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EXHIBIT 10.17
THIRD ADDENDUM TO PROCUREMENT AGREEMENT
BETWEEN
SPRINT/UNITED MANAGEMENT COMPANY
AND
CIENA CORPORATION
This Third Addendum to Procurement Agreement (the "Addendum") is executed this
* day of * and is effective as of the * day of * (the "Effective Date"), by and
between Sprint/United Management Company, a Kansas corporation, having its
principal place of business at 2330 Shawnee Mission Parkway, Westwood, Kansas
66205 (hereinafter referred to as "Sprint") and CIENA Corporation, a Delaware
corporation, having its principal place of business at 1201 Winterson Road,
Linthicum, Maryland 21090 (hereinafter referred to as "CIENA"), as an addendum
to that certain Procurement Agreement KC103251ML dated December 14, 1995,
between Sprint and CIENA (the "Agreement"). Except as otherwise indicated,
defined terms in this Addendum have the same meaning as in the Agreement, as
amended through the Second Addendum.
A. BACKGROUND
1. Pursuant to the Agreement, Sprint has been purchasing and CIENA has been
supplying Deliverables.
2. Sprint and CIENA implemented a special purchasing arrangement in November
1996 for purchases in 1997, which arrangement was memorialized by that
certain First Addendum to Procurement Agreement between Sprint/United
Management Company and CIENA Corporation dated November 7, 1996 (the "First
Addendum"). The parties implemented a special purchasing arrangement in March
1998 for purchases in 1998, which arrangement was memorialized by that
certain Second Addendum to Procurement Agreement between Sprint/United
Management Company and CIENA Corporation dated March 10, 1998 (the "Second
Addendum"). The Procurement Agreement, First Addendum and Second Addendum
shall constitute the "Agreement".) The parties now desire to implement this
Third Addendum.
3. Sprint contemplates purchasing new Deliverables (Addendum Deliverables as
defined below) from CIENA *.
4. Except as amended by this Third Addendum, the Agreement shall remain in full
force and effect.
Now, therefore, in consideration of the foregoing premises, the parties agree as
follows:
B. ADDENDUM
1. DEFINITIONS.
1.1 "Addendum Deliverables" means Deliverables ordered during the Addendum Term
and the training services specified herein. Addendum Deliverables shall not
include orders for installation services, emergency technical and support
services.
1.2 "Addendum Term" means the period from * through *. "Addendum
Deliverables Schedule" means *. The Deliverables Schedule is incorporated
by reference into this Addendum as Exhibit F.
1.3 "Addendum Deliverables Schedule" means *.
1.4 "Preferred Provider" means *.
2. PREFERRED PROVIDER.
Sprint designates CIENA as its Preferred Provider during the Addendum Term.
* The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission.
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3. PRICES, QUANTITIES AND DELIVERY SCHEDULES.
(a) Section 2.1 of the 1998 Agreement is deleted in its entirety and replaced
with the following:
(1)During the Addendum Term, Sprint shall furnish Supplier a monthly
Projection Schedule ("Schedule") setting forth a rolling twelve (12)
month forecast of the respective quantities of each type of Addendum
Deliverable that Sprint then estimates it will require for each month
in the immediately succeeding twelve (12) month period. Sprint and
CIENA shall meet on a monthly basis to review Sprint's issuance of
Purchase Orders for the Addendum Deliverables, and CIENA's deliveries
of same, each in relation to the Addendum Deliverables Schedule.
(2)The Addendum Deliverables Schedule, which is set forth and
incorporated as Exhibit F, is Sprint's *. Except as specifically
provided in Section 4(a) below, CIENA acknowledges that such forecast
is not a commitment and may change from time to time.
(b) Section 3.1, Exhibit "C" pricing * is deleted in its entirety and
replaced with the new Exhibit C "New Pricing", which is set forth and
incorporated herein by reference, *.
(c) Section 13.10 in the 1998 Agreement and the related portions of Exhibit C
thereto * are hereby deleted and replaced by Exhibit D attached hereto,
which refers to Supplier's 96 channel system.
(d) CIENA will provide Sprint, *.
4. ADDITIONAL COMMITMENTS OF THE PARTIES.
(a) Sprint shall order *. Any unfilled purchase orders issued prior to
execution of this Addendum as identified below will be priced *.
*
(b) * training services during the Addendum Term; provided, however, that
Sprint shall pay or reimburse CIENA for travel, meals and lodging
expenses for CIENA employees performing training services for Sprint
during the Addendum Term at a location other than CIENA's training
headquarters in Linthicum, Maryland.
(c) *.
(d) In the event of force majeure affecting CIENA's manufacturing capacity or
delivery capability, Sprint shall thereupon have the first priority on
CIENA's manufacturing output for so long as necessary to fill Sprint's
orders which were pending at the time of the force majeure or otherwise
scheduled in accordance with the Addendum Deliverables Schedule. *.
(e) * Addendum Deliverables for use on dispersion shifted fiber ("DSF") shall
be as set forth in Exhibit E.
(f) *.
(g) Any successors or assignees of Sprint or CIENA must honor all the terms
and conditions of the Agreement and this third Addendum.
5. GENERAL
Except as amended by this Third Addendum, the 1998 Agreement shall remain in
full force and effect. In the event of a conflict between the terms of the 1998
Agreement and this Third Addendum, this Third Addendum will control.
This Third Addendum is executed by authorized representatives of Sprint and
CIENA and is made a part of and incorporates the terms and conditions of the
1998 Agreement.
* The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission.
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IN WITNESS WHEREOF, the parties hereto have caused this Third Addendum to
be executed by their duly authorized representatives as of the day and year
below written.
CIENA CORPORATION SPRINT/UNITED MANAGEMENT COMPANY
By: By:
-------------------------------- ----------------------------------
Title: Title:
--------------------------- ------------------------------
Date: Date:
----------------------------- ------------------------------
Attachments:
Exhibit F - Addendum Deliverables Schedule
Exhibit C - * Pricing
Exhibit D - MW 9600 *
Exhibit E - CIENA Plan *
* The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission.
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