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EXHIBIT 10.1
SERVICE ▇▇▇▇ LICENSE AGREEMENT
SERVICE ▇▇▇▇ LICENSE AGREEMENT dated as of November 18, 1999 by and
between AT&T CORP., a New York corporation ("Licensor"), and KIRI INC., a
Delaware corporation ("Licensee").
WHEREAS, Licensor has, for many years, used the service marks AT&T and AT&T
with a fanciful globe design, as identified in Schedule A attached hereto (the
"Licensed Master Service Marks"), all in connection with telecommunications
services; and
WHEREAS, Licensee wishes to use the Licensed Master Service Marks, and the
Licensed Trade Dress in the Licensed Territory as defined herein in connection
with the marketing and provision of certain services; and
WHEREAS, Licensee also wishes to use the service ▇▇▇▇ "It's all within your
reach" and certain foreign equivalents thereof that are owned by Licensor and
may wish to use certain other service marks which are or will be owned by
Licensor in connection with the Licensed Services; and
WHEREAS, Licensor is willing to license and allow Licensee to use the
Licensed Marks under the terms and conditions set forth in this Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
1. Definitions.
"Affiliate": Of a party shall mean an entity which is under common
control with, controls, or is controlled by, such party.
"Bankruptcy": With respect to a Person shall mean the filing by such
Person of a voluntary petition, or by a third party with respect to such
Person, requesting liquidation, dissolution, reorganization, suspension,
rearrangement or re-adjustment, in any form, of its debts under the laws of
the United States (or corresponding provisions of future laws), the laws of
the Licensed Territory, or any other bankruptcy or insolvency law, or such
Person's consenting to or acquiescing in any such petition, the making by
such Person of any assignment for the benefit of its creditors or the
admission by such Person in writing of its inability to pay its debts as
they mature, an application for the appointment of a receiver for the
assets of such Person, or an involuntary petition seeking liquidation,
dissolution, reorganization, suspension, rearrangement or readjustment of
its debts or similar relief under any bankruptcy or insolvency law.
"Claim": As defined in Section 20.1 hereof.
"Claimant": As defined in Section 20.2 hereof.
"Communications Director": The individual described in Section 8.5.
"Corporate Brand": As defined in Section 5.3(d) hereof.
"Corporate Brand Efforts": As defined in Section 5.3(d) hereof.
"Effective Date": As defined in Section 23.12 hereof.
"Exclusive Services": As defined in Schedule F hereto.
"Final Cure Period": As defined in Section 9 hereof.
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"Graphic Standards Manual": As defined in Schedule D hereto.
"Gross Service Revenue": Revenues received by Licensee and its
sublicensees for the Licensed Services, before any deductions or offsets.
"Including": The terms "including" and "such as" are illustrative and
not limitative.
"Initial Cure Period": As defined in Section 9 hereof.
"Licensed Ancillary Service Marks": Service marks that may be
developed for each of the Licensed Services by Licensor or by Licensee that
become Licensed Ancillary Service Marks pursuant to Section 2.2, and any
additional marks that are added to this Agreement pursuant to Section 4.3
and which shall be owned by Licensor and licensed to Licensee pursuant to
this Agreement (and as such service marks may be modified or supplemented
as contemplated by Section 4.2 or Section 4.3), as set forth in Schedule
C1, as it may be amended from time to time. Registrations and applications
covering the Licensed Ancillary Service Marks in the Licensed Territory
include those set forth in Schedule C2 of this Agreement. The listing of
goods or services in the specification of any of these registrations or
applications which are outside the scope of services licensed under this
Agreement shall not be construed as inclusion of such goods or services in
the license granted by this Agreement. It is understood that the only
services licensed under this Agreement are as expressly set forth in this
Agreement.
"Licensed Marks": Collectively, the Licensed Master Service Marks,
Licensed Ancillary Service Marks, and Licensed Trade Dress.
"Licensed Master Service Marks": The service marks AT&T and AT&T with
a fanciful globe design as identified in Schedule A (and as such service
marks may be modified or supplemented as contemplated by Section 4.2 or
Section 4.3). Registrations and applications covering the Licensed Master
Service Marks in the Licensed Territory are set forth in Schedule B of this
Agreement, as it may be amended from time to time. The listing of goods or
services in the specification of any of these registrations or applications
which are outside the scope of services licensed under this Agreement shall
not be construed as inclusion of such goods or services in the license
granted by this Agreement. It is understood that the only services licensed
under this Agreement are as expressly set forth in this Agreement.
"Licensed Services": The services described in Schedule F attached
hereto.
"Licensed Territory": Antigua and Barbuda, Argentina, Bahamas,
Barbados, Bolivia, Brazil, Chile, Colombia, Dominica, Dominican Republic,
Ecuador, Grenada, Guyana, Haiti, Jamaica, Panama, Paraguay, Peru, Saint
Lucia, Saint ▇▇▇▇▇▇▇ and the Grenadines, Suriname, St. Kitts and Nevis,
Trinidad and Tobago and Uruguay.
"Licensed Trade Dress": The general image, appearance or dress of the
marketing of services performed under the Licensed Master Service Marks and
the Licensed Ancillary Service Marks consisting of colors, designs,
configurations, publication formats, lettering and the like as set forth in
Schedule D attached hereto, and such other trade dress and get-up as may be
added thereto or substituted therefor in accordance with this Agreement.
"Licensee": As defined in the first paragraph hereof.
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"Licensee Brand Efforts": Marketing communications activities
developed in support of specific Licensee products and services, such as
advertising, direct mail and promotions for specific Licensed Services or
rates, or for any activity not specified in this Agreement.
"Licensor": As defined in the first paragraph hereof.
"Managed Network Services" means the provision of (a) service to a
customer consisting solely of the provisioning and maintenance of the
logical and physical elements of the customer's wide area communications
network, and, to the extent relating to a customer's wide area
communications network, directly related planning, design, installation,
maintenance and ongoing life cycle support functions, and (b) equipment on
the customer's premises at the interface between a wide area communications
network and the remainder of the customer's networking environment insofar
as the equipment so provided facilitates (i) the maintenance of the
customer's wide area communication services, (ii) the recording of
performance data with respect to the customer's wide area communications
services, (iii) the provisioning of new wide area communications services
to the customer or changes in the parameters of the wide area
communications services provided to the customer, or (iv) the integration
of multiple wide area communications services, but excluding in the case of
clause (a) or (b) any such service or equipment that materially extends
services beyond the interface described above further into the customer's
non-wide area communications network.
"▇▇▇▇": Any name, ▇▇▇▇▇, ▇▇▇▇, trademark, service ▇▇▇▇, trade dress,
trade name, business name or other indicia of origin.
"Marketing Materials": Any and all materials, whether written, audio,
visual or in any other medium, used by Licensee to market, advertise or
otherwise offer or provide any Licensed Service under the Licensed Marks.
"Marketing Specifications": Licensor's standards and guidelines
relating to the permitted use, depiction and graphic display of the
Licensed Marks that are contained in Schedule E hereto, and those standards
and guidelines relating to such use, depiction and graphic display that
Licensor shall provide to Licensee from time to time.
"Material": As defined in Section 21 hereof.
"Merger Agreement": The Agreement and Plan of Merger among AT&T Corp.,
Kiri Inc., Frantis, Inc. and FirstCom Corporation, dated as of November 1,
1999.
"Minimum Guarantee": As defined in Section 5.1(b) hereof.
"Monitoring Services": As defined in Section 5.3(a) hereof.
"New York Courts": As defined in Section 19 hereof.
"Nonexclusive Services": As defined in Schedule F hereto.
"Payment Period": Each period of six (6) full calendar months or
portion thereof during the term of this Agreement, commencing on the first
day of the first month after the Effective Date.
"Payments": As defined in Section 22.1 hereof.
"Person": Any individual, partnership, limited partnership, joint
venture, syndicate, sole proprietorship, company or corporation with or
without share capital, unincorporated association,
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trust, trustee, executor, administrator or other legal personal
representative, regulatory body or agency, government or governmental
agency, authority or entity however designed or constituted.
"Proprietary Information": Any information that is so designated by
the party disclosing it or deemed to be such under this Agreement.
"Quality Control Representatives": Representatives of Licensor
appointed in accordance with Section 8 hereof.
"Registered User Application": An application by the parties to the
appropriate Regulatory Authority in the Licensed Territory where an owner
of a ▇▇▇▇ (i) licenses a licensee to use the registered ▇▇▇▇, under
conditions in which the nature and quality of the products and/or services
offered under the ▇▇▇▇ are required to be subject to quality control by the
owner, in accordance with local law and practice for acceptable trademark
licensing to ensure the validity and enforceability of the ▇▇▇▇ licensed
and (ii) allows the licensee to be recorded by that administrative agency
as a permitted user of the Licensed Marks.
"Regulatory Approval": Any governmental or regulatory approval,
consent or authorization or waiver required to be obtained from or any
filing required to be made with or notice required to be given to any
governmental or Regulatory Authority, commission, tribunal, ministry,
official or agency.
"Regulatory Authority": Any applicable regulatory, administrative or
governmental entity, authority, commission, tribunal, official or agency,
including without limitation the Export Licensing Office of the U.S.
Department of Commerce.
"Request": As defined in Section 20.2 hereof.
"Respondent": As defined in Section 20.2 hereof.
"Second Cure Period": As defined in Section 9.2 hereof.
"Service Specifications": The standards of quality relating to
Marketing Specifications, technical performance, customer service, and
customer satisfaction, including technical network performance, marketing,
design, and use of Marketing Materials, advertising and promotion that will
be set forth in Schedule E to this Agreement (and as they may be amended,
modified or supplemented from time to time in accordance with this
Agreement).
"Significant Breach by Licensee": As defined in Section 12 hereof.
"Subsidiary": With respect to a party, any Person in which the party
directly owns more than 50% of the voting rights.
"Successor": With respect to any party, any successor, monitor,
coordinator, transferee or assignee, including without limitation any
receiver, debtor in possession, trustee, conservator or similar Person with
respect to such party or such party's assets.
"Technical Information": Information provided by either party under
this Agreement, whether Proprietary Information or otherwise.
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2. Scope of License
2.1 Grant of License.
(a) Subject to the terms and conditions of this Agreement, Licensor hereby
grants to Licensee a non-exclusive, non-transferable, non-sublicensable (except
as provided herein) license to use the Licensed Marks solely in connection with
the marketing, advertising, promotion and provision of the Licensed Services in
the Licensed Territory. Licensee may use the Licensed Marks in marketing,
advertising and promotion outside the Licensed Territory so long as such
marketing, advertising and promotion relates to the provision of Licensed
Services in the Licensed Territory. The foregoing notwithstanding, the rights
granted herein do not include the right to use the Licensed Marks in connection
with the marketing, advertising, promotion or provision of any services through
the global venture between Licensor and British Telecommunications plc, which
shall be covered by separate agreements with such global venture.
Licensor and its other Affiliates retain all rights to use the Licensed
Marks in the Licensed Territory. The Licensed Marks may not be used by Licensee
in connection with any service except as expressly set forth in this Agreement.
Licensee shall not use the Licensed Marks, or any other ▇▇▇▇ of Licensor, or any
confusingly similar Marks in connection with any service or product not within
the scope of this Agreement without Licensor's express written consent.
Licensee may sublicense the rights granted in this Section 2.1(a) to its
Subsidiaries in connection with their operations in the Licensed Territory,
provided that:
(i) such Subsidiaries meet and continue to meet the criteria set forth
in Schedule G of this Agreement;
(ii) such Subsidiaries enter a written agreement with Licensee in
which such Subsidiaries agree to assume all of the same obligations as
Licensee (except for the obligation to make payments pursuant to Section
5.1, as such payments will be made by Licensee) and which is otherwise
consistent with this Agreement; and
(iii) Licensee notifies Licensor within ten (10) days each time a
sublicense is granted and furnishes Licensor with a copy of the relevant
sublicense agreement.
(b) Subject to the terms and conditions of this Agreement and provided that
at least half of the Licensed Services offered by Licensee (namely, those
grossing the highest revenue) are in full compliance with the Service
Specifications furnished by Licensor, Licensee shall have a non-exclusive,
non-sublicensable right (except as otherwise provided herein) to use "AT&T" as
part of the corporate name and trade name set forth in Schedule H of this
Agreement for the remainder of the term of this Agreement. By way of example, if
Licensee offers six (6) Licensed Services, the three (3) Licensed Services
grossing the highest revenue for Licensee would have to be compliant with the
Service Specifications in order to use "AT&T" as part of the corporate name and
trade name. The foregoing notwithstanding, if all of the Licensed Services
contemplated by this Agreement will be provided through Subsidiaries of the
Licensee and not by the Licensee itself, then Licensee may, subject to the terms
and conditions of this Agreement, use "AT&T" as part of the corporate and trade
name set forth in Schedule H for the entire term of this Agreement. In the event
that Licensee wishes to have one or more of its Subsidiaries which has been
granted a sublicense to use the Licensed Marks pursuant to Section 2.1(a) use
"AT&T" as part of its corporate and trade name, Licensee may request Licensor's
written approval to sublicense such use, and Licensee shall not unreasonably
withhold such written approval, provided that such Subsidiaries demonstrate to
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Licensor's satisfaction that at least half of the Licensed Services (namely,
those grossing the highest revenues) offered by such Subsidiaries are in full
compliance with the applicable Service Specifications and provided that such use
is otherwise subject to the terms and conditions and conditions of this
Agreement.
2.2 Use of Licensed Master Service Marks and Development and Use of
Licensed Ancillary Service Marks.
(a) Subject to the terms and conditions of this Agreement, the Licensed
Marks and Licensed Trade Dress shall be used exclusively in connection with all
Licensed Services.
(b) Licensee may use ancillary service marks owned by Licensor with
Licensor's express written consent for one or more service plan names or feature
names. Licensee may develop and use with Licensor's prior written approval
ancillary service marks with respect to one or more service plan names or
feature names, which approval will not be unreasonably withheld. Such ancillary
service marks developed by Licensee and approved by Licensor shall become
Licensed Ancillary Service Marks. Licensee shall assign to Licensor all rights
in and to any such ancillary service marks developed by Licensee that shall
become Licensed Ancillary Service Marks, including all rights in any application
to register or registration of the Licensed Ancillary Service Marks. Upon the
termination of this Agreement, including termination under any renewal and any
transition period provided under Section 12.3, Licensor shall assign to
Licensee, without further consideration, all of its rights, title and interest
in and to such Licensed Ancillary Service Marks developed by Licensee, including
the goodwill attached thereto, in the Licensed Territory. With the exception of
ancillary service marks developed by Licensee and assigned to Licensor as
provided above, Licensor shall be and remain the owner of all Licensed Ancillary
Service Marks, and any foreign language equivalents thereof, that are not
developed by Licensee.
3. Agreement Personal. In recognition of the unique nature of the
relationship between Licensor and Licensee, the parties agree that the rights,
obligations and benefits of this Agreement shall be personal to Licensee and its
authorized sublicensees, and, Licensor shall not be required to accept
performance from or render performance to an entity other than Licensee and its
authorized sublicensees. In the event of the Bankruptcy of the Licensee or its
sublicensees, this Agreement and any sublicense granted pursuant to this
Agreement may not be assigned or assumed by the Licensee, its sublicensees, or
any Successor, and may be terminated by Licensor pursuant to Section 12.2(c)
hereof, and the Licensor shall be excused from rendering performance to or
accepting performance from Licensee, its sublicensees or any Successor.
4. Other Marks
4.1 No Other ▇▇▇▇ To Be Used. Licensee shall not use any other ▇▇▇▇ or
create by use, adoption or practice any alternate ▇▇▇▇ or ancillary ▇▇▇▇ in
connection with the Exclusive Services, without Licensor's express written
consent. In the marketing of the Licensed Services, any use or display by
Licensee of its corporate, business, trade name, or trading style shall adhere
to the Marketing Specifications of the Service Specifications or shall be with
Licensor's express written consent. So long as Licensee is not providing a
Nonexclusive Service in a particular country in the Licensed Territory using the
Licensed Marks, Licensee may, after consultation with Licensor, use Marks that
are not Licensed Marks on such Nonexclusive Service in such country, provided
that Licensee agrees to conduct reasonable searches to determine the
availability of such Marks prior to commencing use. In the event that Licensee
commences providing a Nonexclusive Service using the Licensed Marks in a
particular country in the Licensed Territory, Licensee shall immediately cease
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providing such Nonexclusive Service using other Marks in such country unless
Licensor consents to the continued use of such other Marks.
4.2 Modification of Licensed Service Marks. Modifications to or
replacements of the Licensed Ancillary Service Marks may be initiated by
Licensee, with the concurrence of Licensor as provided in Section 2.2(b), as to
any modification or replacement of the Licensed Ancillary Service Marks as they
are used by Licensee with respect to the Licensed Services.
If Licensor modifies or replaces any of the Licensed Master Service Marks,
Licensed Ancillary Service Marks, or the Licensed Trade Dress as used by
Licensor, Licensee shall agree with Licensor on a program to cease, over a
reasonable period of time, not to exceed one hundred-twenty (120) days, use of
the previous Licensed ▇▇▇▇(s) and to introduce and adopt the modified or
replacement Licensed ▇▇▇▇(s), at Licensee's cost, but without undue expense to
Licensee or disruption to Licensee's business or marketing programs, and
Licensor shall reimburse Licensee from the Brand Fund Fee one-half of such
reasonable costs incurred by Licensee. In either case, such modified or replaced
Licensed Master Service ▇▇▇▇(s), Licensed Ancillary Service ▇▇▇▇(s), or the
Licensed Trade Dress shall be considered the Licensed ▇▇▇▇(s) contemplated by
this Agreement.
If Licensor modifies a Licensed Ancillary Service ▇▇▇▇ for certain uses
outside the Licensed Territory but does not terminate all usage of the
unmodified version, Licensee may choose to adopt the modified version but is not
obliged to do so.
4.3 Use of Additional Marks at Licensor's Request. Licensor may, from time
to time, in consultation with Licensee, request Licensee to adopt and use in
addition to the Licensed Master Service Marks, Licensed Ancillary Service Marks
and Licensed Trade Dress, any ▇▇▇▇ or Marks used or to be used by Licensor,
including any Marks owned by a third party that Licensor has the right to use
and sublicense, in connection with the marketing and provision of Licensed
Services. Such additional ▇▇▇▇ or Marks shall be licensed hereunder on the same
terms as the Licensed Marks. All costs associated with adopting and using such
additional ▇▇▇▇ or Marks shall be borne by Licensor, and shall be paid out of
the Brand Fund Fees.
5. Annual Payments.
5.1 Brand Fund Fee. In consideration of the license granted in this
Agreement and for other good and valuable consideration including Licensor brand
building activities in the Licensed Territory, during the term of this Agreement
with respect to each Payment Period, Licensee shall pay Licensor a Brand Fund
Fee, as provided in Section 5.3, which shall be the greater of:
(a)(i) in Years 1 and 2 of this Agreement, four percent (4%) of Gross
Service Revenues from the Licensed Services;
(ii) in Year 3 of this Agreement, three and one-quarter percent
(3.25%) of Gross Service Revenues from Licensed Services;
(iii) in Years 4 and 5, and for each year during the renewal term, two
and one-half percent (2.5%) of Gross Service Revenues from Licensed
Services; and
(b) two million five hundred thousand dollars ($2,500,000) (the
"Minimum Guarantee").
5.2 Accounting. With respect to each Payment Period as defined herein,
Licensee shall furnish to Licensor a statement, in form reasonably acceptable to
Licensor, certified by a responsible officer of Licensee, showing all Gross
Service Revenues during such Payment Period, and the Brand Fund
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Fee as provided in Section 5.1. payable thereon. During the term of this
Agreement, such statement shall be furnished to Licensor not later than
forty-five (45) days after the end of each Payment Period.
5.3 Payment. With respect to each Payment Period as defined herein,
Licensee shall, irrespective of its own business and accounting method, pay
Licensor or Licensor's designee the Brand Fund Fee as provided in Section 5.1,
forty-five (45) days after the end of each Payment Period. The Brand Fund Fee
will be paid in U.S. currency. Licensee agrees that all of the Brand Fund Fees
received for each Payment Period will be designated and spent by Licensor, with
active participation of Licensee's CEO, on the following activities in support
of Licensor's brand strategy and to ensure proper positioning of the Licensee:
(a) the monitoring of the brand, including the development and
implementation of the Service Specifications set forth in Schedule E and
the requirements set forth in Schedule D of this Agreement, customer
satisfaction surveys, market research, and the management of corporate
identity ("Monitoring Services"). Except as provided in the last sentence
of this Section 5.3(a), no more than three million dollars ($3,000,000) of
the Brand Fund Fees shall be used each year of this Agreement for
Monitoring Services. Monitoring Services shall be subject to the following
conditions: (i) payments for Monitoring Services shall only be made to
Persons that are not Affiliates of Licensee or Licensor, (ii) Monitoring
Services shall be obtained on a cost effective basis using a reasonably
competitive process to the extent practicable and (iii) Monitoring Services
shall be implemented through the Communications Director and his/her team.
Following consultation between Licensor and Licensee's CEO, Brand Fund Fees
in excess of $3,000,000 per year may be designated and spent by Licensor
for Monitoring Services, upon the submission of reasonable supporting
documentation and subject to compliance with the conditions set forth above
in the immediately preceding sentence.
(b) the manpower, including salary and benefits, required to implement
the responsibilities of the Communications Director and his/her team of
five (5) country managers across all of Licensee's communications, provided
that such country managers shall be paid at competitive rates giving effect
to the business conditions in each country and shall devote, in a manner
consistent with the terms of this Agreement, all of their efforts to
support Licensee's business, except that Licensor shall have the right,
with the approval of Licensee's CEO, which shall not be unreasonably
withheld, to use such persons from time to time to support other Licensor
activities in the Latin American region;
(c) any additional manpower, including salary and benefits, based on
the needs of Licensor and Licensee's business and with the agreement of
Licensee's CEO, required to implement the responsibilities of the
Communications Director and his/her team;
(d) following consultation with Licensee's CEO, the implementation of
activities in support of the Licensed Master Service Marks ("the Corporate
Brand") and the position of the RV, as follows: corporate events, media
placement, creativity/production; brand agency costs, sponsorships/events,
and media relations ("Corporate Brand Efforts") and
(e) other items specified in this Agreement.
The foregoing obligation shall not apply to Brand Fund Fees received for
the last Payment Period of the renewal term (unless the parties enter a new
service ▇▇▇▇ license agreement with regard to the Licensed Marks), and shall
immediately cease if this Agreement terminates for any other reason.
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5.4 Audit of Licensee's Records. Licensee and any sublicensees shall keep
accurate books and records of all Gross Service Revenues, payments and Brand
Fund Fees, together with such other data as is necessary and material to
determine accurately the amounts payable hereunder. Licensor and Licensor's
designee shall be entitled to inspect, during normal business hours, the books
and records of Licensee and any sublicensees to ensure the proper reporting of
Gross Service Revenues, payments and Brand Fund Fees and Licensee and any
sublicensee's compliance with the terms and conditions of this Agreement. If
such inspection discloses no deficit or a cumulative deficit over the term of
this Agreement through the last Payment Period ending before the date of the
inspection of less than five percent (5%) from the statements provided under
Section 5.2, the cost of such inspection shall be borne by Licensor. If any such
cumulative deficit is five percent (5%) or greater, the cost of such inspection
shall be borne by Licensee or the appropriate sublicensee. Any payments due
under this Section shall be made in accordance with Section 22 hereof.
5.5 Cure or Termination. If Licensee is in default of any payment or fee
due hereunder, Licensee shall have thirty (30) days after receipt of written
notice of such default to it by Licensor to cure said default, failing which
this Agreement shall be subject to termination by Licensor exercisable thirty
(30) days after delivery of written notice to Licensee. If Licensee is in
default two (2) or more times in any two (2) year period, the Licensor shall
have the right to terminate this Agreement immediately by delivery of written
notice to Licensee by Licensor.
6. Brand Support Functions. Upon mutual agreement, Licensor and Licensee
may enter into a separate agreement, whereby Licensee may procure from Licensor
and Licensor would provide to Licensee certain marketing, promotion and sales
support functions in connection with the Licensed Services.
7. Retention of Rights. All existing goodwill in the Licensed Marks inures
to the sole benefit of the Licensor. Licensee's use of the Licensed Marks and
any and all goodwill that derives from such use, shall, except as provided in
Section 2.2(b), inure to the sole benefit of the Licensor. Except as otherwise
expressly provided in this Agreement, Licensor shall retain all rights in and to
the Licensed Marks, including all rights of ownership in and to the Licensed
Marks and the right to license others to use the Licensed Marks for any product
or service in the Licensed Territory and the rest of the Universe. Licensee
shall execute all documents required to effect any transfer of rights to
Licensor.
8. Quality Control.
8.1 General. Licensee acknowledges that the Licensed Services covered by
this Agreement must be of sufficiently high quality as to provide maximum
enhancement to and protection of the Licensed Marks and the goodwill they
symbolize. Licensee further acknowledges that the maintenance of high quality
services is of the essence of this Agreement and that it will utilize only
Marketing Materials which do not disparage or place in disrepute Licensor, its
businesses or its business reputation, or adversely affect or detract from
Licensor's goodwill.
8.2 Service Specifications. Licensee shall use the Licensed Marks only in
accordance with, and in connection with, the marketing and provision of Licensed
Services that meet the Service Specifications. The Service Specifications shall
consist of technical performance, customer service, customer satisfaction and
Marketing Specifications, shall be set forth in writing by Licensor and become
Schedule E to this Agreement, and shall be defined further as the Licensed
Services are developed for introduction and may evolve to meet market and other
needs. The Service Specifications are deemed to be Proprietary Information under
Section 21 hereof. Licensee shall not commence or continue to offer any Licensed
Service under the Licensed Marks unless it meets each of the relevant Service
Specifications. The initial definition of the Service Specifications will be
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determined solely by Licensor, following consultation with Licensee, and shall
be provided to Licensee for the countries of Brazil, Chile, Colombia and Peru
within three (3) months of the Effective Date of this Agreement, and for any
other country or jurisdiction in the Licensed Territory, within three (3) months
of written notice to Licensor that Licensee intends to begin offering the
Licensed Services in such country or jurisdiction. Licensee shall use its
commercially reasonable best efforts to become fully compliant with the relevant
Service Specifications within six (6) months after the delivery of such Service
Specifications by Licensor to Licensee.
8.3 Changes to Service Specifications.
(a) Except with respect to Marketing Specifications, the Service
Specifications may be amended, modified or supplemented from time to time
by Licensor, following consultation with Licensee. Following any such
amendment, modification or supplement to the Service Specifications,
Licensee shall within a reasonable time determined in the reasonable
judgment of Licensor following consultation with Licensee adhere to such
amendment, modification or supplement.
(b) The Marketing Specifications may be amended, modified or
supplemented from time to time by Licensor in its sole discretion. Within
sixty (60) days of Licensor's request to amend, modify, or supplement the
Marketing Specifications, Licensee shall adhere to such amendment,
modification or supplement.
8.4 Quality Service Reviews. Right of Inspection. Licensor shall have the
right to designate from time to time one or more Quality Control
Representatives, who shall have the right at any time upon fifteen (15) days
prior notice to conduct during Licensee's regular business hours an inspection,
test, survey and review of Licensee's facilities and otherwise to determine
compliance with the applicable Service Specifications. Licensee agrees to
furnish to the Quality Control Representatives (i) samples or simulations of
Licensed Services and Marketing Materials that are marketed or provided under
the Licensed Marks as Licensor may request from time to time, for inspections,
surveys, tests and reviews to assure conformance of the Licensed Services and
the Marketing Materials with the applicable Service Specifications and (ii) all
performance data in its control relating to the conformance of such Licensed
Services with the applicable Service Specifications. Licensor may independently
conduct continuous customer satisfaction surveys to determine if Licensee is
meeting the Service Specifications. Any information obtained by either party or
disclosed by one party to the other party pursuant hereto shall be deemed to be
Proprietary Information of the party obtaining the information or disclosing the
information pursuant to Section 21 hereof. If Licensee has actual knowledge that
it is not complying with any Service Specification it shall notify Licensor and
the provisions of Section 9 shall apply to such noncompliance.
8.5 Communications Director. As set forth in Section 5.3(b) and (c), a
Communications Director and at least five (5) persons reporting to the
Communications Director shall be employed by Licensor at Licensor's sole cost
and expense from the Brand Fund Fee. The Communications Director shall have
several responsibilities relating to Licensee's use of the Licensed Marks, which
shall include: (i) brand management, (ii) marketing communications, (iii)
advertising and direct marketing, (iv) public relations, and (v) the monitoring
of compliance with Service Specifications. The Communications Director shall (i)
review and approve, subject to the concurrence of the Licensor's Vice President
of Communications for Latin America or other Licensor-designated representative,
all Licensee-produced Marketing Materials to ensure adherence to Licensor's
brand positioning, policies and values and shall receive directions regarding
brand position, brand strategy, brand values and implementation parameters from
Licensor's Vice-President of Communications for
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Latin America or other Licensor-designated representative; (ii) ensure
coordination and alignment of Licensee's and Licensor's brand activities,
including brand alignment of all of Licensee's corporate communications,
including advertising, sponsorship/events, and identity; (iii) provide feedback
to Licensee on reports required in the Service Specifications and reporting
Licensee's performance with regard to Service Specifications to Licensor, (iv)
planning and execution of public relations and media relations programs as
further described herein, (v) planning and execution of marketing communications
programs as further described herein, and (vi) manage, along with Licensor's
Vice President of Communications for Latin America or other Licensor-designated
representative, the advertising, direct marketing and public relations brand
agencies used by Licensee. All activities relating to the Corporate Brand
Efforts that are funded by the Brand Fund Fee shall be planned and implemented
in the Latin American region by the Licensor's Latin America Communications
Group with the participation of Licensee's CEO and the Communications Director.
The parties agree that all communications efforts, whether Corporate Brand
Efforts or Licensee Brand Efforts, shall be aligned to Licensor's brand
positioning and strategy, but their implementation shall ensure relevancy to the
markets to which they will be targeted. The Communications Director shall also
attend all Marketing Task Force or similar meetings of Licensor and Licensee,
and will attend relevant marketing and strategy meetings of both Licensor and
Licensee. The Communications Director will work closely with Licensee's CEO and
his/her senior management team and the Licensor's Vice President of
Communications for Latin America in coordinating the overall alignment of
Licensee's and Licensor's brand building activities in the Licensed Territory.
Specifically, Licensee's CEO and his/her senior management team shall provide
the Communications Director with the Licensee's business direction, strategies
and plans for the Communications Director's use in the planning and execution of
marketing communications, public relations and media relations programs which
support Licensee's business goals. Communications programs developed for
Licensee Brand Efforts shall be approved by Licensee's senior management team.
Public relations and media relations programs developed for Licensee Brand
Efforts shall be approved by Licensee's CEO. Licensor and Licensee shall jointly
evaluate the performance of the Communications Director, and Licensor's Vice
President of Communications for Latin America or other Licensor-designated
representative shall provide performance reviews to the Communications Director.
After consultation with Licensee, Licensor will have the sole right to replace
the Communications Director as well as any person reporting to the
Communications Director who was designated by Licensor. Licensee's CEO shall
contact Licensor's Vice President for Latin America regarding problems or
concerns which may arise from time to time with regard to the Communications
Director and his/her team, and Licensor's Vice President for Latin America shall
consult with Licensee's CEO regarding the appropriate corrective measures to be
taken. Funding for Corporate Brand Efforts in Latin America will be defined and
managed by Licensor with the active participation of Licensor's Communications
Director and Licensee's CEO. Licensee shall use brand agencies designated by
Licensor provided that their cost, service and quality are competitive with
local first class international agencies operating in Latin America. The
Licensor's Vice President of Communications for Latin America or other
Licensor-designated representative shall oversee the performance of and shall
have responsibility for employing any corrective measures required with regard
to the brand agencies, but Licensee's CEO and his/her senior management team
shall provide input to Licensor in connection with the evaluation of the brand
agencies. In the event that one or more of the brand agencies designated by
Licensor do not meet or continue to meet relevant cost, service and quality
criteria after corrective measures are implemented, Licensor's Vice President of
Communications for Latin America or other Licensor-designated representative,
with Licensee CEO's active participation, shall select alternative agencies.
Licensee's CEO and his/her senior management team shall communicate directly
with the Communications Director to enable the
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effective performance of his/her responsibilities and management of issues
related to the Licensed Marks.
8.6 Costs. Each party shall bear its own costs associated with, and all
risk of loss and damage resulting from, all inspections, surveys, tests and
reviews under this Section. Except as otherwise agreed herein, Licensee shall
bear the costs for marketing communications, public relations and local
advertising; while Licensor shall bear the cost of regional advertising in Latin
America from the Brand Fund Fee.
8.7 Sponsorship. Licensee shall not use the Licensed Marks to sponsor,
endorse, or claim affiliation with any event, meeting, charitable endeavor or
any other undertaking without the express written permission of Licensor. Any
breach of this provision shall be deemed a Significant Breach by Licensee.
9. Remedies for Noncompliance with Service Specifications.
9.1 Initial Cure Period. If Licensor becomes aware that Licensee is not
complying with any Service Specifications, or otherwise is in breach as defined
by Sections 12.2(d) or (e), Licensor shall notify Licensee in writing, setting
forth, in reasonable detail, a written description of the noncompliance and any
suggestions for curing such noncompliance. Licensee shall have sixty (60) days
from receipt of the description of noncompliance to correct such noncompliance,
in the case of all Service Specifications, except those Service Specifications
relating to Marketing Specifications (an "Initial Cure Period"). In the case of
Licensee's noncompliance with respect to Service Specifications relating to
Marketing Materials or Marketing Specifications, or where the Licensee otherwise
is in breach as defined by Sections 12.2(a) or (f), Licensee shall immediately
cease using any and all Marketing Materials which are in noncompliance with
Service Specifications relating to Marketing Materials or Marketing
Specifications, cease any other activity in noncompliance with these Service
Specifications, and withdraw all Marketing Material in noncompliance with the
Marketing Specifications. If there is any other noncompliance with respect to
Service Specifications or if the Licensee is otherwise in breach as defined in
Sections 12.2(a) or (f), and such breach continues beyond a twenty (20) day
period, Licensee shall within a reasonable time but in any event within sixty
(60) days of the end of such twenty (20) day period either comply with the
Service Specifications or shall be deemed to be in breach of this Agreement.
9.2 Second Cure Period. If the noncompliance with the technical
performance, customer service or customer satisfaction Service Specifications
other than Marketing Specifications is not cured within the Initial Cure Period,
either party may notify the other party thereof, setting forth, in detail, the
reasons for noncompliance. Within ninety (90) days of receipt of any such
notification, Licensor and Licensee shall create a mutually acceptable, detailed
plan to rectify such noncompliance and Licensee and Licensor shall agree upon a
reasonable and prompt timetable (the "Second Cure Period") to develop and
implement this plan. Each party shall use all reasonable efforts to develop and
implement this plan.
9.3 Final Cure Period. If the noncompliance with the technical
performance, customer service or customer satisfaction Service Specifications
continues beyond the Second Cure Period, or if the parties are unable to reach
agreement on a plan within the ninety (90) day time period set forth in Section
9.2 hereof and the Licensee is still in noncompliance, either party may notify
the other party thereof and Licensee shall either cease offering the Licensed
Service(s) which is or are not in compliance until it can comply with the
Service Specifications or be deemed to be in breach of this Agreement.
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9.4 Potential Injury to Persons or Property. Notwithstanding the
foregoing, in the event that Licensor reasonably determines that any
noncompliance with any Service Specification creates a material threat of
personal injury or injury to property of any third party, upon written notice
thereof by Licensor to Licensee, Licensee shall either cease offering the
applicable Licensed Service under the Licensed Marks until it can comply with
the Service Specifications or be deemed to be in breach of this Agreement.
9.5 Costs. Except as otherwise expressly provided herein, all costs
relating to effecting cures, including Licensor's and any consulting firm's
and/or arbitrator's time and expenses and any additional monitoring required,
shall be borne by Licensee.
10. Protection of Licensed Marks.
10.1 Ownership and Rights. Except as otherwise expressly provided in
Section 2.2(b) Licensee acknowledges that Licensor is the sole owner of all
rights, title and interest in and to the Licensed Marks. Licensee admits the
validity of, and agrees not to challenge the ownership or validity of the
Licensed Marks. Licensee shall take no action with respect to obtaining
intellectual property rights in the Licensed Marks without the approval of
Licensor. Licensor represents and warrants that the use of the Licensed Master
Service Marks by the Licensee for the Licensed Services does not infringe the
registered marks of any third party. Licensor shall use reasonable efforts to
ensure that each Licensed Ancillary Service ▇▇▇▇ (other than those Licensed
Ancillary Service Marks developed by Licensee as provided in Section 2.2) is a
▇▇▇▇ which is available for use and registration in the Licensed Territory for
the particular service at issue. Licensee shall not disparage or adversely
affect the validity of the Licensed Master Service Marks, the Licensed Ancillary
Service Marks, or the Licensed Trade Dress. Licensee will not grant or attempt
to grant a security interest in the Licensed Master Service Marks, the Licensed
Ancillary Service Marks, or the Licensed Trade Dress, or this Agreement, or to
record any such security interest in the Licensed Territory or elsewhere against
any trademark or service ▇▇▇▇ application or registration belonging to Licensor.
Licensee agrees to execute all documents including a Registered User Application
reasonably requested by Licensor to effect further registration, maintenance and
renewal of the Licensed Master Service Marks and the Licensed Ancillary Service
Marks and, where applicable, to record Licensee as a registered user of the
Licensed Master Service Marks and the Licensed Ancillary Service Marks. For
purposes of this Agreement, Licensee shall be considered a "registered user" of
the Licensed Master Service Marks and Licensed Ancillary Service Marks under the
laws of the countries in the Licensed Territory, from time to time applicable.
10.2 Similar Marks. Licensee further agrees not to use, acquire or
register in any country any ▇▇▇▇ resembling or confusingly similar or deceptive
or misleading with respect to the Licensed Marks and not to use or register the
Licensed Marks or any part thereof as part of its corporate or trade name except
as authorized in this Agreement. Licensee further agrees not to use or register
in any country any ▇▇▇▇ which dilutes the Licensed Marks. If any application for
registration is or has been filed in any country or political entity by Licensee
which relates to any ▇▇▇▇ which, in the sole opinion of Licensor acting in good
faith, is confusingly similar, deceptive or misleading with respect to the
Licensed Master Service Marks, the Licensed Ancillary Service Marks, or the
Licensed Trade Dress, or which dilutes the Licensed Master Service Marks, the
Licensed Ancillary Service Marks, or the Licensed Trade Dress, Licensee shall,
within a reasonable time, but in any event within 30 days of written request
from Licensor, at Licensor's sole discretion acting in good faith, immediately
abandon any such application or registration or assign it to Licensor. If
Licensee uses any ▇▇▇▇ which, in the sole opinion of Licensor acting in good
faith, is confusingly similar, deceptive or misleading with respect to the
Licensed Master Service Marks, the Licensed Ancillary Service
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Marks, or the Licensed Trade Dress, or which dilutes the Licensed Master Service
Marks, the Licensed Ancillary Service Marks, or the Licensed Trade Dress, or if
Licensee uses the Licensed Master Service Marks, the Licensed Ancillary Service
Marks, or the Licensed Trade Dress in connection with any product or in
connection with any service not specifically authorized hereunder, Licensee
shall, within a reasonable time, but in any event within thirty (30) days of
receiving written request from Licensor, permanently cease such use. Licensee
shall reimburse Licensor for all the costs and expenses of any litigation,
opposition, cancellation or related legal proceedings, including legal fees,
instigated by Licensor or its authorized representative, in connection with any
such use, registration or application.
10.3 Infringement. In the event that Licensee learns of any infringement
or threatened infringement of the Licensed Marks or any unfair competition,
passing-off or dilution with respect to the Licensed Master Service Marks, the
Licensed Ancillary Service Marks, or the Licensed Trade Dress, or any third
party alleges or claims that either the Licensed Master Service Marks, the
Licensed Ancillary Service Marks, or the Licensed Trade Dress are liable to
cause deception or confusion to the public, or are liable to dilute or infringe
any right of such third party, Licensee shall immediately notify Licensor or its
authorized representative giving particulars thereof and Licensee shall provide
necessary information and assistance to Licensor or its authorized
representatives in the event that Licensor decides that proceedings should be
commenced or defended.
Licensor shall have exclusive control of any litigation, opposition,
cancellation or related legal proceedings, or the settlement or compromise of
any claim. The decision whether to bring, defend, maintain or settle any such
proceedings shall be at the exclusive option and expense of Licensor and all
recoveries shall belong exclusively to Licensor and all reasonable expenses or
losses of Licensee in connection therewith shall be paid by Licensor to
Licensee. Licensee will not initiate any such litigation, opposition,
cancellation or related legal proceedings in its own name but, at Licensor's
request, agrees to be joined as a party in any action taken by Licensor to
enforce its rights in the Licensed Master Service Marks, the Licensed Ancillary
Service Marks, or the Licensed Trade Dress.
Licensor shall reimburse Licensee for all reasonable expenses of Licensee
solely in its role as a party in the action. Nothing in this Agreement shall
require or be deemed to require Licensor to enforce the Licensed Master Service
Marks, the Licensed Ancillary Service Marks, or the Licensed Trade Dress.
In the event of any claim, action, proceeding or suit by a third party
against Licensee alleging an infringement by any of the Licensed Marks or
copyright, by reason of the use, in accordance with the Service Specifications,
of the Licensed Master Service Marks, the Licensed Ancillary Service Marks, or
the Licensed Trade Dress in association with the Licensed Service(s), Licensor,
at its expense, will defend Licensee subject to the following conditions:
Licensor will reimburse Licensee for any reasonable costs, expenses, and
legal fees incurred in connection with obtaining advice concerning its liability
with respect to the claim, action, proceeding or suit, but not legal fees, costs
and expenses involved in connection with the defense of the claim, action,
proceeding or suit, unless incurred at Licensor's written request or
authorization in which case Licensor will promptly reimburse Licensee in full
for such amounts. Licensor also will indemnify Licensee against any liability
(including any fines, penalties and punitive damages) assessed against Licensee
by final judgment or order from which no appeal lies or the time for appeal has
expired on account of such infringement or violation arising out of such use.
10.4 Compliance With Laws. In the performance of this Agreement, Licensee
and Licensor shall comply with all applicable laws and regulations, including
those laws and regulations particularly
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pertaining to the proper use and designation of Marks in the countries in the
Licensed Territory. Should either party be or become aware of any applicable
laws or regulations which are inconsistent with the provisions of this
Agreement, such party shall promptly notify the other of such inconsistency. In
such event, Licensor may, at its option, either waive the performance of such
inconsistent provisions or negotiate with Licensee to make changes in such
provisions to comply with applicable laws and regulations.
11. No Transfer of Licensed Rights.
11.1 No Sublicensing; Assignment; Rights to Marketing Materials and Trade
Dress. Licensee shall not, except as provided in Section 2.1, (i) assign,
license, transfer or part with any of its rights or obligations hereunder
(whether by amalgamation, merger, consolidation, sale or otherwise), or (ii)
grant or purport to grant any sublicense in respect of the Licensed Marks.
11.2 Copyright License. Licensee acknowledges that the Marketing Materials
and all proprietary rights therein are owned by or licensed to and reserved to
Licensor and they are valid. Licensor hereby grants Licensee a royalty-free,
non-exclusive, copyright license in the Licensed Territory to reproduce,
distribute, display, perform and create derivative works from all Marketing
Materials in connection with the provision of Licensed Services pursuant to this
Agreement. Licensee shall neither acquire nor assert copyright, patent,
industrial design, service ▇▇▇▇ or trademark ownership or any other proprietary
rights in and to the Marketing Materials or in any derivation, adaptation or
variation thereof. Any and all trademarks, service marks, copyrights (subject to
any moral rights of Licensee which may not be assigned by operation of
applicable law), or related rights accruing to Licensee in the Marketing
Materials by virtue of its sale, distribution, performance or provision of the
services in the Licensed Territory shall vest automatically at the time of
accrual solely and exclusively in Licensor. Licensee shall sign all documents
requested by Licensor to effectuate the transfer of these rights to Licensor,
failing which Licensor may, and Licensee hereby grants Licensor the right to,
execute documents on behalf of Licensee to secure or effectuate such rights. In
the event this Agreement is terminated, canceled or expires, Licensee shall
immediately upon such termination, cancellation or expiration cease all use in
any manner of such Marketing Materials and shall assign any and all right, title
and interest in and to any and all trademarks, service marks, copyrights,
(subject to any moral rights of Licensee which may not be assigned by operation
of applicable law) and other related proprietary rights in the Marketing
Materials or in any derivation, adaptation or variation thereof the Licensee
owns to Licensor.
11.3 Trade Dress. Licensee shall assign to Licensor all rights, title,
interest and related goodwill in and to any Licensed Trade Dress it develops or
uses in connection with the provision of services under this Agreement. Such
assignment shall be made on a non-fee, royalty-free basis.
12. Terms and Termination.
12.1 Term.
(a) Unless earlier terminated in accordance with this Section 12, the
initial term of this Agreement shall be five (5) years from the Effective
Date. This Agreement shall automatically be renewed at the end of the
initial term for an additional five (5) year term, provided that Licensee
is not in default pursuant to Section 5 or in breach pursuant to Section
12.2.
(b) Licensor in its sole discretion may terminate this Agreement if
Licensor and/or its other Affiliates cease to own, directly and indirectly,
a majority of the voting power of Licensee.
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(c) All sublicenses granted hereunder shall terminate upon the
termination of this Agreement.
(d) This Agreement shall terminate in the event of the termination for
failure of Licensee to perform under the ▇▇▇▇▇ Investment Agreement or
other agreements related thereto.
12.2 Breach by Licensee. Licensor may terminate this Agreement at any time
in the event of a Significant Breach by Licensee. A "Significant Breach by
Licensee" shall mean, after exhaustion of any applicable cure provisions set
forth in Sections 9 or 5 hereof, any of the following:
(a) Licensee's use of any ▇▇▇▇ (including the Licensed Master Service
Marks, the Licensed Ancillary Service Marks, or Licensed Trade Dress)
contrary to this Agreement including any use which disparages or places in
disrepute Licensor, its businesses, or its business reputation, or
adversely affects or detracts from Licensor's goodwill;
(b) Licensee's refusing or neglecting a request by Licensor for access
to Licensee's facilities or Marketing Materials, which continues for thirty
(30) days following a written description of the noncompliance and any
suggestions for curing such noncompliance;
(c) Licensee's Bankruptcy or Licensee's licensing, assigning,
transferring or parting with (or purporting to license, assign, transfer or
part with) any of the rights granted in this Agreement to others without
the prior written approval of Licensor;
(d) Licensee's failure to maintain the Service Specifications and
other information furnished under this Agreement in confidence or failing
to restrict the transmission of information, products and commodities as
required by this Agreement;
(e) Licensee's failure to abide by the Service Specifications in the
sale, distribution, performance or provision of the Licensed Services,
other than relating to Marketing Materials;
(f) Licensee's failure to abide by the Service Specifications relating
to Marketing Materials in the sale, distribution, performance or provision
of the Licensed Services;
(g) Licensee's failing to make any payment specified in this
Agreement, including without limitation payments required under Sections 4
or 5 or 8 or 9 hereof;
(h) Licensee's failure to abide by Section 8.7 of this Agreement
relating to sponsorship; or
(i) Licensee's failure to obtain the recordal, approval or permits
required under Section 17 hereof.
12.3 Termination Obligations. In the event this Agreement terminates,
expires or is canceled in accordance with Section 12.2 hereunder, Licensee shall
immediately, and permanently cease all use of the Licensed Marks, the use of
"AT&T" as part of its corporate and trade name, and use of any proprietary
materials of Licensor furnished hereunder and shall not use any confusingly
similar name, ▇▇▇▇ or trade dress, and Licensee shall have no further rights
under this Agreement. In the event this Agreement terminates or expires in
accordance with any other provision of this Agreement, Licensee shall have six
(6) months to cease all use of the Licensed Marks and any proprietary materials
of Licensor furnished hereunder and to change its corporate name and to cause
its Subsidiaries that are using "AT&T" as part of their corporate names to
change their names, and shall thereafter not use any confusingly similar name,
▇▇▇▇ or trade dress and Licensee shall have no further rights under this
Agreement.
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12.4 No Waiver of Rights. In addition to any other provision of this
Section 12, each party will retain all rights to any other remedy it may have at
law or equity for any breach by the other of this Agreement.
13. Indemnity. Licensee shall defend, indemnify and hold Licensor, its
other Affiliates and authorized representatives harmless against all claims,
suits, proceedings, costs, damages and judgments incurred, claimed or sustained
by third parties whether for personal injury, or property damage, due to
Licensee's marketing, sale, or use of services bearing the Licensed Master
Service Marks, the Licensed Ancillary Service Marks, or the Licensed Trade Dress
and shall indemnify Licensor for all damages, losses, costs and expenses
(including reasonable attorneys' fees and expenses) due to such use or any
improper or unauthorized use of the Licensed Marks.
14. Insurance.
14.1 Insurance Policy. Licensee shall maintain, at its own expense, in
full force and effect at all times during which services bearing the Licensed
Master Service Marks, the Licensed Ancillary Service Marks or the Licensed Trade
Dress are being sold, with a responsible insurance carrier acceptable to
Licensor, at least a Five (5) Million U.S. Dollar (U.S. $5,000,000.00)
comprehensive general liability insurance policy with respect to the services
offered under the Licensed Marks. This insurance shall name Licensor as an
insured party, shall be for the benefit of Licensor and Licensee and shall
provide for at least ten (10) days prior written notice to Licensor and Licensee
of the cancellation or any substantial modification of the policy. This
insurance may be obtained for Licensor by Licensee in conjunction with a policy
which covers services and/or products other than the Licensed Services covered
under this Agreement.
14.2 Evidence of Insurance. Licensee shall, from time to time upon
reasonable request by Licensor, promptly furnish or cause to be furnished to
Licensor evidence in form and substance satisfactory to Licensor, of the
maintenance of the insurance required by Section 14.1 hereof, including without
limitation originals or copies of policies, certificates of insurance (with
applicable riders and endorsements) and proof of premium payments.
15. Notices, etc. All notices, requests, demands or other communications
required by or otherwise with respect to this Agreement shall be in writing and
shall be deemed to have been duly given to any party when delivered personally
(by courier service or otherwise), when delivered by telecopy and confirmed by
return telecopy, or seven days after being mailed by first-class mail, postage
prepaid in each case to the applicable addresses set forth below:
If to Licensee:
Kiri Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
General Counsel
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
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If to Licensor:
AT&T Corp.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
and
AT&T Corp.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Trademark and Copyright Counsel
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address as such party shall have designated by notice so given
to each other party.
16. Compliance with Law. Nothing in this Agreement shall be construed to
prevent Licensor or Licensee from complying fully with all applicable laws and
regulations, whether now or hereafter in effect.
17. Governmental Licenses, Permits and Approvals. Licensee, at its
expense, shall be responsible for obtaining and maintaining all licenses,
permits and Regulatory Approvals which are required by all Regulatory
Authorities with respect to this Agreement, and to comply with any requirements
of such Regulatory Authorities for the registration, approval or recording of
this Agreement or any related Registered User Applications and for making
payments hereunder. Licensee shall furnish to Licensor written evidence from
such Regulatory Authorities of any such licenses, approvals, permits,
clearances, authorizations, Regulatory Approvals, registration or recording.
Licensor and Licensee agree that Licensor shall record this License Agreement
with the appropriate authorities in the Licensed Territory where such licenses
shall be recorded, pay the necessary fees and do all that may be required to
effect such recordation and to obtain recognition of Licensee as an authorized
or registered user of the Licensed Marks.
18. Export
Licensee acknowledges that any products, software, and technical
information (including, but not limited to services and training) provided under
this Agreement are subject to U.S. export laws and regulations and any use or
transfer of such products, software, and technical information must be
authorized under those regulations. Licensee agrees that it will not use,
distribute, transfer, or transmit the products, software, or technical
information (even if incorporated into other products) except in compliance with
U.S. export regulations. If requested by Licensor, Licensee also agrees to sign
those export-related documents which may be required for Licensor to comply with
U.S. export regulations. The obligations of this section shall survive and
continue after any termination of rights under this Agreement.
19. Applicable Law; Jurisdiction. The construction, performance and
interpretation of this Agreement shall be governed by the laws of the State of
New York, U.S.A. without giving effect to its principles or rules of conflicts
of law to the extent that such principles or rules would require or permit the
application of the laws of another jurisdiction, provided that if the foregoing
laws should be modified during the term hereof in such a way as to adversely
affect the original intent of the parties, the parties will negotiate in good
faith to amend this Agreement to effectuate their original intent as closely as
possible. Subject to Section 20, Licensee and Licensor hereby irrevocably and
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unconditionally consent to submit to the exclusive jurisdiction of the courts of
the State of New York and of the United States of America located in the State
of New York (the "New York Courts") for any litigation arising out of or
relating to this Agreement and the transactions contemplated hereby (and agrees
not to commence any litigation relating thereto in a court except in such
courts), waives any objection to the laying of venue of any such litigation in
the New York Courts and agrees not to plead or claim in any New York Court that
such litigation brought therein has been brought in an inconvenient forum.
Licensee and Licensor hereby waive any right to a trial by jury.
20. Dispute Resolution.
20.1 Arbitration. Any dispute, controversy or claim arising out of,
relating to, or in connection with, this Agreement, or the breach, termination
or validity thereof, whether based on contract, tort, statute, fraud,
misrepresentation or any other legal or equitable theory (each a "Claim"), shall
be finally settled by binding arbitration. The arbitration shall be conducted in
accordance with the CPR Rules for Non-Administered Arbitration in effect at the
time of the arbitration, except as they may be modified herein or by mutual
agreement of the parties. The seat of the arbitration shall be New York City,
New York, and it shall be conducted in the English language. Notwithstanding
Section 19 hereof, the arbitration and this clause shall be governed by Title 9
(Arbitration) of the United States Code. Any request for interim measures
pursuant to Section 23.5 hereof or otherwise shall not be deemed incompatible
with, or a waiver of, this agreement to arbitrate.
20.2 Number of Arbitrators/Selection. The arbitration shall be conducted
by three arbitrators. The party initiating arbitration (the "Claimant") shall
appoint an arbitrator in its request for arbitration (the "Request"). The other
party (the "Respondent") shall appoint an arbitrator within 30 days of receipt
of the Request and shall notify the Claimant of such appointment in writing. If
within 30 days of receipt of the Request by the Respondent, either party has not
appointed an arbitrator, then that arbitrator shall be appointed by CPR
Institute for Dispute Resolution. The first two arbitrators appointed in accord
with this provision shall appoint a third arbitrator within 30 days after the
Respondent has notified Claimant of the appointment of the Respondent's
arbitrator or, in the event of a failure by a party to appoint, within 30 days
after the CPR Institute for Dispute Resolution has notified the parties and any
arbitrator already appointed of its appointment of an arbitrator on behalf of
the party failing to appoint. When the third arbitrator has accepted the
appointment, the two arbitrators making the appointment shall promptly notify
the parties of the appointment. If the first two arbitrators appointed fail to
appoint a third arbitrator or so to notify the parties within the time period
prescribed above, then the CPR Institute for Dispute Resolution shall appoint
the third arbitrator and shall promptly notify the parties of the appointment.
The third arbitrator shall act as Chair of the tribunal.
20.3 Certain Procedures. The arbitration panel shall strictly limit
discovery to the production of documents directly relevant to the facts alleged
by the Claimant and the Respondent, and if depositions are required, each party
shall be limited to five depositions. Each party shall bear its own expenses,
but those related to the compensation of the arbitrators shall be borne equally.
20.4 Arbitral Award. The arbitral award shall be in writing, state only
the damages and injunctive relief granted and be final and binding on the
parties. The parties hereto expressly waive and forgo any right to punitive,
exemplary or similar damages as a result of any Claim. The arbitrators shall
orally state the reasoning on which the arbitral award rests but shall not state
such reasoning in any writing. The arbitration panel shall endeavor to issue the
arbitral award within six months of the Request, but failure to do so shall not
effect the validity of the arbitral award. The parties agree that the existence
and contents of the entire arbitration, including the award, shall be
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deemed a compromise of a dispute under Rule 408 of the Federal Rules of
Evidence, shall not be discoverable in any proceeding, shall not be admissible
in any court (except for the enforcement thereof) or arbitration and shall not
bind or collaterally estop either party with respect to any claim or defense
made by any third party.
20.5 Confidentiality of Proceedings. All proceedings in connection with
any arbitration, including its existence, the content of the proceedings and any
decision, shall be kept confidential to the maximum extent possible consistent
with the law. The arbitrator shall issue an order preventing the parties, CPR
Institute for Dispute Resolution and any other participants to the arbitration
from disclosing to any third party any information obtained via the arbitration,
including discovery of documents, evidence, testimony and the award except as
may be required by law.
20.6 Judgment. Judgment upon the decision may be entered by any court
having jurisdiction thereof or having jurisdiction over the relevant party or
its assets, provided that the party entering the award shall request that the
court prevent the award from becoming publicly available except as may be
required by law.
21. Confidentiality of Information and Use Restriction. The Service
Specifications disclosed and/or furnished to Licensee by Licensor under this
Agreement and all copies of the Service Specifications made by Licensee,
including translations, compilations and partial copies (the "Material") shall
remain the property of the Licensor and shall be returned to Licensor upon
request. Licensee shall use the Material solely for the purposes described in
this Agreement. Licensee shall hold in confidence during and after the
termination, expiration or cancellation of this Agreement and shall not disclose
such Material to any third party without the prior written consent of the
Licensor.
The Proprietary Information disclosed and/or furnished by one party to
another under this Agreement and all copies thereof made by the receiving party,
including translations, compilations and partial copies shall remain the
property of the disclosing party and shall be returned to the disclosing party
upon request. The receiving party shall use the Proprietary Information solely
for the purposes described in this Agreement. The receiving party shall hold in
confidence during and after the termination, expiration or cancellation of this
Agreement and not disclose, provide, or otherwise make available, in whole or in
part such Proprietary Information to any third party without the prior written
consent of the disclosing party, except Proprietary Information which, as
established by reasonable proof by the receiving party:
(i) at the time of the alleged disclosure, is known to the public;
(ii) after the time of disclosure, becomes known to the public other
than by or through a violation of this Agreement by the receiving party
either directly or indirectly;
(iii) at the time of disclosure, is in the possession of the receiving
party and was not acquired directly or indirectly from the disclosing
party;
(iv) after the time of disclosure is lawfully received by the
receiving party from a third party who has lawfully received it; or
(v) at the time of disclosure, is required to be disclosed by law or
by any government or regulatory agency having jurisdiction for
telecommunication services, the receiving party making reasonable effort to
have the agency retain the Proprietary Information in confidence.
Both parties shall ensure that only its employees with a need to know the
Proprietary Information shall have access to it and then only if those employees
have entered an appropriate
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confidentiality and use restriction agreement obligating them at least to the
same extent as the Licensee is obligated under this Agreement.
The receiving party of the Proprietary Information shall exercise a
standard of care under this Section that is not less than the standard of care
Licensor exercises under its own corporate policy for confidentiality and use
restrictions for its own Proprietary Information.
If and when Licensor receives Proprietary Information of Licensee through
inspection, test, survey and review of Licensee's facilities and otherwise to
determine compliance with the applicable Service Specifications, Licensor's
non-disclosure requirements hereunder shall be for a period not to exceed three
years from the termination or expiration of this Agreement.
22. Payments.
22.1 Payments. All payments or fees due under this Agreement ("Payments")
shall be made on the date that they are due and shall be subject to a late
payment charge equal to the lesser of (i) U.S. dollar LIBOR rate (London Inter
Bank Offer Rate) quoted for sixty (60) day advances (quoted on TELERATE, a
service of Dow ▇▇▇▇▇) plus 600 basis points starting on the date the Payment is
due plus 600 basis points accruing from the due date to date of receipt of the
balance owed by the Licensee and (ii) the maximum rate permitted by law. If
receipt occurs later than sixty (60) days from the due date, a weighted average
is computed based on successive sixty (60) day rates (e.g., if a year elapses
six rates taken sixty (60) days apart would be averaged.)
22.2 Taxes. All Payments due under this Agreement shall be made in full
without any deduction or withholding whatsoever for taxes or duties imposed by
the countries in the Licensed Territory or any subdivision or local jurisdiction
thereof, unless such withholding or deduction is required by law in which event
Licensee shall pay to Licensor such additional amount so that the net amount
received by Licensor after the deduction or withholding will equal the full
amount which would have been received by it had no such deduction or withholding
been made.
22.3 Payment of Brand Fund Fees. The payment of the Brand Fund Fees and
any associated late charges under Section 22.1 shall be made via electronic
funds transfer to a bank account designated by Licensee solely for this purpose
with notice to Licensor as to its existence and signing authority, and the funds
in such account shall be accessible solely by the Licensor Vice President for
Latin America and/or other Licensor-designated representative.
23. Miscellaneous.
23.1 Name, Captions. The name assigned this Agreement and the section
captions used herein are for convenience of reference only and shall not affect
the interpretation or construction hereof.
23.2 Entire Agreement. The provisions of this Agreement (including the
Schedules hereto) contain the entire agreement between the parties relating to
use by Licensee of the Licensed Marks and supersede all prior agreements and
understandings relating to the subject matter hereof. No rights are granted to
use the Licensed Marks except as specifically set forth in this Agreement. In
the event of any conflict between the provisions of this Agreement and
provisions of other agreements involving Licensor and Licensee, the provisions
of this Agreement shall prevail. This Agreement is not a franchise, does not
create a partnership or joint venture and shall not be deemed to constitute an
assignment of any rights of Licensor to Licensee. Licensee is an independent
contractor, not an agent or employee of Licensor, and Licensor is not liable for
any acts or omissions by Licensee. The continuing obligations of Licensee in
this Agreement, including those obligations set forth in Sections 10.2 and 18,
shall survive and continue after the expiration, cancellation, or termination of
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this Agreement. With respect to Section 21, the obligations shall survive and
continue for a period of three (3) years following such expiration, cancellation
or termination of this Agreement. Notwithstanding the foregoing, the
confidentiality provisions of the Purchase Agreement are not in any way altered,
amended, extended, contracted or superseded by this Section 23.2 of this
Agreement.
23.3 Amendments, Waivers, etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified except by an instrument in writing
signed by the parties.
23.4 Severability. If any term of this Agreement or the application
thereof to any party or circumstance shall be held invalid or unenforceable to
any extent, the remainder of this Agreement and the application of such term to
the other parties or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by applicable law.
23.5 Specific Performance. The parties acknowledge that money damages are
not an adequate remedy for violations of this Agreement and that any party may,
in its sole discretion, apply to a court of competent jurisdiction for specific
performance, interim or injunctive or such other relief as such court may deem
just and proper in order to enforce this Agreement or prevent any violation
hereof and, to the extent permitted by applicable law, each party waives any
objection to the imposition of such relief.
23.6 Remedies Cumulative. All rights, powers and remedies provided under
this Agreement or otherwise available in respect hereof at law or in equity
shall be cumulative and not alternative, and the exercise or beginning of the
exercise of any thereof by any party shall not preclude the simultaneous or
later exercise of any other such right, power or remedy by such party.
23.7 No Waiver. The failure of any party hereto to exercise any right,
power or remedy provided under this Agreement or otherwise available in respect
hereof at law or in equity, or to insist upon compliance by any other party
hereto with its obligations hereunder, and any custom or practice of the parties
at variance with the terms hereof, shall not constitute a waiver by such party
of its right to exercise any such or other right, power or remedy or to demand
such compliance.
23.8 No Third Party Beneficiaries. This Agreement is not intended to be
for the benefit of and shall not be enforceable by any person or entity who or
which is not a party hereto.
23.9 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one instrument. Each counterpart may consist of a
number of copies each signed by less than all, but together signed by all, the
parties hereto.
23.10 Further Assurances. Each of the parties shall, and shall cause its
Affiliates to, from time to time, execute and deliver such additional
instruments, documents, conveyances or assurances and take other such actions as
shall be necessary or otherwise reasonably requested by a party, to confirm and
assure the rights and obligations provided for in this Agreement and render
effective the consummation of the transactions contemplated hereby, or otherwise
carry out the intent and purposes of this Agreement.
23.11 Construction of this Agreement. In any construction of this
Agreement, this Agreement shall not be construed against any party based upon
the identity of the drafter of the Agreement or any provision of it.
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23.12 Effective Date. This Agreement shall become effective upon the date
of the consummation of the Merger under the Merger Agreement (the "Effective
Date") and shall have no force or effect prior to such time.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed in duplicate originals by its duly authorized representatives as of the
date first stated above.
KIRI INC. AT&T CORP.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇▇▇
------------------------------------ ------------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇ Name: ▇▇▇ ▇▇▇▇▇▇
Title: Sole Director Title: Director of Brand, Quality & Customer Insight
Date: November 16, 1999 Date: November 15, 1999
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SCHEDULE A
LICENSED MASTER SERVICE MARKS
[AT&T LOGO]
------------------------------------------------------
[AT&T AND GLOBE DESIGN LOGO]
[AT&T AND GLOBE DESIGN LOGO]
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SCHEDULE B
REGISTRATIONS FOR LICENSED MASTER SERVICE MARKS
REGISTRATION REGISTRATION
OR APPLICATION OR APPLICATION
COUNTRY ▇▇▇▇ NO. DATE
------- ---- -------------- --------------
Argentina.................................... AT&T 1099877 Feb. 28, 1995
Argentina.................................... AT&T & Globe Design 1518137 Apr. 29, 1994
Brazil....................................... AT&T 811983030 Aug. 5, 1986
Brazil....................................... AT&T & Globe Design 819860573 Mar. 24, 1997
Chile........................................ AT&T 389224 Mar. 8, 1993
Chile........................................ AT&T & Globe Design 420096 Jan. 18, 1994
Colombia..................................... AT&T 112857 Apr. 4, 1986
Colombia..................................... AT&T & Globe Design 148388 Jan. 28, 1994
Peru......................................... AT&T 2468 Jan. 25, 1984
Peru......................................... AT&T & Globe Design 14617 Jun. 2, 1998
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SCHEDULE C1
LICENSED ANCILLARY SERVICE MARKS
RESTRICTIONS ON LICENSE
-------------------------------------
▇▇▇▇ LICENSED TERRITORY LICENSED SERVICES
---- ------------------ -----------------
IT'S ALL WITHIN YOUR REACH................................. All All
TODO A SEU ALCANCE......................................... All Portuguese- All
speaking countries
TODO A TU ALCANCE.......................................... All Spanish- All
speaking countries
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SCHEDULE C2
REGISTRATIONS FOR LICENSED ANCILLARY SERVICE MARKS
REGISTRATION REGISTRATION
OR APPLICATION OR APPLICATION
COUNTRY ▇▇▇▇ NO. DATE
------- ---- -------------- --------------
Argentina.................................... IT'S ALL WITHIN YOUR REACH ▇▇▇▇▇▇▇ May 20, 1998
Argentina.................................... TODO A TU ALCANCE 2151851 May 20, 1998
Bolivia...................................... IT'S ALL WITHIN YOUR REACH 6065 May 5, 1998
Bolivia...................................... TODO A TU ALCANCE 6064 May 5, 1998
Brazil....................................... IT'S ALL WITHIN YOUR REACH ▇▇▇▇▇▇▇▇▇ Apr. 22, 1997
Brazil....................................... TODO A SEU ALCANCE 820880574 Jun. 29, 1998
Chile........................................ IT'S ALL WITHIN YOUR REACH 414215 May 8, 1999
Chile........................................ TODO A TU ALCANCE 414213 May 8, 1999
Colombia..................................... IT'S ALL WITHIN YOUR REACH ▇▇▇▇▇▇▇▇ May 21, 1999
Colombia..................................... TODO A TU ALCANCE 98028799 May 21, 1999
Peru......................................... IT'S ALL WITHIN YOUR REACH 15536 Sep. 10, 1998
Peru......................................... TODO A TU ALCANCE 15442 Aug. 31, 1998
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SCHEDULE D
LICENSED TRADE DRESS
1. The overall configurations of the AT&T and globe design corporate
signature as set forth more fully in the AT&T document Corporate Identity
Program: Graphic Standards Manual ("Graphic Standards Manual").
2. The AT&T Garamond typeface, namely AT&T's proprietary typeface used for
all marketing communications materials, including print and television
advertising, promotional brochures, pamphlets and other Marketing Materials and
as set forth in the AT&T document Guidelines For Print and TV Advertising.
3. The AT&T identification stripes, namely a rectangular band consisting of
three parallel lines: the top line being red (PANTONE(R) 485); the middle, blue
(PANTONE(R) Process Blue); the bottom, black (PANTONE(R)Process Black), as set
forth in the Graphic Standards Manual.
4. The acceptable color applications of the AT&T and globe design corporate
signature as set forth in the Graphic Standards Manual.
5. The acceptable graphic techniques relating to the AT&T and globe design
corporate signature as set forth in the Graphic Standards Manual.
6. The acceptable applications of the AT&T globe design corporate signature
and typography, as well as the visual style and design techniques (layout) as
applied to any product marking, as set forth in the AT&T document Product
Marking Reference Manual.
7. The acceptable applications of the AT&T globe design corporate signature
and typography, as well as the visual style and design techniques, as applied to
business stationery, and as set forth in the AT&T document Business Stationery
Specifications.
8. Nothing in this Schedule shall restrict or limit AT&T's claim of trade
dress rights in or protection of AT&T's Trade Dress.
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SCHEDULE E
SERVICE SPECIFICATIONS
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SCHEDULE F
LICENSED SERVICES
EXCLUSIVE SERVICES
- Local voice delivered through fixed-line connectivity
- Domestic long distance
- International long distance
- Point-to-point dedicated line
- Asynchronous Transfer Mode (ATM)
- Frame relay
- Internet access
- 1-800/toll free
- Packet X.25 (data)
- Virtual network services (data)
- Switched digital (data)
NONEXCLUSIVE SERVICES
- AT&T card services
- AT&T Direct(R) services
- E-commerce
- Web-hosting
- Fixed wireless for connectivity
- Voice over Internet Protocol
- Managed Network Services (as defined herein)
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SCHEDULE G
CRITERIA FOR SUBLICENSEES
Neither sublicensees nor their affiliates (including any joint venture and
business alliance in which sublicensee is a participant) conduct business or
engage in business practices in any of the following areas:
- Illegal activities;
- Content or practices which demean, ridicule or attack individuals or
groups on the basis of age, color, national origin, race, religion, sex,
sexual orientation or handicap;
- Pornographic, obscene or sexually explicit/suggestive material or
content;
- Material deemed to be harmful to children;
- Tobacco or alcoholic beverages;
- Firearms, ammunition or fireworks;
- Gambling;
- Contraceptives;
- Violence;
- Vulgar or obscene language;
- Solicitation of funds;
- Extreme political or social activism.
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