Document:

exv10w15

 

Exhibit 10.15

Note: Information in this document marked with
a “[***]” has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Flextronics Manufacturing Services Agreement

     This Flextronics Manufacturing Services Agreement (“Agreement”) is entered into this 1st day
of January 2005 by and between ARUBA WIRELESS NETWORKS, a Delaware corporation having its place of
business at 1322 Crossman Avenue, Sunnyvale, California 94089 (“Aruba”) and FLEXTRONICS SALES &
MARKETING NORTH ASIA (L) LTD., having its place of business at Level 1, Lot 7, Block F, Sequking
Commercial Building, Jalan Patau-Patua, 8700 Labaun, F.T., Malaysia (“Flextronics”).

     Aruba desires to engage Flextronics to perform manufacturing services as further set forth in
this Agreement. The parties agree as follows:

1. DEFINITIONS

     Flextronics and Aruba agree that capitalized terms shall have the meanings set forth in this
Agreement and Exhibit 1 attached hereto and incorporated herein by reference.

2. MANUFACTURING SERVICES

     2.1 Work. Aruba hereby engages Flextronics to perform the work (hereinafter “Work”).
“Work” shall mean to procure Materials and to manufacture, assemble, and test products (hereinafter
“Product(s)”) pursuant to detailed written Specifications. The “Specifications” for each Product
or revision thereof, shall include but are not limited to bill of materials, designs, schematics,
assembly drawings, process documentation, test specifications, current revision number, and
Approved Vendor List. The Specifications as provided by Aruba and included in Flextronics’s
production document management system and maintained in accordance with the terms of this Agreement
are incorporated herein by reference as Exhibit 2.1. This Agreement does not include any new
product introduction (NPI) or product prototype services related to the Products. In the event
that Aruba requires any such services, the parties will enter into a separate agreement.

     2.2 Authorized Purchaser. Flextronics agrees to sell Products to Authorized
Purchasers. Flextronics shall afford the Authorized Purchasers the right to receive the pricing
for Product set forth in this Agreement; provided that Flextronics and such Authorized Purchasers
enter into a mutually acceptable agreement (including appropriate credit terms) substantially in
the form attached hereto as Exhibit 2.2 (the “Authorized Purchaser Agreement”). Notwithstanding
the foregoing, Aruba acknowledges and agrees that Flextronics shall not be obligated to sell
Products to Authorized Purchasers or to enter into an Authorized Purchaser Agreement with an
Authorized Purchaser if Aruba is otherwise purchasing Products directly from Flextronics for resale
to such Authorized Purchaser.

     2.3 Engineering Changes. Aruba may request that Flextronics incorporate engineering
changes into the Product by providing Flextronics with a description of the proposed engineering
change sufficient to permit Flextronics to evaluate its feasibility and cost (“Engineering Change
Request” or “ECR”). Upon receipt of an ECR, Flextronics will provide Aruba with a response within
five (5) business days of receipt advising Aruba of the likely impact of an ECR (including but not
limited to the impact on the delivery, scheduling and Product pricing). Flextronics will proceed
with engineering changes when the parties have agreed upon the changes to the Specifications,
delivery schedule and Product pricing and Aruba has issued a purchase order for the implementation
costs (“Engineering Change Order” or “ECO”). All non-recurring costs of implementing ECO’s
(including, without limitation, premium costs of Materials; Material handling charges; process and
tooling charges; engineering charges; and evaluation testing costs and other costs which result
form the ECO) will be the responsibility of Aruba, except as otherwise mutually agreed to in
writing between the parties. Neither party will unreasonably withhold or delay agreement to an ECO
and the parties agree to use commercially reasonable efforts to implement at the earliest
opportunity ECO’s relating to personal and product safety.

     2.4 Tooling; Non-Recurring Expenses; Software. Aruba shall pay for or obtain and
consign to Flextronics any Product-specific tooling, equipment or software and other reasonably
necessary non-recurring expenses, to be set forth in Flextronics’s quotation. All software that
Aruba provides to Flextronics or any test software that Aruba engages Flextronics to develop is and
shall remain the property of Aruba.

     2.5 Cost Reduction Projects. Flextronics agrees to seek ways to reduce the cost of
manufacturing Products by methods such as elimination of Materials, redefinition of Specifications,
and re-design of assembly or test methods. Cost reductions will be governed as follows (i) upon
implementation of such ways that have been initiated by Flextronics and approved by Aruba
Flextronics will receive 100% of the demonstrated cost reduction for a full quarter (3 months)
after

 

 

 implementation of such cost reductions and thereafter 100% to Aruba, (ii) upon implementation
of such ways that have been initiated by Aruba and approved by Flextronics, Aruba will received
100% of the demonstrated cost reductions.

     2.6 Quality Standards.

     (a) Flextronics will maintain quality assurance systems for the control of material quality,
processing, assembly, testing, packaging and shipping in accordance with its usual policies and
practices. The workmanship standard to be used in building Product is IPC A-610 Rev. C Class II,
as published by the Institute for Interconnecting and Packaging Electronic Circuits.

     (b) Aruba may during normal business hours and following reasonable advance written notice and
subject to Flextronics’s security and customer or other and confidentiality requirements, visit the
Flextronics facility where the Products are manufactured and review the quality control procedures
related to manufacture of the Products as reasonably necessary to satisfy itself of compliance with
its obligations under this Agreement.

     2.7 Quarterly Business Review. The parties will conduct a Quarterly Business Review
(“Quarterly Business Review” or “QBR”) meeting at least once each calendar quarter for the purpose
of reviewing the parties’ performance and the business matters to be addressed quarterly as set
forth in the specific provisions of this Agreement. Commercially reasonable efforts will be made
by Flextronics and Aruba to have at least one executive level participant in attendance for each
QBR. To the extent possible, these meetings will be scheduled in order to permit in-person
attendance by participants and they will be conducted at the location where Aruba’s products are
manufactured, unless mutually agreed to otherwise by the parties.

     2.8 Resource Shortages. Excluding cases where Flextronics is excused entirely from
performance under this Agreement or applicable, law, in the event Flextronics is in a position to
require the allocation of materials, facilities, equipment or personnel (collectively “Resources”)
due to shortages. Flextronics shall fairly allocate, in a commercially reasonable manner,
Resources for the period of time during which the cause of the shortages purists; provided however,
that any such allocation shall allocate Resources to Aruba in a manner that is at least as
favorable to Aruba as to other of Flextronics’s customers who provide the same or lesser amount of
business at the facility where Products are manufactured for Aruba. For purposes of determining
whether another customer provides the same or lesser amount of business, such factors as monthly
volume and the economic value of purchases shall be taken into account.

3. FORECASTS; ORDERS; FEES; PAYMENT

     3.1 Forecast. Aruba shall provide Flextronics, on a monthly basis, a rolling twelve
(12) month forecast indicating Aruba’s and its Authorized Purchaser’s monthly Product requirements.
Aruba will use its commercially reasonable efforts to ensure that the Forecast is accurate. The
first ninety (90) days of the forecast will constitute Aruba’s written purchase order for all Work
to be completed within the first ninety (90) day period. Such purchase orders will be issued in
accordance with Section 3.2 below.

     3.2 Purchase Orders; Precedence. Aruba and Authorized Purchasers will provide
Flextronics with purchase orders within at least forty-five (45) days of the scheduled delivery
date. Aruba and Authorized Purchasers may use their standard purchase order form for any notice
provided for hereunder; provided that all purchase orders must reference this Agreement and the
applicable Specifications. The parties agree that the terms and conditions contained in this
Agreement shall prevail over any terms and conditions of any such purchase order, acknowledgment
form or other instrument.

     3.3 Purchase Order Acceptance. Purchase orders shall normally be deemed accepted by
Flextronics, provided however that Flextronics may reject any purchase order: (a) that is an
amended order in accordance with

Section 5.3 below because the purchase order is outside of the Flexibility Table; (b) if the
fees reflected in the purchase order are inconsistent with the parties’ agreement with respect to
the fees; (c) if the purchase order represents a significant deviation from the forecast for the
same period, unless such deviation is within the parameters of the Flexibility Table; or (d) if a
purchase order would extend Flextronics’s liability beyond Aruba’s approved credit line.
Flextronics shall notify Aruba and, as applicable, Authorized Purchaser, of rejection of any
purchase order within five (5) business days of receipt of such purchase order. In the event that
an Authorized Purchaser issues a purchase order pursuant to an Authorized Purchase Agreement,
Flextronics shall notify Aruba of the scheduled dates for delivery of the Products to the
Authorized Purchaser.

     3.4 Fees; Changes; Taxes.

          (a) The fees will be agreed by the parties and will be indicated on the purchase orders issued
by Aruba and Authorized Purchaser and accepted by Flextronics. The initial fees shall be as set
forth on the Fee List attached hereto and

 

 

incorporated herein as Exhibit 3.4 (the “Fee List”). If
a Fee List is not attached or completed, then the initial fees shall be as set forth in purchase
orders issued by Aruba and accepted by Flextronics in accordance with the terms of this Agreement.

          (b) Aruba is responsible for additional fees and costs due to: (a) changes to the
Specifications; (b) failure of Aruba or its subcontractor to timely provide sufficient quantities
or a reasonable quality level of Aruba Controlled Materials where applicable to sustain the
production schedule; and (c) any pre-approved expediting charges reasonably necessary because of a
change in Aruba’s requirements.

          (c) The fees will be reviewed quarterly by the parties. Any changes and timing of changes
shall be agreed by the parties, such agreement not to be unreasonably withheld or delayed. By way
of example only, the fees may be increased if the market price of fuels, Materials, equipment,
labor and other production costs, increase beyond normal variations in pricing or currency exchange
rates as demonstrated by Flextronics.

          (d) Except as provided otherwise in this Agreement, changes to Product prices, and the manner
and timing of their implementation, will be mutually agreed to b the parties on a commercially
reasonable basis at the Quarterly Business Review meeting as set forth in Section 2.7.

          (e) All fees are exclusive of federal, state and local excise, sales, use, VAT, and similar
transfer taxes, and any duties, and Aruba shall be responsible for all such items. This subsection
(e) does not apply to taxes on Flextronics’s net income.

          (f) The Fees List will be based on the exchange rate(s) for converting the purchase price for
Inventory denominated in the Parts Purchase Currency(ies) into the Functional Currency. The fees
will be adjusted, on a monthly basis based on changes in the Exchange Rate(s) as reported on the
last business day of each month, for the following month to the extent that such Exchange Rates
change more than +/- .75% from the prior month. “Exchange Rate(s)” is defined as the closing
currency exchange rate(s) as reported on Reuters’ page FIX on the last business day of the current
month prior to the following month. “Functional Currency” means the currency in which all payments
are to be made pursuant to Section 3.5 below. “Parts Purchase Currency(ies)” means U.S. Dollars,
Japanese Yen and/or Euros to the extent such currencies are different from the Functional Currency
and are used to purchase Inventory needed for the performance of the Work forecasted to be
completed during the applicable month.

     3.5 Payment.

          (a) From the Effective Date to April 1, 2005, payment for the Products and any other costs or
charges payable by Aruba are due to Flextronics in US Dollars within sixty (60) Days following the
date of invoice unless otherwise agreed to by the parties. After April 1st, 2005, payment for the
Products and any other costs or charges payable by Aruba are due to Flextronics in US Dollars
within forty five (45) Days following the date of invoice unless otherwise agreed to by the parties
in writing.

          (b) Flextronics will invoice Aruba as soon as the product is available to be shipped at
Flextronics’s facility, in accordance with Ex Works (Incoterms 2000) delivery terms per Section
5.1.

     3.6 Late Payment. Aruba agrees to pay one and one-half percent (1.5%) monthly
interest on all late payments. Furthermore, if Aruba is late with payments which Aruba has not
remedied within two weeks of such delinquency, or Flextronics has reasonable cause to believe Aruba
may not be able to pay, Flextronics may (a) stop all Work under this Agreement until assurances of
payment satisfactory to Flextronics are received or payment is received; (b) demand prepayment for
purchase orders; (c) delay shipments; and (d) to the extent that Flextronics’s personnel cannot be
reassigned to other billable work during such stoppage and/or in the event restart cost are
incurred, invoice Aruba for additional fees before the Work can resume. Aruba agrees to provide
all necessary financial information required by Flextronics from time to time in order to make a
proper assessment of the creditworthiness of Aruba.

     3.7 Letter of Credit, Escrow Account, Credit Limit.

          (a) In the event that Aruba exceeds its credit limit in subsection (b) below, upon
Flextronics’s written request at any time during the term of this Agreement, within thirty (30)
days of such request, Aruba agrees to obtain and maintain a stand-by letter of credit or escrow
account on behalf of Flextronics to minimize the financial risk to Flextronics for its performance
of the Work under this Agreement. The stand-by letter of credit or escrow account shall be for a
minimum period of time of six (6) months and shall be for a total amount that is equal to the total
value of the risks associated with NCNR Inventory, Special Inventory, and the accounts receivable
from Aruba. The calculation shall be based upon the forecast provided by Aruba pursuant to Section
3.1. The draw down procedures under the stand-by letter of credit or the escrow account shall be
determined solely by Flextronics. Flextronics will, in good faith, review Aruba’s creditworthiness
periodically and may provide more favorable terms once it feels it is prudent to do so. Aruba will
provide all financial information within five (5) business days of request in writing.

 

 

          (b) Aruba’s initial credit limit is [***]. Aruba agrees that it will operate within Aruba’s
credit limit unless otherwise agreed to by Flextronics. In the event that Flextronics’s financial
liability, in Flextronics’s sole discretion, exceeds the amount of Aruba’s then current credit
limit, Flextronics will give Aruba notice of this condition and Aruba agrees that Flextronics may
take appropriate action to reduce Flextronics’s financial liability, including without limitation,
(a) stop all Work under this Agreement until assurances of payment satisfactory to Flextronics are
received or payment is received; (b) demand prepayment for purchase orders; (c) delay shipments;
and (d) to the extent that Flextronics’s personnel cannot be reassigned to other billable work
during such stoppage and/or in the event restart cost are incurred, invoice Aruba for additional
fees before the Work can resume. The credit limit will be reviewed periodically by Flextronics and
may be decreased or increased as business conditions, in Flextronics’s sole discretion warrant.
Flextronics will provide Aruba with prompt written notice of such increase or decrease.

4. MATERIALS PROCUREMENT; ARUBA RESPONSIBILITY FOR MATERIALS

     4.1 Authorization to Procure Materials, Inventory and Special Inventory.

          (a) Accepted purchase orders from Aruba and Authorized Purchasers will constitute
authorization for Flextronics to procure, without Aruba’s prior approval, (a) Inventory to
manufacture the Products covered by such purchase orders based on the Lead Time and (b) certain
Special Inventory based on Aruba’s and Authorized Purchaser’s purchase orders and forecast as
follows: Long Lead-Time Materials as required based on the Lead Time when such purchase orders are
placed and Minimum Order Inventory as required by the supplier. Flextronics will only purchase
Economic Order Inventory with the prior approval of Aruba.

          (b) Flextronics will provide Aruba with quarterly updates of Lead Times for all Materials.
Aruba will be responsible for all costs related to expediting Materials to meet delivery dates as a
result of changes in Lead Times or price increases from suppliers; however, Flextronics will obtain
prior approval from Aruba for expedite costs in excess of $500.00 per purchase order. Aruba agrees
to provide its approval within 2 business days of a request for approval by Flextronics. A failure
of Aruba to provide its approval within 2 business days will be deemed approval by Aruba. A
complete list of monthly premiums will be provided to Aruba each month.

     4.2 Aruba Controlled Materials. Aruba may direct Flextronics to purchase Aruba
Controlled Materials in accordance with the Aruba Controlled Materials Terms. Aruba acknowledges
that the Aruba Controlled Materials Terms will directly impact Flextronics’s ability to perform
under this Agreement and to provide Aruba with the flexibility Aruba is requiring pursuant to the
terms of this Agreement. In the event that Flextronics reasonably believes that Aruba Controlled
Materials Terms will create an additional cost that is not covered by this Agreement, then
Flextronics will notify Aruba and the parties will agree to either (a) compensate Flextronics for
such additional costs, (b) amend this Agreement to conform to the Aruba Controlled Materials Terms
or (c) amend the Aruba Controlled Materials Terms to conform to this Agreement, in each case at no
additional charge to Flextronics. Aruba agrees to provide copies to Flextronics of all Aruba
Controlled Materials Terms upon the execution of this Agreement and promptly upon execution of any
new agreements with suppliers. Aruba agrees not to make any modifications or additions to the
Aruba Controlled Materials Terms or enter into new Aruba Controlled Materials Terms with suppliers
that will negatively impact Flextronics’s procurement activities.

     4.3 Consigned Materials. In the event Aruba consigns components, materials, or
supplies to be used by Flextronics in the manufacture of the Product (“Consigned Materials”), Aruba
agrees to consign adequate quantities to timely manufacture Products and agrees to cover any
production related attrition at Aruba’s sole expense. All Aruba Consigned Materials furnished to
Flextronics or paid for by Aruba in connection with this Agreement shall be allocated part numbers
to indicate Aruba’s ownership and be kept free of liens and encumbrances and Flextronics has no
obligation to purchase the Consigned Materials. Flextronics, however, will be responsible for loss
or damage to Aruba property related to non-production causes while it is on Flextronics’s premises.
Flextronics will provide a physical inventory or cycle count at each Quarterly Business Review.

     4.4 Preferred Supplier. Aruba shall provide to Flextronics and maintain an Approved
Vendor List. Flextronics shall purchase from vendors on a current AVL the Materials required to
manufacture the Product. Aruba shall give Flextronics every opportunity to be included on AVL’s
for Materials that Flextronics can supply, and if Flextronics is competitive with other suppliers
with respect to reasonable and unbiased criteria for acceptance established by Aruba, Flextronics
shall be included on such AVL’s. If Flextronics is on an AVL and its prices and quality are
competitive with other vendors, Aruba will raise no objection to Flextronics sourcing Materials
from itself. For purposes of this Section 4.4 only, the term “Flextronics” includes any companies
affiliated with Flextronics.

 

*** 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.

 

 

     4.5 Aruba Responsibility for Inventory and Special Inventory. Aruba is responsible
under the conditions provided in this Agreement for all Materials, Inventory and Special Inventory
purchased by Flextronics with respect to the forecast and any purchase orders accepted by
Flextronics from Aruba or any Authorized Purchaser under this Section 4.

5. SHIPMENTS, SCHEDULE CHANGE, CANCELLATION, STORAGE

     5.1 Shipments. All Products delivered pursuant to the terms of this Agreement shall
be suitably packed for shipment in accordance with the Specifications and marked for shipment to
Aruba’s or Authorized Purchaser’s destination specified in the applicable purchase order.
Shipments will be made EXW (Ex works, Incoterms 2000) Flextronics’s Shanghai facility. Risk of
loss and title will pass to Aruba or Authorized Purchaser immediately upon leaving the country of
manufacture, and no earlier. All freight, insurance and other shipping expenses, as well as any
special packing expenses not included in the original quotation for the Products, will be paid by
Aruba or Authorized Purchaser.

     5.2 Delivery. Flextronics will use reasonable commercial efforts to deliver Product within a
window between the 10th day and the last day of the calendar month for which the Product is
ordered. Flextronics will not deliver Product to Aruba before the 10th day of the month for which
the Product is ordered unless agreed to by Aruba.

     5.3 Quantity Increases and Shipment Schedule Changes.

          (a) For any accepted purchase order, Aruba may (i) increase the quantity of Products or (ii)
reschedule the quantity of Products and their shipment date as provided in the flexibility table
below (the “Flexibility Table”):

     Maximum Allowable Variance From Accepted Purchase Order Quantities/Shipment Dates

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Maximum	 	 
	# of days before Shipment	 	Allowable	 	Reschedule Quantity	 	Maximum
	 Date on Purchase Order	 	Quantity Increases Up	 	Down or Push Out	 	Reschedule Period
	0-14	 	 	0	%	 	 	0	%	 	0 days
	15-30	 	 	15	%	 	 	0	%	 	0 days
	31-60	 	 	30	%	 	 	20	%	 	30 days
	61-90	 	 	50	%	 	 	40	%	 	60 days

Any decrease in quantity is considered a cancellation, unless the decreased quantity is rescheduled
for delivery at a later date in accordance with the Flexibility Table. Quantity cancellations are
governed by the terms of Section 5.4 below. Any purchase order quantities increased or rescheduled
pursuant to this subsection (a) may not be subsequently increased or rescheduled.

          (b) All reschedules to push out delivery dates outside of the table in subsection (a) require
Flextronics’s prior written approval, which, in its sole discretion, may or may not be granted. If
Authorized Purchaser does not request prior approval from Flextronics, or if Authorized Purchaser
and Flextronics do not agree in writing to specific terms with respect to any approved reschedule,
then Authorized Purchaser will pay Flextronics Monthly Charges for any such reschedule, calculated
as of the first day after such reschedule for any Inventory and/or Special Inventory that was
procured by Flextronics to support the original delivery schedule that is not used to manufacture
Product pursuant to an accepted purchase order within thirty (30) days of such reschedule. In
addition, for all NCNR Inventory and/or NCNR Special Inventory that has remained in Flextronics’s
possession for more than ninety (90) days since such reschedule, Aruba agrees to immediately
purchase any affected Inventory and/or Special Inventory upon receipt of the notice from
Flextronics by paying the Affected Inventory Costs. In addition, any finished Products that have
already been manufactured to support the original delivery schedule will be treated as cancelled as
provided in Sections 5.4, 5.5 and 5.6 below.

          (c) Flextronics will use reasonable commercial efforts to meet any quantity increases, which
are subject to Materials and capacity availability. All reschedules or quantity increases outside
of the table in subsection (a) require Flextronics’s approval, which, in its sole discretion, may
or may not be granted. If Flextronics agrees to accept a reschedule to pull in a delivery date or
an increase in quantities in excess of the flexibility table in subsection (a) and if there are
extra costs to meet such reschedule or increase, Flextronics will inform Aruba for its acceptance
and approval in advance.

 

 

          (d) Any delays in the normal production or interruption in the workflow process caused by
Aruba ‘s changes to the Specifications or failure to provide sufficient quantities or a reasonable
quality level of Aruba Controlled Materials where applicable to sustain the production schedule,
will be considered a reschedule of any affected purchase orders for purposes of this Section 5.3
for the period of such delay.

          (e) For purposes of calculating the amount of Inventory and Special Inventory subject to
subsection (b), the “Lead Time” shall be calculated as the Lead Time at the time of procurement of
the Inventory and Special Inventory.

     5.4 Cancellation of Orders and Authorized Purchaser Responsibility for Inventory.

          (a) Aruba may not cancel all or any portion of Product quantity of an accepted purchase order
without Flextronics’s prior written approval, which, in its sole discretion, may or may not be
granted. If Aruba does not request prior approval, or if Aruba and Flextronics do not agree in
writing to specific terms with respect to any approved cancellation, then Aruba will pay
Flextronics Monthly Charges for any such cancellation, calculated as of the first day after such
cancellation for any Inventory or Special inventory procured by Flextronics to support the original
delivery schedule. In addition, for all NCNR Inventory and/or NCNR Special Inventory that has
remained in Flextronics’s possession for more than thirty (30) days since such cancellation, Aruba
agrees to immediately purchase from Flextronics such Inventory and/or Special Inventory by paying
the Affected Inventory Costs.

          (b) If the forecast for any period is less than the previous forecast supplied over the same
period, that amount will be considered canceled and Aruba will be responsible for any Special
Inventory purchased or ordered by Flextronics to support the forecast.

          (c) For purposes of calculating the amount of Inventory and Special Inventory subject to
subsection (a), the “Lead Time” shall be calculated as the Lead Time at the time of (i) procurement
of the Inventory and Special Inventory; (ii) cancellation of the purchase order or (iii)
termination of this Agreement, whichever is longer.

     5.5 Mitigation of Inventory and Special Inventory. Prior to invoicing Aruba for the
amounts due pursuant to Sections 5.3 or 5.4, Flextronics will use reasonable commercial efforts for
a period of thirty (30) days, to return unused Inventory and Special Inventory and to cancel
pending orders for such inventory, and to otherwise mitigate the amounts payable by Aruba. Aruba
shall pay amounts due under this Section 5.5 within forty five (45) days of receipt of an invoice.
Flextronics will ship the Inventory and Special Inventory paid for by Aruba under this Section 5.4
to Aruba promptly upon said payment by Aruba. In the event Aruba does not pay within forty five
(45) days, Flextronics will be entitled to dispose of such Inventory and Special Inventory in a
commercially reasonable manner and credit to Aruba any monies received from third parties.
Flextronics shall then submit an invoice for the balance amount due and Aruba agrees to pay said
amount within forty five (45) days of its receipt of the invoice.

     5.6 Aruba Responsibility for Ordered Product; Storage of Ordered Product. In the
event Aruba does not arrange for the prompt pickup of Products ordered by it under this Agreement
after being informed by Flextronics that such Products are ready for pickup in accordance with
Aruba’s purchase order, or Aruba attempts to reschedule or cancel a delivery of Products previously
ordered by Aruba, in a manner not permitted by this Agreement, then Aruba hereby authorizes
Flextronics to transfer such Products to a warehouse operated by Flextronics or a third party. If
the Products are transferred to a warehouse operated by Flextronics, then a portion of such
warehouse will be assigned to Aruba for its exclusive use. Such transfer shall be considered a
delivery and sale to Aruba for purposes of this Agreement, and title and risk of loss for such
Products shall thereupon transfer from Flextronics to Aruba. In accordance with the terms of this
Agreement, Flextronics shall invoice Aruba for such sale. Aruba shall also be invoiced for storage
and handling charges equal to one half of one percent (0.50%) of the contract fees for the Products
per month, or any portion thereof, that the Products are stored for Aruba. Such storage and
handling fee shall cover the expense of storage, security, and transporting the goods to and from
such site. During the time that the Products are stored pursuant to this section hereof, Aruba
shall have the right, upon reasonable notice, to inspect the Products for the purposes of this
Agreement. Upon Aruba’s request, Flextronics shall ship the Products to Aruba under the terms of
this Agreement.

     5.7 No Waiver. For the avoidance of doubt, Flextronics’s failure to invoice Aruba for
any of the charges set forth in this Section 5 does not constitute a waiver of Flextronics’s right
to charge Aruba for the same event or other similar events in the future.

6. PRODUCT ACCEPTANCE AND EXPRESS LIMITED WARRANTY

     6.1 Product Acceptance. The Products delivered by Flextronics will be inspected and
tested as required by Aruba within [***] of receipt at Flextronics’s Shanghai facility . If
Products do not comply with the express limited warranty set forth in Section 6.2 below, Aruba has
the right to reject such Products during said period. Products not rejected

 

*** 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.

 

 

during said period
will be deemed accepted. Aruba may return defective Products, freight collect, after obtaining a
return material authorization (“RMA”) number from Flextronics to be displayed on the shipping
container and completing a failure report. Rejected Products will be promptly repaired or
replaced, at Flextronics’s option, and returned freight pre-paid. Aruba shall bear all of the
risk, and all costs and expenses, associated with Products that have been returned to Flextronics
for which there is no defect found. Aruba will return rejected products at its risk to Flextronics
within five (5) business days of receiving an RMA number. Aruba requires an RMA number from
Flextronics prior to returning any product. Prior to Flextronics issuing and RMA number Aruba will
provide Flextronics with an explanation of the problem. Flextronics will issue an RMA number
within (5) business days of Aruba’s request.

     6.2 Express Limited Warranty. This Section 6.2 sets forth Flextronics’s sole and
exclusive warranty and Aruba’s sole and exclusive remedies with respect to a breach by Flextronics
of such warranty.

          (a) Flextronics warrants that the Products will have been manufactured in accordance with the
applicable Specifications and will be free from defects in workmanship for a period of one (1) year
from the date of shipment. In addition, Flextronics warrants that the Products will be free from
defects in Materials to the same extent that the original manufacturer of the Material provides a
warranty for the Materials to Flextronics.

          (b) Notwithstanding anything else in this Agreement, this express limited warranty does not
apply to, and Flextronics makes no representations or warranties whatsoever with respect to: (i)
Aruba’s Controlled Materials; (ii) defects resulting from the Specifications or the design of the
Products; (iii) Product that has been abused, damaged, altered or misused by any person or entity
after title passes to Aruba or Authorized Purchaser, (iv) first articles, prototypes,
pre-production units, test units or other similar Products or (v) defects resulting from tooling,
designs or instructions produced or supplied by Aruba. Aruba shall be liable for costs or expenses
incurred by Flextronics related to the foregoing exclusions to Flextronics’s express limited
warranty.

          (c) Upon any failure of a Product to comply with this express limited warranty, Flextronics’s
sole obligation, and Aruba’s sole remedy, is for Flextronics, at its option, to promptly repair or
replace such unit and return it to Aruba freight prepaid. Aruba shall return Products covered by
this warranty freight prepaid after completing a failure report and obtaining a return material
authorization number from Flextronics to be displayed on the shipping container. Aruba shall bear
all of the risk, and all costs and expenses, associated with Products that have been returned to
Flextronics for which there is no defect found.

          (d) Aruba will provide its own warranties directly to any of its end users, Authorized
Purchasers or other third parties. Aruba will not pass through to end users, Authorized Purchasers
or other third parties the warranties made by Flextronics under this Agreement. Furthermore, Aruba
will not make any representations to end users, Authorized Purchasers or other third parties on
behalf of Flextronics, and Aruba will expressly indicate that the end users, Authorized Purchasers
and third parties must look solely to Aruba in connection with any problems, warranty claim or
other matters concerning the Product. In that regard, Aruba acknowledges and agrees that (a)
Flextronics shall not be obligated to provide any warranties directly to Authorized Purchasers
pursuant to the Authorized Purchaser Supply Agreement and (b) the Authorized Purchasers are not to
be considered third party beneficiaries of any kind to this Agreement.

     6.3 No Representations or Other Warranties. FLEXTRONICS MAKES NO REPRESENTATIONS AND
NO OTHER WARRANTIES OR CONDITIONS ON THE PERFORMANCE OF THE WORK, OR THE PRODUCTS, EXPRESS,
IMPLIED, STATUTORY, OR IN ANY OTHER PROVISION OF THIS AGREEMENT OR COMMUNICATION WITH ARUBA, AND
FLEXTRONICS SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT.

     6.4 Epidemic Failure. During the term of this Agreement, Flextronics shall repair or
replace any affected Products for any Epidemic Failure due to any workmanship related cause covered
by Flextronics’s Express Limited Warranty in Section 6.2 that would have been identified at the
time of manufacture through Aruba’s specified inspection and test procedures. An Epidemic Failure
will be considered to exist when return rate data indicates that  [***] of Product shipped
during any twelve (12) consecutive months has been proven to exhibit a single major functional,
mechanical or appearance defect. Flextronics and Aruba will agree to a reasonable plan and
allocation of costs to carry out the repair or replacement of affected Product shipped during said
twelve-month period. Upon agreement, Flextronics will pay any claims for such costs by Aruba.

7. INTELLECTUAL PROPERTY LICENSES

     7.1 Licenses. Aruba grants to Flextronics, a non-exclusive, non-transferable,
non-sublicensable, limited license under its intellectual property rights to (and only to) perform
the Work and deliver the Products to (and only to) Aruba and, as expressly authorized herein by
Arurba, to Aruba Authorized Purchasers. For the avoidance of doubt, any ambiguity with

 

*** 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.

 

 

respect as
to the scope of the license granted hereunder (including, without limitation, the definition and
scope of the Work covered by such license) shall be resolved in favor of the interpretation given
by Aruba.

     7.2 No Other Licenses. Except as otherwise specifically provided in this Agreement,
each party acknowledges and agrees that no licenses or rights under any of the intellectual
property rights of the other party are given or intended to be given to such other party.

8. TERM AND TERMINATION

     8.1 Term. The term of this Agreement shall commence on the date hereof above and
shall continue for one (1) year thereafter until terminated as provided in Section 8.2
(Termination) or 10.7 (Force Majeure). After the expiration of the initial term hereunder (unless
this Agreement has been terminated), this Agreement shall be automatically renewed for separate but
successive one-year terms unless either party provides written notice to the other party that it
does not intend to renew this Agreement ninety (90) days or more prior to the end of any term.

     8.2 Termination. This Agreement may be terminated by either party (a) for convenience
upon one hundred and eighty days (180) days written notice to the other party, or (b) if the other
party defaults in any payment to the terminating party and such default continues without a cure
for a period of fifteen (15) days after the delivery of written notice thereof by the terminating
party to the other party, (c) if the other party defaults in the performance of any other material
term or condition of this Agreement and such default continues unremedied for a period of thirty
(30) days after the delivery of written notice thereof by the terminating party to the other party,
or (d) pursuant to Section 10.7 (Force Majeure).

     8.3 Effect of Expiration or Termination. Expiration or termination of this Agreement
under any of the foregoing provisions: (a) shall not affect the amounts due under this Agreement by
either party that exist as of the date of expiration or termination, and (b) as of such date the
provisions of Sections, 5.3, 5.4, 5.5 and 5.6 shall apply with respect to payment and shipment to
Aruba of finished Products, Inventory, and Special Inventory in existence as of such date, and (c)
shall not affect Flextronics’s express limited warranty in Section 6.2 above. Termination of this
Agreement, settling of accounts in the manner set forth in the foregoing sentence shall be the
exclusive remedy of the parties for breach of this Agreement, except for breaches of Section 6.2,
9.1, 9.2, or 10.1. Sections 1, 3.5, 3.6, 3.7, 4, 5.3, 5.4, 5.5, 5.6, 6.2, 6.3, 7, 8, 9, and 10
shall be the only terms that shall survive any termination or expiration of this Agreement.

9. INDEMNIFICATION; LIABILITY LIMITATION

     9.1 Indemnification by Flextronics. Flextronics agrees to defend, indemnify and hold
harmless, Aruba and all directors, officers, employees, and agents (each, an “Aruba Indemnitee”)
from and against all claims, actions, losses, expenses, damages or other liabilities, including
reasonable attorneys’ fees (collectively, “Damages”) incurred by or assessed against any of the
foregoing, but solely to the extent the same arise out of third-party claims relating to:

          (a) any actual or threatened injury or damage to any person or property caused, or alleged to
be caused, by a Product sold by Flextronics to Aruba or an Authorized Purchaser hereunder, but
solely to the extent such injury or damage has been caused by the breach by Flextronics of its
express limited warranties related to Flextronics’s workmanship and manufacture in accordance with
the Specifications only as further set forth in Section 6.2;

          (b) any infringement of the intellectual property rights of any third party but solely to the
extent that such infringement is caused by a process that Flextronics uses to manufacture, assemble
and/or test the Products; provided that, Flextronics shall not have any obligation to indemnify
Aruba if such claim would not have arisen but for Flextronics’s manufacture, assembly or test of
the Product in accordance with the Specifications.

     9.2 Indemnification by Aruba. Aruba agrees to defend, indemnify and hold harmless,
Flextronics and its affiliates, and all directors, officers, employees and agents (each, a
“Flextronics Indemnitee”) from and against all Damages incurred by or assessed against any of the
foregoing to the extent the same arise out of, are in connection with, are caused by or are related
to third-party claims relating to:

          (a) any failure of any Product sold by Flextronics hereunder to comply with any safety
standard to the extent that such failure has not been caused by Flextronics’s breach of its express
limited warranties set forth in Section 6.2 hereof;

          (b) any actual or threatened injury or damage to any person or property caused, or alleged to
be caused, by a Product, but only to the extent such injury or damage has not been caused by
Flextronics’s breach of its express limited warranties related to Flextronics’s workmanship and
manufacture in accordance with the Specifications only as further set forth in Section 6.2 hereof;
or

 

 

          (c) any infringement of the intellectual property rights of any third party by any Product
except to the extent such infringement is the responsibility of Flextronics pursuant to Section
9.1(b) above.

     9.3 Procedures for Indemnification. With respect to any third-party claims, either
party shall give the other party prompt notice of any third-party claim and cooperate with the
indemnifying party at its expense. The indemnifying party shall have the right to assume the
defense (at its own expense) of any such claim through counsel of its own choosing by so notifying
the party seeking indemnification within thirty (30) calendar days of the first receipt of such
notice. The party seeking indemnification shall have the right to participate in the defense
thereof and to employ counsel, at its own expense, separate from the counsel employed by the
indemnifying party. The indemnifying party shall not, without the prior written consent of the
indemnified party, agree to the settlement, compromise or discharge of such third-party claim.

     9.4 Sale of Products Enjoined. Should the use of any Products be enjoined for a cause
stated in Section 9.1(b) or 9.2(c) above, or in the event the indemnifying party desires to
minimize its liabilities under this Section 9, in addition to its indemnification obligations set
forth in this Section 9, the indemnifying party’s sole responsibility is to either substitute a
fully equivalent Product or process (as applicable) not subject to such injunction, modify such
Product or process (as applicable) so that it no longer is subject to such injunction, or obtain
the right to continue using the enjoined process or Product (as applicable). In the event that any
of the foregoing remedies cannot be effected on commercially reasonable terms, then, all accepted
purchase orders and the current forecast will be considered cancelled and Aruba shall purchase all
Products, NCNR Inventory and NCNR Special Inventory as provided in Sections, 5.4, 5.5 and 5.6
hereof. Any changes to any Products or process must be made in accordance with Section 2.2 above.
Notwithstanding the foregoing, in the event that a third party makes an infringement claim, but
does not obtain an injunction, the indemnifying party shall not be required to substitute a fully
equivalent Product or process (as applicable) or modify the Product or process (as applicable) if
the indemnifying party obtains an opinion from competent patent counsel reasonably acceptable to
the other party that such Product or process is not infringing or that the patents alleged to have
been infringed are invalid.

     9.5 No Other Liability. EXCEPT WITH REGARD TO A BREACH OF SECTIONS 9.1 AND 9.2 ABOVE
OR SECTION 10.1 BELOW, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY “COVER”
DAMAGES (INCLUDING INTERNAL COVER DAMAGES WHICH THE PARTIES AGREE MAY NOT BE CONSIDERED “DIRECT”
DAMAGES), OR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OF ANY KIND OR NATURE
ARISING OUT OF THIS AGREEMENT OR THE SALE OF PRODUCTS, WHETHER SUCH LIABILITY IS ASSERTED ON THE
BASIS OF CONTRACT, TORT (INCLUDING THE POSSIBILITY OF NEGLIGENCE OR STRICT LIABILITY), OR
OTHERWISE, EVEN IF THE PARTY HAS BEEN WARNED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE, AND
EVEN IF ANY OF THE LIMITED REMEDIES IN THIS AGREEMENT FAIL OF THEIR ESSENTIAL PURPOSE.

     THE FOREGOING SECTION 9 STATES THE ENTIRE LIABILITY OF THE PARTIES TO EACH OTHER CONCERNING
INFRINGEMENT OF PATENT, COPYRIGHT, TRADE SECRET OR OTHER INTELLECTUAL PROPERTY RIGHTS.

10. MISCELLANEOUS

     10.1 Confidentiality. Each party shall refrain from using any and all Confidential
Information of the disclosing party for any purposes or activities other than those specifically
authorized in this Agreement. Except as otherwise specifically permitted herein or pursuant to
written permission of the party to this Agreement owning the Confidential Information, no party
shall disclose or facilitate disclosure of Confidential Information of the disclosing party to
anyone without the prior written consent of the disclosing party, except to its employees,
consultants, parent

company, and subsidiaries of its parent company who need to know such information for carrying
out the activities contemplated by this Agreement and who have agreed in writing to confidentiality
terms that are no less restrictive than the requirements of this Section. Notwithstanding the
foregoing, the receiving party may disclose Confidential Information of the disclosing party
pursuant to a subpoena or other court process only (i) after having given the disclosing party
prompt notice of the receiving party’s receipt of such subpoena or other process and (ii) after the
receiving party has given the disclosing party a reasonable opportunity to oppose such subpoena or
other process or to obtain a protective order. Confidential Information of the disclosing party in
the custody or control of the receiving party shall be promptly returned or destroyed upon the
earlier of (i) the disclosing party’s written request or (ii) termination of this Agreement.
Confidential Information disclosed pursuant to this Agreement shall be maintained confidential for
a period of three (3) years after the disclosure thereof.

     10.2 Entire Agreement; Severability. This Agreement constitutes the entire agreement
between the Parties with respect to the transactions contemplated hereby and supersedes all prior
agreements and understandings between the parties relating to such transactions. If the scope of
any of the provisions of this Agreement is too broad in any respect whatsoever to permit
enforcement to its full extent, then such provisions shall be enforced to the maximum extent
permitted by law, and the

 

 

parties hereto consent and agree that such scope may be judicially
modified accordingly and that the whole of such provisions of this Agreement shall not thereby
fail, but that the scope of such provisions shall be curtailed only to the extent necessary to
conform to law.

     10.3 Amendments; Waiver. This Agreement may be amended only by written consent of
both parties. The failure by either party to enforce any provision of this Agreement will not
constitute a waiver of future enforcement of that or any other provision. Neither party will be
deemed to have waived any rights or remedies hereunder unless such waiver is in writing and signed
by a duly authorized representative of the party against which such waiver is asserted.

     10.4 Independent Contractor. Neither party shall, for any purpose, be deemed to be an
agent of the other party and the relationship between the parties shall only be that of independent
contractors. Neither party shall have any right or authority to assume or create any obligations
or to make any representations or warranties on behalf of any other party, whether express or
implied, or to bind the other party in any respect whatsoever.

     10.5 Expenses. Each party shall pay their own expenses in connection with the
negotiation of this Agreement. All fees and expenses incurred in connection with the resolution of
Disputes shall be allocated as further provided in Section 10.10 below.

     10.6 Insurance. Flextronics and Aruba agree to maintain appropriate insurance to
cover their respective risks under this Agreement with coverage amounts commensurate with levels in
their respective markets. Aruba specifically agrees to maintain insurance coverage for any
finished Products or Materials the title and risk of loss of which passes to Aruba pursuant to this
Agreement and which is stored on the premises of Flextronics.

     10.7 Force Majeure. In the event that either party is prevented from performing or is
unable to perform any of its obligations under this Agreement (other than a payment obligation) due
to any act of God, acts or decrees of governmental or military bodies, fire, casualty, flood,
earthquake, war, strike, lockout, epidemic, destruction of production facilities, riot,
insurrection, Materials unavailability, or any other cause beyond the reasonable control of the
party invoking this section (collectively, a “Force Majeure”), and if such party shall have used
its commercially reasonable efforts to mitigate its effects, such party shall give prompt written
notice to the other party, its performance shall be excused, and the time for the performance shall
be extended for the period of delay or inability to perform due to such occurrences. Regardless of
the excuse of Force Majeure, if such party is not able to perform within ninety (90) days after
such event, the other party may terminate the Agreement.

     10.8 Successors, Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, assigns and legal representatives.
Neither party shall have the right to assign or otherwise transfer its rights or obligations under
this Agreement except with the prior written consent of the other party, not to be unreasonably
withheld. Notwithstanding the foregoing, Flextronics may assign some or all of its rights and
obligations under this Agreement to an affiliated Flextronics entity.

     10.9 Notices. All notices required or permitted under this Agreement will be in
writing and will be deemed received (a) when delivered personally; (b) when sent by confirmed
facsimile; (c) five (5) days after having been sent by registered or certified mail, return receipt
requested, postage prepaid; or (d) one (1) day after deposit with a commercial overnight carrier.
All communications will be sent to the addresses set forth above or to such other address as may be
designated by a party by giving written notice to the other party pursuant to this section.

     10.10 Disputes Resolution; Waiver of Jury Trial.

          (a) Except as otherwise provided in this Agreement, the following binding dispute resolution
procedures shall be the exclusive means used by the parties to resolve all disputes, differences,
controversies and claims arising out of or relating to the Agreement or any other aspect of the
relationship between Flextronics and Aruba or their respective affiliates and subsidiaries
(collectively, “Disputes”). Either party may, by written notice to the other party, refer any
Disputes for resolution in the manner set forth below. Either party’s affiliates and subsidiaries
are also intended beneficiaries of, and may enforce, this dispute resolution procedure.

          (b) Any Disputes shall be referred to arbitration under the Comprehensive Arbitration Rules &
Procedures of JAMS (the “Arbitration Administrator”), as such rules shall be in effect on the
Effective Date, except to the extent that such rules are inconsistent with this Section 10.10, in
which case this Section shall govern.

          (c) The parties shall agree on a single arbitrator (the “Arbitrator”). The Arbitrator shall
be a retired judge selected by the parties from a roster of arbitrators provided by the Arbitration
Administrator. If the parties cannot agree on an Arbitrator within seven (7) days of delivery of
the demand for arbitration (“Demand”) (or such other time period as the parties may agree), the
Arbitration Administrator shall deliver a roster often names to the parties. Within seven (7)
calendar days of service upon the parties of the list of names, each party may strike three (3)
names and shall rank the remaining seven arbitrator

 

 

candidates in order of preference, from least
to most preferred. The Arbitration Administrator will then appoint the remaining candidate with
the highest composite ranking as the Arbitrator, or, in the event of a tie, the Arbitration
Administrator will select an Arbitrator from among the tied candidates.

          (d) Unless otherwise mutually agreed to by the parties, the place of arbitration shall be San
Jose, California, although the arbitrators may be selected from rosters including San Jose or San
Francisco.

          (e) The Federal Arbitration Act shall govern the arbitrability of all Disputes, and the Rules
of the Arbitration Administrator shall, to the extent not inconsistent with this Agreement, govern
the conduct of the arbitration. To the extent that the Federal Arbitration Act and Rules do not
provide an applicable procedure, California law shall govern the procedures for arbitration and
enforcement of an award, and then only to the extent not inconsistent with the terms of this
Section 10.10. Disputes between the parties shall be subject to arbitration notwithstanding that a
party to this Agreement is also a party to a pending court action or special proceeding with a
third party, arising out of the same transaction or series of related transactions and there is a
possibility of conflicting rulings on a common issue of law or fact.

          (f) Unless otherwise mutually agreed to by the parties, each party shall allow and participate
in discovery as follows:

               (i) Non-Expert Discovery. Each party may (1) conduct three (3) non-expert depositions of no
more than five (5) hours of testimony each, with any deponents employed by any party to appear for
deposition in San Jose, California; (2) propound a single set of requests for production of
documents containing no more than twenty (20) individual requests; (3) propound up to twenty
written interrogatories; and (4) propound up to ten (10) requests for admission.

               (ii) Expert Disclosure. If scientific, technical, or other specialized knowledge will assist
the arbitrator, each party may select a single witness who is retained or specially employed to
provide such expert testimony. In addition, each party may select an additional retained or
specially employed expert witness to testify with respect to damages issues, if any. Expert
discovery shall consist of the following: (1) the parties shall exchange complete reports on all
information to be provided by the expert(s) at the hearing no later than thirty (30) days before
the first day of the

hearing; (2) the parties shall produce complete rebuttal reports, if any, no later than ten
(10) days before the first day of the hearing; and (3) the parties shall be required to produce any
and all documents reviewed by their expert(s) in performing work relating to the arbitration.

               (iii) Additional Discovery. The Arbitrator may, on application by either party, authorize
additional discovery only if deemed essential to avoid injustice. In the event that remote
witnesses might otherwise be unable to attend the arbitration, arrangements shall be made to allow
their live testimony by video conference during the arbitration hearing.

          (g) The Arbitrator shall render an award within six (6) months after the date of appointment,
and a condition of the arbitrator’s appointment shall be commitment to comply with this six (6)
month period. This period may be extended by mutual agreement of the parties. The award shall be
accompanied by a written opinion setting forth the findings of fact, conclusions of law and
reasoning relied upon by the arbitrator in reaching his or her decision. The Arbitrator shall have
authority to award compensatory damages only, and shall not award any punitive, exemplary, or
multiple damages. The award (subject to clarification or correction by the arbitrator as allowed
by statute and/or the applicable Rules of the Arbitration Administrator) shall be final and binding
upon the parties, subject solely to the review procedures provided in this Section 10.10.

          (h) Either party may seek review of the award pursuant to the following procedure. Either
party may seek arbitral review of the award pursuant to the JAMS Optional Arbitration Appeal
Procedure then in force. Arbitral review may be had as to any element of the award as allowed by
such Procedures.

          (i) This Agreement’s arbitration provisions are to be performed in Santa Clara County,
California. Any judicial proceeding arising out of or relating to this Agreement or the
relationship of the parties, including without limitation any proceeding to enforce this paragraph
10.10, to review or confirm the award in arbitration, or for preliminary injunctive relief as set
forth in subsection (k), shall be brought exclusively in a court of competent jurisdiction in the
county of Santa Clara, California (the “Enforcing Court”). Any judgment of the Enforcing Court may
be enforced by any sister court of competent jurisdiction. By execution and delivery of this
Agreement, each party (i) accepts, generally and unconditionally, the exclusive jurisdiction of the
Enforcing Court and any related appellate court, and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Agreement, their relationship, or any arbitration relating
thereto, (ii) irrevocably waives any objection it may now or hereafter have as to the venue of any
such suit, action or proceeding brought in such a court or that such court is an inconvenient
forum, and (iii) waives personal service of process and consents to service of process upon it by
certified or registered mail, return receipt requested, at its address specified or determined in
accordance with Section 10.9 hereof, and service so made shall be deemed completed on the third
business day after such service is deposited in the mail. Nothing in this Section 10.10 shall
affect the right of any party hereto to serve process in any other manner permitted by applicable
law.

 

 

          (j) Each party shall pay their own expenses in connection with the resolution of Disputes
pursuant to this Section 10.10, including attorneys’ fees. Notwithstanding the foregoing: (1) the
fees and expenses of the Arbitrator and Arbitration Administrator shall be (A) borne equally by
Aruba and Flextronics if and to the extent that the arbitration panel determines that such result
would be fair and equitable under the circumstances, or (B) borne by Aruba and/or Flextronics in
inverse proportion to the amount that the arbitration panel’s award in favor of Aruba and/or
Flextronics bears to the total amount of the items in dispute (for illustration purposes for this
Section 10.10(i) only, (X) if the total amount of items in dispute is $1,000,000.00, and Aruba
prevails on $500,000.00 as determined by the Arbitrator, Flextronics and Aruba shall bear the
arbitration panel’s fees and expenses equally, or (Y) if the total amount of items in dispute is
$1,000,000.00, and Aruba prevails on $250,000.00 as determined by the Arbitrator, Aruba shall bear
75% and Flextronics shall bear 25% of the fees and expenses of the arbitrator and the Arbitration
Administrator; and (2) the fees and expenses incurred by the prevailing party to enforce this
Section 10.10 or the enforcement of any award shall be paid by the other party.

          (k) The parties agree that any breach of a party’s confidentiality obligations set forth in
this Agreement will result in irreparable injury to the other party for which there is no adequate
remedy at law. Therefore, in the event of any breach or threatened breach of such obligations, the
non-breaching party will be entitled to seek preliminary

injunctive relief in the Enforcing Court or in any Court of competent jurisdiction in the
location in which the breaching party conducts its business, without first pursuing such relief in
arbitration.

          (l) Notwithstanding anything contained in this Section 10.10 to the contrary, in the event of
any Dispute, prior to referring such Dispute to arbitration pursuant to Section 10.10(b) hereof,
Aruba and Flextronics shall attempt in good faith to resolve any and all controversies or claims
relating to such Disputes promptly by negotiation commencing within ten (10) calendar days of the
written notice of such Disputes by either party, including referring such matter to Aruba ‘s
then-current President and Flextronics’s then current executive in charge of manufacturing
operations in the region in which the primary activities of this Agreement are performed by
Flextronics. The representatives of the parties shall meet at a mutually acceptable time and place
and thereafter as often as they reasonably deem necessary to exchange relevant information and to
attempt to resolve the Dispute for a period of four (4) weeks. In the event that the parties are
unable to resolve such Dispute pursuant to this Section 10.10(1), the provisions of Section
10.10(a) through (j) hereof, inclusive, as well as Section 10.10(n) shall apply.

          (m) The parties agree that the existence, conduct and content of any arbitration pursuant to
this Section 10.10 shall be kept confidential and no party shall disclose to any person any
information about such arbitration, except as may be required by law or by any governmental
authority or for financial reporting purposes in each party’s financial statements.

          (n) IN THE EVENT OF ANY DISPUTE BETWEEN THE PARTIES, WHETHER IT RESULTS IN PROCEEDINGS IN ANY
COURT IN ANY JURISDICTION OR IN ARBITRATION, THE PARTIES HEREBY KNOWINGLY AND VOLUNTARILY, AND
HAVING HAD AN OPPORTUNITY TO CONSULT WITH COUNSEL, WAIVE ALL RIGHTS TO TRIAL BY JURY, AND AGREE
THAT ANY AND ALL MATTERS SHALL BE DECIDED BY A JUDGE OR ARBITRATOR WITHOUT A JURY TO THE FULLEST
EXTENT PERMISSIBLE UNDER APPLICABLE LAW.

     10.11 Even-Handed Construction. The terms and conditions as set forth in this
Agreement have been arrived at after mutual negotiation, and it is the intention of the parties
that its terms and conditions not be construed against any party merely because it was prepared by
one of the parties.

     10.12 Controlling Language. This Agreement is in English only, which language shall
be controlling in all respects. All documents exchanged under this Agreement shall be in English.

     10.13 Controlling Law. This Agreement shall be governed and construed in all respects
in accordance with the domestic laws and regulations of the State of California, without regard to
its conflicts of laws provisions; except to the extent there may be any conflict between the law of
the State of California and the Incoterms of the International Chamber of Commerce, 2000 edition,
in which case the Incoterms shall be controlling. The parties specifically agree that the 1980
United Nations Convention on Contracts for the International Sale of Goods, as may be amended from
time to time, shall not apply to this Agreement.

 

 

     10.14 Counterparts. This Agreement may be executed in counterparts.

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed by their duly
authorized representatives as of the Effective Date.

	 	 	 	 	 	 	 	 	 	 	 
	ARUBA WIRELESS NETWORKS:	 	 	 	FLEXTRONICS INTERNATIONAL MARKETING (L) LTD:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/  Steffan Tomlinson	 	 	 	By:	 	[/s/ illegible]	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Title:

	 	CFO	 	 	 	Title:	 	Director	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

 

 

Exhibit 1

Definitions

	 	 	 
	“Affected Inventory Costs”

	 	shall mean: (i) 110% of the Cost of all affected
Inventory and Special Inventory in Flextronics’s
possession and not returnable to the vendor or
reasonably usable for other customers, whether in
raw form or work in process, less the salvage value
thereof, (ii) 105% of the Cost of all affected
Inventory and Special Inventory on order and not
cancelable, (iii) any vendor cancellation charges
incurred with respect to the affected Inventory and
Special Inventory accepted for cancellation or
return by the vendor, and (iv) expenses incurred by
Flextronics related to labor and equipment
specifically put in place to support the purchase
orders and forecasts that are affected by such
reschedule or cancellation (as applicable).
	 
	 	 
	“Approved Vendor List” or “AVL”

	 	shall mean the list of suppliers currently approved
to provide the Materials specified in the bill of
materials for a Product.
	 
	 	 
	“Authorized Purchaser”

	 	shall mean a company with whom Aruba has entered
into a written agreement authorizing the company to
market and distribute Aruba’s Products and who have
otherwise satisfied Flextronics’s credit
requirements.
	 
	 	 
	“Confidential Information”

	 	shall mean (a) the existence and terms of this
Agreement and all information concerning the unit
number and fees for Products and Inventory/Special
Inventory and (b) any other information that is
marked “Confidential” or the like or, if delivered
verbally, confirmed in writing to be “Confidential”
within 30 days of the initial disclosure.
Confidential Information does not include
information that (i) the receiving party can prove
it already knew at the time of receipt from the
disclosing party; or (ii) has come into the public
domain without breach of confidence by the
receiving party; (iii) was received from a third
party without restrictions on its use; (iv) the
receiving party can prove it independently
developed without use of or reference to the
disclosing party’s data or information; or (v) the
disclosing party agrees in writing is free of such
restrictions.
	 
	 	 
	“Cost”

	 	shall mean the cost represented on the bill of
materials supporting the most current fees for
Products at the time of cancellation, expiration or
termination, as applicable.
	 
	 	 
	“Aruba Controlled Materials”

	 	shall mean those Materials provided by Aruba or by
suppliers with whom Aruba has a commercial
contractual or non-contractual relationship.
	 
	 	 
	“Aruba Controlled Materials Terms”

	 	shall mean the terms and conditions that Aruba has
negotiated with its suppliers for the purchase of
Aruba Controlled Materials.
	 
	 	 
	“Aruba Indemnities”

	 	shall have the meaning set forth in Section 9.1.
	 
	 	 
	“Damages”

	 	shall have the meaning set forth in Section 9.1.
	 
	 	 
	“Disputes”

	 	shall have the meaning set forth in Section 10.10(a)
	 
	 	 
	“Economic Order Inventory”

	 	shall mean Materials purchased in quantities, above
the required amount for purchase orders, in order
to achieve price targets for such Materials.
	 
	 	 
	“Fee List”

	 	shall have the meaning set forth in Section 3.4.

 

 

	 	 	 
	“Flexibility Table”

	 	shall have the meaning set forth in Section 5.3.
	 
	 	 
	“Flextronics Indemnitee”

	 	shall have the meaning set forth in Section 9.2.
	 
	 	 
	“Force Majeure”

	 	shall have the meaning set forth in Section 10.7.
	 
	 	 
	“Inventory”

	 	shall mean any Materials that are used to
manufacture Products that are ordered pursuant to a
purchase order from Aruba or an Authorized
Purchaser.
	 
	 	 
	“Lead Time{s)”

	 	shall mean the Materials Procurement Lead Time plus
the manufacturing cycle time required from the
delivery of the Materials at Flextronics’s facility
to the completion of the manufacture, assembly and
test processes.
	 
	 	 
	“Long Lead Time Materials”

	 	shall mean Materials with Lead Times exceeding the
period covered by the accepted purchase orders for
the Products.
	 
	 	 
	“Materials”

	 	shall mean labor, components, materials and
supplies that are used in the manufacturing,
testing, packaging, and distribution of products.
	 
	 	 
	“Materials Procurement Lead Time”

	 	shall mean with respect to any particular item of
Materials, the longer of (a) lead time to obtain
such Materials as recorded on Flextronics’s MRP
system or (b) the actual lead time, if a supplier
has increased the lead time but Flextronics has not
yet updated its MRP system.
	 
	 	 
	“Minimum Order Inventory”

	 	shall mean Materials purchased in excess of
requirements for purchase orders because of minimum
lot sizes available from the supplier.
	 
	 	 
	“Monthly Charges”

	 	shall mean a finance carrying charge of one and
one-half of one percent (1.5%) and a storage and
handling charge of one-half of one percent (0.5%),
in each case of the Cost of the Inventory and/or
Special Inventory affected by the reschedule or
cancellation (as applicable) per month until such
Inventory and/or Special Inventory is used to
manufacture Product or is otherwise purchased by
Aruba.
	 
	 	 
	“NCNR”

	 	shall mean Materials which are listed on Exhibit
5.3 and which list will be reviewed and updated
quarterly by mutual written agreement of the
parties.
	 
	 	 
	“Product”

	 	shall have the meaning set forth in Section 2.1.
	 
	 	 
	“Special Inventory”

	 	shall mean any Long Lead Time Materials and/or
Minimum Order Inventory and/or Economic Order
Inventory.
	“Specifications”

	 	shall have the meaning set forth in Section 2.1.
	 
	 	 
	“Work”

	 	shall have the meaning set forth in Section 2.1.

 

 

Exhibit 2.2

Authorized Purchaser Supply Agreement

This
Supply Agreement (“Agreement”) is entered into this
___ day of ___, 200___ by and
between___, having its place of business at ___(“Authorized Purchaser”) and
FLEXTRONICS SALES & MARKETING NORTH ASIA (L) LTD. having its place of business at Level 1, Lot 7,
Block F, Sequking Commercial Building, Jalan, Patau-Patua, 8700 Labaun, F.T., Malaysia
(“Flextronics”).

1. AUTHORIZED PURCHASER; ACKNOWLEDGEMENT

     1.1 Status as Authorized Purchaser. Authorized Purchaser is a party to a Supply
Agreement with Aruba Wireless Networks (“Aruba”) pursuant to which Authorized Purchaser is
authorized to purchase the Products listed on Schedule 1.1 attached hereto (the “Products”) (the
“Authorized Purchaser-Aruba Agreement”). Authorized Purchaser represents and warrants to
Flextronics that it is in good standing and will remain in good standing under the Authorized
Purchaser-Aruba Agreement.

     1.2 Acknowledgment. Authorized Purchaser hereby acknowledges and agrees that: (a)
this Agreement constitutes the entire agreement between Authorized Purchaser and Flextronics with
respect to the transactions contemplated hereby and supersedes all prior agreements and
understandings between the parties relating to such transactions; (b) unless otherwise set forth
expressly in this Agreement, Authorized Purchaser will look solely to Aruba with regard to the
terms and conditions of its purchase of the Products; (c) and Authorized Purchaser is not a third
party beneficiary of any agreement between Flextronics and Aruba.

2. SALE TO AUTHORIZED PURCHASER

     2.1 Sale of Products. Authorized Purchaser may periodically submit to Flextronics
orders for the purchase of Products (each a “Purchase Order”). Flextronics agrees to sell, and
Authorized Purchaser agrees to purchase, all Products specified in Purchase Orders tendered by
Authorized Purchaser subject to the terms and conditions of this Agreement. Each Purchase Order
may not be cancelled or rescheduled. Purchase orders may not provide for a delivery date that is
less than the then-current lead time for the Products.

     2.2 Shipments. All Products delivered pursuant to the terms of this Agreement shall
be suitably packed for shipment in accordance with Authorized Purchaser’s specifications and marked
for shipment to Authorized Purchaser’s destination specified in the applicable Purchase Order.
Shipments will be governed by Incoterms 2000. Shipment terms will be EXW (Ex works) Flextronics’s
Shanghai facility. Risk of loss and title will pass to Authorized Purchaser immediately upon
leaving the country of manufacture, and no earlier. All freight, insurance and other shipping
expenses, as well as any special packing expenses not included in the original price quotation for
the Products, will be paid by Authorized Purchaser.

     2.3 Authorized Purchaser Responsibility for Ordered Product; Storage of Ordered
Product. In the event Authorized Purchaser does not arrange for the prompt shipment of
Products ordered by it under this Agreement after being informed by Flextronics that such Products
are ready for shipment in accordance with Authorized Purchaser’s Purchase Order, or Authorized
Purchaser attempts to reschedule or cancel a delivery of Products previously ordered by Authorized
Purchaser, in a manner not permitted by this Agreement, then Authorized Purchaser hereby authorizes
Flextronics to transfer such Products to a warehouse operated by Flextronics or a third party.
Flextronics shall promptly notify Aruba in writing of any such transfer of Products. Any portion
of a warehouse operated by Flextronics will be assigned to Authorized Purchaser for its exclusive
use. Such transfer shall be considered a delivery and sale to Authorized Purchaser for purposes of
this Agreement, and title and risk of loss for such Products shall thereupon transfer from
Flextronics to Authorized Purchaser. In accordance with the terms of this Agreement, Flextronics
shall invoice Authorized Purchaser for such sale. Authorized Purchaser shall also be invoiced for
storage and handling charges equal to one half of one percent (0.50%) of the contract price of the
Products per month, or any portion thereof, that the Products are stored for Authorized Purchaser.
Such storage and handling fee shall cover the expense of storage, security,

and transporting the goods to and from such site. During the time that the Products are
stored pursuant to this section hereof, Authorized Purchaser shall have the right, upon reasonable
notice, to inspect the Products for the purposes of this Agreement. Upon Authorized Purchaser’s
request, Flextronics shall ship the Products to Authorized Purchaser under the terms of this
Agreement.

 

 

     2.4 Price and Payment Terms. The price for Products to be manufactured is set forth
in Schedule 2.4 (as may be amended from time to time) and will be indicated on the Purchase Orders
issued by Authorized Purchaser and accepted by Flextronics. All prices quoted are exclusive of
federal, state and local excise, sales, use and similar taxes, and any duties, and Authorized
Purchaser shall be responsible for all such items. Payment for any Products, services or other
costs to be paid by Authorized Purchaser hereunder is due thirty (30) days net from the date of
invoice and shall be made in lawful U.S. currency. Authorized Purchaser agrees to pay one and
one-half percent (1.5%) monthly interest on all late payments. Furthermore, if Authorized
Purchaser is late with payments, or Flextronics has reasonable cause to believe Authorized
Purchaser may not be able to pay, Flextronics may require prepayment or delay shipments or suspend
work until assurances of payment satisfactory to Flextronics are received.

     2.5 Security Interest. Until the purchase price and all other charges payable to
Flextronics hereunder have been received in full, Flextronics hereby retains and Authorized
Purchaser hereby grants to Flextronics a security interest in the Products delivered to Authorized
Purchaser and any proceeds therefrom. Authorized Purchaser agrees to promptly execute any
documents requested by Flextronics to perfect and protect such security interest. In the event of
a default by Authorized Purchaser, Flextronics may exercise any or all remedies provided under the
Uniform Commercial Code or similar statutes or laws enacted in the jurisdiction within which
Flextronics seeks to enforce its rights under this Agreement.

     2.6 Letter of Credit. Upon Flextronics’s request at any time during the term of this
Agreement, Authorized Purchaser agrees to obtain and maintain a stand-by letter of credit on behalf
of Flextronics to minimize the financial risk to Flextronics for its sale to Authorized Purchaser
under this Agreement. The stand-by letter of credit shall be for a minimum period of time of six
(6) months and shall be for a total amount that is equal to the total value of the risks associated
with the accounts receivable from Authorized Purchaser. The draw down procedures under the
stand-by letter of credit shall be determined solely by Flextronics. Flextronics will, in good
faith, review Authorized Purchaser’s creditworthiness periodically and may provide more favorable
terms once it feels it is prudent to do so.

3. NO WARRANTY

     Notwithstanding anything else in this Agreement, as between Flextronics and Authorized Purchaser,
Flextronics sells the Products to Authorized Purchaser AS IS, WHERE IS AND WITH ALL FAULTS.
FLEXTRONICS MAKES NO WARRANTIES OR CONDITIONS ON THE PRODUCTS, EXPRESS, IMPLIED, STATUTORY, OR IN
ANY OTHER PROVISION OF THIS AGREEMENT OR COMMUNICATION WITH AUTHORIZED PURCHASER, AND FLEXTRONICS
SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR NON-INFRINGEMENT. Flextronics assumes no liability for or obligation related
to the Products, including with respect to their performance, accuracy, Specifications, failure to
meet Specifications or defects of or due to materials, workmanship, designs or instructions
produced or supplied by Flextronics to Authorized Purchaser under this Agreement and Authorized
Purchaser shall look solely to Aruba with regard to any costs or expenses incurred by Authorized
Purchaser related thereto. In addition, Authorized Purchaser will provide its own warranties
directly to any of its end users or other third parties. Authorized Purchaser will not make any
representations to end users or other third parties on behalf of Flextronics, and Authorized
Purchaser will expressly indicate that the end users and third parties must look solely to
Authorized Purchaser in connection with any problems, warranty claim or other matters concerning
the Product.

4. TERM AND TERMINATION

The term of this Agreement shall commence on the date hereof above and shall continue so long as
Flextronics is manufacturing the Products for Aruba and Authorized Purchaser is in good standing
under the Authorized Purchaser-Aruba Agreement. This Agreement may be terminated by either party
(a) if the other party defaults in any payment to the terminating party and such default continues
without a cure for a period of fifteen (15) days after the delivery of

written notice thereof by the terminating party to the other party, (b) if the other party defaults
in the performance of any other material term or condition of this Agreement and such default
continues unremedied for a period of thirty (30) days after the delivery of written notice thereof
by the terminating party to the other party, or (c) pursuant to Section 6.7. Expiration or
termination of this Agreement under any of the foregoing provisions shall not affect the amounts
due under this Agreement by either party that exist as of the date of expiration or termination.
Termination of this Agreement and settling of accounts in the manner set forth in the foregoing
sentence shall be the exclusive remedy of the parties for breach of this Agreement.
Notwithstanding termination or expiration of this Agreement, Sections 1.2, 2.3, 4, 5, 6 and 7 shall
survive said termination or expiration.

5. LIABILITY, LIMITATION

IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL OR
PUNITIVE DAMAGES OF ANY KIND OR NATURE ARISING OUT OF THIS AGREEMENT OR THE SALE OF PRODUCTS,
WHETHER SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT (INCLUDING THE POSSIBILITY OF
NEGLIGENCE OR STRICT LIABILITY), OR OTHERWISE, EVEN IF THE
 

 

 

PARTY HAS BEEN WARNED OF THE POSSIBILITY
OF ANY SUCH LOSS OR DAMAGE, AND EVEN IF ANY OF THE LIMITED REMEDIES IN THIS AGREEMENT FAIL OF THEIR
ESSENTIAL PURPOSE.

6. MISCELLANEOUS

     6.1 Confidentiality. All written information and data exchanged between the parties
for the purpose of enabling Flextronics to manufacture and deliver Products under this Agreement
that is marked “Confidential” or the like, shall be deemed to be Confidential Information. The
party that receives such Confidential Information agrees not to disclose it directly or indirectly
to any third party without the prior written consent of the disclosing party. Confidential
Information disclosed pursuant to this Agreement shall be maintained confidential for a period of
three (3) years after the disclosure thereof. Authorized Purchaser shall hold the existence and
terms of this Agreement confidential, unless it obtains Flextronics’s express written consent
otherwise.

     6.2 Independent Contractor. Neither party shall, for any purpose, be deemed to be an
agent of the other party and the relationship between the parties shall only be that of independent
contractors. Neither party shall have any right or authority to assume or create any obligations
or to make any representations or warranties on behalf of any other party, whether express or
implied, or to bind the other party in any respect whatsoever.

     6.3 Insurance. Flextronics and Authorized Purchaser agree to maintain appropriate
insurance to cover their respective risks under this Agreement with coverage amounts commensurate
with levels in their respective markets. Authorized Purchaser specifically agrees to maintain
insurance coverage for any finished Products or Materials the title and risk of loss of which
passes to Authorized Purchaser pursuant to this Agreement and which is stored on the premises of
Flextronics.

     6.4 Force Majeure, In the event that either party is prevented from performing or is
unable to perform any of its obligations under this Agreement (other than a payment obligation) due
to any Act of God, fire, casualty, flood, earthquake, war, strike, lockout, epidemic, destruction
of production facilities, riot, insurrection, materials unavailability, or any other cause beyond
the reasonable control of the party invoking this section, and if such party shall have used its
commercially reasonable efforts to mitigate its effects, such party shall give prompt written
notice to the other party, its performance shall be excused, and the time for the performance shall
be extended for the period of delay or inability to perform due to such occurrences. Regardless of
the excuse of Force Majeure, if such party is not able to perform within ninety (90) days after
such event, the other party may terminate the Agreement.

     6.5 Amendments; Successors, Assignment. This Agreement may be amended only by written
consent of both parties. This Agreements shall be binding upon and inure to the benefit of the
parties hereto and their respective successors, assigns and legal representatives. Neither party
shall have the right to assign or otherwise transfer its rights or obligations under this Agreement
except with the prior written consent of the other party, not to be unreasonably withheld.
Notwithstanding the foregoing, Flextronics may assign this Agreement to an affiliated Flextronics
entity.

     6.6 Notices. All notices required or permitted under this Agreement will be in
writing and will be deemed received (a) when delivered personally; (b) when sent by confirmed
facsimile; (c) five (5) days after having been sent by registered or certified mail, return receipt
requested, postage prepaid; or (d) one (1) day after deposit with a commercial overnight Authorized
Purchaser. All communications will be sent to the addresses set forth above or to such other
address as may be designated by a party by giving written notice to the other party pursuant to his
section.

     6.7 Disputes Resolution.

          (a) Except as otherwise provided in this Agreement, the following binding dispute resolution
procedures shall be the exclusive means used by the parties to resolve all disputes, differences,
controversies and claims arising out of or relating to the Agreement or any other aspect of the
relationship between Flextronics and Authorized Purchaser or their respective affiliates and
subsidiaries (collectively, “Disputes”). Either party may, by written notice to the other party,
refer any Disputes for resolution in the manner set forth below. Either party’s affiliates and
subsidiaries are also intended beneficiaries of, and may enforce, this dispute resolution
procedure.

          (b) Any Disputes shall be referred to arbitration under the Comprehensive Arbitration Rules &
Procedures of JAMS (the “Arbitration Administrator”), as such rules shall be in effect on the
Effective Date, except to the extent that such rules are inconsistent with this Section 6.7, in
which case this Section shall govern.

          (c) The parties shall agree on a single arbitrator (the “Arbitrator”). The Arbitrator shall
be a retired judge selected by the parties from a roster of arbitrators provided by the Arbitration
Administrator. If the parties cannot agree on an Arbitrator within seven (7) days of delivery of
the demand for arbitration (“Demand”) (or such other time period as the parties may agree), the
Arbitration Administrator shall deliver a roster often names to the parties. Within seven (7)
calendar days of service upon the parties of the list of names, each party may strike three (3)
names and shall rank the remaining seven arbitrator

 

 

candidates in order of preference, from least
to most preferred. The Arbitration Administrator will then appoint the remaining candidate with
the highest composite ranking as the Arbitrator, or, in the event of a tie, the Arbitration
Administrator will select an Arbitrator from among the tied candidates.

          (d) Unless otherwise mutually agreed to by the parties, the place of arbitration shall be San
Jose, California, although the arbitrators may be selected from rosters including San Jose or San
Francisco.

          (e) The Federal Arbitration Act shall govern the arbitrability of all Disputes, and the Rules
of the Arbitration Administrator shall, to the extent not inconsistent with this Agreement, govern
the conduct of the arbitration. To the extent that the Federal Arbitration Act and Rules do not
provide an applicable procedure, California law shall govern the procedures for arbitration and
enforcement of an award, and then only to the extent not inconsistent with the terms of this
Section 6.7. Disputes between the parties shall be subject to arbitration notwithstanding that a
party to this Agreement is also a party to a pending court action or special proceeding with a
third party, arising out of the same transaction or series of related transactions and there is a
possibility of conflicting rulings on a common issue of law or fact.

          (f) Unless otherwise mutually agreed to by the parties, each party shall allow and participate
in discovery as follows:

               (i) Non-Expert Discovery. Each party may (1) conduct three (3) non-expert depositions of no
more than five (5) hours of testimony each, with any deponents employed by any party to appear for
deposition in San Jose, California; (2) propound a single set of requests for production of
documents containing no more than twenty (20) individual requests; (3) propound up to twenty
written interrogatories; and (4) propound up to ten (10) requests for admission.

               (ii) Expert Disclosure. If scientific, technical, or other specialized knowledge will assist
the arbitrator, each party may select a single witness who is retained or specially employed to
provide such expert testimony. In addition, each party may select an additional retained or
specially employed expert witness to testify with respect to damages issues, if any. Expert
discovery shall consist of the following: (1) the parties shall exchange complete reports on all
information to be provided by the experts) at the hearing no later than thirty (30) days before the
first day of the

hearing; (2) the parties shall produce complete rebuttal reports, if any, no later than ten
(10) days before the first day of the hearing; and (3) the parties shall be required to produce any
and all documents reviewed by their expert(s) in performing work relating to the arbitration.

               (iii) Additional Discovery. The Arbitrator may, on application by either party, authorize
additional discovery only if deemed essential to avoid injustice. In the event that remote
witnesses might otherwise be unable to attend the arbitration, arrangements shall be made to allow
their live testimony by video conference during the arbitration hearing.

          (g) The Arbitrator shall render an award within six (6) months after the date of appointment,
and a condition of the arbitrator’s appointment shall be commitment to comply with this six (6)
month period. This period may be extended by mutual agreement of the parties. The award shall be
accompanied by a written opinion setting forth the findings of fact, conclusions of law and
reasoning relied upon by the arbitrator in reaching his or her decision. The Arbitrator shall have
authority to award compensatory damages only, and shall not award any punitive, exemplary, or
multiple damages. The award (subject to clarification or correction by the arbitrator as allowed
by statute and/or the applicable Rules of the Arbitration Administrator) shall be final and binding
upon the parties, subject solely to the review procedures provided in this Section 6.7.

          (h) Either party may seek review of the award pursuant to the following procedure. Either
party may seek arbitral review of the award pursuant to the JAMS Optional Arbitration Appeal
Procedure then in force. Arbitral review may be had as to any element of the award as allowed by
such Procedures.

          (i) This Agreement’s arbitration provisions are to be performed in Santa Clara County,
California Any judicial proceeding arising out of or relating to this Agreement or the relationship
of the parties, including without limitation any proceeding to enforce this paragraph 6.7, to
review or confirm the award in arbitration, or for preliminary injunctive relief as set forth in
subsection (k), shall be brought exclusively in a court of competent jurisdiction in the county of
Santa Clara, California (the “Enforcing Court”). Any judgment of the Enforcing Court may be
enforced by any sister court of competent jurisdiction. By execution and delivery of this
Agreement, each party (i) accepts, generally and unconditionally, the exclusive jurisdiction of the
Enforcing Court and any related appellate court, and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Agreement, their relationship, or any arbitration relating
thereto, (ii) irrevocably waives any objection it may now or hereafter have as to the venue of any
such suit, action or proceeding brought in such a court or that such court is an inconvenient
forum, and (iii) waives personal service of process and consents to service of process upon it by
certified or registered mail, return receipt requested, at its address specified or determined in
accordance with Section 6.6 hereof, and service so made shall be deemed completed on the third
business day after such service is deposited in the mail. Nothing in this Section 6.7 shall affect
the right of any party hereto to serve process in any other manner permitted by applicable law.

          (j) Each party shall pay their own expenses in connection with the resolution of Disputes
pursuant to this Section 6.7, including attorneys’ fees. Notwithstanding the foregoing: (1) the
fees and expenses of the Arbitrator and Arbitration

 

 

Administrator shall be (A) borne equally by
Authorized Purchaser and Flextronics if and to the extent that the arbitration panel determines
that such result would be fair and equitable under the circumstances, or (B) borne by Authorized
Purchaser and/or Flextronics in inverse proportion to the amount that the arbitration panel’s award
in favor of Authorized Purchaser and/or Flextronics bears to the total amount of the items in
dispute (for illustration purposes for this Section 6.7(i) only, (X) if the total amount of items
in dispute is $1,000,000.00, and Authorized Purchaser prevails on $500,000.00 as determined by the
Arbitrator, Flextronics and Authorized Purchaser shall bear the arbitration panel’s fees and
expenses equally, or (Y) if the total amount of items in dispute is $ 1,000,000.00, and Authorized
Purchaser prevails on $250,000.00 as determined by the Arbitrator, Authorized Purchaser shall bear
75% and Flextronics shall bear 25% of the fees and expenses of the arbitrator and the Arbitration
Administrator; and (2) the fees and expenses incurred by the prevailing party to enforce this
Section 10.10 or the enforcement of any award shall be paid by the other party.

          (k) The parties agree that any breach of a party’s confidentiality obligations set forth in
this Agreement will result in irreparable injury to the other party for which there is no adequate
remedy at law. Therefore, in the event of any breach or threatened breach of such obligations, the
non-breaching party will be entitled to seek preliminary

injunctive relief in the Enforcing Court or in any Court of competent jurisdiction in the
location in which the breaching party conducts its business, without first pursuing such relief in
arbitration.

          (l) Notwithstanding anything contained in this Section 6.7 to the contrary, in the event of
any Dispute, prior to referring such Dispute to arbitration pursuant to Section 6.7(b) hereof,
Authorized Purchaser and Flextronics shall attempt in good faith to resolve any and all
controversies or claims relating to such Disputes promptly by negotiation commencing within ten
(10) calendar days of the written notice of such Disputes by either party, including referring such
matter to Authorized Purchaser’s then-current President and Flextronics’s then current executive in
charge of manufacturing operations in the region in which the primary activities of this Agreement
are performed by Flextronics. The representatives of the parties shall meet at a mutually
acceptable time and place and thereafter as often as they reasonably deem necessary to exchange
relevant information and to attempt to resolve the Dispute for a period of four (4) weeks. In the
event that the parties are unable to resolve such Dispute pursuant to this Section 6.7(1), the
provisions of Section 6.7(a) through (j) hereof, inclusive, as well as Section 6.7(n) shall apply.

          (m) The parties agree that the existence, conduct and content of any arbitration pursuant to
this Section 6.7 shall be kept confidential and no party shall disclose to any person any
information about such arbitration, except as may be required by law or by any governmental
authority or for financial reporting purposes in each party’s financial statements.

          (n) IN THE EVENT OF ANY DISPUTE BETWEEN THE PARTIES, WHETHER IT RESULTS IN PROCEEDINGS IN ANY
COURT IN ANY JURISDICTION OR IN ARBITRATION, THE PARTIES HEREBY KNOWINGLY AND VOLUNTARILY, AND
HAVING HAD AN OPPORTUNITY TO CONSULT WITH COUNSEL, WAIVE ALL RIGHTS TO TRIAL BY JURY, AND AGREE
THAT ANY AND ALL MATTERS SHALL BE DECIDED BY A JUDGE OR ARBITRATOR WITHOUT A JURY TO THE FULLEST
EXTENT PERMISSIBLE UNDER APPLICABLE LAW.

     6.8 Even-Handed Construction. The terms and conditions as set forth in this Agreement
have been arrived at after mutual negotiation, and it is the intention of the parties that its
terms and conditions not be construed against any party merely because it was prepared by one of
the parties.

 

 

     6.9 Controlling Language. This Agreement is in English only, which language shall be
controlling in all respects. All documents exchanged under this Agreement shall be in English.

	 	 	 	 	 	 	 	 	 	 	 
	ACCEPTED AND AGREED TO:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	AUTHORIZED PURCHASER:	 	 	 	FLEXTRONICS:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 	 	Title:exv10w16

 

Exhibit 10.16

Note: Information in this document marked with
a “[***]” has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 	Aruba Wireless Networks	 
	 	Atheros Communications, Inc.	 	 	 	 	 	 
	 	 	 	 	 	 	(Name of Licensee)	 
	 	 	 	 	 	 
	 	By:

	 	/s/ Tom Foster
	 	 	By:
	 	/s/ Keerti Melkote	 
	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 	Name:

	 	Tom Foster
	 	 	Name:
	 	Keerti Melkote	 
	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 	Title:

	 	V.P. Worldwide Sales
	 	 	Title:
	 	Co-founder/VP Marketing	 
	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 	Date:

	 	10/20/05
	 	 	Date:
	 	9/08/05	 
	 	 	 	 	 	 
	 	Principal Place of Business:	 	 	Principal Place of Business:	 
	 	 

	 	5480 Great America Parkway
	 	 	 	 	1322 Crossman Ave	 
	 	 

	 	Santa Clara, CA 95054
	 	 	 	 	Sunnyvale, CA 94089	 
	 	 	 	 	 	 
	 	Effective Date of this
License Agreement: November 1, 2004 (“Effective
Date”)	 
	 	 	 	 	 	 

This
Technology License Agreement (“License” or
“Agreement”) is made and entered into as
of the Effective Date by and between Atheros Communications, Inc.
(“Atheros” or “we” or “us”), and
the licensee identified above (“Licensee” or
“you”). The parties, intending to be legally bound,
agree as follows:

	1.	 	DEFINITIONS
	 
	 	 	“Atheros Competitor” means a person or entity that designs, develops, manufactures or markets
any integrated circuit, device or software that provides baseband, media access control
(MAC-layer) or radio-frequency front-end functionality for wireless communications using
unlicensed radio spectrum.
	 
	 	 	“Component” means a semiconductor product sold under an Atheros label or manufactured under
license from Atheros.
	 
	 	 	“Designated Equipment” means equipment that incorporates one or more Components.
	 
	 	 	“Development Hardware” means Components and boards listed on the price list in Exhibit A, or on
our then-current Development Hardware price list: (i) that are purchased by you directly from us
for use solely in developing Designated Equipment and Your Software,
and (ii) that will not be
resold, either on a stand-alone basis or in or with other equipment.
	 
	 	 	“Effective Date” is defined in the signature block above.
	 
	 	 	“Excluded Code” means files and groups of files that are governed by a separate (e.g., signed or
click-wrapped terms, or terms provided within the file itself and acknowledged through use of the
file) license agreement. Software licensed by you under the GPL, BSD or other open source licenses
is Excluded Code unless agreed by us otherwise in writing.
	 
	 	 	“Intellectual Property Rights” means patents, trademarks, tradenames, service marks, mask works,
copyrights, and applications for any of the foregoing, know-how, confidential information, trade
secrets and any other similar rights throughout the world.
	 
	 	 	“License Term” means: (i) for the Modules listed in Exhibit A, for all other Modules that you
acquire from Atheros during the Term and for which you are not required to pay a separate license
fee, and for Updates to the foregoing Modules: the Term; and (ii) for Modules and Upgrades for
which you pay us a separate license fee, and for Updates to such Modules and Upgrades: the initial
term (“Initial License Term”) of such license specified by us at the time of such purchase, and any
Renewal License Term of that license.
	 
	 	 	Each Initial License Term will automatically renew, without an additional license fee, for
successive one year periods (each: a “Renewal License Term”), until and unless one of the parties
provides the other a notice of non-renewal at least 90 days
prior to the end of a then-current
License Term.
	 
	 	 	“Licensed Technology” means each and all of the following provided to you during the Term: (i)
Reference Designs, (ii) Our Software, (iii) the Technical Documentation, and (iv) Atheros end user
documentation.
	 
	 	 	“Module” means each and all of the
following: (i) the software file or group of files listed in
Section 6 of Exhibit A, and (ii) any different software file or group of files (excluding Reference
Designs) that you download, with authorization, from an Atheros server or that Atheros otherwise
provides to you during the Term. “Module” excludes and does not mean Excluded Code.

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

	 	 	“Object Code” means an object or binary (machine-readable) version of an item of
Our Software or Your Software.
	 
	 	 	“Our Software” means each and all of the following: (i) a Module, (ii) an Update obtained from
us during a Support Term for which you have paid the applicable fees pursuant to Section 8.3
(Renewal, Support Fees), and (iii) an Upgrade for which you pay a separate license fee to us, and
that is not governed by a separate written (e.g. signed or click-wrap) license agreement.
	 
	 	 	“Reference Design” means the Gerber files and other computer code provided to you by Atheros during
the Term that provide a reference design for boards incorporating a Component.
	 
	 	 	“Source Code” means the source (human readable) version of an item of Our Software or Your
Software.
	 
	 	 	“Support Term” means the first year of the Initial Term designated on Exhibit A, and each annual
extension of that Support Term for which the requisite annual support fee has been paid.
	 
	 	 	“Technical Documentation” means documentation, of Our Software or of a Reference Design, that we
provide to you during the Term, other than end user documentation of Our Software.
	 
	 	 	“Term” means the Initial Term designated on Exhibit A, and any Renewal Term. The Initial Term will
automatically renew, without an additional license fee, for successive one year periods (each: a
“Renewal Term”), until and unless one of the parties provides the other a notice of non-renewal at
least 90 days prior to the end of a then-current Term.
	 
	 	 	“Update” means a version of a Module (released after the date you first obtain the Module) that we
make generally available during the License Term of that Module, without additional charge, to all
customers that have purchased support services from us.
	 
	 	 	“Upgrade” means a version of a Module (released after the date you first obtain the Module) that we
make available during the License Term of that Module, and that is not an Update.
	 
	 	 	“Your Documentation” means any documentation, of Our Software or Your Software, supplied by you to
your customers.
	 
	 	 	“Your Software” means each and all of the following: (i) any change to Our Software developed by or
for you under this License, and (ii) other software developed by or for you under this License
using any application programming interfaces in Our Software.

	2.	 	PERMITTED USES AND RESTRICTIONS.

     2.1. General. Our Software and Reference Designs are
licensed, not sold, to you, for use only as permitted by this
License. We reserve all rights not expressly granted to you.
The rights granted below are non-exclusive, and are limited
to our and our licensors’ Intellectual Property Rights in Our
Software and Reference Designs.

     2.2. Grant. Subject to the terms and conditions of this
License:

     2.2.1. Source Code. During the License Term
of a Module, you may:

          (i) use, copy and modify the Source Code of that Module, solely to develop Your Software
for use in or with Designated Equipment, to generate Object Code of Our Software for use as
permitted in Section 2.2.2 (Object Code), and to develop Designated Equipment;

          (ii) use, copy and modify the Source Code of Your Software that was developed pursuant to
clause (i) above to generate Object Code of Your Software for use as permitted in Section 2.2.2
(Object Code), and to develop Designated Equipment; and

          (iii) sublicense your rights under (i) and (ii) to a person or entity that is not an
Atheros Competitor (a “contractor”) solely to enable the contractor to perform development
services solely for you, provided the contractor agrees in writing to: (a) abide by all the
provisions of this License applicable to such Source Code, including restrictions on the
disclosure and use of the code, and (b) return to you or destroy all copies of any provided
Source Code. You will be responsible for ensuring the contractor’s compliance with that
agreement and agree to enforce such terms in a manner similar to that which you use to protect
your own source code and most confidential information.

     2.2.2. Object Code. During the License Term
of a Module, you may: (i) use the Object Code of
that Module, and of Your Software developed using
that Module or developed for use with that
Module, only when embedded in Designated
Equipment or as a driver of a Component, and
(ii) manufacture, have manufactured, import, offer to sell and sell (directly and indirectly)
Designated Equipment incorporating such Object Code. You may sublicense the rights under (i)
only to end users of the Designated Equipment, pursuant to a binding software license agreement
meeting the requirements set forth in Exhibit B.

     2.2.3. Reference Designs. During the Term,
you may use, copy and modify the Reference
Designs solely to develop, manufacture and have
manufactured, and support, Designated Equipment.

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

     2.2.4.
Documentation. Branding. During the Term, you may:

          (i) use and copy Technical Documentation solely in connection with the development,
manufacture and support of Designated Equipment; and

          (ii) subject to the requirements of this Section 2.2.4 (Documentation, Branding), modify
the Atheros end user documentation we supply to you by incorporating all or any portion of it
into Your Documentation, and distribute (directly and indirectly) Your Documentation to
purchasers of Designated Equipment.

          Other than to list a Component as an ingredient of Designated Equipment, Your
Documentation and Designated Equipment may not be branded with our name or brand without our
prior written permission. You must delete from Your Documentation all references to Atheros
being the contact for technical support. You may use a third-party fulfillment house to produce
Your Documentation, provided you are responsible for ensuring such third party’s compliance
with the terms of this License.

     2.3. No Open Source. In your exercise of the rights granted under this License, you will not
take any action or enter any agreement that would result in any contractual requirement that we or
you make available to a third party any of the Source Code of Our Software or Your Software.

     2.4. Restrictions. Each copy of Our Software must
include all copyright and other proprietary notices contained
on the original copy of that software. Each copy of Your
Software must include a copyright or other notice sufficient
to protect our Intellectual Property Rights in Our Software
from which Your Software was derived.

          Except to the extent permitted in this Section 2 (Permitted Used and Restrictions) or by
applicable law, you may not (and may not allow anyone else to): (i) copy, decompile, decrypt,
reverse engineer, disassemble, modify, or create derivative works of any Licensed Technology or
Development Hardware, or attempt to reconstruct or discover any Source Code or underlying ideas or
algorithms of Our Software, (ii) remove, alter or obscure any product identification, copyright or
other intellectual property notices embedded within or on the Licensed Technology or any
Development Hardware, or (iii) publish, disclose, sell, rent, lease, lend, distribute, sublicense
or provide Licensed Technology or any Development Hardware to any third party.

     2.5. Delivery. Licensed Technology will be made
available to you in electronic format for download, using a
user authorization mechanism (i.e., password). You may
provide the authorization mechanism only to your employees
on a need-to-know basis.

	3.	 	INTELLECTUAL PROPERTY

     3.1.
Ownership, Covenant. We are and will be the
sole owner of all right, title and interest, including all the
Intellectual Property Rights, in and to the Licensed
Technology, and all modifications, enhancements, updates,
upgrades and derivative works thereof made by or for us.
Subject to Atheros’ ownership in the Licensed Technology,
you will be the sole owner of all right, title and interest,
including all the Intellectual Property Rights, in and to Your
Software and Your Documentation, and all derivative works
thereof made by or for you. You irrevocably covenant and
agree that you, and any permitted transferee of your right, title
and interest in and to any of Your Software (each a
“Transferee”), will not assert, commence, assist, advise or
prosecute any claim, action or proceeding of any kind, against
us, or any of our licensees or transferees or any sublicensee of
any of the foregoing, alleging that the reproduction,
modification, display, performance, use, sale, offer to sell,
importation, distribution or other exploitation of any of our
products or software, or of any derivative work or modified
version thereof, infringes or violates any of your or your
Transferee’s Intellectual Property Rights in Your Software; and
you hereby irrevocably and unconditionally waive your right
to assert, commence or prosecute any such claim, action or
proceeding.

     3.2. Feedback. You agree that any feedback or ideas
you provide to us regarding any Licensed Technology or any
suggested improvements thereto (together: the
“Feedback”)
will be the exclusive property of Atheros. To the extent you
own any rights in the Feedback, you agree to assign and hereby do assign to us all right, title and interest in and to the
Feedback. You agree to perform all acts reasonably requested
by us to perfect and enforce such rights. We will reimburse
you for direct out of pocket costs incurred in complying with
our requests.

     3.3. Notices. You agree to include on Your Documentation, all copyright, proprietary and other
Intellectual Property Rights notices reasonably requested by us in writing.

     3.4. Notification of Unauthorized Use. You will
promptly notify us if you become aware of any unauthorized
use of the Licensed Technology or violation or threatened
violation of our Intellectual Property Rights therein. You
agree to cooperate with us and render such assistance as we
may reasonably request to identify, halt and/or prevent any
violation of the provisions of this License.

     3.5. Announcement. Except as required to satisfy legal
disclosure and financial reporting requirements, neither party
may use the name of the other party in any news release,
public announcement, advertisement or other form of
publicity without the prior written consent of the other party.

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

	4.	 	FEES, PAYMENTS, TAXES

     4.1. Fees. You agree to pay to us: (i) the license fees
set forth in Exhibit A for Our Software listed in Section 6.1
of Exhibit A, (ii) the then-current license fee, if any, of any
other Module or Update you obtain under this Agreement;
(iii) the support fees described in Section 8 (Support), and
(iv) the hardware fees described in Section 5 (Supply of
Components and Development Hardware).

     4.2. Payments. Payments will be due within 30 days of
invoice date. All prices are stated, and all payments must be
made, in U.S. dollars. Late payments shall accrue interest at
a rate of 18% per year or a lesser amount required by law.

     4.3. Taxes. All fees are exclusive of, and you are
responsible for, any taxes, tariffs, duties and other
government-imposed charges resulting from the license, sale,
provision or use of Our Technology or of any product or
service under this License (except for taxes based on our net
income) and any penalties, interest and collection or
withholding costs associated with any of the foregoing items.
You agree to pay our fees without deduction for withholding
taxes or other assessments required or imposed by any taxing
authorities, and to pay all such withholding taxes and
assessments. You further agree promptly to furnish us with a
certificate evidencing payment of each such tax or
assessment. When we have the legal obligation to pay or
collect such taxes or fees, you agree to pay such amounts
unless you provide us a valid tax exemption certificate. You
agree to reimburse us for any fines, penalties, taxes and other
charges, including expenses incurred by us, due to your
submission of invalid tax-related information.

	5.	 	SUPPLY OF COMPONENTS AND DEVELOPMENT HARDWARE

     5.1. Supply of
Components. You may order
Components from us (or, in our discretion, from our wholly-owned subsidiary, Atheros Technology Ltd., a Bermuda
corporation), at the then-current Component list prices or
such price as is quoted to you in a written price quote. All
orders are subject to acceptance, and will be governed by the
then-current terms and conditions of sale of Atheros or
Atheros Technology Ltd., as applicable. The terms and
conditions appearing on any purchase order or other
document submitted by you will not apply to your order,
except for name(s) of product(s) ordered, quantity, requested
shipment date and delivery destination.

          Subject to
our prior written consent, which consent may be provided via email, you may
authorize third parties such as contract manufacturers to order Components on your behalf. You may
not reveal pricing to the third party, and you guarantee payment and
compliance by such third party
under and with the then-current terms and conditions of sale of Atheros or Atheros Technology Ltd.,
as applicable.

     5.2. Development
Hardware. During the Term, you
may order a reasonable quantity of Development Hardware,
at the prices set forth on the then-current Development Hardware Price List. All orders are subject
to acceptance, and will be governed by the then-current terms and conditions of sale of Atheros or
Atheros Technology Ltd., as applicable, except that the provisions of this Agreement that
explicitly reference Development Hardware will take precedence over any contrary or additional
provisions of such terms and conditions related to the same subject matter, and we assume no
intellectual property indemnification or defense obligations with respect to Development Hardware.

	6.	 	THIRD PARTY RIGHTS

     6.1.
Third Party Software Supplied. Our Software
may include software licensed from third parties (“Third
Party Software”). Third Party Software is subject to the
license terms and disclaimers (together: “Terms”) provided
by the licensor. Third Party Software will be identified in a
Read Me or Credits file or folder accompanying such
software. NOTWITHSTANDING ANY OTHER
PROVISION OF THIS LICENSE, YOUR USE OF EACH
ITEM OF THIRD PARTY SOFTWARE IS GOVERNED
BY ITS APPLICABLE TERMS, AND WE ASSUME NO
RESPONSIBILITY FOR, AND MAKE NO WARRANTY
WITH RESPECT TO, THIRD PARTY SOFTWARE.

     6.2. Third Party Software Required to be Obtained
by You. You may need to obtain software from third parties
to use or for use with Our Software. For example, you may
need to obtain ethernet source code from National
Semiconductor, or a runtime license and development seats
for VxWorks. It is your responsibility to ensure you obtain
and pay for any such required third party software.

     6.3. Published Standards. Royalty Obligations. You
understand and acknowledge that third parties may claim that a royalty or other fee is due to them
as a result of the adherence of Our Software or Your Software to published standards. Any such fees
are your sole responsibility.

	7.	 	WARRANTIES, INDEMNITY

     7.1. Disclaimer of Warranty. The Licensed
Technology is provided AS IS, with all faults. We support
Our Software as set forth in Section 8.2 (Support Services).

     7.2. Development Hardware Warranty. We warrant
solely to you that for 30 days after delivery to you
(“Hardware Warranty Period”), each item of Development
Hardware will be operative. If you give us written notice that
an item of Development Hardware is non-operative within
the Hardware Warranty Period, we will, at our sole option,
replace the non-operative item or refund the purchase price of
that item (or if that item was provided on a bundled basis
without separate charge, then the price of such item as set
forth in Exhibit A).

     7.3. Warranty Disclaimer and Limited Remedies.
SECTION 7.2 STATES YOUR EXCLUSIVE REMEDY
AND OUR ENTIRE LIABILITY FOR ANY BREACH OF

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

WARRANTY. We make no warranty or representation that any Licensed Technology or
Development Hardware will meet your requirements or work in combination with any hardware or
applications software provided by third parties, that the operation of Our Software will be
uninterrupted or error-free, or that any defects in any Licensed Technology will be corrected.
EXCEPT AS EXPLICITLY SET FORTH IN SECTION 7.2, WE DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE. NO
ORAL OR WRITTEN INFORMATION OR ADVICE GIVEN BY US OR ANY OF OUR EMPLOYEES OR REPRESENTATIVES WILL
CREATE A WARRANTY.

     7.4. Intellectual Property Indemnity.

     7.4.1. By Us. Provided the requirements of Section 7.4.3
(Conditions) are met, we will, at our expense, defend (or at our option, settle) any suit
brought against you, and will pay all damages and costs (including reasonable attorneys’ fees)
(together: “Damages”) finally awarded against you, to the extent based on a claim that Our
Software directly infringes any duly issued United States, Japan or European Union patent or
Berne Convention copyright, or misappropriates any trade secret right of any third party.

          Notwithstanding the foregoing, we will have no liability or obligation with respect to
claims or Damages arising from: (i) Your Software (to the extent it differs from Our Software),
Third Party Software or a modification to or derivative work of Our Software not made by us;
(ii) the combination or use of Our Software with anything other than a Component; (iii) the use
of Our Software to practice any method or process that does not occur wholly within Our
Software, (iv) compliance with your design requirements or specifications or those of your
customer, (v) the use of other than the then-current release of Our Software, or (vi) your
continuation of allegedly infringing activity after being notified
thereof (each, an “Excluded
Claim”).

          If the use of Our Software is enjoined, or we believe a claim of infringement is likely,
we may, at our sole option and expense: (i) procure for you the right to continue using Our
Software as licensed herein; (ii) provide you functionally equivalent, non-infringing software;
or (iii) if neither of the foregoing is commercially reasonable, terminate the license to the
affected software and refund a portion of the license fee you paid for that software (if any)
(amortizing that fee on a straight-line basis over its License Term).

          THIS SECTION 7.4.1 STATES OUR ENTIRE RESPONSIBILITY AND LIABILITY, AND YOUR EXCLUSIVE
REMEDY, FOR ANY ACTUAL OR ALLEGED INFRINGEMENT OR
MISAPPROPRIATION OF ANY THIRD PARTY RIGHTS ARISING WITH RESPECT TO OUR SOFTWARE AND ANY OTHER
ITEMS, PRODUCTS OR SERVICES PROVIDED HEREUNDER.

     7.4.2. By You. Provided the requirements of
Section 7.4.3 (Conditions) are met, you will, at your
expense, defend (or at your option, settle) any suit
brought against us, and will pay all Damages finally
awarded against us, to the extent based on an
Excluded Claim. THIS SECTION 7.4.2 STATES
YOUR ENTIRE RESPONSIBILITY AND
LIABILITY, AND OUR EXCLUSIVE REMEDY,
FOR ANY ACTUAL OR ALLEGED
INFRINGEMENT OR MISAPPROPRIATION OF
ANY THIRD PARTY RIGHTS ARISING WITH
RESPECT TO YOUR SOFTWARE OR ANY
EXCLUDED CLAIM.

     7.4.3. Conditions. As a condition to receiving
the indemnification and defense specified above, the
indemnified party must: (i) promptly notify the
indemnifying party of any actual or threatened suit,
claim or proceeding on which indemnity is or may
be sought, (ii) give the indemnifying party sole
control, through counsel of its choice, of the defense
and settlement of the claim, and (iii) at the
indemnifying party’s expense, reasonably cooperate
in the defense and settlement of the claim and
provide the indemnifying party all information,
assistance and authority requested to enable it to
defend of settle the claim.

	8.	 	SUPPORT

     8.1. Training. No training is provided under this
Agreement.

     8.2.
Support Services. During the Support Term,
subject to the provisions of this Section 8.2, we will provide
to you, at no additional charge, Updates of Our Software and
Technical Documentation, and the other support services
described below.

     8.2.1.
 Error Correction. You may inform us of
Errors in Our Software by sending e-mail to
support@Atheros.com. We will use reasonable
commercial efforts to respond to such reports within
two (2) business days, and to correct any
documented, reproducible Error, to provide an acceptable work-around, or correct errors in the
documentation. “Error” means a problem that
causes Our Software not to operate substantially in
conformance with its Technical Documentation.

     8.2.2. Limitations. Atheros will not support
Your Software. You have sole responsibility for
providing technical support to, and you assume any
and all warranty obligations to, your customers (at

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

any tier) with respect to Our Software, Your Software and Designated Equipment. You
have no authority to obligate us in any way under any warranty you may provide.

     8.2.3. Additional Support Services Location Option. Support services will be
provided only to the site listed on Exhibit A, Section 4. Subject to our consent, you may
purchase support services for additional location(s)
(“Additional Support Services Location(s)”)
at which Our Software, Reference Designs and Development Hardware will be used by executing an
amendment to this License and paying our then-current fees for such Additional Support Services
Location(s) for each year for which you request such support. We will deliver to you, at the
Additional Support Services Location(s), at no additional charge, one test and software
development board.

     8.2.4. Support of Back Revs of Our Software.
Migration to the then-current release of Our
Software may be required for continued support.

     8.2.5.
No Support for Excluded Code, Even if
Provided to You by Us, our Partner, Agent or
Contractor. You may now possess or may receive,
from us, from our contractor or agent, or from
another party or source, Excluded Code that
functions or is intended to function with our
Components, but which is not licensed under this
Agreement. Excluded Code, even if owned and
controlled by us, will not be supported by us and is
in no way warranted, indemnified or otherwise
endorsed by us under this Agreement.

     8.3. Renewal, Support Fees. Support services will be provided to you without charge during the
first year following the Effective Date. Thereafter, the Support Term will automatically extend for
successive annual periods, until one of the parties provides the other a notice of non-renewal of
support services at least 90 days prior to the end of the then-current Support Term. You agree to
pay for annual support services after the first anniversary of the Effective Date. The fee for each
year of support services may be increased by Atheros in its sole discretion, but will not exceed
120% of the support fee for the prior year. For purposes of this calculation, the first year
support fee is set forth on Exhibit A.

          Each annual invoice for support services will be rendered approximately 30 days before the end
of the then-current Support Term. Payment is due within 30 days of the invoice date. Failure to
timely pay the fee shall terminate the Support Term.

	9.	 	LIMITATION OF LIABILITY

     9.1. Limited Remedies, Damages Exclusion.
Notwithstanding any other provision of this Agreement:

               (i) Our
total, cumulative liability arising from or in connection with this License or any item
or service ordered or provided hereunder will be limited to the lesser of (a) the greater of
$50,000 or the fee paid by you for the item or service that caused
such loss, and (b) $100,000.

               (ii) In
no event will we be liable for incidental, consequential, indirect, special or
punitive damages or lost revenue, data or profits (all collectively:
“indirect damages”), arising
from or in connection with this License or any product or service ordered or provided hereunder.
The limitations on and disclaimers of remedies, warranties and damages set forth in this License
will apply regardless of: (a) whether any specified remedy fails of its essential purpose, (b) the
form of action (e.g., contract, tort, statute, or other legal theory) and (c) whether we were
advised of the possibility of such damages or such damages were foreseeable. These limitations and
disclaimers reflect the parties’ reasonable allocation of the risks associated with any performance
or non-performance under this License, and are included in this License as a material inducement
for us to enter into this License.

     9.2.
High Risk Applications. The Licensed Technology is not designed
or warranted for use with chips other than Components, and it and the
Components are not warranted by us for use in
developing, or for incorporation into, products or services used in applications or environments
requiring fail-safe performance, such as in the operation of nuclear facilities, aircraft
navigation or communication systems, air traffic control, life support machines, surgically
implanted devices, weapons systems, or other applications, devices or systems in which the failure
of a Component or of Our Software or Your Software could lead directly to death, personal injury,
or severe physical or environmental damage (“High Risk
Activities”). Notwithstanding any other
provision of this License, you may not use or permit any third party to use Our Software, Your
Software or any Designated Equipment in connection with any High Risk Activity. You assume all risk
of such uses, and if you or your customers at any tier use or permit the use of any such item(s) in
connection with High Risk Activities, you agree to indemnify, defend and hold us harmless from all
claims, expenses and liability arising as a result of such use.

	10.	 	TERM, TERMINATION

     10.1.
Term. Unless earlier terminated pursuant to this Section 10, this License will continue for the Term.

     10.2. Termination for Cause. This License and all
licenses granted hereby will automatically terminate upon
any breach by you of a provision of Sections 2.2.1 (Source
Code), 2.2.3 (Reference Designs), 2.3 (No Open Source), 2.4
(Restrictions), or 12 (Confidentiality). In addition, this
License and all licenses granted hereby may be terminated by
either Party if the other party breaches any provision of this

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ATHEROS
TECHNOLOGY LICENSE AGREEMENT

License and fails to remedy such breach within 30 days of receipt of written notice.

     10.3. Bankruptcy. We may terminate this License immediately upon written notice upon the
occurrence of any one of the following events: (i) a receiver is appointed for either you or your
property; (ii) you become insolvent or admit in writing your inability to pay your debts as they
become due; (iii) you make a general assignment for the benefit of your creditors; (iv) you
commence, or have commenced against you, proceedings under any bankruptcy, insolvency or debtor’s
relief law, which proceedings are not dismissed within 60 days; or (v) you are liquidated,
dissolved or cease to do business.

	11.	 	EFFECT OF TERMINATION/EXPIRATION

     11.1. Return of Materials. On any termination or
expiration of this License, except as provided in Section 11.2
(Retention of Copies, Sell-Off), you agree immediately to
cease all use of, and destroy, all copies (including backup
copies) of the Licensed Technology, including all tangibles
incorporating any such items (but excluding Designated
Equipment), and promptly to certify to us in writing that you
have done so.

     11.2. Retention of Copies, Sell-Off. Unless this
License is terminated automatically or by us for cause
pursuant to Section 10.2 (Termination for Cause), you may:
(a) retain copies of the Licensed Technology solely for use in
supporting customers that purchased Designated Equipment
prior to the expiration or termination of this License, and (b)
sell inventory of Designated Equipment that has already been
manufactured or is in process on the date of expiration or
termination.

     11.3. Survival. Termination or expiration of this License will not affect Object Code
sublicenses granted to purchasers of Designated Equipment pursuant to Section 2.2.2 (Object Code)
prior to expiration or termination, each of which will remain in effect in accordance with its
terms. In addition, the parties’ rights and obligations under the following provisions
will survive any termination or expiration of this License: Sections 2.4 (Restrictions), 3
(Intellectual Property), 4 (Fees, Payments, Taxes), 6 (Third Party Rights), 7.3 (Warranty
Disclaimer and Limited Remedies), 7.4 (Intellectual Property Indemnity), 9 (Limitation of
Liability), 11 (Effect of Termination/Expiration), 12 (Confidentiality) and 13 (General), and the
last sentence of Section 5.2 (Development Hardware).

	12.	 	CONFIDENTIALITY

     12.1. Definition. “Confidential Information” means: (i) any information disclosed by us to
you, either directly or indirectly, during the Term, by any means (whether in writing, orally or
visually, or by permitting inspection of tangible objects (including without limitation documents,
prototypes, samples, plant and equipment)), provided such information is designated as
“Confidential”, “Proprietary” or some similar designation at the time of disclosure; and (ii) the
Licensed Technology, whether or not so designated. Confidential Information does not, however,
include any information that you demonstrate: (a) is legally and publicly available, other than
through a breach of your obligations under this Section 12, (b) you received, without an obligation
of confidentiality, from a third party that was entitled so to disclose it, or (c) is independently
developed by you without use of or reference to Confidential Information. Nothing in this License
will prevent you from disclosing Confidential Information to the extent you are required by law to
disclose such Confidential Information, provided you gives us prompt written notice of that
requirement prior to such disclosure and cooperate with our efforts to obtain an order protecting
the information from public disclosure.

     12.2. Non-use and Non-disclosure. You agree not to
disclose Confidential Information other than to those of your
employees and contractors who have a need to know to
exercise the rights and licenses granted to you herein, and not
to use Confidential Information other than in the exercise of
such rights and licenses, or to determine whether and on what
terms to purchase Components from us. You agree that prior
to any disclosure by you of Confidential Information to an
employee or contractor, you will have entered into a written
non-disclosure agreement with such person, containing terms
at least as strict as those contained in this Section 12. You
may not reverse engineer, disassemble or decompile any
prototypes, software or other tangible objects that embody
Confidential Information and that are provided hereunder.

     12.3. Maintenance of Confidentiality. You agree to
take reasonable measures to protect the secrecy of and avoid
the unauthorized disclosure or use of Confidential
Information, including at least those measures that you takes
to protect your own most highly confidential information.
You may not make any copies of Confidential Information
except as expressly permitted by Section 2.2 (Grant) or as
approved by us in advance, in writing. You must reproduce
all proprietary right notices on any such approved copies, in
the same manner in which such notices were set forth in or
on the original.

     12.4. Return of Confidential Information. Except as
provided in Section 11.2 (Retention of Copies, Sell-Off), you
agree promptly to return to us or destroy, at our request, all
copies of Confidential Information, in whatever form or
media, and to certify to us in writing that you have done so.

     12.5. Remedies. You agree that any violation or
threatened violation of any provision of this Section 12 will
cause us irreparable injury, entitling us to injunctive relief in
addition to all legal remedies.

     12.6. Announcement. Neither parry will disclose,
advertise or publish the terms or conditions of this License
without the written consent of the other party, except (i) as
may be required by law and (ii) to its professional advisors

Page 7 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

and to
investors or potential investors who are under an obligation of
confidentiality at least as restrictive as that contained in this Section 12.

	13.	 	GENERAL

     13.1. Notices. All notices and consents required or
permitted under this License must be in writing and sent, if to
us, to the address listed in the signature block above to the
attention of Legal Department, and if to you, to the address
listed on Exhibit A under Legal or, if none, the address listed
in the signature block above; or to such other address as is
specified by notice from time to time. Any notice of non-
performance, termination or non-renewal must be sent by
nationally (or, if applicable, internationally) recognized
overnight courier or by certified mail, return receipt
requested. All other notices and consents may be sent as
provided above or by fax or e-mail (if to us, to 408-773-9909
or legal@atheros.com) with a confirmation of receipt.
Notices will be deemed given and received on receipt (except
that faxes and e-mails received on a non-business day
(according to the recipient’s business calendar) will be
deemed received on the next business day). If a notice cannot
be received because the recipient has moved and failed to
notify the sender of its change of address, or because the
recipient is out of business, then a notice will be deemed
received when sent.

     13.2. Entire Agreement. This License, together with
its Exhibit(s), constitutes the complete, exclusive and final
expression of the parties’ agreement and supersedes all prior
and contemporaneous understandings, proposals,
representations or communications, oral or written, relating
to the subject matter hereof. Without limiting the generality
of the foregoing, this Agreement supersedes the Non-Exclusive Technology License Agreement dated November
24, 2003 (the “Prior Agreement”) by and between the parties
hereto, and such Prior Agreement is hereby terminated and of
no further force or effect, except those provisions of the Prior
Agreement that by their terms survive any termination of the
Prior Agreement. Any technology licensed to you under the
Prior Agreement shall be deemed to be licensed to you solely
pursuant to the terms of this Agreement.

     13.3. Governing Law, Exclusive Jurisdiction and Venue. This License will be governed by and
construed in accordance with the laws of the State of California without regard to its conflict of
laws provisions. The provisions of the UN Convention on Contracts for the International Sale of
Goods will not apply. Subject to the provisions of Section 13.4 (Arbitration), each party hereby:
(i) agrees that any action, suit or proceeding
(“Action”) that arises, in whole or in part, under or
in connection with this License will be brought in the United States District Court for the
Northern District of California San Jose Branch or the Superior or Municipal Courts of the State of
California, Santa Clara County; and (ii) irrevocably and unconditionally consents and submits to
the jurisdiction of all such courts for purposes of any such Action, and irrevocably and
unconditionally waives any objection (such as inconvenient forum) to the laying of venue of any
Action in any such court.

     13.4.
Arbitration. All disputes, claims, and controversies between the parties arising out of
or related to this License or the breach hereof will be settled by
arbitration. The arbitration
will be conducted by one arbitrator appointed pursuant to the applicable procedures of JAMS and
conducted under the then-current Commercial Arbitration Rules of the American Arbitration
Association. The arbitrator will issue an award in support of his or her decision within 120 days
of the selection of the arbitrator, stating the legal and factual basis for the decision and the
reasoning leading to such decision. The decision and award of the arbitrator will be final and
binding and judgment on the award so rendered may be entered in any court having jurisdiction
thereof. The arbitration will be held in Santa Clara County, California, and the award will be
deemed to be made in California. Both parties will share the costs of the arbitration equally,
except that each party will bear its own costs and expenses, including attorney’s fees, witness
fees, travel expenses, and preparation costs.

          Notwithstanding any other provision of this Agreement, a party may seek injunctive relief (or
any other provisional remedy) from any court having jurisdiction over the parties and the subject
matter of the dispute.

          Within 30 days after the filing of the response to the arbitration demand, each party will
provide the other with copies of all documents that are likely to bear significantly on their
respective claims and defenses.

          The arbitrator will allow the parties to engage in other discovery, including depositions,
unless the arbitrator determines that the likely benefit of the proposed discovery is outweighed by
the burden and expense of the proposed discovery, taking into account the amount in controversy,
the importance of the issues at stake in the arbitration, the importance of the proposed discovery
in resolving those issues, and the parties’ desire to seek justice while minimizing the time and
expense of arbitrating their dispute. The arbitrator’s decisions regarding discovery will be final
and conclusive.

          This agreement to arbitrate and any award rendered by the arbitrator will be enforceable under
California law and Title 9 of the United States Code, to the extent applicable. All questions
concerning the arbitrability of a dispute (including whether the parties have agreed to arbitrate
the dispute) will also be decided by arbitration, and this agreement to arbitrate applies
notwithstanding any claim that all or any part of this agreement is void, voidable or unenforceable
for any reason. Neither party will have the right to appeal the arbitrator’s decision.

          Each party hereby submits to the jurisdiction of all duly constituted courts of the State of
California and the United States District Court for the Northern District of California for the
purpose of enforcement of this agreement to arbitrate and any awards rendered by such arbitration;

Page 8 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

provided that this sentence does not limit the right of either party to enforce any
award in any proper forum.

     13.5. Attorney’s Fees. Except as provided in Section
13.4 (Arbitration), in any action to enforce this License or
collect on any judgment rendered, the prevailing party will be
entitled to recover all court costs and reasonable legal fees
and expenses incurred.

     13.6. No Assignment. Your rights and obligations
under this License are personal, and may not be assigned or
transferred, voluntarily, by operation of law or otherwise,
without our prior written consent, which consent will not be
unreasonably withheld if the proposed transfer occurs in
connection with the sale of substantially all of your assets or
outstanding voting securities to a third party that is not an
Atheros Competitor. Any attempt assignment or transfer
without our consent will be void. For purposes of this
License, a Change of Control will be deemed an assignment
that requires our prior written consent. “Change of Control”
means the acquisition of beneficial ownership of more than
50% of your then-outstanding voting securities entitled to
vote generally in the election of directors, including any such
acquisition that is made pursuant to a merger or other
business combination.

     13.7. Government Authorization. You are
responsible for all governmental authorizations and approvals relating to this License. You
represent and warrant that as of the Effective Date and throughout the Term, you are and will
remain in compliance with all applicable governmental laws, rules and regulations necessary for you
to enter into this License and execute your obligations under this License including, without
limitation, any governmental authorization necessary for you to contract with a foreign party. You
represent and warrant to us that you are fully knowledgeable regarding and will be responsible for
any applicable governmental regulatory compliance matter affecting the design, manufacture or
distribution of Your Software or of Designated Equipment.

     13.8. Export Law Assurances. You may not
download, use, transfer, export or re-export any Licensed
Technology or any product or derivative work thereof, or any
Confidential Information, except as authorized by United
States law and the laws of the jurisdiction in which the
Licensed Technology was obtained. In particular, but without
limitation, Licensed Technology and derivative works thereof
may not be, downloaded, used, exported or re-exported (a) in
or to (or by or to a national or resident of) any country then
under U.S. economic embargo, or (b) to any person or entity
on the U.S. Treasury Department’s list of Specially Designated Nationals or on the U.S. Department of Commerce’s
Denied Persons List or Entity List. By downloading or using
Licensed Technology, you represent and warrant that you are
not located in, under control of, or a national or resident of
any such country or on any such list.

     13.9. Records and Audit. During the Term and for
six months thereafter, we will have the right at reasonable
times no more than once per year, directly or through its
representative, upon a minimum of 14 days written notice
setting forth the period under review, to review your books
and records regarding your adherence to the Intellectual
Property Rights provisions of this License.

     13.10. Amendment, Waiver, Remedies. No
amendment or modification of this License is binding unless
signed by you and an officer of Atheros. The observance of
any provision of this License may be waived (either generally
or in a particular instance) only by the written consent of the
party or parties adversely affected by such waiver. No failure
of a party to enforce its rights under this License will be
deemed a waiver. A waiver will be narrowly construed to
apply solely to the specific instance to which such waiver is
directed. Except as expressly stated herein to the contrary, the
exercise of any right or remedy provided in this License will
be without prejudice to the right to exercise any other right or
remedy provided by law or equity.

     13.11. Severability. If any provision of this License or
portion thereof is found to be invalid, illegal or
unenforceable, such provision will be limited or eliminated to
the minimum extent necessary and this License will
otherwise remain in full force and effect. In addition, the
parties agree to substitute for the limited or eliminated
provision a new provision that effects, as nearly as possible,
the original intent of the parties.

     13.12. Counterparts, Fax Signatures. This License
may be executed in two or more counterparts, each of which
will be deemed an original, but all of which together will
constitute one and the same instrument. Facsimile signatures
will be considered original signatures.

     13.13. Mutual Negotiations. Each provision of this
License will be fairly interpreted and construed in accordance
with its provisions and without any strict interpretation or
construction in favor of or against either party.

     13.14. Choice of Language. The original of this
License is in English. You waive any right to have this
License written in any other language, regardless of whether
your country of incorporation is English speaking.

     13.15. No Third Party Beneficiaries. No provision of
this Agreement is intended or will be construed to confer
upon or give to any person or entity other than you and us
any rights, remedies or other benefits under or by reason of
this License.

END BODY OF AGREEMENT.

EXHIBITS BEGIN ON NEXT PAGE

Page 9 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

Exhibit A

			
	1.	 	YOUR CONTACTS.

	 	 	 
	LEGAL

	Name
	 	 
	Address
	 	 
	Telephone
	 	 
	Fax
	 	 
	Email
	 	 
	 
	 	 
	SHIPPING

	Name
	 	 
	Address
	 	 
	Telephone
	 	 
	Fax
	 	 
	Email
	 	 
	 
	 	 
	BILLING

	Name
	 	 
	Address
	 	 
	Telephone
	 	 
	Fax
	 	 
	Email
	 	 
	 
	 	 
	TECHNICAL/DEVELOPMENT

	Name
	 	 
	Address
	 	 
	Telephone
	 	 
	Fax
	 	 
	Email
	 	 
	 
	 	 
	QUALITY/PROCUREMENT

	Name
	 	 
	Address
	 	 
	Telephone
	 	 
	Fax
	 	 
	Email
	 	 

Page 10 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

	2.	 	INITIAL TERM OF LICENSE. Beginning on the Effective
Date and continuing until [ * * * ].

	3.	 	LICENSE TYPE. General Purpose

	4.	 	SUPPORT SERVICE SITE. Support services are offered only to a single site. You may have several development locations, of which one must be designated as the site to which Atheros will
deliver support services.

	 	 	 
	Support Service Site Address

	 	Same as Technical/Development Address unless this block modified. If
no Technical/Development Address provided, then same as signature
block address on page 1.

	5.	 	FEES.

	 	 	 	 	 
	Item	 	Fees
	Software License Fee

	 	$	[ * * * ]	(1)
	Annual
Support Fee ($[ * * * ] per year)

	 	$	[ * * * ]	(1)

 

			
	(1)	 	The parties acknowledge that a Software License Fee of $[ * *
* ] was paid by Licensee under the
Prior Agreement, and that the Software License Fee hereunder relates to additional Licensed
Technology being provided to Licensee hereunder. The parties also acknowledge that the Annual
Support Fees under the Prior Agreement have been paid by Licensee
through November 23, 2005 and
shall continue to apply under this Agreement during the period from the Effective Date through
November 23, 2005. The Annual Support Fees under this Agreement shall therefore be invoiced and
payable on November 24, 2005 and on each November 24 thereafter of each year of the Term.

	6.	 	LICENSED TECHNOLOGY. Atheros will deliver to You:

6.1. Reference Designs, Technical Documentation and Software Modules

These items are provided without additional charge. In addition, you may elect to
purchase Development Hardware separately.

	 	 	 	 	 
	 	 	Documentation	 	Modules
	 

	 	Programmer’s Guide
	 	AP Driver: Source & Object Code
	 

	 	MAC/Baseband Processor Data Sheet(s)	 	 
	 

	 	User’s Guide
	 	NDIS Driver: Source & Object Code
	 

	 	Test plan	 	 
	 

	 	User’s Guide as required for test
	 	ART (Atheros Radio Test): Source & Object Code
	 

	 	EEPROM Device Configuration Guide	 	 
	 

	 	 	 	LinkMon and/or ACU Source
	 
	 	 	 	 
	SW

	 	 	 	AP Board Support Package (BSP)
	 
	 	 	 	 
	 

	 	Test plan	 	 
	 

	 	ART Diagnostic SW Binary Code	 	 
	 

	 	ART Documentation	 	 
	 

	 	RF Front-end WLAN Data Sheet(s)	 	 
	 

	 	MAC/Baseband Processor Data Sheet(s)	 	 
	 

	 	Reference Guide(s)	 	 
	 

	 	Schematic(s)	 	 
	HW

	 	BOM/AVL(s)	 	 

 

*** 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.

Page 11 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

Layout Diagrams

Regulatory Compliance Guide

Sample Manufacturing Test Flow

EEPROM Device Configuration Guide

Page 12 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

Development Hardware Prices (subject to change without notice):

These prices apply only to Development Hardware. Atheros reserves the right to limit the
quantity of Development Hardware that may be purchased. Refer to Part Numbers (available
separately from Atheros sales staff) to order.

	 	 	 	 	 	 	 	 	 
	Part	 	Description	 	ID	 	Price
	RF or MAC/BB Chip	 	One MAC/BB chip or one RF chip from multi-chip solution
	 	Chip	 	$	[***]	 
	Single Chip Solution	 	Single-chip MAC/BB/RF solution
	 	Chip	 	$	[***]	 
	AP Reference Board	 	Access Point Integrated Reference or Development Board
	 	API	 	$	[***]	 
	Client Reference Board	 	Cardbus,
MiniPCI or other Client Reference or Development Board
	 	BCB	 	$	[***]	 
	Embedded Reference Board	 	Embedded WLAN Integrated Reference or Development Board
	 	EBI	 	$	[***]	 

 

*** 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.

Page 13 of 14

 

ATHEROS
TECHNOLOGY LICENSE AGREEMENT

EXHIBIT B

MINIMUM TERMS OF END USER LICENSE AGREEMENT

Your End User License Agreement will include terms at least as restrictive of Atheros’
liabilities and at least at protective of Atheros’ rights as the following:

	1.	 	License Grant and Restrictions. [Licensee] grants End User a non-exclusive
license to use the software program and related documentation (“Software”) only in conjunction with [name of a
product containing an Atheros Wireless LAN Chipset (“Product”)]. End User only obtains a non-exclusive
license to use the object code version of the Software with the Product and only in the country where the
Product was purchased. This Software is protected by copyright laws and international copyright treaties, as well
as other intellectual property laws and treaties. The Software is
licensed, not sold. Title does not pass to
End User. There is no implied license, right or interest granted in any copyright, patent, trade secret,
trademark, invention or other intellectual property right.
	 
	2.	 	No Reverse Engineering. End User will not decompile, disassemble or otherwise
reverse engineer the Software. If End User is a European Union resident, information necessary to achieve
interoperability with other programs is available upon request.
	 
	3.	 	Termination. Upon any violation of any of the provisions of this Agreement, End
User’s rights to use the Software will automatically terminate and End User will be obligated to destroy all
copies of the Software. End User may terminate this Agreement at any time by destroying the Software.
	 
	 	 	[Licensee]’S SUPPLIERS MAKE NO WARRANTIES,
EXPRESS OR IMPLIED, AND WILL NOT BE LIABLE
TO YOU UNDER ANY LEGAL THEORY FOR ANY DAMAGES OF ANY KIND, DIRECT, CONSEQUENTIAL, OR
OTHERWISE, ARISING IN CONNECTION WITH THE PRODUCT OR ANY SOFTWARE.
	 
	4.	 	Export. The Software may only be operated, exported or re-exported in compliance
with all applicable laws and export regulations of the United States and the country in which End User obtained
them. The Software is specifically subject to the U.S. Export Administration Regulations. End User may not
export, directly or indirectly, the Software or technical data licensed hereunder or the direct product
thereof to any country, individual or entity for which the United States Government or any agency thereof, at
the time of export, requires an export license or other government approval, without first obtaining such
license or approval.

Page 14 of 14

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