*** (PORTIONS OF THIS EXHIBIT) MARKED BY BRACKETS ("[***]") OR OTHERWISE
IDENTIFIED HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.
THE OMITTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***
ICG AUTHORIZED DISTRIBUTOR AGREEMENT
THIS AGREEMENT is entered into this 28 day of Sept. 1999 ("Effective
Date"), by and between ICG Telecom Group, Inc., a Colorado corporation whose
address is ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("hereinafter
ICG") and New Millennium Multimedia, Inc. [Full Legal Name of Distributor], a
Georgia corporation [State of Incorporation] whose address is ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ [Business Address] (hereinafter "Distributor").
Distributor's Employer Identification Number is ▇▇▇▇▇▇▇▇▇.
WHEREAS, ICG is engaged in providing telecommunications services,
including network services.
WHEREAS, Distributor has agreed to market and sell certain of ICG's
telecommunications Services.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, ICG and Distributor agree as follows:
1. Definitions
A. "Agreement" shall mean this agreement together with the following
exhibits:
Exhibit A - List of Offered Services
Exhibit B - Commission Schedule
Exhibit C - Service Ordering Procedure
B. "Equipment" means any piece of equipment provided by ICG to a customer.
C. "Information" shall mean written policies, practices, brochures, ICG
advertisements, ICG provided brochures via authorization from an ICG supplier,
tariffs and communications (whether oral or written) between ICG and Distributor
or ICG and the public.
D. "Initial Training" shall mean training by ICG for all Distributors and
may include a detailed explanation of all services, sales presentations and
information relating to end-users. ICG may conduct additional periodic training
at its discretion.
E. "Marks" means all ICG or other trademarks, service marks and trade
names which the Distributor is authorized to use to market ICG's Services.
F. "Order" shall mean the appropriate ICG document or documents received
and accepted by ICG from the Distributor.
G. "Prices" are ICG's then current prices for Services offered for sale
under this Agreement. Prices for Services are found in ICG's tariffs and other
documents.
Page 1 of 26
H. "Sale" means any Order and other required supporting documents accepted
by ICG.
I. "Service" or "Services" shall mean ICG's then existing network and
other Services which shall be marketed and offered for sale by Distributor, as
listed in Exhibit A.
J. "Slamming" shall mean the practice of switching a telephone customer's
supplier without obtaining written permission from the customer.
K. "Term" shall mean the initial term of this Agreement and any renewal
period.
L. Any terms not in Section 1 have the meanings commonly used in the
telecommunications industry.
2. Term of Agreement
This Agreement shall become effective upon the Effective Date and shall
remain in effect unless otherwise terminated in accordance herewith.
3. Appointment of Distributor
A. ICG hereby grants to Distributor the non-exclusive right to market and
sell the Services as specified herein, under the terms and conditions
hereinafter contained. During the Term of this Agreement, and thereafter, ICG
reserves the right, without obligation or liability to Distributor, to market
ICG Services, whether through ICG's own representatives, other distributors or
by any other means.
B. Distributor shall market and sell those Services as set forth in
Exhibit A, a copy of which is attached hereto and is incorporated herein by
reference. ICG may, from time to time modify Exhibit A upon notice to
Distributor but without the consent of Distributor.
C. Distributor is not authorized to market or sell any Services in any
other territories other than those identified in designated territories which
will be provided to Distributor on a periodic basis. ICG may add and delete
territories as ICG deems necessary upon notice to Distributor. ICG may, on a
periodic basis, also identify certain restricted accounts to which Distributor
may not market or sell Services. Sales or marketing of ICG's Services outside
the territories or to restricted accounts may be cause for ICG to terminate this
Agreement.
4. ICG's Responsibilities to Distributor
A. Provide post-sale activities including, but not limited to,
facilitating installation and Order processing, and documentation coordinating
due dates between end-users and ICG, coordinating and developing an
implementation plan, addressing customer service and repair issues, and, where
applicable, moving, adding and changing services.
Page 2 of 26
B. Provide customer assistance to the end user for products that require
an interface with other vendors.
C. Pay Distributor's commissions in a timely manner. ICG will not pay
commissions directly to Distributor's employees, agents or subcontractors.
D. ▇▇▇▇ the end user in a timely manner to be able to facilitate payment
of earned commissions.
E. Use its best efforts to collect amounts due on all end user accounts.
F. After installation, conversion or cutover, ICG is responsible for
customer service. Distributor, however, agrees to use its best efforts to handle
customer problems or concerns prior to referring customers to ICG.
G. Provide specifications to Distributor for Distributor's advertising and
promotional materials. See Section 11.B., below.
H. Permit Distributor to identify himself/herself as affiliated with ICG
through use of a business card or other promotional materials. The business card
or other promotional material shall, however, state that the Distributor is an
"Authorized Distributor"; Distributor's company or business logo shall be larger
than ICG's company or business logo. A copy of the Distributor's business card
or other promotional material that the Distributor will currently use to market
or sell Services with ICG's logo, shall be provided to ICG to be kept with the
Distributor's file. See Section 15 below.
I. Provide an Organizational Help Chart for purposes of identifying the
appropriate ICG person to receive notice or for escalation purposes.
5. Distributor's Responsibilities to ICG
A. Distributor represents and warrants that it is: (1) qualified through
knowledge and experience in the telecommunications industry through selling
services and products to market and sell ICG's communications Services; and (2)
has sufficient knowledge of ICG's Services to do so.
B. Marketing of ICG Services shall be consistent with, and subject to, the
terms and conditions set forth in any applicable ICG rate sheets and tariffs,
which may be amended from time to time, at ICG's sole discretion, or by the
order of any regulatory body. In the event that the ICG Services have been
de-tariffed, are not subject to tariffs under state or federal law, or are
offered pursuant to tariffs that permit flexible pricing, Distributor shall use
ICG's current standard prices, or Distributor shall request a specific price for
the customized Services. In the event that Services are offered under contract,
Distributor shall offer such Services subject to the applicable terms and
conditions contained in a contract supplied by ICG. Distributor shall not
Page 3 of 26
offer any terms or conditions on ICG's behalf that conflict with ICG's relevant
tariffs, prices, policies or contracts.
C. ICG acknowledges that Distributor may sell services competitive with
the Services being offered pursuant to this Agreement. Distributor shall not
disparage ICG in any respect and shall not initiate moving, or attempt to
initiate moving, customers from Services provided by ICG to those provided by
another supplier of similar Services, during the term of this Agreement,
subsequent renewal terms, or for six months after termination or cancellation of
this Agreement. Such action, at ICG's discretion, may result in the immediate
termination of this Agreement by ICG and the withholding of all current and
future commissions from Distributor in addition to any other legal or equitable
remedies available to ICG.
D. Distributor agrees to discontinue any sales or marketing efforts with
regard to a potential customer, upon learning or discovering that the potential
customer is an existing ICG customer.
E. It is expressly understood and agreed that customers who purchase ICG
Services from or through Distributor are ICG customers for those Services, and
that Distributor shall have no claim on ownership for those customers whatsoever
for the Services provided by ICG.
F. Distributor shall not utilize or allow its employees or agents thereof
to offer ICG Services or otherwise assist in the performance of this Agreement
without ICG's prior written approval. ICG reserves the right to direct
Distributor to bar any of its employees or agents thereof from selling ICG
Services if, in ICG's sole opinion, any one of the sales persons working for
such employee or agent thereof is not selling in compliance with ICG sales
guidelines, as defined in sales manual, sales training and the terms of this
Agreement.
G. Distributor shall be jointly and severally liable for any breach of
this Agreement by it or any of its employees or agents thereof. ICG shall not be
liable to pay commissions under this Agreement or otherwise for revenue
generated by any unauthorized distributor or agents thereof. Distributor's
employees and agents thereof shall not have any claim against ICG for
commissions, salaries, or other items of expense. Distributor expressly agrees
that all of its employees and agents thereof shall be subordinate to all
provisions of this Agreement that are applicable to Distributor. Breach of this
section by Distributor shall be deemed to be an improper marketing activity.
H. Distributor agrees to only use ICG pre-approved form contracts as
provided in the ICG Sales Manual, ICG standard proposals, and ICG standard
pricing. Distributor agrees it will not make any changes to any contract without
prior written approval of ICG legal department nor represent any pricing on
applications for pricing inconsistent with ICG policies, without the prior
written approval of an ICG senior Sales Manager. Failure to comply with this
provision shall constitute a breach and shall be grounds for immediate
termination of this Agreement and any other legal or equitable remedy that may
be available to ICG. Distributor shall be personally liable to the Customer for
any misrepresentation, regarding pricing or product offering.
Page 4 of 26
I. Distributor represents and warrants that providing services pursuant to
this Agreement will not constitute or cause Distributor to be in breach or
default of any obligation(s) Distributor has, or may have in the future, to any
to third party, including, but not limited to, other sellers of
telecommunications services.
6. Compensation
A. Compensation for the services performed by Distributor hereunder shall
be as specified in Exhibit B, a copy of which is attached hereto and
incorporated herein by reference. ICG may, from time to time, modify Exhibit B
by providing Distributor with thirty (30) days prior written notice. All
commissions for sales after the effective date of modification shall be subject
to the new Exhibit B. In the event that the commission structure is reduced by
ICG, Distributor shall have the right to terminate this Agreement upon ten (10)
days written notice to ICG.
B. ICG reserves the right to reject any order if the end-user customer is
an existing customer of ICG and there has been order activity with an authorized
ICG representative during the 120 day period prior to Distributor's contact with
the customer. ICG reserves the right to publish a list of national accounts as
an Exhibit to this Agreement, and provide a copy of such list to Distributor.
National accounts shall not be solicited by the Distributor.
C. ICG shall have no liability to Distributor for commissions from usage
of ICG Services by a customer solicited by Distributor if Distributor is or was
aware or should have been aware the customer uses the ICG Services to send any
message which is illegal, obscene, indecent, threatening or harassing, including
but not limited to, the transmission of unsolicited messages which infringe any
third party's proprietary right.
D. ICG's commission obligations to Distributor shall terminate in
accordance with Section 7.
7. Termination
A. This Agreement shall be terminable by either party at the end of the
initial term or during a renewal term upon written thirty (30) days' prior
written notice.
B. ICG may terminate this Agreement with cause: (1) for breach by
Distributor of any provision of this Agreement provided that written notice of
breach has been given to Distributor and such breach has not been cured within
thirty (30) days after delivery of such notice; (2) immediately upon notice and
without cure period by ICG in the event ICG discovers any improper marketing
activity by Distributor, including, but not limited to, disparaging or
slandering the Services of ICG, solicitation or marketing of Services to
customers outside the Distributor's Territory, moving or attempting to move ICG
customers to providers of services similar to the Services covered hereunder, or
Slamming; (3) immediately upon notice and without cure period for unethical
conduct by Distributor including, but not limited to, offering or providing to
any ICG sales distributor or employee any financial or other incentive for the
Page 5 of 26
purpose of obtaining customer leads or other information which is deemed to be
beneficial to the Distributor; (4) immediately upon notice and without cure
period if use of the ICG Services by Distributor is for any purpose which is
illegal or if Distributor uses the ICG Services to send any message which is
illegal, obscene, indecent, threatening or harassing, including but not limited
to, the transmission of unsolicited messages, or message which infringe any
third party's proprietary right; or (5) immediately upon notice and without cure
period in the event, in ICG's sole discretion, Distributor commits repeated
breaches of this Agreement or otherwise demonstrates a pattern of deviating from
professional standards with regard to the marketing and sale of ICG Services.
C. Either party may terminate this Agreement upon three (3) business days'
written notice in the event that the other party: (1) becomes insolvent, makes
an assignment for the benefit of creditors or files a petition for
reorganization; (2) has filed against it a petition in bankruptcy; (3) is in
breach of this Agreement or is otherwise in default and has not cured said
default within thirty (30) days of receiving written notice of said default; (4)
intentionally makes (or is discovered to have made) any material false
representations, reports, or claims in connection with the business relationship
of the parties; or (5) engages in (or is discovered to have engaged in) fraud,
criminal or negligent conduct in connection with the business relationship of
the parties.
D. Either party may terminate this Agreement at any time without cause
upon forty-five (45) days' written notice to the other party.
E. Except as provided for in Section 7.F. below, ICG's commission
obligations to Distributor shall cease upon the termination of this Agreement.
In the event ICG terminates this Agreement pursuant to section 7.B. or 7.C.
(hereinafter "Termination for Cause"), Distributor waives all claims for any
commissions or profits or for any investments, expenditures or commitments made
in connection with this Agreement.
F. In the event ICG terminates this Agreement pursuant to Section 7.A. or
7.D. (hereinafter "Termination without Cause"), ICG shall pay Distributor earned
commissions for the duration of its customers' contracts, or for two (2) years
after the date of termination of this Agreement, whichever period is less. If
the Distributor terminates this Agreement for any reason, the Distributor shall
not be entitled to any commission payments or fees, after the date of
termination.
G. In the event that any regulatory, judicial, or legislative body having
jurisdiction over the way in which the ICG Services referenced herein are
provided; or changes in the manner in which the ICG Services are permitted to be
provided, ICG may then terminate this Agreement in its sole discretion
immediately upon notice and without further liability for commissions, fees or
otherwise. In the event a Customer terminates its relationship with its
Distributor, ICG's commission obligations to Distributor with regard to that
Customer shall cease on the date of Customer's termination of Distributor.
Page 6 of 26
H. Upon termination or non-renewal of this Agreement, Distributor shall
immediately:
1. Cease holding itself out, in any manner, as an Distributor of the
ICG Services;
2. Discontinue any and all use of ICG's Marks (except to identify
the Services) including without limitation, the use of ICG's Marks in
advertising or business material of Distributor;
3. Return to ICG all sales, product, pricing, advertising and
technical materials and other proprietary information delivered to
Distributor by ICG;
4. Remove and return to ICG, or obliterate, at ICG's request, any
and all signs, stationery or other material supplied without charge by
ICG;
5. Notify and arrange for all publishers and others who may
identify, list or publish Distributor's name as an Distributor of ICG and
ICG's Services, without limitation, publishers of telephone directories,
yellow pages and other business directories, to discontinue such listings;
and
6. Complete all orders in process, including the transmittal of
orders to ICG.
8. Service Ordering Procedure
A. Distributor agrees to comply with service ordering procedures contained
in Exhibit C. All orders for Services shall be further subject to approval and
acceptance by ICG in its sole discretion. ICG reserves the right to modify the
service ordering intervals and any other section of Exhibit C upon written
notice. ICG reserves the right to reject any Service order in its sole
discretion.
B. ICG will use its best efforts to install and maintain the Services sold
by Distributor pursuant to this Agreement, but shall have no responsibility for,
or liability in connection with, any non-ICG services or products sold by
Distributor.
C. ICG shall have the right to independently verify all orders submitted
by Distributor and shall have the right to reject any orders which cannot be
verified as accurate or complete. No commissions may be earned or will be paid
on rejected orders.
D. ICG reserves the right to verify through an independent third party or
other verification methods, or require Distributor to verify, all orders
submitted. The costs of verification by a third party or other verification
methods shall be paid for in a manner agreed upon by the parties.
Page 7 of 26
E. ICG may from time to time, in its discretion, submit leads of potential
customers to Distributor. The submission of any lead is not, and shall not, be
deemed to be ICG's approval of the lead as a customer, and Distributor shall be
responsible for ensuring that the lead is a proper business customer prior to
submitting any order, though Distributor shall be under no obligation to solicit
the leads submitted by ICG. ICG may, as set forth in this Agreement, refuse any
offer for service submitted by Distributor from leads referred to Distributor by
ICG.
9. Reporting and Payment
A. ICG shall provide the Distributor with a monthly commission report. The
commission report shall itemize the Services of each customer solicited by
Distributor for which commissions are earned under this Agreement.
B. ICG shall have no liability to pay commission on any sale that is not
made in accordance with the terms of this Agreement. Distributor agrees that ICG
may offset against any amounts due Distributor, amounts which Distributor may
owe ICG or its affiliates under this Agreement.
10. Relationship of Parties
A. It is expressly understood and agreed that the relationship created
herein is that of independent contractor and that Distributor shall have only
those rights and responsibilities specifically described in this Agreement. No
agency rights or responsibilities shall arise by operation of law. Distributor
is not a legal representative of ICG for any purpose other than as expressly set
forth in this Agreement and is not granted, by the terms or execution of this
Agreement, or otherwise, any right or authority to assume or create any
responsibility on behalf of, or in the name of, ICG, or to bind ICG in any
manner whatsoever.
B. Distributor shall have no authority to bind ICG by contract or
otherwise or to make representations as to the policies and procedures of ICG
other than as specifically authorized by this Agreement. ICG and Distributor
acknowledge and agree that the relationship arising from this Agreement does not
constitute or create a general agency, joint venture, partnership, employee
relationship or franchise between them, and that Distributor is an independent
contractor with respect to the services provided by Distributor under this
Agreement.
C. Distributor shall identify itself as an authorized representative of
ICG only with respect to the services covered by this Agreement and shall
otherwise identify itself as an independent business. Neither ICG nor
Distributor shall make any express or implied agreements, guarantees or
representations, or incur any debt, in the name of or on behalf of the other.
D. Distributor or Distributor's employees shall not be or be deemed to be
ICG employees or joint employees. Distributor assumes full responsibility for
the acts of its employees and for their supervision, daily direction and
control. ICG shall not be responsible for
Page 8 of 26
worker's compensation, disability benefits, unemployment insurance, withholding
taxes, social security or any other taxes or benefits for Distributor,
Distributor's sub-distributors or Distributor's employees.
E. Distributor shall make no warranties relating to the services described
herein except as set forth in the ICG approved written contracts.
F. This agreement is not intended to and does not create any third party
beneficiaries to the rights and obligations set forth herein, nor shall any
third party beneficiaries be inferred by operation of law or otherwise.
11. Marketing
A. Distributor shall use reasonable commercial efforts and technically
qualified people to market, promote, maintain and increase the sale of Services
in the Territory by all usual means, including advertising and personal
solicitation of customers, processing of orders, customer complaints, and
identification of Distributor as a source of Services in business listings,
trade publications, directories, stationery and advertisements and through
distribution of technical literature, catalogues, brochures and advertising
matter issued by ICG. Such marketing and promotions shall be consistent with and
subject to this Agreement and ICG's tariffs, and as stated in the ICG policies
and practices for the sale of the Services.
B. Distributor shall provide for ICG's review, all promotional materials
not provided by ICG related to the ICG Services including, but not limited to,
print ads, radio scripts, television commercials, sales brochures, publicity and
press releases and user's manuals. Distributor may not use any such promotional
materials without ICG's prior written approval. All such materials shall be sent
to the ICG contact. Non-response by ICG shall not constitute approval of such
materials by ICG. In addition, all presentations and representations shall be
consistent with, and shall not misrepresent, ICG's product offerings as may be
in effect from time to time. Failure to obtain prior written ICG approval for
promotional materials shall be deemed an improper marketing activity.
C. Distributor shall not convey to customers or prospective customers that
the ICG Services are available only from the Distributor or only in conjunction
with any other product or service of Distributor. Breach of this paragraph 11.C.
shall be grounds for immediate termination of this Sales Agency Agreement.
12. Sales Aids
ICG will provide Distributor information including sales literature, sales
aids, and order forms to be used by Distributor.
13. Standards of Conduct.
Page 9 of 26
Distributor shall use commercially reasonable efforts at all times to give
prompt, courteous and efficient service to customers; shall be governed in all
dealings with such customers by the highest standards of honesty, integrity and
fair dealing, including without limitation, compliance with all applicable laws,
ordinances and regulations; and shall do nothing which would tend to discredit,
dishonor, reflect adversely upon or in any manner injure the reputation of ICG
or the ICG Services provided pursuant to this Agreement, and the quality image
associated with the ICG Services and ICG.
14. Expenses
Distributor shall be responsible for all traveling, advertising, and any
other expenses which may be incurred by Distributor in connection with
Distributor's responsibilities under this Agreement.
15. Trade Names and Trademarks
A. During the Term of this Agreement, unless otherwise prohibited by ICG,
and pursuant to any applicable provision herein, Distributor may refer to itself
as ICG's "Authorized Distributor" solely in conjunction with the sale of
authorized ICG Services to be sold by Distributor hereunder, and solely in
Distributor's territories.
B. Notwithstanding the foregoing, in no case shall Distributor refer to
itself as an "Authorized Distributor", or use any ICG Marks, in advertising or
other promotional material or activity without first obtaining, for each
proposed use, ICG's prior express written permission. No approval is required
for use of promotional material supplied by ICG. Distributor shall, at
Distributor's sole cost and expense, and prior to the use of any ICG Marks, make
any and all changes, corrections or alterations to any such proposed material or
activity which ICG, in its sole discretion, deems necessary or advisable.
Nothing in this Agreement shall be construed as waiving Distributor's obligation
to obtain prior written permission before use of any ICG Marks except in
material supplied by ICG.
C. Distributor acknowledges the value of ICG Marks, and the goodwill
associated therewith, and acknowledges that such goodwill is a property right
belonging to ICG and that ICG is the owner of all trademark, service ▇▇▇▇, trade
name and other rights in ICG Marks. Distributor recognizes that nothing
contained in this Agreement is intended as an assignment or grant to Distributor
of any right, title or interest in or to ICG Marks and that this Agreement does
not confer any right or license to grant sub-licenses, or permission to third
parties to use any ICG ▇▇▇▇. Distributor will do nothing inconsistent with ICG's
ownership of ICG Marks, and all rights, if any, that may be acquired by use of
ICG Marks by Distributor shall inure to the benefit of and be on behalf of ICG.
Distributor will not adopt, use, other than as authorized herein, register or
seek to register any ▇▇▇▇ anywhere in the world which is identical to ICG Marks,
or which is so similar thereto as to constitute a deceptive colorable imitation
thereof, or to suggest or imply some association, sponsorship or endorsement by
ICG. ICG makes no warranties regarding its ownership of any rights in, or the
validity of, any ICG ▇▇▇▇.
Page 10 of 26
D. Distributor agrees to promptly notify ICG of any unauthorized use of
ICG Marks by other parties when such use becomes known to Distributor. ICG shall
have the sole right to engage in infringement or unfair competition proceedings
involving ICG Marks against Distributor or other third party.
E. Upon termination of this Agreement, any permission or right to use ICG
Marks granted hereunder shall cease to exist, and Distributor shall immediately
cease any use of ICG Marks and immediately cease referring to itself as an ICG
Authorized Distributor. Distributor shall also promptly return to ICG all
materials in its possession or control displaying any ICG Marks or referring to
Distributor as an ICG Authorized Distributor. Upon prior written approval,
Distributor agrees to the use by ICG of Distributor's marks ("Distributor's
Marks") in any jointly or cooperatively sponsored advertisement or promotional
material.
16. Confidential Information
A. The parties understand and agree that the terms and conditions of this
Agreement, all documents referenced herein, communications between the parties
regarding this Agreement or the Service described herein (including price quotes
by ICG for any service proposal to be provided or actually provided to a
customer), customer information and information relevant to any other agreement
between the parties, and the names of ICG customers, addresses of ICG customers
or ICG services purchased by ICG customers are confidential as between
Distributor and ICG (hereinafter "Confidential Information").
B. Distributor may receive, or have access to, records and information,
whether written or oral, which ICG considers to be confidential and proprietary,
including, without limitation, technical information such as specifications,
drawings, guidelines, models and information which relates to ICG's present and
future development of business activities ("Confidential Information"). The
Confidential Information shall be designated by ICG as "Confidential" and/or
"Proprietary," and Distributor shall hold the Confidential Information in trust
and in confidence for ICG; shall use the Confidential Information only for the
purposes permitted hereunder; and shall deliver to ICG all such records and
information, in written or graphic form, upon expiration or termination of this
Agreement. Nothing in this section shall be construed to limit the use of, or
dissemination by Distributor of, such information as is previously known to
Distributor, or is publicly disclosed by ICG either prior to or subsequent to
Distributor's receipt of such information from ICG.
C. The receiving party shall use the disclosing party's Confidential
Information solely for the purposes set forth in this Agreement unless another
use is allowed by written permission of the disclosing party. In handling the
Confidential Information, each party shall: (1) not copy such Confidential
Information of the other unless specifically authorized; (2) not make disclosure
of any such Confidential Information to anyone except officers, directors,
employees, contractors and distributors of such party to whom disclosure is
necessary for the purposes set forth in this Agreement; (3) appropriately notify
such officers, directors, employees, contractors and Distributors that the
disclosure is made in confidence in accordance with the provisions hereof; and
(4) make requests for Confidential Information of the other party only if
necessary to
Page 11 of 26
accomplish the purposes set forth in this Agreement. ICG and Distributor shall
be responsible for ensuring compliance with the terms of this Section 16 by
their respective directors, officers, employees, contractors and Distributors.
D. Within ten (10) days of termination or expiration of this Agreement for
any reason, or upon request of the disclosing party, all Confidential
Information, together with any copies thereof, shall be returned to the
disclosing party or certified destroyed by the receiving party.
E. The obligations imposed in this provision shall not apply to any
information that is (a) already in the possession of, is known to, or is
independently developed by the receiving party, (b) is or becomes publicly
available through no fault of the receiving party, or (c) obtained by the
receiving party from a third person without breach of such third person of an
obligation of confidence with respect to the Confidential Information disclosed.
F. ICG and Distributor acknowledge that in the event of breach or
threatened breach of the provisions of this Section 16, remedies at law will be
inadequate and that either party shall be entitled to an injunction or other
specific performance to enforce this provision, provided, however, that nothing
herein shall be construed as precluding the injured party from pursuing further
remedies.
G. The obligations of confidentiality and non-use shall survive the
termination or expiration of this Agreement.
17. Indemnification
A. Distributor agrees to indemnify, hold harmless and defend ICG from any
and all claims, actions, damages, expenses and other liabilities, including
reasonable attorney's fees and costs of litigation, resulting from Distributor's
negligent acts, omissions or willful misconduct, including, without limitation,
Distributor making a commitment beyond that specified in the original written
proposal which did not have prior ICG approval, or unauthorized execution of a
sales order, regardless of the form of action.
B. ICG agrees to indemnify, hold harmless and defend Distributor from any
and all claims, actions, damages, expenses and other liabilities, including
reasonable attorney's fees and costs of litigation, resulting from ICG's
negligent acts, omissions or willful misconduct.
C. ICG shall not be liable for any misrepresentations by Distributor,
Distributor's sub-distributors or employees, whether intentional or
unintentional, with regard to ICG or ICG's products or Services. Distributor
agrees to indemnify and hold ICG harmless for any such misrepresentations.
D. ICG shall not be liable for service or maintenance calls made by
Distributor, its employees or Distributors to customers.
Page l2 of 26
E. Except as otherwise expressly provided in this Agreement, neither party
shall be liable to the other party for compensation, damages, loss of
prospective profits or anticipated sales, expenditures, investments, loss of
business commitments, or good will of either party, or otherwise, except for
compensation owed by ICG to Distributor for any orders signed by ICG which are
in process at the time of termination or expiration.
F. In addition to the disclaimers of liability expressed herein, ICG shall
not have any liability of any kind under this Agreement unless Distributor gives
ICG written notice of its claim within thirty (30) days after the date
Distributor knows, or should know, of its claim, and files suit against ICG
within one (1) year after such date.
G. Distributor agrees to defend, indemnify, and hold ICG harmless from and
against any and all claims, liabilities, demands, actions, damages, suits,
actions or other expenses (including reasonable attorney's fees and costs of
litigation) resulting from any Slamming by Distributor as defined in this Sales
Agency Agreement, or any other intentional misrepresentation by Distributor,
whether such actions are directly against ICG or against Distributor and ICG.
18. Limitation of Liability
In no event shall either party be liable to the other for any incidental,
punitive, special or consequential damages of any nature whatsoever, including
without limitation lost profits or revenues, regardless of the foreseeability
thereof, arising out of a party's actions or inactions or otherwise occasioned
by a party's inability to perform its obligations hereunder.
19. Insurance
Distributor shall, at its own costs and expense, furnish and maintain the
following insurance during the term of this Agreement. Distributor shall not be
entitled to commence work or be entitled to any compensation until it has
submitted certificates of insurance evidencing such coverage. ICG shall have at
least forty-five (45) days' prior written notice of cancellation, non-renewal,
or material modification. All insurance policies shall be written by companies
with an A.M. Best Company's rating of A VIII or better and be licensed in the
State in which the work is done.
A. Workers' Compensation insurance (including Employer's Liability
insurance) in accordance with statutory requirements of the state in which the
work is being performed;
B. Commercial General Liability insurance providing coverage against
liability for advertising injury, bodily injury, death and property damage in an
amount of not less than $1,000,000.
C. Comprehensive Automobile Liability insurance in an amount of not less
than $1,000,000 for bodily injury and property damage arising from a single
occurrence.
Page 13 of 26
20. Remedies for Breach of Contract
In addition to any of the remedies at law or in equity ICG or Distributor
may have available to it under the terms of this Agreement, ICG or Distributor
shall be entitled to stop the other party, by means of injunction, from
violating any part of this Agreement, and to recover, by means of an accounting,
any profits the other party may have obtained in violation of this Agreement.
21. Assignment
Distributor may not assign this Agreement without the prior written
consent of ICG. ICG may assign this Agreement without Distributor's consent to a
subsidiary, affiliate or parent company; any firm, corporation, or entity which
the Company controls, is controlled by, or is under common control with; any
partnership in which it has a majority interest; or to any entity which succeeds
to all or substantially all of its assets whether by merger, sale or otherwise.
Distributor may refer prospective successor Distributors to ICG who may apply
for Distributor status; granting of such status shall be subject to ICG's sole
discretion.
22. Modifications
Unless otherwise provided, this Agreement may be modified only by a
written amendment, duly signed by persons authorized to sign agreements on
behalf of Distributor and ICG, and shall not be modified or supplemented by oral
agreement or by any course of dealing or trade usage.
23. Notices
Any notice required or allowed hereunder shall be in writing and shall be
deemed given when sent by the United States Mail, registered or certified mail,
return receipt requested, postage prepaid, or by a nationally recognized
courier, addressed as follows:
ICG: Senior V.P. Sales Assistant General Counsel
ICG Telecom Group, Inc. Contract Administration
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ICG Communications, Inc
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Page 14 of 26
DISTRIBUTOR: New Millennium Multimedia, Inc.
-------------------------------------
[Full Legal Name of Distributor]
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
[Street Address]
▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
-------------------------------------
[City, State, Zip Code]
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
or as such addressee or address is changed by written notice to the other party.
24. Compliance With Laws
A. Distributor shall comply with all applicable federal, state and local
laws and regulations which may be applicable to Distributor as an employer of
labor. Distributor and ICG shall comply with all applicable federal, state,
county and local laws, ordinances, regulations and codes in the performance of
this Agreement, including, without limitation, the procurement of permits,
licenses and certificates where needed, excluding those licensing and other
requirements which are the obligation of ICG in reference to the ICG Services
offered hereunder. Each party shall bear its own costs associated with
compliance with the laws, including, without limitation, procurement of permits,
licenses and certificates. Distributor and ICG agree to indemnify and hold each
other harmless for any loss, damage, liability, claim or demand, or any
penalties, including, without limitation, costs, expenses and reasonable
attorney's fees assessed against the other that may be sustained by the other's
failure to comply with such requirements.
B. This Agreement is subject to applicable laws and executive orders
relating to equal employment and non-discrimination in employment. The parties
hereto shall not discriminate in their employment practices against any person
by reason of race, religion, color, sex, age or national origin, and agree to
comply with the provisions of those laws and orders as well as all laws and
orders relating to the employment of the handicapped, the employment of veterans
and the use of minority business enterprises, to the extent any such laws and
orders are applicable to the performance of this Agreement. For this purpose,
the provisions of such laws and orders and pertinent regulations issued
hereunder, as now in force or hereafter amended, shall be deemed an integral
part of this Agreement.
25. Severability
In the event that any one or more of the provisions of this Agreement
shall for any reason be held to be invalid or unenforceable, the remaining
provisions of this Agreement shall be unimpaired, and shall remain in effect and
be binding upon the parties.
Page 15 of 26
26. Force Majeure
With the exception of payment obligations under this Agreement, a party
shall be excused from performance if its performance is prevented by any acts or
events beyond the party's reasonable control, including, without limitation:
severe weather and storms; earthquakes or other natural occurrences; strikes or
other labor unrest; power failures; computer failures; nuclear or other civil or
military emergencies; or acts of legislative, judicial, executive or
administrative authorities.
27. Waiver
The failure of either party to enforce at any time, or for a period of
time, any of the provisions of this Agreement, shall not be construed as a
waiver of such provision or of the right of such party thereafter to enforce
such provision.
28. Credit Checks
Distributor agrees to execute any commercially reasonable documents to
allow ICG to perform credit and/or background checks on Distributor.
29. Choice of Law/Jurisdiction
The validity, performance and construction of the terms and conditions of
this Agreement shall be construed in accordance with and governed by the laws of
the State of Colorado, and any suit to enforce or construe any provision of this
Agreement shall be brought in a Court of competent jurisdiction in Denver
County, Colorado. The prevailing party shall be entitled to recover its
attorney's fees and expenses in any successful action to enforce this Agreement.
30. Paragraph Headings
Paragraph headings, as contained herein, are provided for convenience and
reference only. They in no way restrict or limit the contents or terms of this
Agreement.
31. Successors and Assigns
Except as otherwise expressly provided for herein, the provisions of this
Agreement are for the benefit of the parties hereto and not for any other person
and shall be binding on all successors and assigns.
32. Authority to Execute
Each party represents and warrants that it has full power and authority to
enter into and perform under this Agreement and that the person signing this
Agreement has been properly authorized to do so. Each party further acknowledges
that it has read and understands this Agreement and agrees to be bound by all of
its terms, conditions and provisions.
Page 16 of 26
33. Entire Agreement
This Agreement, together with its appendices attached hereto, sets forth
the entire understanding of the parties and supersedes and terminates any prior
agreements, understandings, or representations between the parties, whether
written or oral, with respect to the subject matter contained herein. No
representative of either party shall have the authority to waive or change any
provision of this Agreement unless such waiver or change is made in writing and
signed by an authorized representative of both parties. This Agreement shall
only be effective upon the execution by Distributor and the acceptance and
execution by an authorized officer of ICG.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives on the day and year first above
written.
ICG TELECOM GROUP, INC. New Millennium Multimedia, Inc.
-----------------------------------------
(Distributor Name)
By: By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------- -------------------------------------
Name: Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------- -------------------------------------
Title: Title: CHIEF INFORMATION OFFICER
---------------------------- -------------------------------------
Date: Date: 9/28/99
---------------------------- -------------------------------------
DISTRIBUTOR HEREBY SELECTS OPTION __.
Page 17 of 26
[LOGO](TM) ICG
TELECOM GROUP, INC.
ICG TELECOM GROUP, INC. DISTRIBUTOR AGREEMENT
EXHIBIT A
Distributor is authorized to sell ICG Services at the rates shown in the pricing
section of the Distributor Manual. Distributor acknowledges that sales at prices
other than those defined in the Distributor Manual must be approved in writing
by ICG Telecom Croup, Inc. prior to providing a proposal to the Customer.
Dialtone services are available for sale as described in Table 1 below.
Commissions will not be paid to Distributor for non-standard product
configurations.
PRODUCT LIST
Table 1
Custom Calling Features
Analog Trunks
Business Lines (SBL, SBLP, Connect/Connect Plus)
Calling Cards
Digital Trunks
Long Distance (1+, Toll Free)
PRI (DAS/EOS)
Special Access (EDS, DTS)
Voice Mail
Co-Location
DSL
Frame Relay
IPLD
RAS
IAS
Table 2
IAS for ISPs
Page 18 of 26
Table 3
PRI/RAS for ISPs
The above products may not be available in each geographic location within a
territory.
Page 19 of 26
EXHIBIT B
Commission Schedule and Policies
I. COMMISSIONS
1. To earn commission for a new customer, order must be: (1) for a minimum
of 10 digital standard business lines or 10 analog business lines (unless a
greater number of lines is required by the particular region in which the
service is installed; (2) for on-switch or on-net services; and (3) accepted and
approved by ICG through ICG's internal order tracking system. A Distributor will
be paid a one-time, non-recurring earned commission in accordance with the first
number in the following Monthly Line Volume Commitment Schedule and the
recurring commission will be paid on Dial Tone, Long Distance and Voice-Mail as
set forth below in the second number and in accordance with the Commission Pay
Date Schedule set forth below. Commission will be paid only for the products
listed in Table I, page 18.
--------------------------------------------------------------------------------
Line Volume Commitment Schedule
Contract Term 1-24 lines 25-100 lines 101+ lines
--------------------------------------------------------------------------------
Option 1 12 months [***] [***] [***]
24 months or greater [***] [***] [***]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Option 2 l2 months [***] [***] [***]
24 months or greater [***] [***] [***]
--------------------------------------------------------------------------------
For all new Distributors, there will be no commitments required for their
first quarter. Thereafter, each Distributor has a quota of [***] or greater
lines per month, [***] or greater lines per quarter.
Distributors must select either Option I or Option 2 by indicating their
selection in writing on page 17 of the Agreement.
Commissions will be paid on the products listed in Table 2, page
18, as follows:
--------------------------------------------------------------------------------
Table 2
--------------------------------------------------------------------------------
IAS Earned according to the Volume Commitment selected by the
(Integrated Access Distributor on p. 17 of this Agreement. IAS sold to an ISP
Service) by a Distributor will be paid a one-time, non-recurring
commission of [***] per line. Only Dial Tone and Dedicated
LD will count toward volume attainment for commission
purposes.
--------------------------------------------------------------------------------
[***] Confidential treatment requested
Page 20 of 26
Commissions will be paid on the products listed in Table 3, page 19, as follows:
--------------------------------------------------------------------------------
Table 3
--------------------------------------------------------------------------------
ISP PRI/RAS sold to an ISP by a Distributor will be paid a one time,
non-recurring commission of [***] per line. Such sales will not
count toward line volume attainment for commission purposes.
--------------------------------------------------------------------------------
2. Special Access
Recurring commissions may be earned for Special Access based on the actual
monthly billed revenue of the customer. Sales of Special Access products
consisting of OC1, OC3, OC12, OC48 and 0C192 will be treated on a case-by-case
basis. A commission is deemed "earned" after the order is installed, accepted
into ICG's internal order tracking system and billed. Earned recurring
commissions will be paid on a monthly basis in accordance with the following
schedule:
--------------------------------------------------------------------------------
Hybrid On Net
--------------------------------------------------------------------------------
[***] of monthly billed revenue [***] of monthly billed revenue
--------------------------------------------------------------------------------
3. Installation Commission
A Distributor may earn a one-time commission of [***] of the billed
installation revenue per order. No commissions will be paid if installation
charges are waived.
1999 Non-Recurring Earned Commission Anticipated Pay Date Schedule
Month order is Dates Pay
accepted Included Date
--------------------------------------------------------------------------------
February February 1 -- 28 April 2, 1999
--------------------------------------------------------------------------------
March March 1 -- 31 April 30, 1999
--------------------------------------------------------------------------------
April April 1 -- 30 June 11, 1999
--------------------------------------------------------------------------------
May May 1 -- 31 July 9, 1999
--------------------------------------------------------------------------------
June June 1 -- 30 August 6,1999
--------------------------------------------------------------------------------
July July 1 -- 31 September 3, 1999
--------------------------------------------------------------------------------
August August 1 -- 31 October 1, 1999
--------------------------------------------------------------------------------
September September 1 -- 30 November 12, 1999
--------------------------------------------------------------------------------
October October 1 -- 31 December 10, 1999
--------------------------------------------------------------------------------
November November 1 -- 30 January 7, 2000
--------------------------------------------------------------------------------
December December 1 -- 31 February 4, 2000
--------------------------------------------------------------------------------
[***] Confidential treatment requested
Page 21 of 26
CHARGEBACKS
1. If a customer cancels its agreement with ICG prior to installation,
100% of any paid non-recurring commission will be charged back to the
Distributor.
2. If a customer cancels ICG service within six (6) months following
installation, 100% of the paid non-recurring commission will be charged back to
the Distributor.
3. BY SIGNING THIS AGREEMENT DISTRIBUTOR SPECIFICALLY AGREES THAT ANY OR
ALL CHARGEBACK AMOUNTS MAY BE WITHHELD FROM ANY FUTURE COMMISSIONS OR
COMPENSATION OTHERWISE DUE OR PAYABLE TO THE DISTRIBUTOR.
III. ADDITIONAL LINES
When lines are added to a customer order, the monthly recurring
commissions will increase based on actual billed revenue. A one-time,
non-recurring commission will be paid for additional line only on orders of 10
lines or more.
IV. RESALE OF LOCAL SERVICES
Please consult with your ICG sales representative before placing a resale
order. If ICG accepts a resale order, the monthly recurring commission will be
as follows based on the actual billed revenue of the Customer:
--------------------------------------------------------------------------------
Flat Rate Recurring Percentage Earned Per Month
Length of Contract for Standard Business Lines Only
--------------------------------------------------------------------------------
Any [***]
--------------------------------------------------------------------------------
ICG reserves the right to accept or reject any resale order.
V. SERVICE RENEWAL
Distributor's contracted services will automatically renew on a
month-to-month basis at the end of initial Term of the Service Agreement with
ICG unless ICG is notified in writing of cancellation in accordance with the
terms of this Agreement. Distributor will continue to receive monthly residual
based on actual billed revenue until the customer cancels the service with ICG.
[***] Confidential treatment requested.
Page 22 of 26
Pay-out Examples
1. EXAMPLE 1- OPTION 1
▇▇▇▇▇ has been designated as a Distributor for XYZ Communications. She has
just signed a customer for 30 standard business lines at [***] per line. For the
first three months of the contract, the customer bills $2,000, $2,000, and
$3,750, respectively. Contract term is 36 months. ▇▇▇▇▇ will be paid a monthly
recurring commission of [***].
--------------------------------------------------------------------------
Non-Recurring Commission Payment 30 lines X [***] = [***]
--------------------------------------------------------------------------
January Commission $2,000 X [***] = [***]
--------------------------------------------------------------------------
February Commission $2,000 X [***] = [***]
--------------------------------------------------------------------------
March Commission $3,750 X [***] = [***]
--------------------------------------------------------------------------
2. EXAMPLE 2- OPTION 1
▇▇▇▇ has been designated as a Distributor for ZYX Telecommunications. He
has just signed a customer for 150 standard business lines at [***] per line.
For the first three months of the contract, the customer bills $25,000, $25,000,
and $46,875 respectively. Contract term is 36 months. ▇▇▇▇ will be paid a
monthly recurring commission of [***].
--------------------------------------------------------------------------
Non-Recurring Commission Payment 150 lines X [***] = [***]
--------------------------------------------------------------------------
January Commission $25,000 X [***] = [***]
--------------------------------------------------------------------------
February Commission $25,000 X [***] = [***]
--------------------------------------------------------------------------
March Commission $46,875 X [***] = [***]
--------------------------------------------------------------------------
[***] Confidential treatment requested.
Page 23 of 26
3. EXAMPLE 3- OPTION 2
▇▇▇▇▇ has been designated as a Distributor for XYZ Communications. She has
just signed a customer for 20 standard business lines at [***] per line. For the
first three months of the contract, the customer bills $2,000, $2,000, and
$3,750, respectively. Contract term is 12 months. ▇▇▇▇▇ will be paid a monthly
recurring commission of [***].
--------------------------------------------------------------------------
Non-Recurring Commission Payment 20 lines X [***] = [***]
--------------------------------------------------------------------------
January Commission $2,000 X [***] = [***]
--------------------------------------------------------------------------
February Commission $2,000 X [***] = [***]
--------------------------------------------------------------------------
March Commission $3,750 X [***] = [***]
--------------------------------------------------------------------------
4. EXAMPLE 4 - OPTION 2
▇▇▇▇ has been designated as a Distributor for ZYX Telecommunications. He
has just signed a customer for 150 standard business lines at [***] per line.
For the first three months of the contract, the customer bills $25,000, $25,000,
and $46,875 respectively. Contract term is 36 months. ▇▇▇▇ will be paid a
monthly recurring commission of [***].
--------------------------------------------------------------------------
Non-Recurring Commission Payment 150 lines X [***] = [***]
--------------------------------------------------------------------------
January Commission $25,000 X [***] = [***]
--------------------------------------------------------------------------
February Commission $25,000 X [***] = [***]
--------------------------------------------------------------------------
March Commission $46,875 X [***] = [***]
--------------------------------------------------------------------------
[***] Confidential treatment requested.
Page 24 of 26
EXHIBIT C
Service Ordering Requirements
1. Sales Package
The Distributor Representative is responsible for the Sales Package which
includes the following documents:
o Dialtone Checklist
The Dialtone Checklist begins with the Sales Package and
remains with the order throughout.
o Inquiry LOA (Letter of Agency for Presale)
The full LOA authorizes the Distributor to request a Customer
Service Record (CSR) directly from the Local Exchange Carrier
(LEC).
o Master Telecommunications Services Agreement
The Agreement is used for establishing customer information,
terms and conditions, services and customer authorization of a
review of Customer's credit rating.
o Inquiry LOA (Letter of Agency for Presale)
The full LOA authorizes the Distributor to request a Customer
Service Record (CSR) directly from the Local Exchange Carrier
(LEC).
o Local Exchange Service Agreement -- Attachment A
The Local Exchange Service Agreement determines the local
products requested, their options, term and provides ICG with
Letter of Authorization.
o Voice Mail Service Agreement -- Attachment B
The Voice Mail Service Agreement determines type of voice mail
ordered and term.
o Long Distance Service and/or Calling Card Service Agreement --
Attachment C
The Long Distance Service and/or Calling Card Service
Agreement determines long distance service and term for
Customer as well as order placement for Calling Cards.
Page 25 of 26
o Toll Free Number Reassignment Terms
The Toll Free Number Reassignment Terms outlines Customer
acknowledgement that the Toll Free Number that the Customer is
requesting has not been inactive for the period of time
normally required by ICG prior to reassignment.
o Letter of Agency for Toll Free Service
The Letter of Agency for Toll Free Service authorizes ICG to
act on Customer's behalf for specified Toll Free Numbers.
o Letter of Agency to Change Interexchange Service Provider
The Letter of Agency to Change Interexchange Service Provider
authorizes ICG to act as Customer's agent for interexchange
services for specified BTNs and WTNs.
2. Forward to Distributor Sales Manager
The Sales Package is forwarded to the respective Distributor Sales Manager who
is responsible for validating the completeness of the package. If the package is
incomplete, it will be returned to the Distributor with notification on the
Dialtone Checklist indicating what is missing. The process will not progress
while waiting for completion of the package.
If the package is complete, the Distributor Sales Manager forwards the order to
the Sales Operations Coordinator (SOC) for internal processing for delivery of
services to the end user customer.
Page 26 of 26