Preview of our top selling Distribution Agreement
Com21 / 3Com - Reseller Agreement
br/> RESELLER AGREEMENT
THIS AGREEMENT is by and between Com21, Inc. a Delaware corporation with principal offices at 750 Tasman Drive, Milpitas, California 95035 ("Company"), and 3Com Corporation, a Delaware corporation located at 5400 Bayfront Plaza, Santa Clara, CA 95052-8145 ("3Com"). The effective date of this Agreement shall be the date last executed below ("Effective Date").
A. Company and 3Com have entered into a Technology License and Reseller Agreement dated as of March 22, 1996.
B. Company and 3Com mutually desire 3Com to market and sell certain cable headend products and cable modem products developed by Company.
C. Company and 3Com mutually desire for Company to deposit into escrow the designs and other materials relating to such headend products, and to permit the release of said designs and other materials relating to such headend products to 3Com upon the occurrence of certain conditions, as more specifically set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and conditions contained herein, the parties agree as follows:
1. DEFINITIONS.
1.1 "Affiliate" means with respect to any person, any other person controlling, controlled by or under direct or indirect common control with such person (for the purposes of this definition "control," when used with respect to any specified person, shall mean the power to control the vote of fifty percent (50%) or more of the voting securities of such person).
1.2 "Authorized Reseller" means a reseller or distributor authorized by 3Com to distribute any of Company's Products within the Territory.
1.3 "Compatibility" or "Compatible" for the Com21 Headend initially means material compliance with the Ethernet standard interface and, approximately six (6) months from the effective date of the Technology License and Reseller Agreement, material compliance with the Fast Ethernet standard interface. "Compatibility" or "Compatible" for the Com21 Modem initially means material compliance with the Ethernet standard interface. "Material compliance" with the Ethernet or Fast Ethernet standard interface means that the Com21 Headend or Com21 Modem, as the case may be, can properly pass data with equipment that complies with such standard interface. In all instances "Compatibility" will also include compliance with the specifications entitled "The Com21 Community Protocol for HFC Networks version 1.04.05 dated January 28, 1997", as well as any other specifications mutually agreed to by the parties from time to time. Furthermore, with respect to the interoperability of the Com21 Headend Product with the 3Com Product, Compatibility shall mean the criteria used by Company (in Company's sole discretion) to determine whether the initial generation of the Com21 Modem Product properly interoperates with the initial generation of the Com21 Headend Product (including but not limited
to functionality and performance criteria).
1.4 "Com21 Headend" means the headend controller unit to be developed by Company and all enhancements, upgrades and new versions thereof that are compliant with the Com21 Community Protocol specification referenced in Section 1.3 above.
1.5 "Com21 Headend Product" shall mean the Com21 Headend and the Com21 Headend Software.
1.6 "Com21 Headend Software" means the Company network management applications programs and other Com21 Headend software in object code form described in the Design Specifications, and related documentation provided by Company and all enhancements, Upgrades, Updates and new versions thereof made available by the Company.
1.7 "Com21 Modem" means the cable modem unit to be developed by Company and all enhancements, upgrades and new versions thereof.
1.8 "Com21 Modem Product" means the Com21 Modem and the Com21 Modem Software.
1.9 "Com21 Modem Software" means the Com21 Modem image software and other Com21 Modem software in object code form described in the Design Specifications, and related documentation provided by Company and all enhancements, Upgrades, Updates and new versions thereof made available by the Company.
1.10 "Com21 Software" shall mean the Com21 Headend Software and the Com21 Modem Software.
1.11 "Confidential Information" means that information of either party ("Disclosing Party") which is disclosed to the other party ("Receiving Party") pursuant to this Agreement, in written form and marked "Confidential" or if disclosed orally, the Disclosing Party shall indicate that such information is confidential at the time of disclosure and send a written summary of such information to the Receiving Party within thirty (30) days of disclosure and mark such summary "Confidential." Confidential Information shall include, but not be limited to, trade secrets, know-how, inventions, techniques, processes, algorithms, software programs, schematics, designs, contracts, customer lists, financial information, sales and marketing plans and business information. References to 3Com as a Receiving Party or a Disclosing Party shall also include all present and future subsidiary and parent companies of 3Com.
1.12 "Design Specifications" means the final design specifications for the Products that, prior to the date of first shipment of the Products by Company to 3Com, will be incorporated into Exhibit A (Design Specifications). The Design Specifications will specify that the Com21 Headend will have the capability to recognize, load, configure and associate the appropriate modem image with the most current Version of the initial Generation and each future Generation of the 3Com Product and at least the two most recent prior Versions of each Generation of the 3Com Product, provided that the 3Com Product is compliant with the
specifications entitled "The Com21 Community Protocol for HFC Networks version 1.04.05 dated January 28, 1997", as well as any other specifications mutually agreed to by the parties from time to time. The Design Specifications will also specify that 3Com will have the ability to distribute patches, updates, upgrades and new versions of the Com21 Software and the software for the 3Com Products by making such patches, updates, upgrades and new versions available for downloading into units of the Products and the 3Com Products, as applicable.
1.13 "3Com" means 3Com Corporation and all its present and future subsidiaries and Affiliates.
1.14 "End User" means an end user who acquires a Product from 3Com or an Authorized Reseller.
1.15 "End User License Agreement" has the meaning given it in Section 3.3.
1.16 "Generation" means a substantial change in the form, fit or function of the 3Com Product, as determined by 3Com in its sole discretion.
1.17 "Inventory" means all Products which are: (a) in 3Com's custody, whether or not consigned to, or paid for by, any customer; (b) ordered by 3Com but not yet shipped by Company; (c) in transit to 3Com or from 3Com to 3Com's buyer; or (d) returned to 3Com from any customer of 3Com.
1.18 "Large Multiple System Operators" means customers or potential customers which purchase the Products and/or the 3Com Product and for which the number of homes passed exceeds one million (1,000,000) homes.
1.19 "Multiple System Operators" means customers or potential customers which purchase the Products and/or the 3Com Products and for which the number of homes passed is below one million (1,000,000) homes.
1.20 "MLOP Cost" means the materials, labor, overhead and period costs associated with supplying units of the Product.
1.21 "NFR" means "not for resale" copies of the Product, that is, the Product is used for purposes which do not directly produce revenue for 3Com (e.g., testing, evaluation, sales, marketing, engineering and demonstration purposes).
1.22 "Products" means the Com21 Headend Products and the Com21 Modem Products set forth in Exhibit B hereto, and any additional amendments thereto that may be signed by the parties and attached to this Agreement, and shall include all enhancements, fixes, Updates, Upgrades, modifications to and with respect to the Com21 Headend Products only, future versions of the Com21 Headend Products made by or for Company.
1.23 "Technology Documentation" means all designs, drawings, specifications, test information, vendor lists, source and object code versions of the software incorporated into or
used by Company to design, manufacture or maintain the Com21 Headend Products and all other data and information owned by Company or to which Company has the right to grant sublicenses with respect to the design, manufacture and use of the Com21 Headend Products. The Technology Documentation will include a list of third party technology, if any, in the Com21 Headend Products to which Company cannot sublicense the rights envisioned by the manufacturing license below, and persons at such third parties to contact regarding obtaining licenses. The Technology Documentation will further include a list of consultants, if any, whom Company reasonably believes could provide technical support to 3Com in connection with 3Com's exercising of the fights under the manufacturing license below. Attached as Exhibit F to this Agreement is a complete list of the Technology Documentation that exists as of such date. Company shall update such Technology Documentation if it updates its own archival copy of the Technology Documentation.
1.24 "Technology License and Reseller Agreement" means the Technology License and Reseller Agreement between the parties dated March 22,
1.25 "Territory" means the United States and the rest of the world.
1.26 "Update" shall mean a replacement of all or a portion of a Product that is primarily intended to fix an error or deficiency in the Product.
1.27 "Upgrade" means a replacement of all or a portion of a Product that is primarily intended to add functionality or performance to the Product and for which a separate or additional charge can be made to the End User.
1.28 "Version" means a basic change in the form, fit or function of the 3Com Product, as determined by 3Com in its sole discretion.
1.29 "3Com Product" means the initial Generation and each future Generation of the cable modem products developed by 3Com under the terms of the Technology License and Reseller Agreement and all updates, up-grades and new versions thereto.
2. APPOINTMENT.
2.1 Subject to the terms and conditions of this Agreement, Company hereby appoints 3Com as a non-exclusive reseller and distributor of Products in the Territory, and grants 3Com a non-exclusive license to use, demonstrate, sell, market, publicly perform and publicly display for marketing purposes, and distribute the Products directly or through Authorized Resellers. Said license shall include a license under all presently existing and future copyrights, patents, trade secrets and other rights necessary for 3Com and its Authorized Resellers to perform all acts contemplated herein. 3Com accepts such appointment and license and agrees to acquire the Products from Company under the terms and conditions of this Agreement.
2.2 Subject to the terms of this Agreement, 3Com shall have complete freedom to determine the manner by which it wishes to market and sell the Products.
2.3 3Com may sell the Products in the Territory directly to End Users or through Authorized Resellers. 3Com shall have sole authority to authorize Authorized Resellers in accordance with criteria determined by 3Com.
2.4 No ownership of any intellectual property rights to the Products is transferred to 3Com hereunder, all of which rights shall remain with Company or the applicable third party owner. As between the parties, Company retains all title to, and except as expressly and unambiguously licensed herein, all rights and interest in the Com21 Software and all intellectual property and proprietary rights throughout the world protecting the Products.
2.5 This Agreement shall not be construed as restricting in any way 3Com's freedom to make, use or distribute any other products, including any products which may compete with the Products. Nothing in this Agreement shall be construed as limiting in any manner Company's marketing or distribution activities or its appointment of other dealers, distributors, licensees or agents.
2.6 Subject to Section 8.12 below, Company reserves the right to change, modify or discontinue any Product at any time.
3. DUTIES AND OBLIGATIONS OF 3COM.
3.1 3Com agrees to use reasonable commercial efforts to encourage and develop the sales potential for the Products, to employ competent sales personnel to meet the demands and needs for marketing of the Products, and to encourage the purchase of the Products by Authorized Resellers and End Users.
3.2 Except as otherwise contemplated in this Agreement or the Technology License and Reseller Agreement, and except to the extent expressly prohibited by applicable law, 3Com shall not modify or reverse engineer any Product without the prior written consent of Company.
3.3 This Section 3.3 shall apply only if Company has provided an end user license agreement to be distributed with the Com21 Software. No distribution or license of the Com21 Software by 3Com shall be made except pursuant to a written agreement, whether distributed in printed or electronic form (an "End User License Agreement") that is at least as protective of Company and its rights as Company's end user software license agreement, set forth in Exhibit E (Com21 End User Software License Agreement) attached hereto. Company agrees that if it licenses Com21 Software on terms more favorable to the end user than the terms set forth in Exhibit E (Com21 End User Software License Agreement), then such more favorable terms shall automatically apply.
3.4 3Com agrees to use commercially reasonable efforts to keep Company informed as to any problems encountered with the Products and any resolutions arrived at for those problems, and to communicate promptly to Company any and all modifications, design changes or improvements of the Products suggested by any customer.
4. DUTIES AND OBLIGATIONS OF COMPANY.
4.1 With respect to each Product, Company shall provide 3Com within a mutually agreeable time, at no cost, an electronic copy of the Company's Product specifications and Product sales literature for use in 3Com's sales efforts. 3Com will be permitted to incorporate such materials into its own materials. 3Com may purchase from Company hard copies of such Company specifications and sales literature at the prices set forth in Exhibit B (Product and Price List). In its distribution efforts, 3Com will use the then current names (the "Marks") used by Company for the Products. However, all advertisements, promotional materials, packaging and anything else bearing a Mark shall identify Company as the Mark owner and unless used in substantially a form previously approved by Company, shall be subject to prior approval of Company, which approval shall not be unreasonably withheld or delayed. 3Com also agrees not to contest during or after the term of this Agreement any Mark used by Company anywhere in the world (or any name, mark or designation similar thereto) and to reasonably cooperate with Company (at Company's expense) in Company's efforts to register the Marks. 3Com shall not apply to register any of the Marks without Company's prior written consent, which consent shall not be unreasonably withheld or delayed. If Company so consents, 3Com may promptly register at its expense such Marks in the name of and for the sole benefit and ownership of Company. Company shall provide 3Com one copy of each maintenance manual, operator's manual, any other manuals for the Products and field change orders and technical bulletins incorporating engineering changes for Products. 3Com may copy and distribute such materials internally and to its Authorized Resellers.
4.2 Company shall provide 3Com within a mutually agreeable time, at Company's MLOP Cost, (a) [*] Com21 Modem Product, for use by 3Com and its Authorized Resellers.
4.3 Company shall use commercially reasonable efforts to make available, at no cost to 3Com, a reasonable number of man hours of appropriate members of Company's technical personnel to assist 3Com to keep current with the latest technological developments in the Products. Each party shall designate an appropriately trained employee as a technical liaison and apprise the other party of the liaison's name.
4.4 Company represents and warrants to 3Com that upon and after the Effective Date of this Agreement, Company will not provide any Product to 3Com which has come into physical contact with: (i) a Class I substance, as defined in Section 611 of the Federal Clean Air Act (the "Act"), during any portion of the manufacturing process; or (ii) a Class II substance, as defined in the Act and Title 40, Code of Federal Regulations, Section 82 (the "Code"), during any portion of the manufacturing process, where there has been a determination by the U.S. Environmental Protection Agency that there is a substitute product or manufacturing process for such Product which does not rely on the use of such Class II substance, that reduces overall risk to human health and the environment, and that is currently or potentially available, in accordance with the Code.
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Company further represents and warrants that 3Com shall not be subjected to any warning or labeling requirements regarding a Class I substance or a Class II substance pursuant to the Act or any regulation promulgated under the Act, as a result of any Product provided by Company to 3Com under this Agreement.
Without limitation to the foregoing, Company represents and warrants that in all respects, the manufacture and sale of the Products comply and will throughout the term of this Agreement comply with all applicable environmental laws, regulations and other regulatory requirements.
If Company discovers a breach of any of the representations and warranties in this Section 4.4. it shall immediately notify 3Com of such breach in writing, explaining the circumstances constituting the breach and identifying the Product(s) involved. Further, Company shall defend, indemnify and hold harmless 3Com and its officers, directors, employees, agents, representatives, successors and assigns from any liabilities, losses, demands, claims or judgments arising from the breach of any of Company's representations and warranties set forth in this Section 4.4.
4.5 Company shall give 3Com written notice of Product Updates, Upgrades and new versions as soon as reasonably possible, but in any event at least sixty (60) days prior to their availability to Company's customers. Such notices shall contain detail of the changes to the form, fit or function of the Product. Company shall use reasonable efforts to provide 3Com with six (6) months notice of new Products that Company elects to make available for distribution by 3Com under this Agreement. Company shall also provide 3Com at Company's MLOP Cost with NFR units of the affected Product modules so that 3Com has [*] new versions of Com21 Headend Products and future Com21 Headend Product Upgrades, one [*] Com21 Modem Products and future Com21 Modem Product Upgrades, concurrent with the providing of such notice or at the earliest possible date thereafter (but always prior to their general availability) for purposes of evaluation and testing of Compatibility with 3Com Products.
4.6 Company agrees to give sixty (60) days prior written notice to 3Com of any product being considered by Company for distribution to customers through channels other than this Agreement, which is functionally similar to any of the Products or which is designed or will be marketed as compatible with any version of the Product ("Similar Product").
4.7 For a period of twelve (12) months after delivery of each unit of the Com21 Headend or Com21 Modem, as the case may be, to the End User, Company warrants to 3Com that such Com21 Headend or Com21 Modem, as the case may be, will substantially conform to the Design Specifications and to any performance or other specifications for the Com21 Headend or Com21 Modem, as the case may be, published or made generally available by Company. For a period of ninety (90) days after installation of the Com21 Software by the End User, Company warrants that the media on which the Com21 Software is supplied will be free from defects in materials or workmanship. 3Com shall notify Company of any nonconformance during the applicable warranty period. The parties shall follow the RMA procedures set forth in Section 3.5
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(Return Material Authorization) of Exhibit C (Support Services). Company's exclusive obligation with respect to nonconforming Product shall be, at Company's option, to repair or replace such Product within the turnaround time described in Section 3.5(ii) (Turn-Around Time) of Exhibit C (Support Services), or to refund to 3Com the purchase price paid for said Product. In the event a Product completely fails to function within the first forty-eight (48) hours of installation (dead- on-arrival or DOA) and is verified as such by Company, Company shall waive any charges to 3Com in order to effect the earliest reasonable repair or replacement of such defective Product. Replacement and repaired Products shall be warranted for the remainder of the warranty period or ninety (90) days, whichever is longer. Company will upgrade repaired Product to the most recent revision level of such Product at no cost to 3Com. THE FOREGOING WARRANTIES ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTORY OR OTHERWISE, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. The above warranty does not extend to any Product that is modified or altered by any party other than Company or other than pursuant to Company's recommendations, is not maintained to Company's maintenance recommendations, is operated in a manner other than that specified by Company or is treated with abuse, negligence or other improper treatment (including, without limitation, use outside the recommended environment). 3Com's sole remedy with respect to any warranty or defect is as stated in this Section 4.7.
4.8 Company shall provide statistics on Product no problem found (NPF) returns on a quarterly basis. During the Warranty Period, Company shall waive any NPF charges on in- warranty Products returned for repair. In the event that (a) NPF returns of a Com21 Headend Product exceeds twenty-five percent (25%) of the calendar quarter in-warranty returns of such Com21 Headend Product or (b) NPF returns of a Com21 Modem Product exceeds ten percent (10%) of the calendar quarter in-warranty returns of such Com21 Modem Product, both parties agree to work together to reduce the frequency of NPF returns of such Product.
4.9 "Epidemic Failure" shall mean substantial deviations in a Product not modified by the Company or with the Company's authorization from the Design Specifications which significantly impair the use of such Product existing at the time of delivery but which are not reasonably discernible at that time and which are evidenced by an identical. repetitive defect due to the same cause and occurring in the same series of the Products.
In the case of an Epidemic Failure, Company's obligations shall be, as soon as practical, to propose an action plan to fix the failure of any affected Products and to implement this action plan upon 3Com's acceptance thereof. If the action plan is not acceptable to 3Com, 3Com can require Company to repair or replace, at Company's option, the affected Products. The repair or replacement shall be done at mutually agreed-upon location(s); provided, however, that costs of repair or replacement together with the shipping, transportation and other costs of gathering and redisseminating the Products shall be borne by Company. The parties agree to make commercially reasonable efforts to complete the repair or replacement of all of the affected Products within four (4) weeks after written notice of Epidemic Failure by 3Com to Company.
4.10 Company shall provide Authorized Resellers and End Users of the Products with warranty, maintenance and support services as provided herein.
5. SOFTWARE LICENSE
5.1 Subject to the terms and conditions of this Agreement, Company grants to 3Com a nonexclusive, nontransferable, worldwide, royalty-free license to reproduce and distribute to 3Com's customers object code versions of the Com21 Software for the Products and any patches, Updates, Upgrades and new versions thereto.
5.2 Company will deliver each patch, Update, Upgrade or new version of the Com21 Software for the Product to 3Com in a mutually agreed upon format no later than the date that Company first makes such patch, Update, Upgrade or new version available to Company's own customers, subject to the terms and conditions of Section 4.5.
6. TESTING AND MODIFICATION OF THE PRODUCTS.
6.1 As soon as reasonably possible after receipt of 3Com's written request, Company shall submit [*] to 3Com at Company's MLOP Cost for Compatibility testing as provided in Section 6.2 below. At 3Com's request, Company shall provide 3Com with up to [*] NFR receive modules for each sample at Company's MLOP Cost.
6.2 3Com shall test such samples and notify Company in writing within sixty (60) days after receipt of the samples if the samples fail to materially comply with the Design Specifications or fail to be Compatible (each, a "Nonconformity"). Failure to so notify Company within said sixty (60) days shall be deemed to be acceptance of such samples. Such notice shall describe the Nonconformity in enough detail for the Company to reproduce such Nonconformity. Within thirty (30) days after receipt of such notice of Nonconformity, Company shall modify the Products to correct such Nonconformity and shall promptly resubmit four (4) samples of the redesigned Product (if such modified Product is a Com21 Headend Product, one (1) unit will have a fully-loaded configuration (i.e., all optional slots are filled with a combination of receive modules or 10Base-T modules, as determined by 3Com) and three (3) units will have a configuration containing at least one (1) receive module) to 3Com at no cost for re-testing. If 3Com rejects such redesigned Products due to a Nonconformity, the parties shall repeat the procedures set forth up to two more times, if necessary.
If after the third delivery of samples to 3Com as set forth above, the samples contain a Nonconformity, then within ten (10) days of 3Com's written request, the parties will choose in -good faith an independent consulting firm acceptable to both parties (which acceptance will not be unreasonably withheld) to determine whether it is feasible to correct such Nonconformity. If the parties are unable to agree upon such independent consulting firm within such ten (10) day period, Company shall choose an independent consulting firm reasonably acceptable to it within ten (10) days after the expiration of such ten (10) day period. The parties agree that time is of the essence in the selection of such independent consulting firm. Unless otherwise agreed by the
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parties, the consultant shall be certified as a professional engineer in electrical engineering. Such consulting firm shall agree in writing to keep confidential the information disclosed to it by Company and 3Com. For purposes of this Section 6.2, a consulting firm will be deemed to be "Independent" if it does not have a material interest (financial or otherwise) in either party, it does not have any ongoing work with either party and its fees are not contingent on the results of such feasibility determination.
Such firm will be instructed to make its decision in writing within thirty (30) days of being retained. Each party will fully cooperate with the consulting firm, will equally bear such firm's fees and expenses and will not take any action against such firm relating to its review or decision. If the consulting firm decides that the correction of the Nonconformity is feasible, then 3Com may immediately terminate this Agreement for Company's default and declare that an Event of Escrow Release (as defined in Section 16.1 (Technology Escrow and Manufacturing License)) has occurred. If the consulting firm decides that the correction of the Nonconformity is commercially not reasonably feasible, then 3Com may terminate this Agreement but such termination shall not constitute an Event of Escrow Release.
6.3 The parties agree to meet quarterly to discuss the states and direction of Company's design and development of the Products and to assess how 3Com could assist to accelerate and enhance such design and development. During such status meetings, 3Com shall report to Company regarding changes to the design and functionality of the Products requested or suggested by Large Multiple System Operators and Multiple System Operators. For any given change so requested or suggested, if such change is requested or suggested by (i) one (1) Large Multiple System Operator, or (ii) by a combined total of any five (5) Large Multiple System Operators and/or Multiple System Operators, Company and 3Com will meet to discuss in good faith whether such change is reasonably feasible to implement and when such change could be implemented. Each Product developed as a result of such discussion shall be subject to Compatibility testing as provided in Section 6.2 above.
6.4 Company at its expense shall implement any modifications necessary to maintain the Compatibility of the Products. The design and manner of implementation of such modifications shall be in Company's sole discretion. Company shall implement such modifications and [*] case may be, to 3Com at Company's MLOP Cost for testing within sixty (60) days after making any mutually agreeable changes to the Design Specifications, or such other time frame as may be mutually agreed in writing. Section 6.2 above shall apply to such modified Products, or the applicable module of such modified Products.
6.5 Subject to Company's agreements with its subcontract manufacturers, 3Com shall have the right to perform vendor audits of manufacturing processes at Company's manufacturing and subcontract manufacturing facilities upon reasonable advance written notice, and Company shall reasonably cooperate with 3Com in that regard. If an inspection or test is
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made on Company's premises, Company shall provide 3Com's inspectors with reasonable facilities and assistance. Each party will bear its own expenses with respect to such audits.
7. PRICE AND PAYMENT.
7.1 The price to 3Com for the Products are set forth in Exhibit B (Product and Price List). The prices for additional Products to be covered by the Agreement shall be set forth in amendments to Exhibit B (Product and Price List). Company represents and warrants that, at the date of this Agreement, the prices set forth herein will not exceed those charged to any other customer of the Company purchasing the Products or products similar or equivalent thereto in similar channels and in similar quantities. If at any time, Company offers lower prices to any other customer for such similar or equivalent products on similar terms or on terms less favorable to Company, taken as a whole, Company shall immediately notify 3Com and offer such more favorable terms to 3Com effective as of the date such prices were offered to such other customer (provided 3Com adopts any and all minimum purchase commitments imposed upon such other customer). Any consideration provided to Company hereunder for Products delivered to 3Com prior to such date shall be non-refundable and non-creditable. Any other changes to the price paid by 3Com for the Products and prices for Upgrades shall be mutually agreed upon in writing.
7.2 Payment for Products ordered pursuant to this Agreement shall be net thirty (30) days after the last to occur of (a) receipt of the Product by 3Com at the point of delivery, or (b) receipt by 3Com of Company's correct invoice.
7.3 Company shall provide 3Com with thirty (30) days prior written notice of any price increases. In the event of a price decrease, all 3Com orders not yet shipped or in transit will be invoiced at the decreased price. Orders issued by 3Com after the date of the price decrease will be invoiced at the decreased price. Company shall also provide price protection on Products in 3Com's inventory purchased within the then current leadtime for such Products. In the event of a price increase, the new prices will apply to all orders accepted by Company after the notice period. In the event of a price increase, upon 3Com's request, Company shall furnish 3Com with Company's written cost-based justification for the Products documenting the reason for such price increase.
7.4 The prices for the Products are exclusive of all federal, state or local sales, use, excise, ad valorem, export, import or value-added taxes. 3Com agrees to pay such taxes unless 3Com has provided Company with a valid exemption resale certificate, or unless 3Com is otherwise exempt. In addition, 3Com shall pay all duties, import licenses, fees, tariffs and other similar expenses incurred by Company in making international shipments hereunder.
7.5 Notwithstanding any provision of this Agreement, 3Com is free, in 3Com's sole discretion, to distribute the Products at any price.
8. ORDERS AND RETURNS.
8.1 3Com shall provide Company with a [*] nonbinding, forward looking, rolling unit order forecast and update such forecast on a monthly basis. Company shall
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use such forecast for internal planning requirements only. Such forecast does not represent any commitment by 3Com to purchase Products. Further, Company shall treat all such forecasts as Confidential Information in accordance with Section 13 (Confidential Information) below.
8.2 Orders for Products must be in the form of written or electronically transmitted purchase orders. Neither party shall have any obligation to the other based on an orally transmitted order. In the event of a conflict between the terms of this Agreement and the terms of a purchase order or purchase acknowledgment, the terms of this Agreement shall govern. No minimum order quantities shall be required. Invoices by Company shall be in duplicate and shall include purchase order number, line item number, part number, description of items, quantities, unit price, and extended totals. Payment shall not be deemed to constitute acceptance.
8.3 3Com shall submit binding purchase orders to Company at least ninety (90) days prior to the requested delivery date. ne parties agree to meet quarterly to discuss Company's efforts to reduce leadtimes for Products. 3Com's order shall automatically be deemed accepted upon receipt by Company. Company shall notify 3Com within two (2) business days after receipt of an order if Company anticipates any problem in shipping the quantity of Product ordered on the time schedule set forth below or in the order. Company shall ship all Com21 Modem Products ordered by 3Com within ninety (90) days of receipt of the order or as otherwise specified in the order. Company shall ship all Com21 Headend Products ordered by 3Com within ninety (90) days of receipt of the order or as otherwise specified in the order; provided however that if (a) the number of units of Com21 Headend Products ordered for delivery in the month for which delivery has been requested is greater than [*] the number of units of such Products forecasted by 3Com for the month in which delivery has been requested and (b) such number of units ordered over the forecasted number is greater than [*], then Company shall be obligated only to use commercially reasonable efforts to ship such Com21 Headend Products ordered by 3Com within ninety (90) days of receipt of order or as otherwise specified in the order.
8.4 The quantity of goods on the face of the purchase order must not be exceeded without written approval from 3Com. 3Com will pay for maximum quantities ordered. Overshipments will be held at Company's risk and expense for a reasonable time awaiting shipping instructions. Return shipping charges for excess quantities will be at Company's expense.
8.5 3Com shall have right to defer the shipment of all or part of any order prior to the estimated shipping date by giving Company written notice of the revised planned shipment date, subject to the following conditions:
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