Apple (AAPL)

12.1         Neither party shall be entitled to special, indirect, incidental, consequential or punitive damages, including lost profits, opportunities or savings based on any breach or default of the other party, even if such party is informed of their possibility, except (i) [**], and (ii) to the extent such damages are awarded in a final judgment or settlement covered by Section 11.

12.2         In no event shall either party’s aggregate liability to the other party for damages in connection with all claims relating to this Agreement exceed the amount of [**], regardless of the form of action (including fundamental breach, negligence, misrepresentation, or other contract or tort claim), provided that this limitation will not apply to:  (i) the amount of any damages for bodily injury (including death) caused by such party’s negligence or damages to real property and tangible personal property caused by such party’s negligence; and (ii) payments owed for Products and Services provided hereunder.

This Section 12.2 also applies to any of IBM’s subcontractors and any Authorized Purchasers.  It is the maximum for which IBM and its subcontractors are collectively responsible, and for which Apple and its Authorized Purchasers are collectively responsible.

12.3     Under no circumstances is either party liable to the other for any of the following:  (i) third party claims against a party for losses or damages other than those in Section 11 and 12.2 (i), above; or (ii) loss of, or damage to, records or data.  Further under no circumstances will IBM be liable when the Products or Services are used in conjunction with military, nuclear, automotive or aeronautical applications or medical implantation or other direct life support applications where malfunction may result in injury, harm or death to persons, or used in any other ultrahazardous applications

[**] = information redacted pursuant to a confidential treatment request.  Such omitted information has been filed separately with the Securities and Exchange Commission.

13.0         WARRANTIES

13.1         Product Warranty.

13.1.1      PowerPC Warranty.  IBM warrants each PowerPC Product delivered hereunder to be free from defects in material and workmanship and to comply with Product specifications at the time of manufacture, as agreed in writing by IBM and Apple, for the notice period of [**] from the date of shipment.

13.1.2      ASIC Product Warranty.  IBM warrants all ASIC Products delivered to be free from defects in material and workmanship and conform to the Product specifications as set forth in the RTM for the notice period of [**] from the date of shipment. Apple acknowledges that the functionality of ASIC Products may be contingent on Apple’s designs and, therefore, Apple agrees that such warranty does not apply to the functionality of ASIC Products designed by Apple and manufactured by IBM under this Agreement except to the extent the lack of functionality is due to a defect in materials or workmanship.

13.1.3      Other Product Warranty.  IBM warrants all other standard Products delivered to be free from defects in material and workmanship and to conform to the Product Specifications for the notice period of [**] from the date of shipment unless otherwise stated in an Attachment applicable to such standard Products, and all other custom Products delivered to be free from defects in material and workmanship for the notice period of [**] from date of shipment unless otherwise stated in an Attachment applicable to such custom Products.  Apple acknowledges that the functionality of such other custom Products may be contingent on Apple’s designs and, therefore, Apple agrees that such warranty does not apply to the functionality of Products designed by Apple and manufactured by IBM under this Agreement except to the extent the lack of functionality is due to a defect in materials or workmanship.  IBM warrants Services will be performed using reasonable care and ordinary skill.

13.2         The Product warranty does not include defects in or failures of Products that result from (i) an Apple-supplied design; (ii) matters not covered in the Product specification or use outside of the intended operating environment set forth in the applicable Product specifications; (iii) accident, disaster, neglect, abuse, misuse, improper handling, testing, storage or installation after delivery to the carrier, including improper handling in accordance with generally acceptable static sensitive electronic device handling requirements; (iv) alterations, modifications or repairs

[**] = information redacted pursuant to a confidential treatment request.  Such omitted information has been filed separately with the Securities and Exchange Commission.

 by Apple or third parties not authorized by IBM in writing; (v) removal or alteration of labels by Apple or a third party; or (vi) failure caused by a product which IBM did not provide or for which IBM is not responsible.  IBM does not warrant uninterrupted or error free operation of the Products or that IBM will correct all defects.

13.3         THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS OR USAGE FOR PARTICULAR PURPOSE OR NON-INFRINGEMENT.

13.4         This warranty is not transferable.  No course of dealing, course of performance, usage of trade, or description of Product or Service shall be deemed to establish a warranty, express or implied.

13.5         If an Authorized Purchaser or Designee claims that any Products or Services are nonconforming, the Authorized Purchaser or Designee shall, (i) promptly notify IBM, in writing, of the basis for such claim of nonconformity; (ii) follow IBM’s instructions for the prompt return of the Products; and (iii) return such Products freight collect to IBM’s designated facility.  If IBM determines that the returned Products are nonconforming and such returned Products were shipped with Apple’s consent prior to their qualification, IBM’s sole and exclusive obligation will be to, at IBM’s option, repair or replace the defective Products, or issue a credit for the purchase price (e.g., Section 14.0 will not apply to such Product units delivered before the Product is qualified).  If IBM determines the Products are nonconforming and they were shipped subsequent to their qualification, IBM will issue a credit or rebate for the purchase price.

13.6         Prior to returning any defective Products to IBM, the Authorized Purchaser or Designee shall obtain a Return Merchandise Authorization number (“RMA”) from IBM (which IBM will provide within [**] Business Days of the request) and provide the specific description of the problem, by part number for the total quantity of the defective Products.  The Authorized Purchaser or Designee shall only return the exact quantity authorized in each RMA by following IBM’s RMA instructions.  Each shipping container shall contain only one (1) RMA.

13.7         IBM’s sole liability and Apple’s exclusive remedy for breach of warranty shall be limited as stated in this Section 13, except that Product Failures which exceed the applicable Failure Threshold shall be governed by Section 14 below.

[**] = information redacted pursuant to a confidential treatment request.  Such omitted information has been filed separately with the Securities and Exchange Commission.

12.1         Neither party shall be entitled to
special, indirect, incidental, consequential or punitive damages, including
lost profits, opportunities or savings based on any breach or default of the
other party, even if such party is informed of their possibility, except (i)
[**], and (ii) to the extent such damages are awarded in a final judgment or
settlement covered by Section 11.

12.2
        In no event shall either party’s
aggregate liability to the other party for damages in connection with all claims
relating to this Agreement exceed the amount of [**], regardless
of the form of action (including fundamental breach, negligence,
misrepresentation, or other contract or tort claim), provided that this
limitation will not apply to: 
(i) the amount of any damages for bodily injury (including death) caused
by such party’s negligence or damages to real property and tangible personal
property caused by such party’s negligence; and (ii) payments owed for Products and Services provided hereunder.

This Section 12.2 also
applies to any of IBM’s subcontractors and any Authorized Purchasers.  It is the maximum for which IBM and its
subcontractors are collectively responsible, and for which Apple and its
Authorized Purchasers are collectively responsible.

12.3     Under
no circumstances is either party liable to the other for any of the
following:  (i) third party claims
against a party for losses or damages other than those in Section 11 and 12.2
(i), above; or (ii) loss of, or damage to, records or data.  Further under no circumstances will IBM be
liable when the Products or Services are used in conjunction with military,
nuclear, automotive or aeronautical applications or medical implantation or
other direct life support applications where malfunction may result in injury,
harm or death to persons, or used in any other ultrahazardous applications

[**] = information
redacted pursuant to a confidential treatment request.  Such omitted information has been filed
separately with the Securities and Exchange Commission.

13.0         WARRANTIES

13.1         Product
Warranty.

13.1.1      PowerPC Warranty.  IBM warrants each PowerPC Product delivered
hereunder to be free from defects in material and workmanship and to comply
with Product specifications at the time of manufacture, as agreed in writing by
IBM and Apple, for the notice period of [**] from the date of shipment.

13.1.2      ASIC Product
Warranty.  IBM warrants all ASIC Products delivered to be free
from defects in material and workmanship and conform to the Product
specifications as set forth in the RTM for the notice period of [**] from the
date of shipment. Apple acknowledges that the functionality of ASIC Products
may be contingent on Apple’s designs and, therefore, Apple agrees that such
warranty does not apply to the functionality of ASIC Products designed by Apple
and manufactured by IBM under this Agreement except to the extent the lack of
functionality is due to a defect in materials or workmanship.

13.1.3      Other Product Warranty.  IBM warrants all other standard Products
delivered to be free from defects in material and workmanship and to conform to
the Product Specifications for the notice period of [**] from the date of
shipment unless otherwise stated in an Attachment applicable to such standard
Products, and all other custom Products delivered to be free from defects in
material and workmanship for the notice period of [**] from date of shipment
unless otherwise stated in an Attachment applicable to such custom
Products.  Apple acknowledges that the
functionality of such other custom Products may be contingent on Apple’s
designs and, therefore, Apple agrees that such warranty does not apply to the
functionality of Products designed by Apple and manufactured by IBM under this
Agreement except to the extent the lack of functionality is due to a defect in
materials or workmanship.  IBM
warrants Services will be performed using reasonable care and ordinary skill.

13.2         The Product warranty does not include
defects in or failures of Products that result from (i) an Apple-supplied
design; (ii) matters not covered in the Product specification or use outside of
the intended operating environment set forth in the applicable Product
specifications; (iii) accident, disaster, neglect, abuse, misuse, improper
handling, testing, storage or installation after delivery to the carrier,
including improper handling in accordance with generally acceptable static
sensitive electronic device handling requirements; (iv) alterations,
modifications or repairs

[**] = information
redacted pursuant to a confidential treatment request.  Such omitted information has been filed
separately with the Securities and Exchange Commission.

 by Apple or third parties not authorized by IBM in writing; (v)
removal or alteration of labels by Apple or a third party; or (vi) failure
caused by a product which IBM did not provide or for which IBM is not
responsible.  IBM does not warrant uninterrupted or
error free operation of the Products or that IBM will correct all defects.

13.3         THE FOREGOING WARRANTIES ARE IN LIEU OF
ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS OR USAGE FOR PARTICULAR PURPOSE OR NON-INFRINGEMENT.

13.4
        This warranty is not
transferable.  No course of dealing,
course of performance, usage of trade, or description of Product or Service
shall be deemed to establish a warranty, express or implied.

13.5         If an Authorized Purchaser or Designee
claims that any Products or Services are nonconforming, the Authorized
Purchaser or Designee shall, (i) promptly notify IBM, in writing, of the basis
for such claim of nonconformity; (ii) follow IBM’s instructions for the prompt
return of the Products; and (iii) return such Products freight collect to IBM’s
designated facility.  If IBM determines
that the returned Products are nonconforming and such returned Products were
shipped with Apple’s consent prior to their qualification, IBM’s sole and
exclusive obligation will be to, at IBM’s option, repair or replace the
defective Products, or issue a credit for the purchase price (e.g., Section
14.0 will not apply to such Product units delivered before the Product is
qualified).  If IBM determines the
Products are nonconforming and they were shipped subsequent to their
qualification, IBM will issue a credit or rebate for the purchase price.

13.6         Prior to returning any defective
Products to IBM, the Authorized Purchaser or Designee shall obtain a Return
Merchandise Authorization number (“RMA”) from IBM (which IBM will provide
within [**] Business Days of the request) and provide the specific description
of the problem, by part number for the total quantity of the defective
Products.  The Authorized Purchaser or
Designee shall only return the exact quantity authorized in each RMA by following IBM’s RMA instructions.  Each shipping container shall contain only one (1) RMA.

13.7         IBM’s sole liability and Apple’s exclusive remedy for breach
of warranty shall be limited as stated in this Section 13, except that Product
Failures which exceed the applicable Failure Threshold shall be governed by
Section 14 below.

[**] = information
redacted pursuant to a confidential treatment request.  Such omitted information has been filed
separately with the Securities and Exchange Commission.