PART I FINANCIAL INFORMATION

EX-10.37 3 f83290exv10w37.txt EXHIBIT 10.37 Exhibit 10.37 5600 Cottle Road San Jose, CA 95193 0001 June 6, 2002 Brocade Communications Systems, Inc. 1901 Guadalupe Parkway San Jose, CA 95131 Attention: Mr. Patrick Johnston Subject: Amendment 7 to SOW#1 of the IBM/Brocade Goods Agreement ROC-P-68 Dear Patrick: This letter (the "Amendment") serves as Amendment Number 7 to SOW#1, including all amendments thereto ("SOW#1") of the Goods Agreement ROC-P-68, including all amendments thereto (the "Goods Agreement") which the parties hereto do mutually agree to amend as follows: 1. Delete the table in Section 1.1, "Specifications," and replace as follows:

* CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 1 2. Delete pricing table in its entirety in Section 2.1, "Pricing" and replace with the following:

* CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 2 Switch Single Power Supply (SW3200) Includes Web Tools [*] [*] Full Fabric [*] Upgrade Includes Zoning and Fabric Watch [*] [*] Fan (SW3800) [*] [*] [*] Power Supply [*] (SW3800) [*] [*] Mainboard FRU [*] (SW3800) [*] [*] Fan (SW3900) [*] [*] [*] Power Supply [*] (SW3900) [*] [*] Mainboard FRU [*] (SW3900) [*] [*] LUN Zoning [*] [*] [*] LUN Zoning [*] [*] [*] LUN Zoning [*] [*] [*] Advanced Security [*] [*] [*] Advanced Security [*] [*] [*] Advanced Security [*] [*] [*] Performance [*] Bundle (Trunking and Performance Monitoring) [*] [*] Performance [*] Bundle (Trunking and Performance Monitoring) [*] [*] Performance [*] Bundle (Trunking and Performance Monitoring) [*] [*] 32 Port Fibre [*] Channel Core Switch (SW12000) Includes 2 Stiletto Port Blades, 2 CP Blades, 4 Power Supplies, 3 Blowers, 6 Port Blade Filler Panels, 1 Cable Management Pillar, Fabric OS, Advanced Web Tools, Advanced Zoning, Fabric Watch, Performance Monitoring, Trunking. [*] [*] Rack Mounting Kit [*]

* CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 3 14U, FRU [*] [*] Switch Blade 16 [*] port, 2GB [*] [*] Chassis Door, [*] Includes Plastic and Metal door Components and IBM Front Badge [*] [*] Control Processor [*] Blade [*] [*] Stiletto Port [*] Blade Slot Filler Panel, SW12000, FRU [*] [*] Power Supply, [*] 180-264VAC, 1000W, FRU [*] [*] Blower Assembly, [*] FRU [*] [*] Cable Management [*] Pillar, FRU [*] [*] WWN Card [*] [*] [*] Power Plug, [*] Switch and Distribution Panel [*] [*] Chassis FRU, [*] includes backplane, blower and power supply backplane, AC and blower harness. [*] [*] Rear WWN Bezel [*] Assy [*] [*] Cable Management [*] Tray [*] [*] AC Power Cord, FRU [*] [*] [*] AC Power Cord, [*] UK/Ireland, 250V, FRU [*] [*] AC Power Cord, [*] Cont. Europe CEE7/7, FRU [*] [*] AC Power Cord, [*] AUST/INZ, 250V [*] [*] AC Power Cord, [*] Intl IEC [*] [*] Remote Switch [*] software [*] [*] Extended Fabric [*] software [*] [*] Fabric Manager 3.x [*]

All prices are in U.S. dollars. * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 4 3. Add the following sentence prior to the first sentence in Section 3.0, "Rescheduling and Cancellation": "Except for Products identified in Section 4.0 "Replenishment Logistics Attachment", Products will be subject to the terms herein stated in Section 3.0." 4. Section 4.0, "Replenishment Logistics Attachment" delete in its entirety and replace with the following: "4.0 REPLENISHMENT LOGISTICS ATTACHMENT 4.1 PULL DEFINITIONS "Pull Products" means Products specified in the Pull Product Profile in Section 4.6 below. "Pull Product Profile" or "Pull Profile" or "MIRS Profile" means the table in Section 4.6 below, describing the Pull Products and process including, but not limited to, Product Type, Part Number, Replenishment Lead-Time and Packaging Specifications. "Pull Purchase Order" or "Pro forma Purchase Order" or "PPO" means a blanket PO used for invoicing, receiving and forecasting purposes and does not represent a firm offer by Buyer nor bind Buyer to any quantity or delivery date. "Upside Flexibility" means a percentage of Pull Products specified in the Pull Profile in excess of the Planning Schedule Quantity. "Buffer Inventory Replenishment Lead-time" means the time from Seller's receipt of Buyer's Planning Schedule for Supplier to replenish the Buffer Inventory. "Planning Schedule" means Buyer's forecast of requirements for Pull Products. "Pull Notification" or "Shipping Schedule" means Buyer's only authorization (WA) for Supplier to deliver a specified quantity of Pull Products. "Pull Notification Lead-Time" means the time from Supplier's receipt of a Pull Notification to shipment of the Pull Products to Buyer's location. "Pull Program Inventory" means the minimum inventory for which Supplier is responsible to maintain, to satisfy Buyer's quantities as specified in the Planning Schedule. "Buffer Inventory" means the additional inventory that Supplier keeps as a safety inventory. 4.2 PLANNING Buyer will issue a PPO to Supplier for all Pull Products. Buyer may issue a Planning Schedule at intervals as specified in the Pull Profile, the most recent Planning Schedule to supersede all previous Planning Schedules. The Planning Schedule provides a forecast of requirements for the Pull Products and establishes Upside Flexibility, if any, with the Supplier. 4.3 PULL DELIVERY Supplier will deliver to Buyer on the delivery date the Pull Products specified in the Pull Notifications issued by Buyer, provided such Pull Notifications do not exceed the Planning Schedule Quantity. To the extent practicable, Supplier will comply with Pull Notifications for quantities of Pull Products in excess of the Planning Schedule Quantity, but at a minimum in accordance with the Upside Flexibility. 4.4 PULL LIMITATION OF LIABILITY Buyer makes no representation or warranty and assumes no liability regarding the quantity of Pull Products that it will purchase. 4.5 END OF LIFE ORDER Pull Products that Supplier has provided a written End of Life notice to Buyer will not be subject to the terms contained in Section 4.0 Replenishment Logistics Attachment, effective when Buyer submits a EOL purchase order (WA) for such products pursuant with Section 2.10 "Notice of Product Withdrawal" of SOW#1. 5 4.6 PULL PRODUCT PROFILE PRODUCT PART NUMBER AND [*] DESCRIPTION PULL PROGRAM INVENTORY Current week's Planning Schedule quantity. BUFFER INVENTORY One (1) week inventory based on rolling weekly planning schedule, that is in addition to the Pull Program Inventory. PULL PURCHASE ORDER Quarterly CANCELLATION Unused quantities on PPO and Planning Schedule shall be cancelled. Pull Notification may not be cancelled. RESCHEDULE Via Planning Schedule BUFFER INVENTORY [*] days REPLENISHMENT LEAD TIME PULL NOTIFICATION LEAD-TIME [*] days PULL NOTIFICATION Email COMMUNICATION VEHICLE PULL NOTIFICATION FREQUENCY Weekly or as required PLANNING SCHEDULE (FORECAST) Six month rolling (first 13 weeks in weekly increments, balance monthly) PLANNING SCHEDULE FREQUENCY Minimum monthly (with weekly review, planning schedule updated as necessary to maximize the Upside Flexibility). UPSIDE FLEXIBILITY [*] (% BASED ON AFFECTED 4 WEEK FORECAST PLANNING SCHEDULE)

* CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 6 5. Add after the second sentence in Section 9.3, "Post Warranty Services," "Pricing" the following: "The post Warranty repair (CSP) pricing for FRU's used in the 2109-M12 (SW12000) shall be as follows. 18P5017 XIB-12000-0101 Port Blade [*] 18P5035 XIB-12000-0103 CP Blade [*] 18P5128 XIB-12000-0010 Chassis FRU [*] 6. Delete Section 2.6, "Delivery", in its entirety and replace with the following: ExWorks (IncoTerms 2001, location Brocade Contract Manufacturer). 7. Delete the last sentence in Section 9.3 "Post Warranty Services", "Packaging and Delivery" and replace with the following: "The TAT for Serviced Products will not be more than [*] days after receipt of said Products, unless specified otherwise. Seller will use commercially reasonable efforts to reduce the TAT days and make adjustment to Buyer accordingly." Please have your authorized representative indicate acceptance thereof by signing both copies of the Amendment and returning one copy to the attention of Karen Takahashi at 5600 Cottle Road, San Jose, California 95193. The effective date of this Amendment shall be the date on the top of this Amendment (the "Effective Date"). The parties acknowledge that they have read this Amendment, understand it, and agree to be bound by its terms and conditions. All capitalized terms not defined herein shall have the meaning set forth in the Goods Agreement or the SOW #1. All other terms and conditions of the Goods Agreement and SOW#1 that are unaffected by the revisions set forth in this Amendment shall remain in full force and effect. Further, the parties agree that this Amendment and the Goods Agreement and SOW#1 are the complete and exclusive statement of the agreement between the parties, superseding all proposals or other prior agreement, oral or written, and all other communications between the parties relating to this subject. ACCEPTED AND AGREED TO: ACCEPTED AND AGREED TO: INTERNATIONAL BUSINESS MACHINES BROCADE COMMUNICATIONS SYSTEMS, INC. CORPORATION By: By: ---------------------------------- ---------------------------------- Authorized Signature Date Authorized Signature Date - ------------------------------------- ------------------------------------- Type or Print Name Type or Print Name - ------------------------------------- ------------------------------------- Title & Organization Title & Organization * CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 7