PURCHASE AGREEMENT
This Purchase Agreement ("Agreement") is entered into between AMP Incorporate, a
Pennsylvania corporation, with its principal place of business in Harrisburg,
PA, on behalf of itself and its subsidiaries and affiliates ("AMP"), and
FiberCore, Inc., a Nevada corporation, with its headquarters in Sturbridge, MA
("Seller"). An affiliate of AMP is an entity in which AMP has a controlling
interest.
The background of this Agreement is as follows:
A. Seller manufactures and sells glass optical fiber for fiber optic cable.
B. AMP purchases fiber optic cable from third parties and intends to
manufacture fiber optic cable.
C. AMP wants to purchase glass optical fiber from Seller, and Seller wants to
sell glass optical fiber to AMP.
In consideration of the mutual promises and obligations set forth in this
Agreement and intending to be legally bound, AMP and Seller agree as follows:
SECTION I
SCOPE
A. This Agreement and its exhibits incorporate all the terms and conditions
agreed upon by AMP and Seller for the purchase of the glass optical fiber
described in the attached Exhibit A ("Product(s)").
B. As to AMP, this Agreement will apply to Product purchased directly by AMP
or a subsidiary or affiliate of AMP via a Purchase Order (as defined below)
or to Products that have been incorporated into fiber optic cable
subsequently purchased by AMP from a third party. As to third parties,
Seller will separately negotiate prices and terms and conditions of sale
with third parties for all Products purchased by third parties.
SECTION II
PURCHASE PERIOD
The initial term of this Agreement will be from the latest signature date to
December 31, 2000. Unless AMP provides Seller with a written notice o f its
intent not to renew this Agreement at least 6 months prior to the end of the
initial term, this Agreement will be automatically renewed for an additional
five year term. After the second five year term, either party can terminate this
Agreement for any reason, either with or without cause, by
giving the other party six months prior written notice. For any such nonrenewal
or termination, each parts will be liable to the other party as described in
Section X.
SECTION III
PRICING
A. The initial prices for the products and the discounts during 1996 are
described in Exhibit A.
B. The prices can be adjusted as described in Exhibit A if the combined price
for all the raw materials described in Exhibit A change by more than 7% and
if the party requesting an adjustment provides the other party with 60 days
prior written notice.
C. On January 1st and July 1st of each calendar year, either party can request
that the prices for the Products be adjusted. The revised prices will be
the higher of Seller's then-current prices for the Products given to
customers who order Products at the highest volumes (the "High Volume
Price") less the discount described in Section III, or Seller's
manufacturing material, labor and overhead costs plus 15%, but in no event
will the revised prices be more than the High Volume Price. The High Volume
Price must be equal to or lower than the lowest bona fide long-term price
charged by a major supplier of fiber for purchases at the highest volumes.
No price change will take effect prior to 30 days after the parties have
signed a new Exhibit A reflecting the price change.
D. No price increase will apply to any Purchase Order which is received by
Seller prior to the effective date of any price increase and which is
scheduled for delivery within 2 months of the effective date of any price
increase. If, after the effective date of any price increase, AMP makes any
addition or other change to a Purchase Order that would otherwise be priced
at the old price, then that Purchase Order will be priced at the new price.
If AMP needs a longer price protection period, then Seller will negotiate
such periods with AMP on a case-by-case basis.
E. If Seller sells any product identical or substantially similar to a Product
to any other customer at a lower price for the same or less quantity than
the price then in effect under this Agreement, then the price under this
Agreement will be reduced to the lower price for all comparable quantities
under outstanding Purchase Orders and subsequent Purchase Orders as long as
the lower price to the other customer continues to be offered.
F. Seller will pay rebates to AMP for all Products purchased and paid for by
third parties that are incorporated into fiber optic cable that is
subsequently purchased by AMP during the term of this Agreement.
1. The rebate will be calculated by multiplying the quantities of Product
so incorporated and purchased by the discount described in Exhibit A
from
the then-current price for purchases by AMP. If Seller grants a
discount to induce a third party fiber optic cable manufacturer to
purchase Products, then the discount described in Exhibit A on fiber
optic cable that is subsequently purchased by AMP from such third
party, but in no event will the discount to AMP be reduced by more
than 30%.
2. Seller will estimate the amount of the rebate each month and remit
such amount to AMP within 30 days after the end of each month. Seller
and AMP will meet at the end of each calendar quarter to review AMP's
records relating the quantities of fiber optic cable purchased from
various third parties and Seller's records relating to the quantities
of fiber sold to various third parties and to reconcile the amount of
the rebate during that calendar quarter. If the amount remitted by
Seller is less than the reconciled amount, then Seller will promptly
pay the amount of the shortfall to AMP. If the amount remitted by
Seller is greater than the reconciled amount, then AMP will promptly
pay the amount of the overage to Seller. Each party will have the
right, at its own expense, to audit such records of the other party by
an independent auditor once a calendar quarter by providing 10 days
prior written notice. AMP will waive the first $1200 in rebates in
exchange for a reasonable amount of mechanical samples.
SECTION IV
QUANTITY AND DELIVERY
A. On January 1st and July 1st of each calendar year, AMP will provide Seller
with a forecast of its requirements for Products from Seller for both
direct purchases by AMP and purchases of fiber optic cable by AMP from
third parties for the following 2 calendar years. AMP can increase its
forecast by 25% at any time by providing Seller with 1 year's prior written
notice, and Seller will obtain or maintain the capacity to meet such
additional forecasted amounts. Any quantity so forecasted by AMP are good
faith estimates only.
B. If Seller has capacity to manufacture glass optical fiber that is not
already being used to meet AMP's forecasted requirements for both direct
purchases by AMP and purchases of fiber optic cable by AMP from third
parties or to meet the requirements of another customer of Seller (i.e.,
additional capacity), then Seller will make such capacity available to AMP
if requested by AMP in writing.
C. AMP is Seller's preferred customer. In the event that demand for Products
by Seller's customers exceeds Seller's ability to meet such demand, Seller
will first meet AMP's Purchase Orders (as described in Section IV.E.), and
AMP's forecasted requirements (as described in Section IV.A.), subject to
Seller's rights
to contract with other customers to supply products using capacity not
otherwise committed to or reserved for AMP under this Agreement.
D. Except for 1996, AMP intends to purchase at least 50% of its global
requirements for glass optical fiber during the initial term from Seller,
either via direct purchases by Purchase Orders or via purchases of fiber
optic cable by AMP from third parties; subject, however, to Seller
substantially meeting all of its material obligations under this Agreement,
including, but not limited to, Seller's pricing, delivery, quality and
intellectual property obligations; and further subject to the willingness
of customers of AMP to purchase products containing glass optical fiber
from Seller. Beginning on July 1, 1997, on January 1st and July 1st of each
calendar year, AMP will provide Seller with a report describing AMP's total
purchases of glass optical fiber from all suppliers during the previous 6
months. Subject to Seller substantially meeting all of its material
obligations under this Agreement, including, but not limited to, Seller's
pricing, delivery, quality and intellectual property obligations, and
further subject to the willingness of customers of AMP to purchase products
containing glass optical fiber from Seller, if AMP's actual purchases of
Products from Seller are less than 50% of AMP's total purchases of glass
optical fiber from all suppliers, then, as Seller's sole and exclusive
remedies. Seller can either terminate this Agreement by providing AMP with
90 days prior written notice or reduce the amount of the discount described
in Section III for the previous 6 month period (i.e., January 1st to June
30th or July 1st to December 31st) by 50%. On purchases of Products during
the previous 6 month period, either directly from Seller or via purchases
of fiber optic cable by AMP from third parties for which AMP received a
rebate, AMP will reimburse Seller for the amount of the reduction.
Notwithstanding anything in this Section to the contrary, in no event will
the remedies of this Section or any other remedies of Seller apply if AMP's
actual purchases of Products from Seller are less than 50% of AMP's total
purchases of glass optical fiber from all suppliers because AMP's demand
for glass optical fiber exceeds the forecasts described in Section IV.A.,
and if Seller does not have the capacity to meet such increased demand and,
if such increased demand is due to an acquisition, AMP is no longer subject
to contractual purchase obligations to third parties for glass optical
fiber arising from the acquisition.
E. Purchases will be authorized only upon issuance by AMP of a purchase order
("Purchase Order(s)"). At the beginning of each calendar quarter, AMP will
provide Seller with a Purchase Order for Products to be delivered to AMP
during the next 6 months. AMP may, without cost or liability, at any time
reschedule delivery within each 6 month period provided that delivery is
taken during the 6 month period.
F. Purchase Orders may be provided by AMP via electronic data interchange
(EDI), facsimile or United States mail.
G. The Lead Time for Product is shown in the attached Exhibit A. The elapsed
time beginning when AMP places a Purchase Order and ending when the Product
contained in that Purchase Order is received at the proper AMP location is
the "Lead Time." Proper scheduling requires any delivery time to include
the Lead Time.
H. Purchase Orders will state AMP's required delivery time for Products. Time
and rate of delivery are of the essence for all purchases made under this
Agreement. For Product to be considered on time, it must be shipped so as
to arrive within the delivery window requested by AMP, currently +5 days
early/-0 days late, under normal shipping circumstances. Seller will be
responsible for extraordinary freight costs in the event that such costs
are incurred by Seller to ensure Product is received by AMP per the
delivery time in the event Seller does not satisfy the above shipping
requirements.
I. All shipments will be made F.O.B. Seller's factory. AMP shall assume title
and responsibility for Product once it leaves Seller's factory and shall be
responsible for all freight, insurance and handling charges.
SECTION V
PAYMENT
AMP will issue payment no later than 30 days from the date of receipt of a
correct Seller's invoice for Product or services accepted by AMP.
SECTION VI
SELLER TESTING, STANDARDS AND QUALITY
A. Seller will test and inspect all Product according to the quality control
procedures described in the attached Exhibit B to ensure conformance to the
specifications described in Exhibit B ("Specifications"). Seller will
provide the quality control records and test data for each Product in
electronic form with shipment.
B. Seller agrees to bar code per AMP Specification ______utilizing Code 3 of 9
symbology in the Automotive Industry Action Group (AIAG) format on all
product packaging and parts as appropriate.
C. Seller agrees to participate in AMP's assessment of Seller's quality
management system by completing a self-assessment compiled and administered
by a third party consultant hired by AMP. The cost of the assessment will
be born in part by Seller and in part by AMP, provided that the annual cost
for such assessment does not exceed $5,000.
SECTION VII
INSPECTION BY AMP
A. All Product is subject to acceptance by AMP. Product may be inspected and
tested by AMP for conformance to the requirements of this Agreement and any
Purchase Order prior to acceptance, but such inspection and testing will
not relieve Seller of its obligation to delivery Product in conformance to
such requirements. If Product fails to meet such requirements, then AMP, at
its option, may reject such Product or require its prompt repair or
replacement, all at Seller's expense.
B. In the event Product does not conform to such requirements, then Seller
will have 45 days from the date non-complying Product is returned to
Seller's plant to correct the deficiency. If the deficiency is not
corrected, then AMP will have the option to cancel the Purchase Order, but
only as to the affected Product.
C. Certain Product is designated as Certified Product which is not required to
be inspected and tested by AMP upon receipt at an AMP receiving location
according to AMP Specifications 102-33, 102-37 or their equivalents.
Certified Product is accepted by AMP upon receipt of the Certified Product
at the AMP receiving location. Acceptance is subject to revocation if the
Product is found to be nonconforming upon attempted use in AMP's
manufacturing process. Once discovered, any Certified Product found to be
nonconforming would be subject to inspection and/or testing by AMP
according to procedures documented in AMP specification 102-1391.
SECTION VIII
WARRANTY
Seller warrants all Product as described in the attached Exhibit C.
SECTION IX
CHANGES
AMP may, by providing 90 days written notice, make reasonable changes, within
the scope of this Agreement and any Purchase Order, regarding, but not limited
to, specifications, designs, drawings, methods of shipment, packaging and/or
place of delivery. Seller may not make such changes to any of the processes,
material, testing or location of manufacture, without first obtaining the
express written consent of AMP. If any changes cause changes in cost of or time
required for Seller's performance under this Agreement or a Purchase Order, the
parties will agree in writing to an equitable adjustment in the price (subject
to Section III) and/or delivery schedule.
SECTION X
TERMINATION
A. In addition to any other remedies available to AMP in law or equity, AMP
may terminate this Agreement under the following circumstances.
1. Seller fails to supply Products as warranted or that meet the
Specifications, and fails to cure such breach within 45 days after
receiving a written notice from AMP.
2. Seller's lot acceptance or received on time percentages for Product
falls below those called for in Section 5.1 of AMP Specification
102.47 (Rev. F, updated 03/17/95), and is not corrected as provided by
the specification. Seller acknowledges receipt of the specification.
Measurement of this performance will be in accord with the
specification, and Seller will have 6 months to bring its performance
to the stated acceptable level after notice as provided in Section 5.2
of the specification. The percentages stated in Section 5.1 of the
specification for 1993 will be applicable through 1996.
3. Upon 120 days prior written notice if AMP no longer needs the
Products.
4. Seller otherwise materially breaches this Agreement and does not cure
the breach within 90 days after Receipt of a notice describing the
breach.
B. AMP's sole liability to Seller for such termination will be:
1. Any unpaid balance due Seller for Product ordered, delivered and
accepted by AMP prior to Seller's Receipt (as defined below) of the
termination notice; and
2. The price for Product scheduled for delivery within 90 days of
Seller's Receipt of the termination notice, provided that such Product
is in production on such date, except that AMP will only be obligated
to pay for conforming Product so delivered and accepted by AMP.
C. In addition to any other remedies available to Seller in law or equity,
Seller may terminate this Agreement if AMP materially breaches this
Agreement and does not cure the breach within 90 days after Receipt of a
notice describing the breach.
D. Seller may terminate this Agreement as described in Section IV.D.
E. Seller's sole liability to AMP for either such termination will be:
1. Delivery to AMP of all Product ordered and for Purchase Orders
subsequently placed related to firm commitments made by AMP to its
customers for fiber optic cable prior to the date of termination
except if this Agreement is terminated as a result of AMP's
non-payment to Seller for Products sold to AMP; and
2. Delivery to AMP of all AMP-owned prints and property and any
confidential information at AMP's expense and in accordance with AMP's
instructions.
F. Either party may terminate this Agreement without liability upon written
notice if the other party files a voluntary petition in bankruptcy; or
makes an assignment for the benefit of creditors; or a receiver, trustee
and bankruptcy or similar officer is appointed to take charge of all or
part of the other party's assets/property; or the other party is adjudged
bankrupt.
G. For purpose of this Section, "Receipt" is defined as follows:
1. For facsimile, the date the sending party faxes the Notice to the
receiving party;
2. For express courier, the date the express courier company delivers the
Termination Notice to the receiving party.
H. Neither party shall be entitled to consequential or liquidated damages.
SECTION XI
COMPLIANCE WITH LAWS, INDEMNIFICATION AND INSURANCE
A. Seller hereby agrees that all services, Products, and processes covered
hereby will be manufactured and furnished by Seller in accordance with and
will conform to all applicable federal, state and local laws or regulation.
Seller will, and hereby does, indemnify and hold harmless AMP, its
officers, directors, employees and agents from all claims, demands, suits
or actions, environmentally related or otherwise, of any nature whatsoever,
including reasonable attorney's fees and expenses, arising from Seller's
performance of any specified, required or requested services for, or the
furnishing of Product to AMP. Seller agrees to defend AMP, at AMP's request
against any such claim, demand or suit.
B. Seller agrees to maintain, at its own expense, a policy or policies of
comprehensive general liability insurance with vendor's and product
endorsements naming AMP as an additional insured with a combined single
limit of at least $1,000,000. All such policies will provide that the
coverage will not be
terminated without at least 30 days prior written notice to AMP.
Certificates of insurance will be furnished to AMP upon request.
C. Notwithstanding any other terms and conditions in this Agreement or any
other document, the following terms and conditions will apply with regard
to Seller's environmental responsibilities:
1. Seller acknowledges that it is solely responsible for compliance with
all federal, state and local environmental laws, regulations,
ordinances and other requirements which apply or may apply to its
operations, including such operations as are necessary to provide the
Product covered by this Agreement and any Purchase Order issued
pursuant to this Agreement. Seller's responsibility includes but is
not limited to, where applicable, ensuring the proper handling and
disposal of any hazardous or toxic substances or wastes and other
waste materials under the Resource Conservation and Recover Act
("RCRA"), 42 U.S.C. Section 9601 et seq., any implementing regulations
and analogous state laws and regulations arising from the other
party's use, handling or disposal of hazardous and/or toxic substances
or other waste materials related to the Products, or arising from the
other party's alleged noncompliance with any federal, state or local
environmental laws, regulations, ordinances, licenses, permits, or
other requirements whatsoever, or arising from any claim that the
other party's improper use, handling or disposal of hazardous or toxic
substances or other materials related to the Products has resulted in
personal injury or property damage to any third party.
2. For the purpose of monitoring Seller's compliance with the terms of
this Agreement, Seller hereby authorizes AMP to perform a compliance
review, including a tour of Seller's facility, at any time upon
reasonable notice to Seller.
SECTION XIII
AMP CONFIDENTIAL INFORMATION
Seller understands and agrees that it will forever hold and protect in strict
confidence on behalf of itself and its employees, all confidential information
derived from AMP or its subsidiaries and affiliates participating in the
Agreement. Seller will at AMP's request immediately return all documents
received by Seller during the duration of this Agreement along with any copies.
If Seller wants to provide AMP with confidential information, then AMP will only
be obligated to hold such information in confidence if Seller and AMP enter into
a separate confidentiality agreement.
SECTION XIII
INTELLECTUAL PROPERTY AND INFRINGEMENT
A. Any design and development of Product or processes relating to Product
which AMP provides to Seller or for which AMP pays Seller to perform will
be the property of AMP.
B. Seller and AMP will negotiate in good faith an agreement for Seller to
provide product preforms and technical and manufacturing assistance to AMP
in drawing the preforms. C. Seller warrants that any Product which it
designed or developed will be delivered free of the rightful claim of any
third person by way of infringement of any patent or misappropriation of
any trade secret; provided, however, that the representation set forth in
this Section will not apply to Product manufactured in accordance with
specifications originated by AMP or its customer.
D. Subject to Section XIII.F. below, Seller will defend, at the Seller's
expense, every suit or claim for infringement or misappropriation related
to Product designed or developed by Seller brought against AMP or any
customer of AMP. Seller will indemnify, defend and save AMP and its
customers harmless from all liability, loss or expense, including costs of
settlement after obtaining Seller's written consent and reasonable
attorney's fees, resulting from any claim that AMP; or any customer's use,
possession, sales or resale of any Product or part thereof infringes any
patent, or is a misappropriation of any trade secret or other proprietary
right covering the Product or any part thereof. Each party agrees to notify
the other promptly of any matter in respect to which the foregoing
indemnity may apply and of which the notifying party has knowledge. If so
notified, Seller will, without limitation, defend those actions or pay any
fees awarded against AMP in any action or claim provided AMP will give
Seller an opportunity to elect to take over, settle or defend any such
claim, action or suit through counsel selected by Seller and under its sole
direction, and at its sole expense and provided that in the event that the
Seller elect to take over, defend of settle same, AMP will make available
to Seller all defenses against any such claim, action, suit or proceeding
known to or available to AMP. It is understood that either party is free to
waive the right to seek indemnification from the other, in which event the
party waiving the right of indemnification may select its own legal
counsel.
E. If a Product designed or developed by Seller is held to constitute an
infringement or misappropriation, then Seller will, at its own expense,
either procure for AMP the right to continue using the Product or part
thereof, or replace it with a non-infringing Product or part or modify the
Product or part so that it becomes non-infringing, or, if neither of the
foregoing alternatives is reasonably available
despite Seller's best efforts, refund the purchase price and freight costs
of such Product or part.
F. The foregoing provision as to indemnity by Seller to AMP will not apply if:
(a) the Product delivered by Seller to AMP is manufactured in accordance
with designs and/or specifications and/or intellectual property supplied by
AMP, in which case AMP agrees to indemnify Seller to the same extent that
Seller has agreed to indemnify AMP hereunder; or (b) the Product delivered
by Seller to AMP is subsequently modified or augmented by AMP without the
written consent of Seller in a manner which creates an infringement or
intellectual property violation which did not previously exist.
G. SECTION XIV
COOPERATIVE ADVERTISING
Seller and AMP will negotiate in good faith an agreement for Seller to provide
AMP with a cooperative advertising fund based on a percentage of purchases of
Product by AMP. Any such agreement shall insure that any advertising derived
from the advertising fund highlights Seller as the supplier of the Product in a
manner acceptable to Seller.
SECTION XV
PUBLICITY
A. Seller may not disclose, advertise or publish information about the
Agreement without the prior written consent of AMP, which shall not be
unreasonably withheld or delayed. AMP's prior written consent will not be
required when a disclosure about the Agreement is required by law.
B. Seller will, within 10 working days after Receipt a notice from AMP, grant
reasonable access to its facilities during normal business hours to AMP and
its customers and provide such data relating to a particular Product to AMP
and its customers as AMP will reasonably request to demonstrate Seller's
manufacturing and other capabilities to AMP's customers.
SECTION XVI
NOTICES
A. Any notices required or permitted to be given must be in writing and
delivered in person, set by express courier, or via facsimile to the
address set forth below. Notices will be effective upon Receipt, as defined
in Section X.
If to AMP:
If to Seller:
SECTION XVII
OTHER PROVISIONS
A. Seller may not assign the Agreement or any Purchase Order or any part
thereof without first obtaining the express written consent of AMP.
B. Force Majeure. Neither party to this Agreement will be liable for its
failure to perform any of its obligations hereunder during any period in
which such performance is delayed by fire, flood, war, embargo, strike,
riot, or the intervention of any government authority, provided that the
party suffering such delay immediately notifies the other party of the
delay.
C. AMP and Seller understand and contemplate that their relationship as
described in this Agreement will be solely that of supplier and purchaser.
The parties acknowledge that other contracts describe other aspects of the
relationship between the parties. Nothing in the Agreement is intended or
will be construed to create any partnership, joint venture, joint
enterprise or other similar joint relationship, nor will either part be
deemed to be an employee, agent or legal representative of the other for
any purpose whatsoever. Neither party will have any authority, whether
express, implied or apparent to assume or create any obligations for, on
behalf of, in the name of, or for the benefit of the other.
D. The terms, provisions, representations and warranties contained in this
Agreement will survive expiration or earlier termination of this Agreement
notwithstanding delivery, acceptance of or payment for the Product ordered
pursuant to this Agreement.
E. Seller agrees to provide to AMP notice of an information regarding any
transaction which result in a change of control of Seller's business,
including details of the transaction and any conditions placed on the
transaction. For purposes of this paragraph "transaction" is construed
broadly and includes, without limitation, sales, mergers, acquisitions, and
devises.
F. This Agreement will be interpreted and governed in all respects by the laws
of the Commonwealth of Pennsylvania without regard to its principles of
conflict of law.
G. Any dispute that cannot be settled amicably by mediation will be heard,
settled and decided under the Commercial Rules of the American Arbitration
Association by three arbitrators chose in accordance with such Rules.
Service of any matters in reference to such arbitration will be given in
the manner described in Section
XVI. Such arbitration will be conducted in New York, New York. The award in
such arbitration will be final and enforceable in any court of
competent jurisdiction. The costs of arbitration will be paid as
directed by the arbitrators.
H. If a conflict arises between any of the terms in the following documents,
the order of precedence will be: (1) this Agreement; (2) terms and
conditions on the face of any Purchase Order issued pursuant to this
Agreement; and (3) terms and conditions on the reverse side of any Purchase
Order issued pursuant to this Agreement.
I. The failure of either party to enforce any breaches of a provision of this
Agreement will not be construed as waiving subsequent breaches of the same
or any other provision of this Agreement. No such failure will be deemed to
be an amendment to this Agreement.
J. This Agreement constitutes the entire Agreement between the parties
relating to the purchase of fiber. NO modification will be valid unless set
forth in writing and signed by the parties, except as otherwise provided
herein. Both parties acknowledge that this agreement is the complete and
exclusive agreement of the parties which supersedes all prior written
proposals, negotiations and/or communications between the parties relating
to this Agreement. This Agreement may be executed in duplicate, each of
which will be deemed an original.
The authorized representatives of the parties have executed this Agreement
intending to be legally bound.
AMP Incorporated, on behalf of itself FiberCore, Inc.
and its subsidiaries and affiliates
BY: BY: /s/
------------------------------ ------------------------------
Title: Title: Chairman, CEO
---------------------------
Date: Date: July 29, 1996
----------------------------
EXHIBIT A
PRICES AND DISCOUNTS
EXHIBIT A
DISCOUNTS AND PROJECTED VOLUMES
- ------------------------------------------------------------------------------------------------------------
Year Proj. AMP Fiber Proj. FC Proj. MM SM
Cable Sales Portion Share Purchases Discount Discount
$MM % % $MM % %
- ------------------------------------------------------------------------------------------------------------
1996 15 15
- ------------------------------------------------------------------------------------------------------------
1997 18 50 44 4.7 20 20
- ------------------------------------------------------------------------------------------------------------
1998 34 50 60 10 20 20
- ------------------------------------------------------------------------------------------------------------
1999 54 50 70 19 25 20
- ------------------------------------------------------------------------------------------------------------
2000 77 50 80 31 25 20
- ------------------------------------------------------------------------------------------------------------
Total: 64
- ------------------------------------------------------------------------------------------------------------
If AMP elects, it can purchase 3.5 meters of single mode fiber for every meter
of multimode fiber waved. Such an election must be made per the purchase order
procedure.
INITIAL PRICES
(NET)
Product Type Price $/KM
1 UK 62.5 micron core 160
2 FDDI 155
3
4
MATERIAL PRICE ADJUSTMENT
Units Cost Cost
Per Per Per
Material Meter Unit Meter
- -------- ----- ---- -----
Initial Cost
- ------------
Substrate tubes
Silicon Tetrachloride
Germanium Tetracholoride
Hydrogen
Oxygen
Helium ______ _____ ______
New Cost
Substrate tubes
Silicon Tetrachloride
Germanium Tetracholoride
Hydrogen
Oxygen
Helium ______ _____ _____
Adjustment (New Cost less Initial Cost) _____