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EXHIBIT 10.2.7
Confidential: Use of disclosure of this document is subject to the restriction
on the Confidentiality Statement.
AMENDMENT
TO
IDEN SUBSCRIBER SUPPLY AGREEMENT
BETWEEN
MOTOROLA, INC.
AND
NEXTEL COMMUNICATIONS, INC.
This Amendment is between Motorola, Inc. a Delaware corporation
("Motorola") and Nextel Communications, Inc. ("Customer") and amends the
iDEN Subscriber Supply Agreement dated as of November 4, 1991, as heretofore
amended, modified, supplemented or otherwise revised ("Supply Agreement").
WHEREAS, the parties have mutually agreed to enter into this
Amendment to the Supply Agreement in order to encourage efforts to enhance the
reputation of iDEN in the United States market place by establishing improvement
plans for iDEN subscriber delivery, and
WHEREAS, this Amendment shall set forth the Rebate Program under the
Supply Agreement.
NOW THEREFORE, in consideration of their mutual promises set forth
herein and for other good and valuable consideration received by each of them,
the parties agree to amend the Supply Agreement by adding the following new
Sections to the Supply Agreement:
(A) Customer shall be entitled to the below stated rebate(s) upon the purchase
of the required number of subscriber units set forth below:
Column 1 2 3 4
Year Required # of Subscriber Units Rebate Per Subscriber Reduction
---- ------------------------------ ------ ------------------------
1999 [ * ] [ * ] [ * ]
2000 [ * ] [ * ] [ * ]
2001 [ * ] [ * ] [ * ]
2002 [ * ] [ * ] [ * ]
2003 [ * ] [ * ] [ * ]
(i) If, during the relevant year, the required number
of subscriber units set forth in Column 2 of the table
above is not reached, the rebate amount for such year
set out in Column 3 of the table above shall be reduced
on a per subscriber basis in the amount set forth in
Column 4 of the table above for each subscriber unit
that Customer falls short of [ * ] for the relevant
year. The Column 2 number is the minimum number of
subscribers to qualify for this rebate only. To the
extent that Customer has agreed to a higher minimum
purchase quantity
Motorola/Nextel Equipment Purchase Agreement
* Confidential portions omitted and filed separately with the
Commission pursuant to an application for confidential treatment pursuant to
Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.
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Confidential: Use of disclosure of this document is subject to the restriction
on the Confidentiality Statement.
during any relevant period elsewhere, then this Section
shall in no way modify such agreement.
(ii) The rebate shown in Column 2 of the table above shall be
the maximum rebate paid under this Amendment. Subscriber
shipments in excess of [ * ] in any year will not result
in any increase in the rebates defined above.
(iii) The [ * ] unit commitment per year is based upon
Motorola subscriber units remaining competitive in price
with iDEN subscriber units with similar features
manufactured by other parties. If at any time Customer
believes Motorola subscriber units are not competitive
with other iDEN subscriber manufacturers, Customer shall
notify Motorola and provide documentation of price
differential. The parties shall then agree on actions to
remedy the deficiency. If the parties can not agree on a
course of action to make Motorola competitive, the
subscriber units with similar features and comparable
quality manufactured by third parties shall count
towards the [ * ] unit commitment.
(iv) If, for any reason, Motorola fails to ship subscriber
units that were ordered by Customer (and other
qualifying purchasing entities) per agreed upon shipment
lead times in any year, the orders that Motorola failed
to ship shall be added to shipment quantities for the
purpose of meeting the [ * ] unit commitment set forth
in Column 2 in the above table. If Customer requests
such adjustment to shipment quantities in any year,
those units will count in the year of order and will be
excluded from the shipments in the subsequent year.
(v) Purchases by Customer of subscriber units from a
Motorola licensed alternate supplier of subscriber units
that contain at least [ * ] of their product cost value
from Motorola manufactured or assembled parts shall
count towards the required number of subscriber units
set forth in Column 2 above.
(vi) [ * ]
(B) [ * ]
(i) [ * ]:
(a) [ * ]
(b) [ * ]
(c) [ * ]
(d) [ * ]
(e) [ * ]
(ii) [ * ]
(iii) [ * ]
[ * ]
Motorola/Nextel Equipment Purchase Agreement
* Confidential portions omitted and filed separately with the
Commission pursuant to an application for confidential treatment pursuant to
Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.
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Confidential: Use of disclosure of this document is subject to the restriction
on the Confidentiality Statement.
(iv) [ * ]
(v) [ * ]
(C) [ * ]
(i) [ * ]
(ii) [ * ]
[ * ]
The Supply Agreement shall remain in full force and effect except as expressly
amended hereby. This Amendment is effective as of January 1, 1999 with respect
to and for all purchases of subscriber units accruing on or after such date.
Motorola/Nextel Equipment Purchase Agreement
* Confidential portions omitted and filed separately with the
Commission pursuant to an application for confidential treatment pursuant to
Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.
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Confidential: Use of disclosure of this document is subject to the restriction
on the Confidentiality Statement.
IN WITNESS WHEREOF, this Amendment has been executed and delivered
by the parties set forth below.
MOTOROLA, INC. NEXTEL COMMUNICATIONS, INC.
By:/s/ Charles F. Wright By:/s/ Stephen Taylor 12/29/99
----------------------------- -----------------------------------
(Authorized Signatory) (Authorized Signatory)
Name: Charles F. Wright Name: Stephen Taylor
Title: Sr. V.P. & G.M. CSG-NA Title: V.P. - Supply Chain Management
Motorola/Nextel Equipment Purchase Agreement
Commission pursuant to an application for confidential treatment pursuant to
Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.