Exhibit 10.10
This Purchase and License Agreement for FWA Equipment (the "Agreement") is
entered by and among Nortel Networks Limited and Nortel Networks de Mexico, S.A.
de C.V. ("NN Mexico" and, collectively, "Nortel Networks"), and Axtel, S.A. de
C.V. (the "Customer" and, together with Nortel Networks, the "Parties"), is
effective from the Closing Date and shall continue in effect thereafter during
the Term. References to "days" shall mean calendar days, unless otherwise
specified.
1. Definitions
1.1 "Concession" means any concession, license, permit or the like (including
any additions or amendments thereto) granted and issued by the governmental
authorities of Mexico as of the Closing Date or during the Term in favor of
Customer that are legally required under applicable laws for operation of
the Products sold hereunder and Customer's networks in Mexico.
1.2 "Force Majeure Event" means the occurrence of fire, casualty, explosion,
lightning, accident, strike, lockout, labor unrest, labor dispute (whether
or not, in respect of the foregoing labor-related matters, the affected
party is in a position to settle the matter), war (declared or undeclared),
armed conflict, civil disturbance, riot, Act of God, delay of common
carrier, the enactment, issuance, or application of any law, local by-law,
regulation, or executive, administrative, or judicial order, acts
(including delay or failure to act) of any governmental authority, or any
other cause or causes (whether of the foregoing, nature or not), or any
other similar or different occurrence, which cause or occurrence is beyond
the reasonable control of the affected party and whether or not foreseeable
by such party.
1.3 "Furnish-only" means Products which Customer is responsible for installing.
1.4 "FWA Business" means, among other things, the know-how and licenses that
would allow a third party to manufacture and support base station
equipment, customer premises equipment, remote element manager, system
software and installation toolsets, that combined provide a fixed wireless
access solution operating in the 3.5 GHz spectrum using TDMA technology.
1.5 "Hardware" means a Nortel Networks machine, equipment or component, but not
including the software.
1.6 "Local Nortel Networks Affiliate" means any person or entity established
prior to or during the Term in Mexico, more than fifty percent (50%) of
whose voting shares or outstanding capital stock is owned or controlled
(directly or indirectly) by Nortel Networks or an affiliate of Nortel
Networks.
1.7 "Nortel Networks Finance Agreement" means the Restructured Amended and
Restated Finance Agreement, dated as of _____________ __, 2003, entered
into by and between Nortel Networks Limited as Lender and Axtel, S.A. de
C.V. as Borrower.
1.8 "Products" means any Hardware, Software or Third Party Vendor Items
provided under this Agreement, which are further described in Annex C
hereto.
1.9 "Replacement Agreements" means, collectively: (i) this Agreement, (ii) the
Technical Assistance Services Agreement for FWA Equipment, dated as of the
date hereof and entered into between Customer and NN Mexico (the "FWA TAS
Agreement"), (iii) the Purchase and License Agreement for Non-FWA
Equipment, dated as of the date hereof and entered into between the Parties
hereto, and (iv) the Technical Assistance Services Agreement for Non-FWA
Equipment, dated as of the date hereof and entered into between Customer
and NN Mexico.
1.9.1 "Restructuring Agreement" means the Restructuring Agreement, dated as of
__________ __, 2003, entered into among the Parties hereto.
1.10 "Senior Note" means that certain promissory note dated ____________ __,
2003, executed by Customer and payable to Nortel Networks as per the Nortel
Networks Finance Agreement.
Purchase and License Agreement for FWA Equipment
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1.11 "Services" means the activities which may be undertaken by Nortel Networks
pursuant to an Order, including but not limited to, consulting, business
planning, network planning and analysis.
1.12 "Site" means a location designated by Customer at which the Products are to
be installed and the Services are to be performed.
1.13 "Software" means computer programs in object code form or firmware which is
owned or licensed by Nortel Networks, its parent or one of its subsidiaries
or affiliates, and is copyrighted and licensed, not sold. Software consists
of machine-readable instructions, its components, data, audio-visual
content (such as images, text, recordings or pictures) and related licensed
materials including all whole or partial copies.
1.14 "Software Scripts" means the high level overlay of the Radio Element
Manager (REM) software that is either run on demand or scheduled and
typically collects, post processes or interprets data for operational,
installation, commissioning and maintenance purposes. The Software Scripts
do not include REM daemons or REM Graphical User Interface screens (GUI).
1.15 "Specifications" means, with respect to Products and/or Services, the
technical specifications set forth in Annex D hereto, which describe or
explain the standard functional capabilities and/or requirements for such
Products and/or Services.
1.16 "Taxes" means all federal, state, provincial, local, foreign, gross income,
gross receipts, sales, use, value added, stamp, levies, customs duties,
franchise, withholding, excise, real or personal property taxes,
registration charges and all other similar taxes.
1.17 "Term" means five (5) years, commencing on the Closing Date (as defined in
the Restructuring Agreement), provided that the Term may be extended for
subsequent one (1) year periods, subject to the Parties agreeing on
mutually acceptable commercially reasonable terms and conditions, where
"commercially reasonable" shall mean terms and conditions which would be
expected to be found in a comparable contractual arrangement between arms'
length parties, acting without other economic constraint or influence, of
similar size and financial situation for products and/or services similar
or comparable to those under this Agreement, including, without limitation,
price and gross margins, minimum orders, volume commitments and delivery
lead times, capital investment required and credit quality of the buyer;
and provided, further, that, solely for the period prior to any sale of the
FWA Business by Nortel Networks to an unrelated third party, (i) twelve
(12) months prior to the end of the Term as then in effect, the Parties
shall enter into negotiations to determine such mutually acceptable
commercially reasonable terms and conditions, (ii) if agreement on such
terms and conditions is not reached by the date that is nine (9) months
prior to the end of such Term, such determination shall be submitted to
arbitration pursuant to the Rules of Conciliation and Arbitration of the
International Chamber of Commerce then in force, such proceedings to take
place in the English language in the City of Miami, Florida, before a panel
of three (3) arbitrators appointed in accordance with the aforementioned
rules, (iii) if such arbitration has not resulted in a determination on or
before the end of the Term as then in effect, the terms and conditions of
this Agreement as in effect during such Term shall be deemed to continue in
effect until such a determination is reached, at which time such
determination shall be applied retroactively to the end of such Term, (iv)
if the terms and conditions determined by such arbitration are acceptable
to Customer but are not accepted by Nortel Networks, then the arbitrators
shall determine the price at which they believe the FWA business would be
sold in an arms length transaction by parties acting without other economic
constraint or influence, (v) Customer shall have the right to purchase the
FWA Business at such price, and (vi) if the Customer elects not to purchase
the FWA Business at such price, then Nortel Networks shall have no
continuing obligation to Customer beyond the terms of this Agreement as
then in effect.
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1.18 "Third Party Vendor Items" includes "Third Party Hardware" and "Third Party
Software" and means any non-Nortel Networks hardware and/or software
supplied to Customer under this Agreement.
2. Orders; Initial Order; Change Orders and Delivery Times
2.1 Customer may acquire Products or Services by: (i) issuing a written
purchase order, signed by an authorized representative, or (ii) if Customer
is enrolled in any then current Nortel Networks electronic commerce
program, by submitting electronic orders (collectively, "Orders").
2.2 All Orders shall reference this Agreement and shall comply with the Order
Procedure attached as Annex E hereto. Orders are totally binding and
non-cancelable.
2.3 All Orders will be governed by and cannot alter the terms and conditions of
this Agreement. In order to be valid, all Orders must be accepted by Nortel
Networks through a written or electronic communication. Nortel Networks
shall accept such Order within the next ten (10) business days after
delivery thereof, if such Order (i) is in compliance with this Agreement
(prices and descriptions) and no additional terms and conditions have been
imposed; (ii) Nortel Networks has received the applicable payment in
accordance with Section 5 hereof; and (iii) Customer has provided the
applicable letter of credit or other form of payment guarantee in
accordance with Section 5 hereof. For the avoidance of doubt, the Parties
agree that Nortel Networks shall not be obligated to start performing under
any Order until Customer complies with the provisions of this Section 2.3.
In the event Nortel Networks does not accept an Order in accordance with
this Section 2.3, it shall promptly return to Customer any payments made
and/or letters of credit provided by Customer under this Section 2.3.
2.4 The implementation schedule, responsibility matrix and any other items
which may be necessary for the performance of Nortel Networks' obligations
hereunder shall be mutually agreed upon between the Parties and included as
exhibits to the Order. Such exhibits shall be deemed incorporated into this
Agreement by this reference.
2.5 Attached hereto as Annex A is the initial Order, which Customer hereby
delivers and shall be subject to Section 5.21 below.
2.6 The prices set forth in Annex F and reflected in each Order are based on
anticipated delivery and performance schedules and specifications
incorporated in such Order.
2.7 Any changes to this Agreement or an Order initiated by Customer or Nortel
Networks after the Closing Date resulting in adjustments to process, job
schedule, contract price or other requirements thereof may be cause for
adjustment by Nortel Networks to the prices and to the relevant delivery
and performance schedules set forth therein. Any such adjustment shall be
detailed in a change order, a form of which is attached hereto as Annex B
("Change Order"). If the Change Order affects any Products for which Nortel
Networks has commenced manufacturing or has shipped or any Services for
which Nortel Networks has commenced performance, the adjustment of the
price shall include reasonable, documented charges incurred by Nortel
Networks related thereto. No such changes shall be performed until a Change
Order has been executed by authorized representatives of the Parties. A
Change Order may only be used to increase the amount of Products and/or
Services ordered and in no event may the amount of Products and/or Services
in an Order be cancelled or decreased, whether through a Change Order or
otherwise.
2.8 Nortel Networks shall deliver the Products in accordance with the timing
set forth in Annex J of this Agreement. The delivery times shall commence
after Order acceptance as specified in Section 2.3 of this Agreement.
Nortel Networks shall deliver the Products at the applicable Nortel
Networks' factory, except for RSS equipment, which shall be delivered at
Nortel Networks' North American consolidation warehouse for Mexico
(currently in Texas, USA).
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3. Electronic Commerce Programs
3.1 By enrolling in any Nortel Networks' electronic commerce program, Customer
agrees to comply with the terms of such program. Customer agrees that all
electronic Orders issued are equivalent to a written Order, are governed by
the terms and conditions of this Agreement and that in the event of any
conflict between this Agreement and the information contained in Customer's
or Nortel Networks' electronic commerce website, this Agreement governs.
Customer is responsible for the use and protection of all electronic
commerce passcodes provided by Nortel Networks and agrees that all Orders
submitted using such passcodes are valid and binding Orders authorized by
Customer. Nortel Networks shall have no liability to Customer due to
Customer's failure to access Customer's or Nortel Networks' electronic
commerce website or errors or failures relating to its operation.
4. Licensed Use of Software
4.1 Nortel Networks grants Customer a nonexclusive and perpetual (subject to
Nortel Networks termination rights set forth in section 4.5 below) license
to use a copy of the Software with the Products to the extent of the
activation or authorized usage level.
4.2 To the extent Software is furnished for use with designated Products or
Customer-furnished equipment ("CFE"), Customer is granted a nonexclusive
and perpetual (subject to Nortel Networks termination rights set forth in
section 4.5 below) license to use the Software only on such Products or
CFE, as applicable.
4.3 Software contains trade secrets and Customer agrees to treat Software as
Information (as defined in Section 10). Customer will ensure that anyone
who uses the Software does so only in compliance with the terms of this
Agreement.
4.4 Customer shall not: (a) use, copy, modify, transfer or distribute the
Software except as expressly authorized, provided, however, that, Customer
is hereby authorized to generate new Software Scripts or modify the
existing ones; and provided, further, that Nortel Networks shall not be
obligated to support such modified Software Scripts, nor shall it be
responsible for any performance issues resulting from such modified
Software Scripts; (b) reverse assemble, reverse compile, reverse engineer
or otherwise translate the Software; (c) create derivative works or
modifications unless expressly authorized; or (d) sublicense, rent or lease
the Software. Licensors of intellectual property to Nortel Networks are
beneficiaries of this provision.
4.5 Upon breach of the Software license by Customer as set forth in this
Agreement or in the event the designated Product or CFE is no longer in
use, this license terminates and Customer will promptly return the Software
to Nortel Networks or certify its destruction.
4.6 Nortel Networks may audit by remote polling or other reasonable means to
determine Customer's Software activation or usage levels.
4.7 With respect to Third Party Software, Customer agrees to abide by the terms
provided by Nortel Networks with respect to any such software. Customer
further agrees that the terms contained in any Nortel Networks or third
party "shrink wrap" or "click" licenses shall govern the use of such
software.
4.8 If Nortel Networks and Customer agree that delivery of Software is to be
made electronically via File Transfer Protocol, then delivery of such
Software by Nortel Networks shall be deemed to have taken place at such
time as the Software is loaded onto a network server, as designated by
Nortel Networks, and Customer has been provided with appropriate
instructions and passwords to enable Customer to begin use of such
Software. Notwithstanding the
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foregoing, the Parties shall comply with all regulations applicable to
importation of Software pursuant to applicable law.
4.9 Customer is allowed to make copies of the Software, as may be reasonably
necessary for back up, execution or archival purposes only.
5. Charges, Payment and Taxes
5.1 The contract price for the Products (including software) and Services is
set forth in Annex F hereto. Unless otherwise agreed by the Parties in an
Order, all prices are in U.S. dollars, exclusive of Taxes. All prices are
applicable solely in Mexico.
5.2 In accordance with the terms of Annex "E", within the next five (05)
business days after the delivery of the Order in accordance with the terms
set forth in Sections 5.3 and 5.21 below, Nortel Networks shall deliver to
Customer an invoice for one hundred percent (100%) of the purchase price of
such Order.
5.3 Except for the Orders for RSSs mentioned in Section 5.21 below, all Orders
for Products shall be accompanied by: (i) payment of seventy percent (70%)
of the purchase price thereof upon delivery of the Order through a wire
transfer of immediately available funds or by a letter of credit or by any
other mutually agreed means; and (ii) within the next five (5) days after
delivery of the respective invoice as per Section 5.2 above, a letter of
credit or other form of payment guarantee consistent with Section 5.17
hereof for the remaining thirty percent (30%) of the purchase price of the
relevant Order.
5.4 Payment of this thirty percent (30%) shall be made by Customer ten (10)
days after Delivery Date (as defined in Annex E of this Agreement) of the
Products; provided that Customer may notify Nortel Networks in writing
within such 10-day period if some or all of the Products delivered are not
in compliance with the terms of the Order (the "Non-Compliant Products"),
in which case Nortel Networks shall take, within thirty days of the date of
Customer's notice, corrective action to resolve such Non-Compliant
Products. Customer shall not be obligated to pay, and Nortel Networks shall
not be entitled to draw on the letter of credit or other form of payment
guarantee, the purchase price of the Non-Compliant Products until Nortel
Networks corrects such non-compliance, provided, however, that prior to
such resolution Nortel Networks shall issue a revised invoice relating to
the portion of Products received by Customer that is in compliance with the
terms of the Order. Partial shipments shall be allowed under this
Agreement, subject to the terms set forth in Annex "J" of this Agreement.
For the avoidance of doubt, the Parties agree that the purchase price of
the compliant Products shall be paid by Customer as provided in this
Section 5.4.
5.5 All Orders for Services shall be accompanied by a letter of credit or other
form of payment guarantee consistent with Section 5.17 hereof for one
hundred percent (100%) of the price of such Services. Nortel Networks shall
invoice Customer one hundred percent (100%) of the price of Services upon
completion, unless the Service continues beyond thirty days, in which case
Nortel Networks shall invoice Customer at the end of each month for the
Services performed in that month.
5.6 With respect to Services, amounts are due upon receipt of invoice and shall
be paid by Customer within thirty (30) days of the invoice date.
5.7 Customer shall pay interest on any late payments at the rate of eighteen
percent (18%) per annum (11/2% per month).
5.8 Charges for Software may be based on extent of use authorized as specified
in this Agreement. Customer agrees to pay the charges applicable for any
activation or usage beyond the authorized level.
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5.9 Customer is liable and responsible for any Taxes relating to the Products
or Services furnished by Nortel Networks or its subcontractors pursuant to
this Agreement (whether incurred directly or indirectly by Nortel Networks)
and shall, at Nortel Networks' direction, promptly pay to Nortel Networks
or pay directly to the applicable government or taxing authority, if
requested by Nortel Networks, all such Taxes; provided, however, that in no
event shall Customer be liable for Taxes computed upon the income or gross
revenues of Nortel Networks or its subcontractors.
5.10 Customer shall be responsible for payment of personal property taxes for
Products and materials from the date of shipment by Nortel Networks.
Customer's obligations pursuant to this Section shall survive any
termination of this Agreement.
5.11 Customer shall, within thirty (30) days of the tax payment on behalf of
Nortel Networks, furnish to Nortel Networks all original tax receipts or
certified copies in Nortel Networks' name showing payment of the Tax and
such other documentation relating to the tax payment which Nortel Networks
may reasonably request.
5.12 If Customer shall claim to be exempt from any Taxes, Customer shall furnish
to Nortel Networks a tax exemption certificate from the relevant taxing
authority in the form required by law or otherwise reasonably acceptable to
Nortel Networks. If Customer shall claim any such tax exemption and
provides Nortel Networks the required tax exemption certificate and Nortel
Networks does not collect the Taxes in reliance thereupon, Customer shall
hold Nortel Networks harmless from and against any and all assessments for
such Taxes levied on Nortel Networks, including all interest, penalties and
late charges upon any such Taxes and the cost of professional consulting
fees incurred by Nortel Networks to settle the applicable tax matter with
the relevant tax authorities.
5.13 If withholding of any Tax is required in respect of any payment by Customer
to Nortel Networks hereunder, Customer shall: (i) withhold the appropriate
amount from such payment, (ii) pay such amount to the relevant authorities
in accordance with applicable law, and (iii) pay Nortel Networks an
additional amount such that the net amount received by Nortel Networks is
the amount Nortel Networks would have received in the absence of such
withholding.
5.14 Customer shall pay all applicable customs fees, import duties, and similar
charges directly to the appropriate governmental authorities. Each party
agrees to ensure that it is in good standing and is appropriately
registered, including without limitation, with respect to Taxes, in any
country, state or other jurisdiction where legally required.
5.15 Nortel Networks reserves the right to import services or subcontractors
when and where necessary to complete services related to this Agreement. To
the extent the Local Nortel Networks Affiliate must import services or
subcontractors in support of this Agreement, Nortel Networks reserves the
right to have the Local Nortel Networks Affiliate invoice Customer an
additional amount such that the cost of the withholding taxes for such
imported Services are borne by Customer.
5.16 Customer consents without qualification to the sale and/or assignment of
receivables, in whole or in part, including all or any part of any
associated rights, remedies, and obligations, by Nortel Networks subject to
a 30-day prior written notice, and authorizes the disclosure of this
Agreement as necessary to facilitate such sale. Any tax impact to Customer
resulting from such sale and/or assignment shall be borne by Nortel
Networks.
5.17 The payments referred to in Sections 5.3(ii), 5.5 above and 5.21 below
shall be secured by: (i) an irrevocable and unconditional letter of credit
in favor of Nortel Networks, confirmed by a United States bank acceptable
to Nortel Networks, or (ii) another form of payment guarantee acceptable to
Nortel Networks in its sole discretion.
5.18 If Nortel Networks is prevented from making a shipment of Products,
installing such Products or performing the Services due to any Force
Majeure Event or for any other reason
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attributable, in whole or in part, to Customer, the Customer shall
accordingly arrange an extension of such letter of credit and reimburse
Nortel Networks for any additional expenses arising out of any such delay;
provided, however, that this reimbursement obligation shall apply only to
the extent that the delay was attributable to Customer; and provided,
further, that Customer shall promptly reimburse Nortel Networks for any
such additional expenses, and Nortel Networks shall subsequently return to
Customer any monies which Customer may have paid in excess once the Parties
have reached an agreement on the actual extent of Customer's reimbursement
obligation.
5.19 Nortel Networks reserves the right to reject an Order at Nortel Networks'
sole discretion, or to withhold shipment of the Products or performance of
the Services, or any portion thereof, if: (i) Customer is in default of its
payment obligations hereunder, (ii) Customer is in breach of its
obligations under this Agreement, or (iii) Customer falls under any of the
situations described in Sections 16.1 (i) through (iv) hereof, and all
relevant dates for completion shall be adjusted accordingly.
5.20 Customer hereby irrevocably waives, to the fullest extent permitted by law,
the right to dispute any invoice submitted by Nortel Networks hereunder, if
such invoice is not disputed within twenty one (21) days from invoice
receipt. Such dispute must be resolved within ninety (90) days from the
invoice date. Payment of any disputed amounts is due and payable upon
resolution. All other amounts remain due as per this Section 5.
5.21 Notwithstanding any other provision of this Section 5 to the contrary, in
the case of Orders for the annual minimum order amounts referred to in
Section 19 below, Customer shall submit, on or before December 15 of each
year, and dated as of the date of such submission, separate Orders relating
to the minimum order commitments for the succeeding calendar year, as
follows: (a) In the case of RSS's, the Customer shall submit four (4)
separate Orders, each one for one fourth (1/4) of the Baseline Annual
Minimum Commitment of RSS units set forth in Section 1(a) of Annex H of
this Agreement, relating to the four calendar quarters of the succeeding
calendar year, provided that the Orders for the Additional Annual Minimum
Commitment of RSS Units set forth in such Annex H, shall be placed by
Customer during the calendar year to which such Additional Annual Minimum
Commitment applies, and (b) In the case of base stations, the Customer
shall submit one (1) Order for the total annual minimum commitment for such
calendar year. Nortel Networks shall accept such Orders within ten (10)
business days (in the place where Nortel Networks' office which receives
such Orders is located) after delivery thereof if such Orders are in
compliance with this Agreement (prices and descriptions) and no additional
terms and conditions have been imposed. In the case of Orders for RSSs, (i)
payment of the initial seventy percent (70%) of the purchase price for the
Order corresponding to the first calendar quarter of each calendar year
shall be made on or before January 15th of such calendar year, together
with a letter of credit or other form of payment guaranty consistent with
the requirements of Section 5.17 hereof for the remaining thirty percent
(30%) of the purchase price; and (ii) payment of the initial seventy
percent (70%) of the purchase price for the respective Orders corresponding
to each of the three remaining calendar quarters of such calendar year
shall be made on or before the 15th calendar day of the month immediately
preceding the calendar quarter to which such Order relates, together with a
letter of credit or other form of payment guaranty consistent with the
requirements of Section 5.17 hereof for the remaining thirty percent (30%)
of the purchase price. Delivery of Products under each such Order shall be
in accordance with Annex "J" and shall commence after the initial payment
and that payment of the remaining thirty percent (30%) of the purchase
price for each Order will be due ten (10) days after Product delivery,
subject to the terms set forth in Section 5.4 for non-complying delivery.
5.22 Customer has the right to engage a third party financial institution to
provide financing for the Products and/or Services supplied by Nortel
Networks under this Agreement (provided that Customer is in compliance with
the financial covenants set forth in the Nortel Networks Finance
Agreement), in which case such third party financial institution will make
the payments
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as provided under this Agreement; provided, however, that Customer shall
continue to be obligated to comply with all its obligations hereunder.
6. Warranty
6.1 Nortel Networks warrants that the Hardware: (i) is free from defects in
materials and workmanship, and (ii) substantially conforms to its
Specifications. If Hardware does not function as warranted during the
warranty period, Nortel Networks will determine to either: (i) make it do
so, or (ii) replace it with substantially equivalent Hardware.
6.2 Nortel Networks provides the Software on an "AS IS" BASIS WITHOUT
WARRANTIES OF ANY KIND.
6.3 Nortel Networks warrants that Services will be performed in a professional
and workmanlike manner. If Services are not performed as warranted and
Nortel Networks is notified in writing by Customer within sixty (60) days
of the date of the non-conforming Services, Nortel Networks will re-perform
the non-conforming Services.
6.4 The warranty period for Hardware shall be twelve (12) months from the date
of delivery to Customer as per the terms of this Agreement. In the event
Nortel Networks determines that repair or replacement as set forth in this
Section 6 cannot be made using commercially reasonable efforts (which
determination shall be made within thirty (30) days after Nortel Networks
receives written notice from Customer) Nortel Networks will give Customer a
credit equal to the purchase price paid by Customer for the Hardware,
provided that Customer has returned such Hardware to Nortel Networks.
6.5 No warranty is provided for: (i) supply items normally consumed during
Product operation; (ii) failures caused by non-Nortel Networks products;
(iii) failures caused by a Product's inability to operate in conjunction
with other Customer hardware or software different from the Third Party
Vendor Items provided by Nortel Networks under this Agreement; or (iv)
performance failures resulting from improper installation and maintenance
or Customer's use of unauthorized parts or components. Warranty will be
voided by misuse, accident, damage, alteration or modification, failure to
maintain proper physical or operating environment, use of unauthorized
parts or components or improper Customer maintenance. The performance by
Customer, directly or indirectly, of the installation, engineering,
commissioning, network design, support and maintenance of FWA Products by
skilled personnel in accordance with the Nortel Procedures shall not
invalidate the warranty provided hereunder.
6.6 Nortel Networks provides Third Party Vendor Items on an "AS IS" BASIS
WITHOUT WARRANTIES OF ANY KIND, unless Nortel Networks specifies otherwise.
However, such Third Party Vendor Items may carry their own warranties and
Nortel Networks shall pass through to Customer any such warranties to the
extent authorized. Nortel Networks shall provide to Customer the necessary
contact information and applicable documentation, if available, for those
third party vendors. Furthermore, Nortel Networks shall provide reasonable
assistance to Customer so that Customer may avail itself of any such
warranties, but only to the extent such assistance does not cause Nortel
Networks to incur any out-of-pocket expenses or material additional costs.
6.7 Nortel Networks warrants that all Nortel Networks Products supplied
hereunder shall have been tested at the factory to ensure that they conform
to their Specifications and that they shall have successfully passed those
tests.
6.8 THESE WARRANTIES AND LIMITATIONS ARE CUSTOMER'S EXCLUSIVE WARRANTIES AND
SOLE REMEDIES, AND REPLACE ALL OTHER WARRANTIES OR CONDITIONS, EXPRESS OR
IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OR
CONDITIONS OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
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7. Services
7.1 Warranty Services: During the warranty period, Nortel Networks provides
warranty Services without charge for Nortel Networks Hardware supplied
under this Agreement to correct Hardware defects or to bring it up to
conformance with the Specifications set forth in this Agreement. Warranty
Services to be provided by Nortel Networks are further described in Annex
"G" hereof.
7.2 Customer shall notify Nortel Networks prior to returning any Hardware and
must reference a return material authorization number issued by Nortel
Networks on documentation accompanying such returned Hardware. When
Customer is required to return Hardware to Nortel Networks for warranty
service, Customer agrees to ship it prepaid and suitably packaged to a
location Nortel Networks designates. Nortel Networks will return the
Hardware to Customer at Nortel Networks' expense. Nortel Networks is
responsible for loss of, or damage to, Hardware while it is: (i) in Nortel
Networks' possession, or (ii) in transit back to Customer. Any exchanged
Hardware becomes Nortel Networks' property and, subject to Section 8 -
Title and Risk of Loss, its replacement becomes the Customer's property.
The replacement Hardware may not be new but will be in working order and
equivalent to the item exchanged. The warranty period for the repaired or
exchanged Hardware shall be the greater of ninety (90) days from the date
of delivery of the Hardware back to Customer, or the remaining Hardware
warranty period. Customer agrees to ensure that exchanged Hardware is free
of any legal obligations or restrictions that prevent its exchange and
represents that all returned items are genuine and unaltered. Relocation of
Products under warranty Services may result in adjustments to the price and
response times.
7.3 Where applicable, before Nortel Networks provides warranty services,
Customer agrees to: (i) follow the problem determination, problem analysis,
and warranty services request procedures that Nortel Networks provides;
(ii) secure all program and data contained in Hardware; and (iii) inform
Nortel Networks of changes in the Hardware's location.
7.4 Post-warranty and other Services to supplement the warranty Services,
including advanced shipment of replacement parts, may be available at
prices and policies to be negotiated in good faith and agreed between the
Parties. The warranty service terms and exclusions in Section 6 above shall
apply to post- and supplemental warranty Services.
7.5 Services in General: Customer agrees to reasonably cooperate with Nortel
Networks in the performance by Nortel Networks of the Services, including,
without limitation, providing Nortel Networks with sufficient and timely
access free of charge to facilities, data, information and personnel of
Customer in accordance with the then-current Customer policies, and a
suitable physical environment meeting Nortel Networks' specified
requirements to permit the timely delivery and installation of Products
and/or performance of Services, including the recovery by Nortel Networks
of any tools, diagnostic or test equipment, documentation or other items
used by Nortel Networks in the performance of the Services.
7.6 In addition, Customer shall be responsible for the accuracy and
completeness of all data and information that it provides or causes to be
provided to Nortel Networks. In the event that there are any delays by
Customer in fulfilling its responsibilities as stated above, there is a
disagreement between the parties as to the cooperation required from
Customer, or there are errors or inaccuracies in the information provided,
Nortel Networks shall be entitled to appropriate schedule and pricing
adjustments, including storage fees. It is understood and agreed that the
Services provided by Nortel Networks may include the advice and
recommendations of Nortel Networks, but all decisions in connection with
the implementation of such advice and recommendations shall be the sole
responsibility of, and made by, Customer, unless such advice and
recommendations are part of consulting services purchased by Customer.
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7.7 Service Personnel: Nortel Networks and Customer are each responsible for
the supervision, direction, compensation and control of their own employees
and subcontractors. Nortel Networks may subcontract any portion or all of
the Services to subcontractors selected by Nortel Networks. Neither Party
shall knowingly solicit to hire employees of the other Party with whom it
had contact as a result of the performance of the Services for a period
ending twelve (12) months after completion of the Services. Neither Party
shall be precluded from conducting generalized searches for employees (and
hiring those employees who respond to generalized searches) either through
the use of search firms or advertisements in the media, provided that
searches are not specifically targeted to employees providing Services.
7.8 Intellectual Property Rights: Nortel Networks, on behalf of itself and its
subcontractors, reserves all proprietary rights in and to: (i) all
methodologies, designs, engineering details, and other data pertaining to
the Services and designs, documentation and other work product prepared by
Nortel Networks and delivered to Customer, (ii) all original works,
computer programs and updates developed in the course of providing the
Services (except Customer's developed programs) or as otherwise agreed in
writing by the Parties, (iii) discoveries, inventions, patents, know-how
and techniques arising out of the Services, and (iv) any and all products
(including software and equipment) developed as a result of the Services.
The performance by Nortel Networks of Services shall not be deemed work for
hire. Nortel Networks grants to Customer a perpetual, non-exclusive,
world-wide, paid up license to use, copy and modify the designs,
documentation and other work product prepared by Nortel Networks and
delivered to Customer in the performance of Services solely for Customer's
internal business purposes. It is understood between the Parties that
Nortel Networks will employ its know-how, techniques, concepts, experience
and expertise, as well as all other intellectual property, including that
to which it reserves its rights hereunder, to perform services for others
which are the same as or similar to the Services.
8. Title and Risk of Loss
8.1 Title and risk of loss for ordered Hardware and Third Party Hardware shall
pass from Nortel Networks to Customer upon its delivery to Customer.
9. Installation and Commissioning
9.1 Customer shall perform all installation, commissioning and software loading
services with respect to the FWA Products, using skilled personnel and in
accordance with the Nortel Procedures, with the exception of REM software
upgrades, which shall be installed by Nortel Networks pursuant to the FWA
TAS Agreement.
10. Confidential Information
10.1 Confidential information ("Information") means: (i) Software and Third
Party Software; and (ii) all business, technical, marketing and financial
information and data that is clearly marked with a restrictive legend of
the disclosing party ("Discloser").
10.2 The party receiving Information ("Recipient") will use the same care and
discretion to avoid disclosure, publication or dissemination of Information
as it uses with its own similar information that it does not wish to
disclose, publish or disseminate. The Recipient may disclose Information
only to: (i) its employees and employees of its parent, subsidiary
affiliated companies or subcontractors who have a need to know for purposes
of carrying out this Agreement; and (ii) any other party with the
Discloser's prior written consent. Before disclosure to any of the above
parties, the Recipient will have a written agreement with such party
sufficient to require that party to treat Information in accordance with
this Agreement.
10.3 The Recipient may disclose Information to the extent required by law.
However, the Recipient must give the Discloser prompt notice and make a
reasonable effort to obtain a protective order.
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10.4 No obligation of confidentiality applies to any Information that the
Recipient: (i) already possesses without obligation of confidentiality;
(ii) develops independently; or (iii) rightfully receives without
obligations of confidentiality from a third party. No obligation of
confidentiality applies to any Information that is, or becomes, publicly
available without breach of this Agreement.
10.5 Each party's obligations hereunder shall survive for a period of five (5)
years after receipt of Information hereunder from the Discloser, except as
otherwise mutually agreed upon by the parties.
10.6 The Discloser makes no representations or warranties of any nature
whatsoever with respect to any Information furnished to the recipient,
including, without limitation, any warranties of merchantability or fitness
for a particular purpose or against infringement, EXCEPT FOR THOSE SET
FORTH IN SECTION 6 HEREOF.
10.7 The release of any advertising or other publicity relating to this
Agreement requires the prior approval of both Parties.
11. Patents and Copyrights
11.1 Nortel Networks shall indemnify and hold harmless Customer, its officers,
directors, representatives, agents, employees, contractors, subcontractors,
subsidiaries and affiliates against any actual direct loss, damage,
liability, cost, expense, action or claim, including reasonable attorneys'
fees, litigation costs and expenses and amounts paid in settlement, subject
to the limitations set forth in the following paragraphs, arising out of or
in connection with any infringement or alleged infringement of patents,
copyrights, trademarks, trade secrets, or any other intellectual property
right of a third party. Therefore, if a third party claims that Nortel
Networks Hardware or Software provided to Customer under this Agreement
infringes such third party's patent or copyright, Nortel Networks will
defend Customer against that claim at Nortel Networks' expense and pay all
costs and damages that a court finally awards or are agreed in settlement,
provided that Customer: (a) promptly notifies Nortel Networks in writing of
the claim, and (b) allows Nortel Networks to control, and cooperates with
Nortel Networks at Nortel Networks' expense in, the defense and any related
settlement negotiations. If such a claim is made or appears likely to be
made, Nortel Networks agrees to secure the right for Customer to continue
to use the Hardware or Software, or to modify it, or to replace it with
equivalent Hardware or Software. If Nortel Networks determines that none of
these options is reasonably available, Customer agrees to return the
Hardware or Software to Nortel Networks on Nortel Networks' written
request. Nortel Networks will then give Customer a credit equal to the
purchase price paid by Customer for the Hardware or Software. Any such
claims against the Customer or liability for infringement arising from use
of the Hardware or Software following a request for return by Nortel
Networks are the sole responsibility of Customer. This represents
Customer's sole and exclusive remedy regarding any claim of infringement.
11.2 Nortel Networks has no obligation regarding any claim based on any of the
following: (a) anything Customer provides which is incorporated into the
Hardware or Software; (b) compliance by Nortel Networks with the Customer's
specifications, designs or instructions; (c) the amount of revenues or
profits earned or other value obtained by the use of a Product by Customer;
(d) Customer's modification of Hardware or Software (subject to Section
4.4(a) hereof); (e) the combination, operation, or use of Hardware or
Software with other products not provided by Nortel Networks as a system,
or the combination, operation, or use of Hardware or Software with any
product, data, or apparatus that Nortel Networks did not provide; (f) the
Customer's failure to install or have installed changes, revisions or
updates as instructed by Nortel Networks; or (g) infringement by a Third
Party Vendor Item alone, as opposed to its combination with Products Nortel
Networks provides to Customer as a system.
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11.3 In case of any infringement caused by any Third Party Vendor Item, Nortel
Networks shall reasonably cooperate with Customer and hereby assigns to
Customer any of its rights to request the proper defense and
indemnification for such claim to such Third Party Vendor. Nortel Networks
shall provide Customer with all necessary contact information and
applicable documentation, if available, for those third party vendors.
Furthermore, Nortel Networks shall use its best efforts to provide
reasonable assistance to Customer for Customer to be able to obtain from
the Third Party Vendor the applicable defense and indemnification for such
Third Party Vendor Item infringement, but only to the extent such
assistance does not cause Nortel Networks to incur any out-of-pocket
expenses or material additional costs.
12. Limitation of Liability
12.1 In no event shall Nortel Networks or its agents or suppliers be liable to
Customer for more than the amount of any actual direct damages up to the
greater of U.S. $100,000 (or equivalent in local currency) or the charges
for the Product or Services that are the subject of the claim, regardless
of the cause and whether arising in contract, tort or otherwise. This
limitation will not apply to claims for damages for bodily injury
(including death) and damage to real property and tangible personal
property for which Nortel Networks is legally liable and payments as set
forth in Section 11 - Patents and Copyrights.
12.2 IN NO EVENT SHALL NORTEL NETWORKS OR ITS AGENTS OR SUPPLIERS BE LIABLE FOR
ANY OF THE FOLLOWING: I) DAMAGES BASED ON ANY THIRD PARTY CLAIM, EXCEPT AS
EXPRESSLY PROVIDED FOR HEREIN; II) LOSS OF, OR DAMAGE TO, CUSTOMER'S
RECORDS, FILES OR DATA; OR III) INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR
CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS OR LOST SAVINGS), EVEN IF
NORTEL NETWORKS IS INFORMED OF THEIR POSSIBILITY.
13. Concessions
13.1 Customer hereby warrants and represents that it and its affiliates in
Mexico have obtained the Concessions which will permit each of them to
legally operate all or a portion of the Products in Mexico. The Parties
agree that Nortel Networks shall not deliver or install any Products,
perform any Services or accept any Orders hereunder unless Customer or its
affiliates (if applicable) have been granted a Concession in Mexico for the
use of such Products.
14. Changes or Substitution of Products
14.1 At any time, Nortel Networks may implement changes to the Products, modify
the Products' designs and Specifications or substitute the Products with
ones of similar or more recent design. The Parties shall mutually agree on
the Price of such changed or substituted Products. Such a change to or
substitution of the Products provided under this Agreement shall be subject
to the following requirements: (i) shall not adversely affect the physical
or functional interchangeability or the performance Specifications of the
Products, except as otherwise agreed in writing by Customer; (ii) the price
for equivalent performance shall be the same or lower than the price agreed
hereunder, except as otherwise agreed in writing by Customer; (iii) any
change or substitution of the Products shall be functionally equivalent and
compatible with the changed or substituted Product, without the need for
any other adaptations; and (iv) shall under no circumstances either reduce
or decrease Nortel Networks' warranty obligations set forth in this
Agreement.
15. Delayed Shipment of the Products or the Performance of the Services
15.1 If Customer notifies Nortel Networks less than thirty (30) days prior to
the scheduled delivery date of the Products (or if the Products have been
manufactured per the agreed upon schedule) that Customer does not wish to
take delivery thereof at the scheduled time or that a site is not available
to receive such Products, or if Customer fails to take delivery of such
Products upon their arrival at the applicable site, Nortel Networks shall
have the right to place
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the Products in storage and Customer shall bear all costs of demurrage,
restocking, warehousing, reloading, transporting, off-loading, and other
associated costs incurred by Nortel Networks. All such costs shall be paid
in full within thirty (30) days of Customer's receipt of Nortel Networks'
commercial invoice therefor. Customer may delay delivery or fail to take
delivery of the Products for not more than thirty (30) days. Once such
thirty-day term elapses, Customer shall immediately pay to Nortel Networks
the outstanding balance of the purchase price of the Products, if any, and
the warranty period for the affected Products shall be deemed to start upon
expiration of such 30-day term.
15.2 If Customer notifies Nortel Networks less than thirty (30) days prior to
the scheduled performance date of the Services that Customer does not wish
Nortel Networks to perform such Services at the scheduled time or that the
Site is not available for the performance of such Services, Nortel Networks
shall have the right to delay the performance of the Services and Customer
shall bear all associated and documented out of pocket travel and expense
costs incurred by Nortel Networks. All such costs shall be paid in full
within thirty (30) days of Customer's receipt of Nortel Networks'
commercial invoice therefor.
15.3 Site facilities and physical specifications of equipment (including
shelters, fiber cabling, power, etc.) provided by Customer for use with the
Products sold hereunder must meet Nortel Networks' installation and
environmental Specifications. Any testing required to verify the condition
of Site facilities and any required upgrades will be at Customer's expense.
16. Termination; Survival
16.1 Without prejudice to any rights and remedies provided for hereunder, either
Party hereto may terminate this Agreement, effective immediately, upon
written notice to any other Party, upon the occurrence of any of the
following events or conditions (each, an "Event of Default"):
(i) the other Party applies for or consents to the appointment of, or the
taking of possession by a receiver, custodian, trustee or liquidator
of itself or of all or a substantial part of its property,
(ii) the other Party makes a general assignment for the benefit of its
creditors,
(iii) the other Party commences a voluntary proceeding under the
bankruptcy, insolvency or similar laws relating to relief from
creditors generally,
(iv) the other Party fails to contest in a timely or appropriate manner, or
acquiesces in writing to, any petition filed against it in an
involuntary proceeding under the bankruptcy, insolvency or similar
laws relating to relief from creditors generally, or any application
for the appointment of a receiver, custodian, trustee, or liquidator
of itself or of all or a substantial part of its property or its
liquidation, reorganization, dissolution or winding-up, or
(v) the other Party materially fails to perform any term or condition
under this Agreement or any of its Annexes, which failure continues
for a period of thirty (30) days after written notice has been given
to the breaching Party; provided, however, that if any Party exercises
its termination rights as provided in this Section 16.1 (v) after any
sale of the FWA Business by Nortel Networks, the FWA TAS Agreement,
shall automatically be terminated concurrently therewith; and
provided, further, that if any Party exercises its termination rights
as provided in this Section 16.1 (v) prior to any sale of the FWA
Business by Nortel Networks, the three other Replacement Agreements
shall automatically be terminated concurrently therewith. For the
avoidance of doubt, the Parties agree that any failure by Customer to
comply with the purchase commitment set forth in Section 19 hereof
shall be deemed material.
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16.2 In addition, and without prejudice to any rights and remedies provided for
hereunder, Nortel Networks may terminate all four Replacement Agreements,
effective immediately, upon written notice to the other Party, upon the
occurrence of any of the following events or conditions:
(i) Customer fails to make payment in accordance with the terms and
conditions hereof, which failure continues for a period of ten (10)
business days (in Mexico) after written notice to Customer,
(ii) within eighteen (18) months from the date hereof, the identity of
Customer's business materially changes by sale of its business,
transfer of control of its capital stock, merger or otherwise, unless
prior written consent therefor has been obtained from Nortel Networks;
or
(iii) the occurrence of an Event of Default under any one of the Senior
Note or the other Replacement Agreements which by the terms of such
agreements would allow Nortel Networks to declare such Senior Note due
and payable or to terminate such Replacement Agreement, as the case
may be.
16.3 The respective obligations of each Party pursuant to Sections 1, 4, 5, 6,
7, 10, 11, 12, 16 and 18 hereof, and any other obligations of each Party
pursuant to this Agreement that by their nature would continue beyond the
termination, cancellation, or expiration hereof, shall survive such
termination, cancellation, or expiration; provided, however, that if
Customer fails to make payment in accordance with the terms and conditions
hereof (subject to the cure period provided in Section 16.2 above), the
Parties expressly agree that the following Sections hereof shall not
survive such termination, cancellation, or expiration: Sections 6 and 7;
and provided, further, that Section 4 hereof shall survive such
termination, cancellation, or expiration only to the extent that Customer
is not in default of the payment of the applicable Software license fees,
if any.
17. Nortel Procedures
17.1 "Nortel Procedures" will consist of documents which describe in detail the
engineering, installation, commissioning, maintenance, troubleshooting and
operation of Product(s). The Nortel Procedures shall be provided in the
English language. Nortel Networks shall provide the Nortel Procedures in
Spanish if so published. Nortel Networks shall ship electronic
documentation containing the applicable Nortel Procedures to Customer with
the initial delivery of a system release to Customer. During the Term,
Nortel Networks shall, at no additional charge to Customer, deliver to
Customer, one set of electronic files with updates, revisions and/or
corrections of such Nortel Procedures as they become available. Customer
may order additional copies of the Nortel Procedures at Nortel Networks'
then applicable prices. Customer may use and reproduce the Nortel
Procedures in paper format for the purposes of engineering, installing,
commissioning, maintaining, troubleshooting and operating the Products,
subject to the limitations regarding Information set forth in Section 10.
Reproduction shall include the copyright or similar proprietary notices.
Customer is responsible for ensuring proper versions of the Nortel
Procedures are printed and distributed.
18. General
18.1 Customer agrees that it will not export Products procured hereunder from
Mexico without Nortel Networks' prior written consent. Nortel Networks
reserves the right to assign any portion of an Order accepted under this
Agreement, in whole or in part, provided that such assignment shall be in
compliance with the provisions of Section 20 below if such assignment falls
under the situation provided for in Section 20 of this Agreement. Customer
represents and warrants that it is buying Products and/or Services for its
own internal use and not for resale.
18.2 Customer agrees to comply with all laws applicable to it, including all
applicable export and import laws and regulations. In the event that any
provision of this Agreement or portions
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thereof are held to be invalid or unenforceable, the remainder of this
Agreement will remain in full force and effect.
18.3 The terms and conditions of this Agreement, together with the other three
Replacement Agreements and any other agreements contemplated by the Term
Sheet entered into between Customer and Nortel Networks Limited on October
12, 2002, form the complete and exclusive agreement between Customer and
Nortel Networks and replaces any prior oral or written communications and
agreements regarding the subject matter thereof.
18.4 Any changes to this Agreement must be made by mutual agreement in writing.
All Customer's rights and all of Nortel Networks' obligations are valid
only in Mexico.
18.5 The laws of the State of New York, United States of America govern this
Agreement, exclusive of its conflict of laws provisions; and nothing in
this Agreement affects any statutory rights of consumers that cannot be
waived or limited by contract. The United Nations Convention on the
International Sale of Goods shall not apply.
18.6 If, within thirty (30) days from the date of any notice of dispute from a
Party to any other Party, such Parties are unable to resolve the issue,
then either Party may initiate the binding arbitration to resolve such
dispute by written notice to such other Party upon expiration of such
thirty (30) day period. Any dispute between the Parties arising in
connection with this Agreement shall be exclusively resolved by arbitration
pursuant to the Rules of Conciliation and Arbitration of the International
Chamber of Commerce then in force. The arbitration proceedings pursuant to
this Section 18(c) shall take place in the English language in the City of
Miami, State of Florida, before a panel of three (3) arbitrators appointed
in accordance with the aforementioned rules. The decision of the
arbitrators shall be final and binding upon the Parties and their
respective successors and assigns. The decision and award rendered by the
arbitrators may be entered in any court of competent jurisdiction and any
such court may order the enforcement of such award against the Parties and
their respective successors and assigns.
18.7 EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF, OR RELATING TO, THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING ANY ORDER ISSUED AND ACCEPTED
HEREUNDER.
18.8 The following Annexes are part of this Agreement:
Annex A - Initial Order
Annex B - Change Order Procedures and Form of Change Order
Annex C - Description of Products
Annex D - Product Specifications Annex E - Order Procedure
Annex F - Prices
Annex G - Warranty Services
Annex H - Purchase Commitment
Annex I - Intentionally Left in Blank
Annex J - Delivery Times
In the event of any conflict or inconsistency between the provisions of the
body of this Agreement and its Annexes, the body of this Agreement shall
prevail.
18.9 Notwithstanding anything in this Agreement to the contrary, if the supply
of the Products or the performance of the Services by Nortel Networks, or
any portion thereof, or the performance of any other obligation hereunder
by any party is prevented, delayed, interfered with, or interrupted by
reason of a Force Majeure Event, such prevention, delay, interference, or
interruption shall be deemed not to be a default pursuant to this Agreement
and the time or
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times for such performance or supply hereunder shall be extended by the
period or periods same is so prevented, delayed, interfered with, or
interrupted. The foregoing shall apply even though any such cause exists or
is foreseeable as of the date hereof. Neither Party shall be required to
change its usual business practices or methods or to assume or incur other
than its usual costs or expenses in order to mitigate, avoid, or eliminate
any Force Majeure Event or to reduce the period of any resulting delay.
Each Party shall notify the other Parties of any delay or failure excused
by this Section 18(f) and shall specify the revised performance date as
soon as practicable. Nothing contained in this Section 18(f) shall affect
any obligation of Customer to make any payment when due in accordance with
this Agreement.
18.10 All notices pursuant to this Agreement will be in writing and deemed given
when delivered in person, by certified mail or courier service, or by
facsimile. Notices to Customer shall be sent to:
Boulevard Xxxxxxx Xxxx Xxxxx Xx. 3.33 L-1
Colonia Unidad San Xxxxx
San Xxxxx Xxxxx Xxxxxx
Nuevo Xxxx, Mexico
Attention: Director de Negociaciones Estrategicas
with a copy to the Corporate Counsel.
Notices to Nortel Networks shall be sent to:
Nortel Networks (CALA) Inc.
0000 Xxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000-0000,
Attention: Senior Counsel
with a copy to:
Nortel Networks de Mexico, S.A. de C.V.
Xxxxxxxxxxx Xxx 0000, Xxxx 00
Xxx. San Xxxx Xxxxxxxxxxx
00000 Xxxxxx, X.X.
Attn.: President
Notices from Customer to Nortel Networks pursuant to Section 5.20, shall be
sent to:
Nortel Networks de Mexico, S.A. de C.V.
Xxxxxxxxxxx Xxx 0000, Xxxx 00
Xxx. San Xxxx Xxxxxxxxxxx
00000 Xxxxxx, X.X.
Attn.: Contract Management - Axtel Project
19. Purchase Commitment
19.1 Customer hereby irrevocably agrees to purchase from Nortel Networks the
minimum annual amounts of Products as further described in Annex H hereof.
20. Assignment; Right of First Refusal
20.1 Each Party agrees not to assign or otherwise transfer this Agreement or its
rights under it, or delegate its obligations, without the other Party's
prior written consent, and any attempt to do so is void. Notwithstanding
the foregoing, Nortel Networks may assign or otherwise transfer this
Agreement or its rights under it, or delegate its obligations, to any of
its affiliates. Nortel Networks may also assign or otherwise transfer this
Agreement or its rights under it, or
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delegate its obligations, to any purchaser of the FWA Business without the
Customer's prior written consent; provided that:
(i) Nortel Networks shall provide to Customer the soliciting or offering
material used in connection with any contemplated sale of the FWA
Business (the "FWA Information") at the same time any such FWA
Information is provided to any third party potential purchaser (the
"Potential Purchasers"), subject to execution by the Parties of a
non-disclosure agreement in a form and substance reasonably
satisfactory to Nortel Networks, but no less restrictive on Customer
than the non-disclosure agreement executed with the Potential
Purchasers; and provided, however, that Nortel Networks may not offer,
solicit interest in or sell the FWA Business to any company which is a
direct competitor of Customer or does not have the necessary resources
(human and/or technical), at Nortel Networks' reasonable judgment, to
manufacture the Products and/or to provide the technical support
required by Customer, including without limitation, Telefonos de
Mexico, S.A. de C.V. or any of its affiliates (the "Restricted
Companies");
(ii) Nortel Networks hereby grants to Customer a right of first refusal
("RFR") with respect to any offer received by Nortel Networks from any
third party which Nortel Networks proposes to accept (including any
revised offers), allowing Customer to purchase the FWA Business on
terms not less favorable than such offer, subject to Customer having
made, within fourteen (14) days after Nortel Networks shall have
delivered written notice to Customer of such offer or revised offer
(the "Vendor's Notice"), a single deposit of US$4,500,000.00 (four
million five hundred thousand United States dollars) (the "Deposit")
into an interest bearing escrow account. Once Nortel Networks has
received the Deposit, Customer shall have the right to perform a due
diligence investigation of the FWA Business, and Nortel Networks shall
be obligated to promptly provide all the information and access that
Customer reasonably requires for the evaluation of the FWA Business;
and
(iii) in the event of any such sale to a purchaser other than Customer,
such new vendor shall assume all of Nortel Networks' obligations under
this Agreement.
20.2 If Customer exercises its RFR, Nortel Networks and Customer shall have
sixty (60) days from payment of the Deposit to negotiate in good faith and
enter into a purchase agreement pursuant to which Nortel Networks will sell
the FWA Business to Customer, unless a longer period of time is stated in
the offer received from the Potential Purchaser, in which case such longer
period shall prevail (the "Offer Period"). If the Parties have entered into
such an agreement by the end of the Offer Period, the Deposit shall be
credited towards the purchase price of the FWA Business. If the Parties
have not entered into such an agreement by the end of the Offer Period,
Customer shall forfeit in favor of Nortel Networks the Deposit, and Nortel
Networks shall have the right to sell the FWA Business to any Potential
Purchaser other than a Restricted Company, subject to the terms and
conditions of Section 20.3 below; provided, however, that if the terms of
the proposed sale are more favorable to such Potential Purchaser than the
best offer (from Nortel Networks' perspective) presented by Customer to
Nortel Networks during the Offer Period, then the RFR shall again apply to
such sale, but Customer shall not be obligated to provide any additional
Deposit.
20.3 If Customer shall decline in any instance to exercise its RFR or the
Parties fail to enter into the purchase agreement as described in Section
20.2, Nortel Networks shall have the right for a period of one year from
the date of such declination or failure, to sell the FWA Business to a
Potential Purchaser (except if such Potential Purchaser is a Restricted
Company) without prior notice to Customer, on terms which are not more
beneficial to such Potential Purchaser than those set forth in Vendor's
Notice. If the foregoing conditions are not met, the RFR shall again apply
to such sale; provided, however, that the 60-day term provided in Section
20.2 above shall be reduced to thirty (30) days and Customer shall not be
obligated to provide any additional Deposit.
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The Parties hereto have executed this Purchase and License Agreement for FWA
Equipment as of February 14, 2003 and it shall become effective on the Closing
Date.
AXTEL, S.A. DE C.V.
By: /S/ Xxxxxxx xx Xxxxxxxxxx
-------------------------
Name: Xxxxxxx xx Xxxxxxxxxx
Title: Legal Representative
NORTEL NETWORKS LIMITED
By: /S/ Xxxxxxx Xxxxxx-Xxxxxxxx
---------------------------
Name: Xxxxxxx Xxxxxx-Xxxxxxxx
Title: Attorney-in-Fact
NORTEL NETWORKS DE MEXICO, S.A. DE C.V.
By: /S/ Xxxxxxx Xxxxxx-Xxxxxxxx
---------------------------
Name: Xxxxxxx Xxxxxx-Xxxxxxxx
Title: Attorney-in-Fact
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