreate Problem on the Developer Test System;
	 
	 	•	 	assist Level 2 in developing a bypass or circumvention for high impact Problem (i.e., Severity 1 and 2);
	 
	 	•	 	deliver corrections to the Product and/or Product code to Buyer within the applicable
APAR Correction Times to fix Problems identified by Buyer;
	 
	 	•	 	return all APARs to Buyer with an APAR Closing Code assigned, including text describing
the resolution of Problem;
	 
	 	•	 	confirm resolution of Problem with Buyer and Customer, and update PMR documenting Level 3 actions; and,
	 
	 	•	 	answer any questions from Buyer and Customers concerning the operation and use of Products.





4.4 Other Technical Support Responsibilities.




Supplier will provide to Buyer the name and phone numbers of Supplier Personnel to contact for all
technical support matters related to the Product. Supplier will provide all training initially
required by Buyer to enable Buyer to perform technical support functions for the Product and .
will keep Buyer informed of any known Problems and their associated solutions. Notwithstanding
anything to the contrary, Supplier will not contact or work directly with Customers except as
directed by Buyer.



5.0 Quality




5.1 Acceptance Criteria.




Within 90 days after delivery, Buyer may inspect and test all Product at Buyer’s facility prior to
acceptance or rejection, and may refuse to accept Product which does not conform to the
specifications, certifications, and other requirements referenced in the Agreement. If Buyer
properly rejects Product and requests a replacement Product,, Supplier shall replace the rejected



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Product within seven calendar days of Buyer’s request. shall pay for the air freight, if required
by Buyer, and all other expenses associated with the return of the rejected Product to Supplier,
and Supplier will pay for freight and other expenses associated with the return of the new or
repaired Products to Buyer.



5.2 Product Modifications.




Supplier will not make any changes to the Products or to processes supporting Products that have
been certified by Buyer, without Buyer’s prior written consent, such consent not to be withheld
unreasonably. In the event of such changes without Buyer’s prior written consent, Supplier will,
at Buyer’s discretion, either: (i) replace all such products with products approved by Buyer and
reimburse Buyer for all actual and reasonable expenses incurred that are associated with such
products replacement (including expenses associated with problem diagnosis, testing, and
replacement of products in normal inventory, finished goods inventory, distributors inventories,
and with Customers; ; or (ii) credit or refund Buyer the Price of Products. If Supplier improves
the safety, function, cost, or reliability of products that it builds for itself or for its other
customers by changing a design, component, part, supplier, or production process that may also be
used in or in connection with a Product that Supplier builds for Buyer, then Supplier will inform
Buyer of such improvement and implement changes to Product as approved by Buyer to incorporate such
improvement in Products. Supplier may implement other modifications in standard Products from time
to time at its discretion, and will give Buyer written notice in advance of delivering any Product
that incorporates any modification not suggested by Buyer. Buyer’s approval shall not be
unreasonably withheld.



5.3 ISO Requirements.




For ISO compliance, the Supplier represents and warrants that the Supplier is ISO 9001 compliant or
intends to use reasonable efforts to achieve such compliance by 31 December 2005. Compliance
hereunder may be either by means of external accreditation or self-declaration. For external
accreditation, Supplier will provide to Buyer, upon Buyer’s request, a copy of Supplier’s current
registration, including the scope, Standard Industrial Classification code or equivalent, all
locations involved, and any restrictions or exclusions. For self-declaration, Supplier will
provide to Buyer, upon Buyer’s request, a letter from Supplier’s chief executive officer, chief
operating officer, or other executive assuring that self-declaration was performed with due
diligence based upon a previously executed internal audit report, and that such self-declaration
has had executive management review and approval.



5.4 Quality Audits and Records.




Buyer or Buyer’s quality representative may conduct audits of any or all Product and Product
component facilities and any or all sites where work is being performed or materials are being
delivered to Supplier in performance of Supplier’s work for the Buyer. Supplier shall, at Buyer’s
request, permit access to Buyer or Buyer’s quality representative to all manufacturing operations
for the Products. In the case of any facilities or operations not owned or controlled by Supplier,
Supplier will use reasonable efforts to obtain the contract manufacturer or other third party’s
consent to such access by Buyer. Supplier shall, at no charge to Buyer, provide no less than 1 or
2 units of each Product type (or other number as agreed to by Buyer) for non-destructive use, space
and facilities for each Buyer requested audit. Such audits may relate to process control, quality
inspection test data, internal audit reports, and other information related to the Product being
manufactured in compliance with all the requirements of this SOW. Supplier will 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 data,
test and inspection records, and all other quality records required Buyer. The Supplier shall
maintain a history file for all Products, by part number, that tracks changes to the Product or
Product component designs, materials, and/or manufacturing source. Supplier will make any or all of
the aforementioned records available to Buyer or Buyer’s quality representative.



5.5 Document Control.




Supplier shall ensure that all documents such as software/firmware, engineering drawings,
specifications, contracts, policies, procedures, manufacturing process flow chart, and work
instructions (including test procedures) are under revision control and are available to all
necessary Buyer and/or Supplier Personnel in the manufacturing environment. Supplier shall have a
system for the effective updating/removal of any obsolete documentation from all manufacturing
areas.



5.6 Product Traceability Requirements.




Supplier shall establish and maintain procedures and processes for the identification and lot
traceability of critical Product items during all stages of production, delivery, and installation
per applicable ISO & EIA standards. Supplier will maintain both forward and backward traceability
capabilities and ensure that its response time for traceability requests from Buyer does not exceed
twenty-four (24) hours.



5.7 Factors Affecting Product Quality.




Supplier must immediately notify Buyer of any factors affecting Product quality. Supplier will not
ship affected Products to Buyer without prior written approval from Buyer. Within twenty-four
hours of Supplier’s notification to Buyer pursuant to



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this section, Supplier will provide Buyer a resolution plan including a description of the factor
affecting Product quality, documentation of the root cause analysis performed by Supplier in
response, a schedule of all actions for the containment and correction of all affected Products,
relevant traceability data for the affected Products, and a process ensuring the effectiveness of
the actions to be taken hereunder.



5.8 Review and Disposition of Nonconforming Product.




Supplier shall have established, documented, and maintained procedures to ensure that Product,
which does not conform to the requirements of the Agreement, is prevented from unintended use or
shipment to Buyer. If Buyer expressly instructs Supplier to ship nonconforming Product to Buyer,
then Supplier will describe the extent of such Product’s non-conformance in writing and secure
Buyer’s written agreement prior to any shipment of any such non-conforming Product.



5.9 Periodic Quality Reviews.




Supplier shall develop and implement a process for continuous Product improvement. Buyer may
conduct reviews and/or hold meetings related to Supplier’s performance under the SOW, including but
not limited to the following respects, and may (for Buyer’s internal use only) compare Supplier’s
performance with that of similarly situated suppliers:




	 	•	 	Supplier’s compliance with delivery dates in support of WAs issued by Buyer;
	 
	 	•	 	Supplier’s compliance with Emergency Orders issued by Buyer hereunder;
	 
	 	•	 	Supplier’s compliance with the targeted Shipped Product Quality Level (SPQL) as set by
the parties on a monthly basis;
	 
	 	•	 	Supplier’s compliance with the targeted Incoming Product Quality Level (IPQL) as set by
the parties on a monthly basis;
	 
	 	•	 	Supplier’s compliance with the targeted Field Replace Action Level (FRAL) as set by parties on a monthly basis;
	 
	 	•	 	Supplier’s compliance with the targeted Cumulative Failure Rate (CFR) as set by the parties on a monthly basis;
	 
	 	•	 	Percentage of Products failing to function properly upon delivery (also known as the Product DOA rate);
	 
	 	•	 	Supplier’s speed in taking corrective actions for any problems with Product identified by Buyer;
	 
	 	•	 	Supplier’s implementation of lessons learned in previous periodic quality reviews.





In any calendar month in which Supplier shows poor performance with respect to the criteria set
forth above, Buyer may notify Supplier of such poor performance. In such case, Supplier will
respond to Buyer with an agreed upon action plan within five (5) business days of notification by
Buyer demonstrating its ability to achieve the required measurements, unless additional time is
granted by Buyer in writing.. Supplier’s failure to successfully execute an action plan within an
agreed upon time frame shall be a material breach of the Agreement. Satisfying any or all criteria
of this section shall not relieve Supplier of its warranties or other obligations of the Agreement.



5.10 Quality Cost Sharing.




Except in the case of Epidemic Defects, Supplier shall compensate Buyer in the event Buyer or
Buyer’s authorized third party incurs reasonable costs resulting directly from in-warranty defects
with Products under this SOW and such costs exceed one hundred thousand dollars ($100,000 USD) per
Product(s) on an annual basis. Such compensation shall be fifty percent (50%) of Buyer’s or
Buyer’s authorized third party’s reasonable costs, which may include but are not limited to;
repair, replacement, rework, field labor, logistics, problem diagnosis, and field and finished
goods inventory related costs (“Excess Failure Costs”). Supplier will make payments to Buyer within
     *     days of receiving an invoice from Buyer for such Excess Failure Costs. For
avoidance of doubt, the section of this SOW entitled “Epidemic Defects”, and not this section, will
apply in the instance of an Epidemic Defect. The remedy provided in this section is in addition to
any other remedies available to Buyer under the Agreement, at law and in equity.



6.0 Drop Shipments




6.1 Drop Shipments to Customers.




Regardless of the delivery point, in the event Buyer requests drop shipments to Customers, Supplier
will prepare all shipping labels and transfer materials (as submitted by Buyer) to identify Buyer,
not Supplier, as the party shipping Product, except to the extent that Supplier, and not Buyer,
must be identified for customs clearances or to comply with other laws. To the extent Supplier
must be identified on the final Product packaging, Supplier will have prior written agreements in
place with each carrier (regardless of whether Buyer or Supplier controls the common carrier) that
will require each carrier to remove (after applicable customs clearances, but before delivery to
any Customer), hold in confidence, and return (or certify destruction or hold in confidence in
perpetuity until destruction is certified for cases where the carrier requires to keep such
documents for archival purposes) to Supplier all documents and markings that reflect transaction
information between Supplier and Buyer (including without limitation, all pricing information),
while retaining or placing the appropriate transaction information between Buyer and Customers.
Supplier will ensure that no markings, labels of any kind, are placed on the Products (including
Customer packaging), other than as expressly specified by Buyer in writing, or as required by law
(including





 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.





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without limitation, patent notices), provided that Supplier first notify and secure Buyer’s written
confirmation with such requirements.



6.2 Confidential Information Related to Drop Shipments.




Notwithstanding any other confidentiality agreements between the parties, Supplier will hold the
following information in confidence: (a) Customer names, addresses, purchase histories and
requirements; (b) Buyer’s order fulfillment and related processes, including Buyer’s relationship
and Agreement with Supplier; (c) Buyer’s artwork, Customer packaging, and other materials
identifying Buyer; (d) Buyer’s business plans, Product plans, and forecasts; (e) the relative
success or failure of any Product or supporting process; and (f) Supplier’s involvement in
developing or assembling Buyer’s Products. Supplier may use such confidential information only for
the benefit of Buyer and only to fulfill the purpose of this SOW. Supplier may disclose such
information to Supplier’s Personnel on a need to know basis only or to enforce its rights
hereunder. In the event disclosure is required by law, Supplier will disclose only to the extent
required by law, and will notify Buyer prior to any such disclosure and reasonably assist Buyer in
seeking a protective order and/or limiting disclosure to the extent possible. Supplier will
immediately notify Buyer of any lost or unapproved disclosures of confidential information such
notification not to relieve Supplier’s obligations hereunder. Supplier will return or destroy all
confidential information, no later than ten (10) days after Buyer’s request. Supplier will allow
Buyer to periodically inspect Supplier’s premises during normal working hours to verify these
requirements for custody and use of confidential information.



7.0 Emergency Orders




7.1 Emergency Order Placement Process.




If or when buffer stock of Product is not available to Buyer from a Supplier hub, Supplier will
accept and respond to EOs from Buyer twenty-four (24) hours a day, each day of the year. Supplier
will provide contact information for EO coverage at all times. Supplier will respond to all EOs
via fax, EDI (or other electronic commerce approach) and/or telephone, such EOs to be confirmed by
Buyer with a written WA mailed, faxed, or electronically transmitted to Supplier within two (2)
business days of EO placement. EOs may include Buyer’s WA number, Buyer’s part number, part
number description, quantity, unit Price, relevant EO urgency code (2H, SD, ND, and TD), delivery
date and ship to address. Supplier will acknowledge all EOs back to Buyer via fax or telephone
within one (1) hour of receipt for EOs with a 2H or SD EO code and within two (2) hours of receipt
for EOs with a ND or TD EO code. EOs may not be changed, rescheduled or cancelled, except that
Buyer may cancel EOs without cost at any time prior to Supplier’s acknowledgment of such EO.
Supplier will deliver EO Products directly to the address specified in the EO and in accordance
with this SOW.



7.2 Emergency Order Shipment Responsibilities.




Supplier will ship code 2H and SD EOs via “Next Flight Out” and “Air Charter” to arrive at Buyer’s
specified receiving location on the same day of the EO’s issuance, unless specified otherwise by
Buyer. Supplier will ship code ND EOs to arrive on the next business day of the EO’s insurance at
the Buyer specified receiving location and will ship code TD Eos to arrive within two business days
of the EO’s issuance at the Buyer specified receiving location. Shipment timeframes set forth in
this section are subject to receipt of the EO from Buyer within a period reasonably allowing
Supplier to meet cutoff times established by the transportation carriers. If the transportation
carrier’s cutoff time is missed because of an EO being placed by Buyer after the established cutoff
times provided by the transportation carriers, Supplier will inform Buyer as soon as practicable
and Buyer will determine if the EO being placed is required for delivery in the morning of the next
day or at another time during the next day. Notwithstanding any provision of this Agreement to the
contrary (including without limitation, any EO or WA term), all EO deliveries shall be collect, and
in any event, all charges related to expediting and delivering EOs shall be paid by Buyer.



8.0 Warranty Support




8.1 Epidemic Defects




For Epidemic Defects, Buyer will notify supplier in writing of the existence of an epidemic failure
and provide supporting technical failure characteristics and data, failure rate details, and failed
products to support the claim. If an epidemic failure has occurred in accordance with this Section
8.1,, Supplier shall prepare and propose a Corrective Action Plan or response with respect to such
material within 24 hours of such notification, addressing implementation and procedure milestones
for remedying such Epidemic Defect condition(s). An extension of the time frame is permissible upon
prior written notification by Buyer.



For Epidemic Defects, Supplier will at Buyer’s discretion: (i) refund or credit the Product Price,
or replace or repair the Products at no charge in a timely manner, and (ii) reimburse Buyer for
actual and reasonable expenses incurred by Buyer



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Agreement #4998RL1168

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related to Epidemic Defects, including costs associated with repair, or replacement, field costs,
customer related expenses, problem diagnosis, and field and finished goods inventory related costs.



The following cap will apply to Supplier’s obligations under this Section 8.1. SUPPLIER’S
AGGREGATE LIABILITY UNDER THIS SECTION 8.1 FOR ALL PRODUCTS ON A PER INCIDENT BASIS SHALL NOT
EXCEED *.



8.2 Warranty Period




The warranty redemption set forth in the section of the BA entitled, “Warranty Redemption” as it
applies to the relevant subsection of the section of the BA entitled, “Ongoing Warranties” will be
available to Buyer for all Products hereunder for the longer of the relevant warranty period set
forth herein, unless expressly provided otherwise in the applicable Product Unique Attachment, (as
calculated from the date Buyer takes title of Product) or, if shorter, the relevant warranty period
offered by Buyer to Customers in the relevant Buyer offering that includes the Product. Supplier
will be responsible for its warranty redemption responsibilities under the Agreement for all
Products returned to Supplier, regardless of the reason why such Products fail to meet the
requirements in the Agreement. Such warranty redemption for Repaired Product shall be the longer of
the remainder of the above period for the original Product or one-hundred eighty (180) days after
the Buyer’s receipt of the Repaired Product. Nothing in this section shall be deemed to affect or
amend the ongoing duration of the remaining ongoing warranties.



8.3 Warranty Redemption Logistics.




Supplier will provide Buyer with information and processes by which Buyer is able to verify Product
warranty entitlement. Where Supplier is required to ship Product pursuant to its warranty
redemption responsibilities under the Agreement, Supplier will ship such Product to Buyer’s
designated “ship to” location via Buyer’s designated carrier.



Unless specified otherwise by Buyer, Supplier will provide locations for Buyer to redeem Product
warranty in the following four geographic areas: United States, Western Europe.



     a. Returns. Requests for warranty service shall be initiated by Buyer’s written notice
(including by facsimile or electronic mail), advising Supplier of the nature of the problem. If
Supplier is unable to resolve the problem through remote diagnostics or other communications with
Buyer, Supplier shall assign Buyer a return material authorization number (“RMA”). At its risk and
expense, Buyer shall deliver the nonconforming Product (with prominent indication of the RMA) to
Supplier or its designated repair center. Products returned without an RMA shall not be afforded
warranty service, and Buyer shall be liable for all costs and expenses incurred by Supplier in
connection with servicing the unauthorized return.



     b. Response. For warranty claims made within 30 days after delivery, Supplier will use
diligent efforts to deliver replacement Products within 2 business days after the RMA is assigned.
Buyer will return the defective Product within 30 days after the RMA is assigned; if not, Supplier
may invoice Buyer at its then current list price for the replacement Product. For all later
warranty claims, Supplier will use diligent efforts to repair or replace defective Product within
15 business days after the RMA is assigned. Products repaired or replaced hereunder shall be
covered by this warranty for the longer of 30 days after re-delivery to Buyer or the remainder of
the original 1 year warranty period. All Products (or any component) that is replaced hereunder
becomes Supplier’s property.



     c. Exclusions.



Notwithstanding any other provision to the contrary, these warranties shall not apply to any
Product that was (a) used, handled, transported, operated, maintained or stored improperly, or in
any manner not in accord with Supplier’s instructions or recommendations, documentation or industry
standard practice or (b) repaired, altered or modified other than by Supplier or its authorized
agents. Supplier shall not be responsible for any data or other information contained in Products
returned for warranty service.



9.0 Repair




9.1 Required Replacement.




All components of Products sent to Supplier for Repair that exhibit unsafe conditions (including
but not limited to cracking, chafing, and/or other unsafe conditions) will be replaced with an
identical (same manufacturer, part or model number, electrical/thermal rating, physical dimensions
and agency approval) if such manufacturer then currently supplies such component to Supplier, or an
approved alternate component (identical mechanical, electrical/thermal, physical, compositional and
performance characteristics but different manufacturer). Compliance with this section will not
relieve Supplier of its other obligations under the Agreement and this SOW.





 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.




Page 9 of 19









 






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9.2 Scope of Repair Services.




Supplier will make Repair Services available to Buyer up through and including the relevant EOS
date, as specified by Buyer in writing. Products sent to Supplier for Repair during the applicable
warranty period will be delivered to Supplier at Buyer’s cost, then Repaired at no cost to Buyer
and returned to Buyer at Supplier’s cost. Products sent to Supplier for Repair outside of the
applicable warranty period will be delivered to Supplier at Buyer’s cost, then (also at Buyer’s
sole cost and expense) Repaired and returned to Buyer freight prepaid in accordance with the
delivery date specified by Buyer in the WA for such Repair. All Repaired Products must meet the
requirements regarding CSPs set forth in this SOW. Repair Services for the same defect will not be
performed on Products sent for Repair a second time within such Product’s applicable warranty
period. In such event, Supplier will, at Supplier’s discretion, provide Buyer a replacement
Product, or credit or refund Buyer an amount equal to the Price paid by Buyer. Supplier must
maintain a history of Repair activities and provide a monthly report to Buyer in the format of the
attachment to this SOW that is entitled “Monthly Warranty Analysis Report.”



9.3 CSP Requirements.




Products will only be classified as CSP with Buyer’s written approval. Products classified as CSP
may be used for field service only and may not be used in the manufacturing of a new Product. CSPs
will meet the following criteria: (i) the functional performance of such Products will comply with
all current and applicable engineering drawings, specifications, and other Product requirements;
(ii) the appearance of such Products will be equivalent to that of a new counterpart; (iii)
manufacturer warning labels will remain intact and legible or will be replaced, and protective
covers (e.g., guards or shields) will be securely mounted as originally designed or will be
replaced; and (iv) the Repair of such Products (including EC related Repairs) will be in compliance
with all agreed upon listings and certifications issued by National Certification Body (NCB). If
Supplier is not able to meet specified criteria, then Product will be deemed non-repairable and
Buyer will be notified accordingly. Suppliers will place on all CSPs, a “SERVICEABLE USED PART(S)”
label meeting the following criteria: (i) printed using high quality paper with a shelf life of ten
(10) years; (ii) using permanent pressure sensitive and tamper evident adhesive (black printing on
orange background); (iii) which do not contain any voids, ink specks, ink fill-ins or
edge-roughness; (iv) which are applied in a manner that provides durable and wrinkle free labels
that permanently and securely bonds to the Product and container under variable environmental
conditions; (v) which are clearly visible; and (vi) which will not adversely affect the
functionality or aesthetics of the Product. The original manufacture date will be preserved or
restored as needed at the time of Repair. Product labels (labels applied directly to the Product)
will comply with the following dimensions: (i) large labels will measure 3.0448 cm x 0.9615 cm
(1.1875 in x 0.3750 in); (ii) small labels will measure 2.2435 cm x 0.6410 cm (0.8750 in x 0.2500
in). Container labels (labels applied to the container) will comply with the following dimensions:
(i) 9.2948 cm x 4.4871 cm (3.6250 in x 1.7500 in).



9.4 Engineering Deliverables.




In the event Supplier is unable to fulfill repair responsibilities, Supplier will provide Buyer,
upon Buyer’s request, all the information (in the English language) required to enable Buyer to
procure alternate Repair source(s), including but not limited to the following:


Product drawings

Schematics / diagrams

Engineering specifications

Performance specifications

Component placement listings

Certified component source listings (IEC / UC / CSA 950)

Debug / fault isolation test procedures

Special tooling drawings / specifications if applicable

Rework / upgrade instructions

Test procedures / software / equipment

Repair verification procedures / test software / equipment

Hazardous materials listings




10.0 Consigned Materials




10.1 Handling of Consigned Materials.




In instances where Buyer sends Product to Supplier for Repair, and/or provides to Supplier tooling
and/or other items, Buyer may, but is not obligated to, entrust such Products, tooling, and/or
other items to Supplier as Consigned Materials. Buyer will retain title to Consigned Material at
all times. Supplier will: (i) use Consigned Materials only in the performance of this SOW and will
not reuse or resell nor allow to be reused or resold any Consigned Material without Buyer’s prior
written



Page 10 of 19









 






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authorization; (ii) acknowledge receipt of Consigned Materials within five (5) business days of
receipt to the Buyer’s Business Coordinator via email or fax, and such acknowledgment will include
a detailed report of any quantity shortages or overages (any shortages not reported to Buyer’s
Coordinator in such acknowledgment will be deemed received by Supplier), all relevant part numbers,
and the relevant WA (if applicable) and quantity; (iii) immediately notify carrier and Buyer’s
Business Coordinator of any Consigned Materials that exhibit external damage at the time of
delivery from Buyer to Supplier, document on carrier’s freight bill such damage, and receive either
an inspection report or a letter from carrier stating that such inspection has been waived; (iv)
ensure that Consigned Materials are not pledged, mortgaged, assigned, borrowed or encumbered by
security interests or otherwise and are not be removed from Supplier’s location without Buyer’s
prior written authorization, unless provided to Buyer in accordance with the terms and conditions
of this SOW; (v) provide monthly reports of all transactions made by Supplier involving Consigned
Materials, together with the quantities remaining in Supplier’s custody as of the date of such
report, and will make due settlement and payment on a monthly basis, if not already made, for any
and all Consigned Materials in accordance with this SOW; (vi) maintain account books and records
providing complete information as to all such transactions involving Consigned Materials, and such
books and records will be available to Buyer during normal business hours, upon forty eight (48)
hours prior notice to Supplier; (vii) permit Buyer to inspect Consigned Materials at any time
during normal business hours, at Supplier’s location and to remove any or all of the same if Buyer
so desires; (viii) upon Buyer’s request and at Buyer’s cost, maintain replacement cost insurance on
Consigned Materials; (ix) upon Buyer’s written request, or upon termination or expiration of this
SOW, return Consigned Materials to Buyer pursuant to Buyer’s instructions and in the same condition
as received by Supplier; (x) upon Buyer request, mark Consigned Material in a manner acceptable to
Buyer to indicate Buyer’s ownership; (xi) control Consigned Materials in a manner reasonably
designed so as to not commingle Consigned Materials with other materials, parts, or other assets of
Supplier or of any third party; and (xii) notify Buyer immediately in writing of any personal
property taxes or assessments that may be levied on Consigned Materials. Supplier shall not charge
inventory fees or any other costs to Buyer regarding Consigned Materials provided to Supplier in
reasonable quantities and for reasonable periods of time.



10.2 Return of Consigned Materials.




Supplier will provide a packing slip with all return shipments of Consigned Materials to Buyer
which specifies Supplier’s name, Buyer part number(s) of Consigned Materials being returned,
quantity of Consigned Materials, by Buyer part number being returned, and the relevant WA number.
Consigned Materials which Supplier is unable to Repair will be returned to Buyer with a packing
slip which additionally references a return authorization number, obtained from Buyer, and provide
a reason why Supplier is unable to Repair such Consigned Materials. Supplier will reimburse Buyer
for Consigned Materials that are not returned to Buyer in accordance with the terms of this SOW,
including, without limitation, any Consigned Materials that have been stripped, stolen, lost,
damaged, or unaccounted for. The calculations for reimbursement of Consigned Materials is as
follows: (i) for new Consigned Materials, Supplier will reimburse Buyer an amount equal to Buyer’s
then current price for the Consigned Materials; or (ii) for used Consigned Materials, Supplier will
reimburse Buyer an amount equal to twenty-five percent (25%) of Buyer’s weighted average cost per
piece. Buyer shall promptly reimburse Supplier for all costs and expenses of returning Consigned
Materials to Buyer.



11.0 Guaranty For Purchases Through Supplier Affiliates




11.1 Company Guaranty




Supplier guarantees the prompt and
satisfactory performance of obligations and
responsibilities under the Agreement or any
Participation Agreement by its Affiliates in
accordance with all the terms and conditions
of the Agreement or any Participation
Agreement. If a Supplier Affiliate defaults
in performance of its obligations or
responsibilities under the Agreement or any
Participation Agreement according to their
terms and conditions, Supplier shall pay to
Buyer or Buyer Affiliate all damages, costs
and expenses that Buyer or Buyer Affiliate
is entitled to recover from the Supplier
Affiliate by reason of such default. This
guaranty shall continue in force until all
obligations of the Supplier Affiliate under
the Agreement or any Participation Agreement
have been completely discharged. Supplier
shall not be discharged from liability under
this guaranty as long as any claim by Buyer
or Buyer Affiliate against the Supplier
Affiliate remains outstanding.



Page 11 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



	 	 	 	 	 	 	 	 	 
	ACCEPTED AND AGREED TO:

INTERNATIONAL BUSINESS

MACHINES CORPORATION	 	 	 	ACCEPTED AND AGREED TO:

VOLTAIRE, INC.
	By: /s/ Davor Cindric                     11/19/04

	 	 	By: /s/ Mark E. Favreau                     11/18/04
	 	 	 	 	 
	Buyer Signature

	 	Date
	 	 	 	Supplier Signature
	 	Date
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	Davor Cindric	 	 	 	Printed Name
Mark E. Favreau
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	
	Manager, CPUs, Chipsets, Networking and Comm.	 	 	 	Title & Organization
 Executive Vice-President & General Manager, Voltaire, Inc.
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	
	Buyer Address:

3039 Cornwallis Road

RTP, NC 27709	 	 	 	Supplier Address:

6 Fortune Drive, 3rd Floor

Billerica, MA 01821-3917 USA






Page 12 of 19









 







Agreement #4998RL1168

SOW #4904RL1344



ATTACHMENT A




MONTHLY WARRANTY ANALYSIS REPORT




Supplier Name:                                         

Month:                                                             




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







	 	 	 
	SUMMARY REPORT
	 	 
	Total Units Repaired in Current Montho
	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






Page 13 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



PRODUCT UNIQUE ATTACHMENT #1 EFFECTIVE NOVEMBER 19, 2004




1.0 PRODUCT DESCRIPTION




The Product is InfiniBand connectivity solution, including Switches and HCAs. The Product
(including Product code and documentation) will be available in the following languages: English..
Additional requirements applicable to Products include the following specifications:



2.0 PART NUMBER UNIQUE TERMS




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Unit	 	 	 	 	 	Country of Origin	 	 	 	Repair	 	 	 	 
	 	 	 	 	Price	 	Delivery	 	Lead	 	and Complete	 	Warranty	 	Price	 	 	 	 
	Buyer P/N	 	Description	 	(USD)	 	Term	 	Time	 	Street Address	 	Period	 	(USD)*	 	TAT	 	Yield
	26K7511
	 	Voltaire ISR 9024M	 	$ *	 	DDU	 	* Days	 	USA	 	*	 	* $	 	* days	 	100%
	 
	 	with Redundant PS	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	26K7536
	 	Voltaire	 	$ * 	 	DDU	 	* Days	 	USA	 	*	 	* $	 	* days	 	100%
	 
	 	HCA PCI-X	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	26K7617
	 	HCA PCI-EX	 	$ *	 	DDU	 	* Days	 	USA	 	*	 	* $	 	* days	 	100%









 




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





3.0 WA FLEXIBILITY




	 	 	 	 	 	 	 
	Number of Days prior to a	 	Increase of Product Quantity to a WA	 	Cancellation of Product Quantity to a WA	 	Rescheduling of Product Quantity to a WA
	WA Scheduled Delivery	 	Scheduled Delivery Date	 	Scheduled Delivery Date	 	Scheduled Delivery Date
	Date	 	(% of WA Quantity)	 	(% of WA Quantity)	 	(% of WA Quantity)
	Less than * days
	 	*	 	*	 	*
	 
	 	 	 	 	 	 
	From * days to * days
	 	*	 	*	 	*
	 
	 	 	 	 	 	 
	More than * days
	 	*	 	*	 	*






5.0 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.





 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.




Page 14 of 19









 






Agreement #4998RL1168

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5.1 Business Coordinators.




	 	 	 	 	 	 	 
	SUPPLIER

	 	 	 	BUYER	 	 
	Name

	 	Mark Favreau
	 	Name
	 	Kathryn Terry
	Title

	 	EVP and GM
	 	Title
	 	Global Commodity Manager
	Address

	 	6 Fortune Drive, Billerica, MA 01821
	 	Address
	 	11400 Burnet Road, Austin, TX 78758
	Phone

	 	+1 (978) 439-5454
	 	Phone
	 	512-838-5646
	Fax

	 	978-439-5401
	 	Fax
	 	512-838-5999
	E-mail

	 	markf@voltaire.com
	 	E-mail
	 	klterry@us.ibm.com






5.2 Technical Coordinators.




	 	 	 	 	 	 	 
	SUPPLIER

	 	 	 	BUYER	 	 
	Name

	 	Bob Spear
	 	Name
	 	Terry Duff
	Title

	 	Director of Professional Services
	 	Title
	 	W/W Technical Program

Manager/Linux Cluster Operations

Manager
	Address

	 	6 Fortune Drive, Billerica, MA 01821
	 	Address
	 	3039 Cornwallis Road, RTP, NC 27709
	Phone

	 	+1 (978) 439-5405
	 	Phone
	 	919-486-0220
	Fax

	 	978-439-5401
	 	Fax
	 	919-486-8228
	E-mail

	 	bobs@voltaire.com
	 	E-mail
	 	tduff@us.ibm.com






5.3 Legal Coordinators.




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

	 	Mark Favreau
	 	Name
	 	Phil Gevertz
	Title

	 	EVP and GM
	 	Title
	 	Contracts Representative
	Address

	 	6 Fortune Drive, Billerica, MA 01821
	 	Address
	 	3039 Cornwallis Road, RTP, NC 27709
	Phone

	 	+1 (978) 439-5454
	 	Phone
	 	919-543-5859
	Fax

	 	978-439-5401
	 	Fax (Fax notice
shall be valid only
when verbal
confirmation of
receipt is
obtained.)
	 	919-543-4253
	E-mail

	 	markf@voltaire.com
	 	E-mail
	 	pgevertz@us.ibm.com






Page 15 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



	 	 	 	 	 
	

	   	International Business Machines

1701 North Street

Endicott NY 13760
	 	Authorization for Electronic Funds Transfer






If Supplier’s bank is in the United States, include this form and delete the form entitled
“Electronic Funds Transfer.”



You hereby authorize IBM to initiate credit entries to the account listed below in connection with
agreed upon Electronic Data Interchange (EDI) transactions between our companies. You agree that
such transactions will be governed by the National Automated Clearing House Association (ACH)
rules. This authority is to remain in effect until IBM has received written notification of
termination in such time and such manner as to afford IBM a reasonable opportunity to act on it.
You also authorize the Bank listed below to verify your account information as necessary to
establish the EFT. IN NO EVENT SHALL IBM BE LIABLE FOR ANY SPECIAL, INCIDENTAL, EXEMPLARY OR
CONSEQUENTIAL DAMAGES AS A RESULT OF THE DELAY, OMISSION OR ERROR OF AN ELECTRONIC CREDIT ENTRY,
EVEN IF IBM HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. You are required to provide IBM
prompt written notice regarding the initiation, change, or termination of any relationship in which
you authorize a Third Party to receive payment from IBM on your behalf. Payments made by IBM to a
Third Party you authorize within this form to accept payments on your behalf shall satisfy any
payment obligation from IBM to you and shall constitute payment in full for such obligation.

This agreement shall be governed by the laws of the State of New York.



	 	 	 
	TRADING PARTNER NAME:
	 	 
	 
	 	 
	REMIT TO ADDRESS

	 	This should be the remit to address shown on your
invoices
	Street Address / PO Box

	 	6 Fortune Drive
	City, State, Zip

	 	Billerica MA 01821
	Company Tax ID Number

	 	52-2099223
	 
	 	 
	BANKING INFORMATION

	 	This must be a U.S. Domestic Bank to use this form
	Name of Bank

	 	Chase Manhattan Bank
	Street Address / PO Box

	 	200 E. 57th Street
	City, State Zip

	 	New York, NY 10022
	Title on Bank Account**

	 	Voltaire Inc.
	(Should Read Exactly as Listed on 

Bank Statement)
	 	 





			
	

 



	**	 	If Name on Bank Account differs from Trading Partner Name,
provide a description of relationship (ex: Parent/sub, factoring company, other 3rd party receivable, etc) on your company
letterhead , attach documentation of this relationship , and check the box here to indicate that the other entity is an
Agent of Trading Partner and authorized to accept payments from IBM on behalf of Trading Partner: [ ].




	 	 	 
	EFT INFORMATION

	 	Obtain this information directly from your bank
	Bank ABA Number:

	 	                    *
	(also known as Bank Routing Number)

	 	___ ___ ___ ___ ___
 ___ ___ ___ ___ (Must be 9 digit number)
	Bank Account Number

	 	                    *




	 	 	 	 	 
	YOUR BANK CONTACT	 	Person at your bank who we can contact to verify Banking information
	Contact Name / Title

	 	Name:
	 	Title:
	Contact Phone / Fax

	 	Phone: (     )
	 	Fax (     )






	 	 	 
	REMIT ADVICE OPTION

	 	Check One (See instructions for help)
	 
	 	 
	Remit advice sent directly to your

	 	___ 1                                                                 
          
  
	EDI/Forms Exchange/WOI Mailbox

	 	          Fill in your EDI/ Forms Exchange / WOI UserID above
	 
	 	 
	Remit Advice sent to your bank w/
payment

	 	___ 2








 




			
	*	 	Omitted pursuant to a confidential treatment request. The confidential portion has been filed separately with the SEC.





Page 16 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



	 	 	 
	AUTHORIZATION

	 	Authorized Signature(MUST BE SIGNED)
	Signature: /s/ Josh Siegel
	 	 
	Date: November 21, 2004
	 	 
	Name: Josh Siegel
	 	 
	Title: VP Finance
	 	 
	Phone: (972-9) 971-7666
	 	 
	Fax: (972-9) 971-7660
	 	 
	E-Mail Address: joshs@voltaire.com
	 	 






A copy of a voided check is recommended to validate your EFT banking information.



Please fax this form along with a copy of a voided check to (845) 491-3399, Attentions: EFT
Team.



Page 17 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



The following instructions will assist you in filling out the EFT Authorization Form accurately.
These instructions are designed to prevent errors which cause delays in you EFT setup. If you have
additional questions, information can be found on our internet website at
http://www-1.ibm.com/procurement/proweb.nsf/ContentDocsByTitle/United+States~EFT+Process?OpenDocument&Parent=EDI+Invoicing or e-mail eftsetup@us.ibm.com.



Trading Partner Name:



This is the name of your company.



Remit To Address:



This is the address for which your invoices read “send payments to:.” This is not to be confused
with your company’s physical location; however it may be the same. A rule of thumb is: Where
should payments be mailed in the event a paper check needs to be cut?



Banking Information:



This is the physical location of the bank you use. If you use a branch, please supply the branch’s
address in this section.



Title on Bank Account:



This should be the exact name as shown on your monthly Bank Statements. If the name (Title) on
your bank account differs from your company name, we will need a written explanation on your
company letterhead of the relationship between the name on the account and your company name. This
letter can be faxed in along with the EFT Authorization Form.



EFT Information:



We recommend that you obtain this information directly from you bank. The information needed is
the Routing/ABA# (American Banking Association) of your bank, and your company’s individual Account
#. When asking the bank for this information, let them know that IBM intends to send EFT payments
to you account using the ACH (Automated Clearing House). It is important to note that IBM is
sending an EFT payment through the ACH, we are not sending a Wire payment. Wire payments and EFT
payments are not the same. For additional backup, we recommend that you send a copy of a voided
check along with the EFT Form.



Bank
Contact:

This should be an employee of your bank whom IBM can contact to verify that the banking information
supplied is correct.



Remit Advice Option:



This determines where IBM sends your remittance advice for payments that are sent electronically.
IBM offers two options:



Option 1 : You must be an EDI / Forms Exchange (FOX) / WOI enabled supplier to use this
option. IBM will electronically send your remittance to your EDI/FOX/WOI in-box. You will
normally receive your remittance advice 1 to 2 days prior to the date the funds will be available
in your account. Please provide your EDI/FOX/WOI mailbox / userid in the space to the right of the
option 1 check-box. Option 1 is recommended for all EDI/FOX/WOI users.



Option 2 : IBM will electronically send your remittance to your bank along with the
payment. When choosing this option you will need to set up an agreement with your bank for them to
forward you this information. (IBM will be sending the payment and remittance advice in an X-12
820 CTX file via the ACH).



Signature / Company Contact:



The form must be signed by someone in your company who has the authorization to permit IBM to
electronically send payments to your company’s bank account. Please provide all the requested
information for this individual.



International Business Machines Corporation

1701 North St.

Endicott, NY 13760




Page 18 of 19









 






Agreement #4998RL1168

SOW #4904RL1344



If Supplier’s bank is outside the United States, include this form and
delete the form entitled “Authorization for Electronic Funds Transfer Form.”



ELECTRONIC FUNDS TRANSFER




Accounts Payable cannot accept faxed materials to enable an Electronic Funds Transfer (EFT) setup
for payments to banks outside the United States. Please PROVIDE the following information on your
company letterhead/stationery in order to authorize IBM to begin payments via electronic transfer:




	1.	 	Invoice name and address remit to data must match the information provided by you on your
letterhead/stationery.
	 
	2.	 	Remittance detail will be mailed to the address listed at the time of payment.
	 
	3.	 	Payment will begin only after the information supplied by you can be verified.
	 
	4.	 	This request must be original and air-mailed to the following address:




IBM National Accounts Payable Services

1701 North Street, Bldg. 250-1, Dept., G6L

Endicott, NY 13760 USA

ATTN: Lynn Ward, EFT — Set Up




REQUIRED INFORMATION: (Original, typed on your company letterhead/stationery)




	1.	 	Supplier name and remit to address (which is on your invoices).
	 
	2.	 	Supplier contact name / telephone number / fax number / Internet id, if applicable.
	 
	3.	 	Supplier bank name and address.
	 
	4.	 	Supplier bank account number.
	 
	5.	 	Bank contact name / telephone number / fax number.
	 
	6.	 	Name of IBM Buyer.
	 
	7.	 	IBM purchase order number, if there are multiple purchase order numbers, provide at least one
number.
	 
	8.	 	Is a paper check acceptable until the electronic payment process has been completed? YES or
NO
	 
	9.	 	If you have an IBM Remit Supplier number, include it in your response.





DO NOT MAIL THIS INFORMATION WITH INVOICES YOU SEND TO IBM. Mail the above information separately
to the address noted above.



NOTE: IF, IN THE FUTURE, ANY ALTERNATIONS TO THE INFORMATION IS NECESSARY, ONCE IT IS VERIFIED, YOU
MUST REPEAT THE REQUIREMENTS ABOVE AND RE-SEND THE REVISED INFORMATION TO THE ADDRESS NOTED ABOVE.
THE REVISED INFORMATION WILL THEN NEED TO BE REVERIFIED WITH THE BANK(S) INVOLVED. IF THE
INFORMATION CHANGES, ACCOUNTS PAYABLE WILL NOT BE AWARE OF IT UNLESS YOU INFORM US BY PROVIDING THE
REVISED INFORMATION ON YOUR LETTERHEAD/STATIONERY



For payment inquiries older than thirty (30) days, call: Global Accounts Payable Service Center at
607-429-4848. Internal calls can be made to 8-620-4848.




Page 19 of 19









 








    IBM
    Proposal



 


	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
 
	
 
	
 
	
 
	
 
	
 
	
    IBM

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
    DDP

	
 
	
 
	
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    DDP

	
 
	
 
	
 

	
    Products
	
 
	
 
	
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    List
    
	
 
	
 
	
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    Guadalajara
    
	
 
	
 
	
    Shenzhen
    
	
 
	
 
	
    Greenock
    
	
 
	
 
	
    Discount
    

	

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    Includes Shipping cost and Insurance

    Excludes Duties and taxes that should be on there account

    Not Special Export charges are required

    HCA minimum shipment is 10 units

    PowerSupply minimum shipment is 5 units

    RallKit minimum shipment is 5 units

    ConsoleKit minimum shipment is 5 units



 





 




			
	
    * 		
    Omitted pursuant to a confidential treatment request. The
    confidential portion has been filed separately with the SEC.