EXHIBIT 10.3
RESALE AGREEMENT
THIS RESALE AGREEMENT dated October 2, 2000, between Alloy LLC (on
behalf of itself and its Affiliates (collectively referred to herein as
"NEWCO")) and BellSouth Telecommunications, Inc., on behalf of itself and
Affiliates, other than Newco (the "RESELLER");
W I T N E S S E T H:
WHEREAS, BellSouth Corporation, a Georgia corporation and SBC
Communications Inc., a Delaware corporation ("SBC") have transferred
substantially all of their wireless businesses to NewCo and, following such
transfers and as a result thereof, NewCo owns Licenses to provide Wireless
Service within certain Geographic Service Areas (as defined herein); and
WHEREAS, NewCo desires to sell to the Reseller existing and future
wireless services and features providing access to the wireless systems NewCo
owns or wireless services to which NewCo has access pursuant to roaming
agreements; and
WHEREAS, the Reseller desires to purchase wireless services and
features from NewCo for resale to the Reseller's customers, separately and
packaged with other telecommunications services;
NOW THEREFORE, for and in consideration of the premises and other good
consideration, the receipt and sufficiency of which are hereby acknowledged,
NewCo and the Reseller agree as follows:
1. DEFINITIONS. The following capitalized terms, whenever used in this
Agreement, have the respective meanings set forth below:
"ACCESS NUMBER" means (i) a telephone number provided to the Reseller
by NewCo and associated with the Reseller's or an Authorized User's Equipment,
or (ii) other means of addressing individual units of Equipment, including
without limitation, internet protocol addresses, in each case enabling use of a
Wireless System.
"ADVANCED SERVICES" means high speed services which enable users to
originate and receive high quality voice and data services.
"AFFILIATE" means a Person that directly or indirectly Controls, is
Controlled by, or is under common Control with another Person, provided that,
with respect to NewCo, "Affiliate" shall not include the Reseller, the Other
Reseller or their respective subsidiaries.
"AIR-GROUND SERVICE" means air-ground wireless voice and data service
provided pursuant to licenses issued by the FCC pursuant to Subpart G of Part 22
of the FCC Rules and all air-ground wireless voice and data services reasonably
ancillary thereto.
"AGENCY AGREEMENT" means the Wireless Agency Agreement, of even date
herewith, between NewCo and the Reseller.
"APPLICABLE LAW" means all applicable laws, statutes, treaties, rules,
codes (including building codes), ordinances, regulations, certificates, orders
and licenses of, and interpretations by, any Governmental Authority and
judgments, decrees, injunctions, writs, Permits, orders or like governmental
action of any Governmental Authority (including environmental laws and those
pertaining to health or safety).
"AUTHORIZED USER" means a Person that is authorized by the Reseller to
use a Wireless Service purchased by the Reseller under this Agreement and resold
to such Person by the Reseller.
"BANKRUPTCY LAW" means any bankruptcy, insolvency, reorganization or
other law for the relief of debtors under the applicable jurisdiction.
"CELLULAR SERVICE" means mobile wireless telephone service provided
pursuant to Wireless Licenses issued by the FCC pursuant to Subpart H of Part 22
of the FCC's rules and all mobile voice and data services reasonably ancillary
thereto.
"COMMUNICATIONS ACT" means the Communications Act of 1934, as amended.
"CONTRIBUTION AGREEMENT" means the Amended and Restated Contribution
and Formation Agreement by and among Newco, the Reseller and the Other Reseller,
dated as of April 4, 2000.
"CONTROL" (including the correlative meanings of the terms "CONTROLLED
BY" and "UNDER COMMON CONTROL WITH"), as used with respect to any Person, shall
mean the possession directly or indirectly, of the power to direct or cause the
direction of management policies of such Person, whether through the ownership
of voting securities, by contract or otherwise.
"CONTROLLED SUBSIDIARY" means, with respect to any Person, an Affiliate
at least a majority of the Voting Securities and other equity interests of which
are owned, directly or indirectly, by such Person.
"CPE" means customer-provided equipment.
"DOMESTIC" means the fifty states comprising the United States of
America, the District of Columbia, the U.S. Virgin Islands and the Commonwealth
of Puerto Rico, but excluding all other territories and possessions of the
United States of America.
"EQUIPMENT" means wireless communications equipment, including mobile
and portable radio units and other terminals that are used by Authorized Users
and approved by the FCC.
"FCC" means Federal Communications Commission, and any successor
regulatory body in the United States performing the same or similar functions.
"FCC RULES" means any applicable rules and regulations of the FCC.
"GEOGRAPHIC SERVICE AREAS" (GSAs) means, as to any Wireless Service of
NewCo, the geographic areas within which NewCo has the authority pursuant to a
License issued by the FCC to offer such Wireless Service. Each geographic area
for which the FCC has issued a separate Wireless License shall be a separate
GSA.
"GOVERNMENTAL AUTHORITY" means the government of the United States of
America or any state or other political subdivision thereof, including the U.S.
Virgin Islands and the Commonwealth of Puerto Rico, or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to, any such government.
"HOME FRAUD" means unauthorized Wireless Service, excluding fraud in
the activation of services, respecting an Access Number in the Home Service Area
in which such Access Number is registered.
"HOME SERVICE" means Wireless Service provided in respect of an Access
Number in the Home Service Area applicable to such Access Number.
"HOME SERVICE AREA" means, with respect to an Access Number registered
in any Market, the GSAs (which may be in more than one Market) for which NewCo
provides Wireless Services on the terms and conditions applicable to Home
Service to more than fifty (50%) percent of the Access Numbers newly activated
by NewCo in such Market during the preceding calendar year.
"ILEC SERVICES" means any of the following products or services: (a)
Advanced Services, Information Service, InterLATA Service, Telephone Exchange
Service, Electronic Publishing Service, or any other Telecommunications Service
(other than where such services are used solely as part of Wireless Services);
(b) all current and future ancillary features and services offered in
conjunction with any of the services listed in clause (a), including, but not
limited to, voice mail, caller ID, call waiting, directory listing services,
calling card services, toll calling plans and associated CPE and any successors
thereto; (c) security services, virtual private networks and associated CPE; and
(d) any product or service that emulates or replicates the foregoing utilizing
an IP protocol and the PSTN (including IP telephone, IP fax, unified messaging
and Internet call waiting and associated CPE). For the purpose of this
definition, the terms Information Service, InterLATA Service, Telephone Exchange
Service and Telecommunications Service have the respective meanings set forth in
Section 3 of the Communications Act and the term Electronic Publishing Service
has the meaning set forth in Section 274(h) of the Communications Act.
"IN TERRITORY" means within the Service Territory.
"LICENSEE" means, in respect of any Geographic Service Area for any
Wireless Service, NewCo or the Affiliate of NewCo, in either case which holds
the applicable Wireless License.
"LLC AGREEMENT" means the Limited Liability Company Agreement dated as
of October 2, 2000 among the Reseller, the Other Reseller and Alloy Management
Corp. relating to NewCo, as amended from time to time in accordance with the
terms thereof.
"MARKET" means one or more GSAs that are managed by NewCo as a unit for
purposes of administering provision of Wireless Services.
"MOUS" or "MINUTES OF USE" means minutes of use of Wireless Service.
"NATIONAL ACCOUNT" means any Person which offers to subscribe or, at
the time of the initial subscription for wireless services, subscribes for, in
the aggregate, 500 or more Access Numbers in two or more areas codes (other than
overlapping area codes).
"NEW SERVICE OFFERINGS" has the meaning set forth in Section 2.
"NEWCO MARKS" means any trademarks, trade names, service marks, logos,
brands, domain names, insignia, symbols, decorative designs, and other marks,
and all variants and deviates thereof, which NewCo or its Affiliates own or are
licensed or sublicensed to use.
"NEWCO'S SERVICE TERRITORY" means the entire area within which NewCo
provides Wireless Services from time to time pursuant to FCC Licenses.
"OTHER RESELLER" means SBC.
"OTHER RESELLER AGREEMENT" means that certain Resale Agreement, of even
date herewith, between NewCo and the Other Reseller.
"OUT OF TERRITORY" means outside of the Service Territory.
"PACKAGE" means the marketing, sale, resale, or any other mode of
selling a Wireless Service in combination, whether for a single price or
otherwise, with any other ILEC Services.
"PACKAGE SUBSCRIBER" means any customer who purchases Wireless Services
and other ILEC Services in a Package.
"PAGING SERVICE" means the provision of Domestic one and two-way paging
and radiotelephone service pursuant to licenses issued by the FCC pursuant to
Subpart E of Part 22 of the FCC Rules and Subpart P of Part 90 of the FCC Rules
and all one- and two-way paging and radiotelephone services reasonably ancillary
thereto.
"PART 27 SERVICE" means mobile wireless voice and data service provided
pursuant to licenses issued by the FCC pursuant to Part 27 of the FCC Rules and
all mobile voice and data services reasonably ancillary thereto, other than with
respect to the provision of multi-channel video programming service and data
services reasonably ancillary thereto.
"PCS SERVICE" means mobile wireless telephone service provided pursuant
to Wireless Licenses issued by the FCC pursuant to Part 24 of the FCC's rules
regardless of the frequency block designated by the FCC under 47 C.F.R. 24.229
and all mobile voice and data services reasonably ancillary thereto.
"PERMITS" means all licenses (including without limitation Wireless
Licenses), permits, certificates of need, approvals and authorizations from all
Governmental Authorities required to lawfully conduct a business as presently
conducted.
"PERSON" means an individual, partnership, corporation, limited
liability company, limited liability partnership or other business association.
"PSTN" means public switched telephone network.
"RESELLER MARKS" means the trademarks, trade names, services marks,
logos, brands, domain names, insignia, symbols, decorative designs, and other
marks, and all variants and deviates thereof, which the Reseller or its
Affiliates own or are licensed or sublicensed to use, or specified on EXHIBIT B.
"ROAMER" means an Authorized User who receives wireless service in
respect of an Access Number in a geographic area outside of the Home Service
Area applicable to such Authorized User's Access Number.
"ROAMER FRAUD" means unauthorized wireless service respecting an Access
Number assigned to an Authorized User in a geographic area outside such the Home
Service Area with respect to such Access Number.
"ROAMING AGREEMENTS" means roaming agreements with third parties that
provide to NewCo the ability for its customers to roam, thereby receiving
wireless services on a Wireless System of such third party.
"SATELLITE SERVICES" means mobile wireless voice and data services
(other than multi-channel video services and data services reasonably ancillary
thereto) provided, via fixed or non-geostationary satellite, pursuant to
licenses issued by the FCC pursuant to Part 25 of the FCC Rules and all mobile
wireless voice and data services reasonably ancillary thereto that are also
provided via fixed or non-geostationary satellites.
"SERVICE TERRITORY" means the Service Territory of the Reseller, as
defined in the LLC Agreement.
"USAGE" means a period of time or other applicable unit of measurement
during which an Authorized User uses a Wireless System and incurs charges for
such use.
"VOTING SECURITIES" means any securities or other interests entitled to
vote in the ordinary course in the election of directors or of Persons serving
in a similar governing capacity of any corporation, partnership, limited
liability company or other entity.
"WIRELESS BUSINESS" means the acquisition, development, ownership and
operation of businesses engaged in the provision of mobile wireless voice and
data services utilizing radio frequencies licensed by the FCC for the provision
of Cellular Service, PCS Service, Wireless Data Service, Satellite Services and
Part 27 Service.
"WIRELESS DATA SERVICE" means the provision of Domestic wireless data
service pursuant to Wireless Licenses issued by the FCC pursuant to Subpart E of
Part 22 of the FCC Rules and Subpart S of Part 90 of the FCC Rules and all
messaging and data services customarily ancillary thereto.
"WIRELESS LICENSE" means a license provided by the FCC to provide a
specified type of Wireless Service.
"WIRELESS SERVICES" means the mobile wireless voice and data services,
products and features offered by NewCo in its Wireless Business, including
without limitation Cellular Service, PCS Services, Wireless Data Service,
Air-Ground Service, Satellite Services and Part 27 Service.
"WIRELESS SYSTEM(S)" means a radio communications system that provides
wireless services.
2. DUTIES OF NEWCO.
(a) NewCo agrees to provide each type of Wireless Service to the
Reseller upon the terms and conditions specified herein and at rates and charges
determined pursuant to SECTION 11 and EXHIBIT A. NewCo shall obtain, retain and
maintain suitable facilities, Permits and rights for the construction and
maintenance of the circuits and equipment necessary to provide each type of
Wireless Service in the applicable Geographic Service Areas. Subject to the
limitations on resale of Wireless Services set forth herein, any new service or
feature not described in EXHIBIT A, including but not limited to any New Service
Offering as described in SECTION 2(C), will be available for resale under this
Agreement by the Reseller in all GSAs, both In Territory and Out of Territory,
as soon as reasonably practicable after the date when such service or feature is
first commercially offered by NewCo.
(b) Subject to SECTION 11(B), NewCo shall extend to the Reseller
the same or better rates and terms (including Local Calling Areas at the rates
so offered) for its Wireless Services, including volume discounts, offered by it
to any other reseller of Wireless Services. Subject to applicable regulatory
rules, rates offered to NewCo's retail subscribers, including, but not limited
to corporate subscribers for the use of their employees, may from time-to-time
be less than the rates offered to the Reseller, if NewCo extends such lower
rates in order to meet competition, to use excess capacity, or for other sound
business reasons.
(c) NewCo will provide to the Reseller marketing information,
including sample coverage maps of geographic areas where each type of Wireless
Services and New Service Offerings (defined below) is available, and samples of
any pertinent informational material and other assistance to enable the Reseller
to acquaint Authorized Users with such services. The Reseller may replicate such
materials in whole or in part for its marketing efforts; provided, however, that
such right to replicate shall not be deemed to expand the Reseller's right to
use NewCo's Marks beyond the contemplation of SECTION 17. NewCo shall provide
reasonable prior notice (in all events, of not less than sixty (60) days) to the
Reseller of (i) any material changes in
any type of Wireless Service of either a permanent or temporary nature and (ii)
any new type of Wireless Service not previously offered by NewCo ("NEW SERVICE
OFFERINGS").
(d) NewCo shall provide a designated contact person or persons to
the Reseller for the Reseller's interface, but not for the use of the Reseller's
Authorized Users. Nothing in this Agreement shall require NewCo to provide
customer service or billing services to the Reseller's Authorized Users. The
Reseller recognizes and agrees that NewCo will offer Wireless Service to the
public directly and through agents, other resellers, and other distribution
channels, subject to compliance with SECTION 17.
(e) Operational procedures of NewCo with respect to Wireless
Services shall be in accordance with the procedures in effect in the applicable
Market immediately prior to the date hereof, subject only to (i) changes and
improvements to such operational procedures that do not have an adverse effect
on the Wireless Service or the performance by NewCo of its obligations hereunder
or (ii) in the case of other changes, the prior written consent of the Reseller.
Order processing procedures for the activation, deactivation, and modification
of service features of the Reseller's Authorized Users in any Market shall be
consistent with the procedures used by NewCo or its predecessor-in-interest with
respect to the conduct of the Wireless Business in such Market immediately prior
to the date of this Agreement, with such changes as are necessary to give effect
to the transition of the Wireless Business from such predecessor-in-interest to
NewCo, or as otherwise approved in writing by the Reseller and the Other
Reseller. The parties shall cooperate to refine such processes so as to improve
the efficiency of both parties.
(f) NewCo shall establish and maintain procedures for accepting
and responding to reports by the Reseller of trouble with any Wireless Service
(i) comparable or superior to those procedures available to NewCo's retail
customers, and (ii) consistent with standards generally prevalent in the
industry.
(g) The Reseller shall have access to NewCo's remote customer
activation systems as may be in use by NewCo from time to time in the various
markets, as set forth in SECTION 10(D) hereof.
(h) NewCo shall comply with all Applicable Laws in the performance
of its obligations hereunder and in the provision of Wireless Services to the
Reseller. NewCo shall be responsible for obtaining and maintaining all Permits
necessary for such performance.
3. ADDITIONAL PROVISIONS REGARDING RESALE.
In addition to the other responsibilities of the Reseller as set forth
in this Agreement, the Reseller and NewCo agree to the following:
(a) If NewCo fails to maintain the requisite Permits, despite
compliance with SECTION 2(A), to operate as Licensee with respect to any
Wireless Service in any given Geographic Service Area, the Reseller agrees that
this Agreement will cease as to such Wireless Service in the affected Geographic
Service Area without penalty to either party. The Agreement shall remain in full
force
and effect for all other Wireless Services in such affected Geographic Service
Area, and for such affected Wireless Service in all other Geographic Service
Areas within NewCo's Service Territory.
(b) The Reseller will submit non-binding forecasts, by type of
Wireless Service, on a quarterly basis to NewCo for planning purposes. The
Reseller will have no liability in respect of any failure to use Wireless
Services in the amounts specified in such forecasts.
(c) The Reseller is responsible for all charges on lost or stolen
Equipment of any of its Authorized Users, until Reseller reports the loss or
theft of that Equipment to NewCo.
(d) NewCo is not liable to the Reseller or its Authorized Users if
changes in any of NewCo's facilities, operations, equipment, procedures or
services render obsolete any equipment or software provided by the Reseller or
Authorized Users, or require modification or alteration of such software or
equipment, or otherwise affect the Reseller's performance, so long as NewCo has
complied with its obligations hereunder.
(e) The Reseller agrees to suspend or cancel the use of Wireless
Services by any Authorized User that NewCo reasonably identifies as using such
Wireless Services in an abusive or fraudulent manner.
(f) In the event the Reseller ceases providing Wireless Services
to its Authorized Users, the Reseller agrees it will cooperate with NewCo to
contact these Authorized Users so that NewCo may continue to provide service to
them, uninterrupted by the cessation of the Reseller's activities.
4. AVAILABILITY OF THE WIRELESS SERVICE.
(a) From the date hereof until the date, if any, on which any
event described below occurs, the Reseller will be permitted to sell Wireless
Services by resale only Out of Territory. Notwithstanding the foregoing, the
Reseller shall be permitted to resell Wireless Services In Territory, as
follows:
(i) If the Reseller makes the election contemplated by
Section 9.1 of the Agency Agreement to begin reselling to Package
Subscribers, the Reseller will be permitted to resell the Wireless
Services In Territory to Package Subscribers and may use NewCo Marks as
described in SECTION 17 hereof.
(ii) If the Reseller makes an election pursuant to Section
9.2 of the Agency Agreement to begin reselling to specified National
Accounts, the Reseller will be permitted to resell the Wireless
Services to National Accounts wherever located, and may use NewCo Marks
as described in SECTION 17 hereof.
(iii) If the Reseller terminates the Agency Agreement
pursuant to Section 19.2 thereof, from and after the effective date of
such termination, the Reseller may resell Wireless Services In
Territory and competing Wireless Services in any Market at Reseller's
sole discretion.
The exercise of one or more of the foregoing elections shall not affect
the Reseller's right hereunder to resell Wireless Services Out of Territory,
which right shall continue whether or not any such election is made. Nothing
contained herein shall be construed to prohibit the Reseller from continuing to
provide Wireless Services by resale to Package Subscribers In Region where such
Package Subscribers elect to stop purchasing any other ILEC Services from the
Reseller.
(b) Subject to SECTION 4(A), each type of Wireless Service shall
be available to the Reseller and its Authorized Users with Equipment equipped
for such Wireless Service when within the range of the applicable Wireless
System. The quality of the Wireless Service available to Authorized Users shall
be at least equal to the quality of Wireless Service available to NewCo's retail
subscribers. Features shall be available to Authorized Users (i) subject to
SECTION 2(A), as made available to NewCo's retail customers; (ii) as required by
the FCC, (iii) as required to be provided pursuant to the terms hereof or (iv)
as otherwise agreed by the parties. Service may be temporarily refused or
limited because of system capacity limitations, is subject to transmission
limitations caused by atmospheric and other natural or artificial conditions
adversely affecting transmissions, and may be temporarily interrupted or
curtailed due to equipment modifications, upgrades, relocations, repairs and
similar activities necessary for the proper or improved operation of the
Wireless Service, but under no circumstance will service be provided to the
Reseller or any Authorized User be any worse than that provided by NewCo to its
own customers.
(c) The Reseller's Authorized Users of any Wireless Service shall
receive the same roaming privileges as NewCo allows its own retail customers;
provided that the price for such roaming service shall be determined in
accordance with EXHIBIT A.
(d) Under no circumstances will the Reseller have access to any
switch functionality of NewCo's Wireless System, including but not limited to
any triggers, billing feeds, or the interconnection of the Reseller's Home
Location Register.
5. LIMITATION OF LIABILITY.
(a) The Reseller acknowledges that (i) occasional interruptions or
irregularities in each type of Wireless Service may occur; (ii) any potential
harm from interruptions or irregularities in Wireless Service is speculative in
nature; (iii) NewCo can only offer Wireless Services at rates set without regard
to the needs of any specific customer and cannot offer Wireless Service at rates
which reflect its value to any specific customer; and (iv) NewCo assumes no
responsibility other than that set forth in this Agreement. Accordingly, the
Reseller agrees that any liability NewCo may have due to interruptions or
irregularities in the Wireless Service shall not exceed the amount of the
prorated charge (as defined below) to the Reseller for the period in which the
interruption or irregularity occurred. NewCo's liability shall be discharged by
credit to the Reseller's account of the prorated charge as set forth below. The
above is in lieu of any other express or implied warranties including any
warranties of merchantability or fitness for a particular purpose. In the
absence of gross negligence or willful misconduct, NewCo's sole liability to the
Reseller and its Authorized Users for loss or damages arising out of mistakes,
omissions, interruptions, delays, errors or defects in the Wireless Service, its
transmission, or failures or defects in facilities
furnished by NewCo, occurring in the course of furnishing Wireless Service is a
credit allowance, as described in Subsection (c) below, made, at the Reseller's
written request, in the form of a pro rata adjustment of the fixed monthly
charges billed to the Reseller as NewCo's full and complete liability.
(b) Such credit allowance will be based upon the period of time in
which such mistakes, omissions, interruptions, delays, errors or defects in the
Wireless Service, its transmission, or failures or defects in facilities
furnished by NewCo, existed. Any such interruption will be measured from the
time it is reported to or detected by NewCo, whichever occurs first. An
adjustment will be made in the event the Reseller or its Authorized User is
affected by such interruption for a period of twenty-four (24) hours or more or
for every three (3) interruptions per billing cycle of less than twenty-four
(24) hours which total twenty-four (24) hours or more. When an interruption
exceeds twenty-four (24) hours, the length of the interruption will be measured
in twenty-four (24) hour days. An additional fraction of a day consisting of
less than twelve (12) hours will not be credited, and an additional period of
twelve (12) hours or more will be considered an additional day.
(c) The credit allowance will be computed by dividing the length
of the Wireless Service interruption by a standard thirty (30) day month, and
then multiplying the result by NewCo's fixed monthly charges for each
interrupted Access Number. In no case will the credit exceed the fixed monthly
charges. In the absence of gross negligence or willful misconduct, no other
liability will attach to NewCo in consideration of such mistakes, omissions,
interruptions, delays, errors or defects in the Wireless Service.
(d) A credit allowance will not be given for mistakes, omissions,
interruptions, delays, errors or defects caused by the negligence or willful
misconduct of the Reseller or Authorized User or mistakes, omissions,
interruptions, delays, errors or defects caused by failure of equipment or
service not provided to the Reseller or its Authorized User by NewCo.
(e) NewCo will in no event be liable for interruptions or delays
in transmission, errors or defects in transmission, or failure to transmit, when
caused by acts of God, fire, war, riots, Government authorities or other causes
beyond either party's control, including, but not limited to, service
interruptions.
(f) The Reseller hereby agrees to indemnify, defend and hold NewCo
harmless from and against any and all claims, demands, suits, judgments, causes
of action, losses, expenses, fees (including reasonable attorneys' fees) and
liability or damages (collectively, "CLAIMS") for libel, slander, or
infringement of copyright from the material transmitted over its facilities by
it or its Authorized Users; against Claims for infringement of patents arising
from combining or using apparatus or systems of the Reseller or its Authorized
Users with the facilities of NewCo; and against all other Claims arising
directly out of any act or omission of the Reseller or its Authorized Users in
connection with facilities or Wireless Service provided by NewCo. The
indemnification provisions are applicable to the Reseller and its Authorized
User(s) and the Reseller agrees to notify of and use its reasonable efforts to
bind its Authorized User(s) to these indemnifications other than
Authorized Users purchasing in a negotiated transaction, in which case the
Reseller agrees to use reasonable efforts to include such indemnification
provisions in the contract for such transaction.
(g) The Reseller shall include in the terms and conditions it has
with Authorized Users a provision substantially as follows, but this provision
shall not be interpreted to require the Reseller to have a written agreement
with Authorized Users:
Unless caused by the sole negligence of the Reseller,
Authorized User shall indemnify and hold the Reseller, its
officers, employees, suppliers of service and agents harmless
against any and all claims, demands, suits, judgments, causes
of action, losses, expenses, fees (including reasonable
attorneys' fees), and liability or damages for libel, slander
or infringement of copyright from the material transmitted via
the access telephone number, and against any and all other
claims, demands, suits, judgments, causes of action, losses,
expenses, fees (including reasonable attorneys' fees),
liability, including without limitation for any personal
injury or death, arising in any way directly or indirectly in
connection with this agreement or the use or inability to use
the access telephone number (whether caused in whole or in
part by the negligence of suppliers of service). This
indemnity shall survive the termination of this agreement.
(h) NewCo is not liable for damages for any accident or injury
occasioned by the use of any Wireless Service or the presence of any Equipment.
(i) NewCo is not liable for any defacement or damage to the
Reseller's or any Authorized User's motor vehicle or any other personal or real
property resulting from the presence of any Equipment.
(j) EXCEPT AS OTHERWISE PROVIDED HEREIN, IN NO EVENT WILL EITHER
PARTY AND/OR ANY OF THEIR AFFILIATES, OTHER THAN NEWCO AND ITS AFFILIATES, BE
LIABLE TO OR THROUGH THE OTHER PARTY FOR ANY OF THE FOLLOWING:
(i) Damages caused by the other party's and/or any of its
Affiliates' failure to perform their obligations and responsibilities;
(ii) Claims or demands brought against the other party by
third-parties other than those third-party claims in respect of which
such party is expressly obligated to indemnify the other party pursuant
to a provision of this Agreement; or
(iii) Any lost profits, loss of business, loss of use or
interruptions of business, lost savings opportunities or other
consequential, special, incidental, indirect, exemplary or punitive
damages;
arising from or in connection with the delivery, use, or performance of Wireless
Service governed by this Agreement.
(k) NewCo agrees to indemnify, defend and hold the Reseller
harmless from and against any and all Claims arising from, out of or in
connection with:
(i) any Claims of infringement of any patent, copyright,
trade secret, trademark, service ▇▇▇▇ or other intellectual property
right alleged to have occurred because of any service, equipment or
other resources provided by NewCo;
(ii) the inaccuracy or untruthfulness of any
representation or warranty made by NewCo in this Agreement;
(iii) any amounts, including but not limited to taxes,
interest and penalties assessed against the Reseller which are
obligations of NewCo;
(iv) any Claims that are the result of NewCo's negligent
or willful act or failure to act, including but not limited to Claims
for bodily injury or damage to property;
(v) any Claims that are a result of NewCo's or its
Affiliate's failure to comply with any Applicable Laws in the
performance of its obligations under this Agreement; and
(vi) any Claims of an unaffiliated third party that is
entitled to resell Wireless Services to its customers under the terms
and conditions of this Agreement.
(l) The Reseller agrees to indemnify, defend and hold NewCo
harmless from and against any and all Claims arising from, out of or in
connection with:
(i) any Claims of infringement of any patent, copyright,
trade secret, trademark, service ▇▇▇▇ or other intellectual property
right alleged to have occurred because of any service, equipment or
other resources provided by the Reseller (other than Claims for which
any of the Reseller and its Authorized Users is indemnified pursuant to
SECTION 5(K));
(ii) the inaccuracy or untruthfulness of any
representation or warranty made by the Reseller in this Agreement;
(iii) any amounts, including but not limited to taxes,
interest and penalties, assessed against NewCo which are obligations of
the Reseller;
(iv) any Claims that are the result of the Reseller's or
its Authorized User's negligent or willful act or failure to act,
including but not limited to claims for bodily injury or damaged
property; and
(v) any Claims that are the result of the Reseller's or
its Affiliate's failure to comply with any applicable laws, regulations
or orders in the performance of its obligations under this Agreement.
(m) All indemnities under in this Agreement shall include
indemnification of the indemnified party's Affiliates, and their respective
directors, officers, employees, agents, customers (including in the case of the
Reseller, its Authorized Users), successors and assignees and their heirs, legal
representatives, and assigns. The indemnification shall be for all Claims
arising out of the specific event referred to in this Agreement which is covered
by the indemnification, including all costs reasonably incurred in the defense
of any claim, including without limitation reasonable accountants', attorneys'
(including allocated in-house expense), and expert witness fees, cost of
investigation and proof of facts, court costs, and other reasonable litigation
expenses including, but not limited to, travel and living expenses. Written
notice of Claims shall be forwarded promptly by the indemnified party to the
indemnitor and there shall be no settlement of the Claim without the consent of
the indemnified party, which consent shall not be unreasonably withheld or
delayed. The indemnified party shall have the right to participate in the
defense of any such claim in which it is named as an defendant at its own cost
and expense. The indemnification obligations under the Agreement shall survive
and continue in full force and effect subsequent to and notwithstanding the
expiration or termination of this Agreement. Provisions for indemnification in
this Agreement are not in lieu of and do not supplant any insurance coverage
required in the Agreement, and are not intended to act as insurance.
(n) Notwithstanding anything herein to the contrary, neither party
shall owe the other party any indemnity obligation in respect of the other
party's intentional acts, negligence or willful misconduct. Intentional acts
shall be those actions intentionally undertaken and intended to cause the
consequences for which indemnity is sought.
THE LIABILITY OF NEWCO IN CONNECTION WITH THE PROVISION OF WIRELESS SERVICE BY
NEWCO IS SUBJECT TO THE FOREGOING LIMITATIONS AND NEWCO MAKES NO WARRANTIES OF
ANY KIND, EXPRESS OR IMPLIED, AS TO THE PROVISION OF SUCH WIRELESS SERVICE,
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT.
6. BILLING PROCEDURES.
(a) NewCo shall provide the Reseller, at no additional charge to
the Reseller, complete billing and call detail for all charges incurred for each
Access Number at least once per calendar month, with the billing date to be the
same for that Access Number each successive month, subject to change on at least
sixty (60) days notice from NewCo to the Reseller. NewCo may, at its sole
discretion, provide such invoices on a Market by Market basis. NewCo and the
Reseller shall cooperate with each other to develop a billing format compatible
with the Reseller's requirements
and audit procedures, provided that in no event shall NewCo be obligated to
develop a billing format that is not technically compatible with NewCo's own
billing systems or that is otherwise not technically feasible. NewCo will use
reasonable efforts to have all Access Numbers of the Reseller assigned to a
single cycle, but any Access Number may be assigned to any cycle; provided,
however, that NewCo shall not unreasonably require multiple billing cycles for
the Reseller. NewCo shall use reasonable efforts to make its billing data
reasonably satisfactory to the Reseller. The Reseller and NewCo agree to jointly
develop a process to ensure that billing information is exchanged in a timely
manner.
(b) NewCo may establish a system such that NewCo will provide
reasonable billing detail electronically in as many intervals a month as are
reasonably adequate for the Reseller to rebill its end users.
(c) NewCo shall provide to the Reseller or its designated billing
agent free of charge, accurate magnetic billing tapes or other medium of data
retention for all Wireless Service provided pursuant to this Agreement. The
magnetic tapes provided by NewCo will include complete billing detail compiled
using standard industry protocols (e.g., the ▇▇▇▇▇ format). NewCo shall provide
such tapes within five (5) working days after each billing cutoff date. Each
container within which the magnetic billing tapes are shipped shall be labeled
with the Reseller's name, NewCo's name, the name of the Reseller's billing
agent, if any, the billing period to which the tape pertains, and the number of
records on the tape. It is understood and agreed that the data related to
billing may be transmitted, with the Reseller's written consent, by means other
than magnetic tape, such as by optical disk or by way of wired networks from one
computer to another. The substitution of another form of transmission shall not
affect the transmission, compliance with standard protocols, timeliness of
notice regarding defects and identification of the data by reasonable
"labeling."
(d) In the event that NewCo desires to make any material change to
the billing format from that in use on the date hereof, if practicable, NewCo
shall first give the Reseller not less than ninety (90) days' prior written
notice of such change, which change shall be effective unless the Reseller
notifies NewCo of its objection to such change within sixty (60) days after
NewCo first notified the Reseller of the change. Any dispute as to any such
change will be resolved pursuant to SECTION 30. Upon the effectiveness of any
such change, NewCo shall provide to the Reseller the new format and a
description of the information reasonably necessary to allow the Reseller to
read and otherwise use the billing information for billing of Reseller's
Authorized Users.
(e) When NewCo is notified that, due to its error or omission,
incomplete or incorrect data has been provided to the Reseller, NewCo shall use
its best efforts to locate and/or recover the data and provide new magnetic
tapes to the Reseller at no additional charge. Such request to recover the data
must be made within sixty (60) days from the date the tape was received by the
Reseller. Upon receipt of such request NewCo shall use its reasonable best
efforts to send new magnetic tapes to the Reseller by overnight courier service
within five (5) days of such request.
(f) Except for the remedies set forth above, neither NewCo nor its
agents shall be liable to the Reseller for any claim for relief, including but
not limited to damages of any kind,
attributable to any acts or omissions in the performance of recording/billing
service, in the absence of gross negligence or willful misconduct.
7. USE OF WIRELESS SERVICES. Wireless Service is furnished for use by the
Reseller for any lawful purpose, including resale subject to the terms hereof.
Subject to SECTION 4(A), the Reseller may resell Wireless Service purchased
hereunder to any Authorized User, wherever located, separately or in Packages;
provided, however, that the Reseller may not sell Wireless Services for the
purpose of subresale (other than to any Controlled Subsidiaries identified in
the signature pages hereto or that have undertaken to be bound by the terms and
conditions hereof pursuant to SECTION 20(A)). An Access Number may be associated
with only one unit of Equipment, unless NewCo offers such service and the
Reseller subscribes to such Wireless Service. Orders, including those which
involve the start, a change or the discontinuance of Wireless Service, will be
accepted by NewCo only from the Reseller and not from an Authorized User.
8. DISCONNECTION AND TERMINATION OF WIRELESS SERVICE TO AUTHORIZED USERS
FOR CAUSE.
(a) Upon non-payment of any sum due NewCo in respect of any Access
Number, or the fraudulent or other misuse of the Wireless Services by an
Authorized User as described in SECTIONS 8(A) THROUGH 8(C), NewCo may, by notice
to the Reseller in writing, without incurring any liability to the Reseller or
any of its other Authorized Users, either temporarily discontinue or permanently
terminate the furnishing of Wireless Service to such Access Number or Authorized
User, at NewCo's sole but reasonable discretion, either in part or in whole.
NewCo shall notify the Reseller of any such termination, but shall not be
required to give notice of any such termination to any Authorized User. NewCo
shall not be liable to any Authorized User for any damages resulting from
interruption of Wireless Service as a result of temporary disconnection or
permanent termination of Wireless Service to the Reseller.
(b) Where any Authorized User's Equipment is used with facilities
provided by NewCo in violation of any material provisions herein, NewCo will
notify the Reseller and take such action as is necessary for the protection of
its facilities or the Wireless Service to its customers. The Reseller shall
notify the Authorized User to discontinue such use of the Equipment or correct
the violation immediately and the Reseller shall confirm in writing to NewCo
within five (5) days (following NewCo's giving written notice) that such notice
has been provided. Failure of the Authorized User to discontinue such use or to
correct the violation or of the Reseller to give the required written
confirmation to NewCo within the time stated above shall result in disconnection
of the applicable Wireless Service to the Authorized User without any credit
allowance as provided in SECTION 5 hereof, until such time as the Reseller and
such Authorized User complies with the provisions hereof.
(c) Wireless Service to any Authorized User may be refused,
discontinued or terminated without notice in the event the Wireless Service is
used by such Authorized User in such a manner that is in violation of a relevant
rule or regulation established by a Governmental Authority or that will
imminently and significantly impair NewCo's Wireless Service to any of its other
customers or if it is determined that such Authorized User's Equipment
significantly impairs
NewCo's provision of Wireless Service to any of its other customers. NewCo shall
provide prompt notice to the Reseller in the event of any such interruption.
9. EQUIPMENT OF AUTHORIZED USERS.
(a) NewCo is not responsible for the sale to Authorized Users,
installation, programming, operation, quality of transmission or maintenance of
any Equipment of the Reseller or any Authorized User.
(b) The Reseller or its Authorized User must provide and maintain
all Equipment and ensure that it is technically and operationally compatible
with the Wireless Systems and in compliance with applicable Federal
Communications Commission rules and regulations.
(c) All Equipment sold by the Reseller to Authorized Users shall
be capable of providing digital Wireless Services.
10. ACCESS NUMBERS.
(a) The Reseller may order Access Numbers in such amounts and as
frequently as may be reasonably required by the Reseller. If requested by the
Reseller, NewCo shall reserve full NXX blocks for the Reseller subject to
availability. If NewCo is unable to obtain an entire NXX for the Reseller, then
NewCo and the Reseller agree to cooperate to seek an alternative solution
utilizing smaller blocks of numbers. Subject to the availability of Access
Numbers from the number administrator, Access Numbers shall be supplied to the
Reseller within twenty-four (24) hours of NewCo's receipt of the order therefor.
NewCo shall process requests for Access Numbers from all resellers including
customers who are owned or controlled by NewCo or an Affiliate of NewCo, in the
sequence in which the orders for additional Access Numbers are placed, provided
that such standards do not discriminate against the Reseller vis-a-vis any of
NewCo's other customers (including without limitation the Other Reseller). If
Access Numbers or NXXs are unavailable, NewCo shall follow generally accepted
industry standards and/or regulatory requirements, if any, in responding to the
shortage of Access Numbers, provided, however, that in no event shall NewCo
discriminate against the Reseller vis-a-vis any of NewCo's other customers
(including without limitation the Other Reseller). If NewCo has assigned an
entire NXX to the Reseller and NewCo is unable to obtain additional numbers for
the use of NewCo, its Authorized Users or other resellers, the Reseller agrees
to return to NewCo numbers in 1,000 blocks, which are not then being utilized by
the Reseller or its Subsidiaries.
(b) Neither the Reseller nor any Authorized Users shall have any
proprietary right in the Access Numbers provided to them by NewCo. NewCo
reserves the right to assign, designate or change such Access Numbers when, due
to an order of an appropriate administrative body or as a result of good faith
negotiations by NewCo with the code administrator, such assignment, designation
or change is reasonable or necessary in the conduct of its business. NewCo may
also request the Reseller to change Access Numbers for other business reasons,
subject to paragraph (e) below. NewCo agrees to provide the Reseller with at
least sixty (60) days' prior written notice of any intended change in Access
Numbers, except as otherwise required or as is necessary to
implement changes mandated by any Governmental Authority. The Reseller shall not
retain the Access Numbers provided by NewCo for use with services provided by
any other wireless carrier unless and until number portability is mandated. The
Reseller shall not be entitled to order additional Access Numbers at any time
that its inventory of inactive Access Numbers in any relevant area exceeds
twenty percent (20%) of the Reseller's then active Access Numbers.
(c) Subject to availability, NewCo will use its reasonable efforts
to make Access Numbers requested by the Reseller available by NewCo within
twenty-four (24) hours from receipt by NewCo, in a form reasonably prescribed by
NewCo, of an order therefor. The order shall be in writing or, if given orally,
shall be subsequently confirmed in writing. NewCo will activate Access Numbers
within the same time period that NewCo activates its retail subscribers based on
the activation procedures utilized. NewCo will deactivate the Resellers'
Authorized Users within two (2) hours of a request by the Reseller for such
deactivation. The Reseller agrees that it will not transfer to or otherwise
authorize any Person other than NewCo or the Reseller's Authorized Users, the
right to utilize any number or NXX.
(d) Where NewCo or Licensee makes a remote access procedure
available to resellers, the Reseller (i) shall bear all costs reasonably
associated with utilizing such remote access capability and (ii) shall order
Access Numbers, and activate, modify or terminate Wireless Service to Authorized
Users utilizing such procedure. In the event that the remote access system is
temporarily unavailable to the Reseller, NewCo will perform these activities for
the Reseller in a non-discriminatory manner as set forth in paragraph (a) above.
(e) NewCo shall use its reasonable efforts to keep Access Number
changes to a minimum. NewCo agrees to implement such changes on a
non-discriminatory basis vis-a-vis NewCo's other customers or retail
subscribers. NewCo or the Licensee shall provide the Reseller written notice of
the intended change. If the Reseller consents to a discretionary number change
(i.e., a number change not mandated by the FCC or other number administrator),
NewCo shall compensate the Reseller for the Reseller's reasonable programming
and other costs incurred by it in making such changes.
11. RATES AND CHARGES.
(a) The price for each type of Wireless Services purchased by the
Reseller shall be determined in accordance with the terms of EXHIBIT A. The
method for calculating rates and charges, whether the initial rates and charges
or subsequent rates and charges set from time to time, for each type of Wireless
Service pursuant to EXHIBIT A may not be modified during the term of this
Agreement without the Reseller's written consent. Each of NewCo and the Reseller
acknowledge that the prices set out on EXHIBIT A have been established taking
into consideration a number of factors including, but not limited to, (i) the
fact that NewCo has been the recipient of the contribution of various Wireless
Licenses and Wireless Systems from the Reseller or its Affiliates, (ii) NewCo
has been accorded the opportunity to be the agent for various Affiliates of the
Reseller in accordance with the terms of the LLC Agreement between Silver and
Brass, (iii) NewCo will benefit from the ability to jointly brand its offerings
with those of the Affiliates of the Reseller in accordance with the terms of the
Agency Agreements established between NewCo and such
Affiliates and (iv) the commitment of Silver and Brass, contained in, and
constituting a part of the consideration for, the LLC Agreement that, until and
unless certain circumstances occur, the Affiliates of Silver and Brass will
exclusively market the Wireless Services of NewCo under the terms of each of the
Agency Agreement and the Reseller Agreements contemplated by the LLC Agreement.
(b) Subject to SECTION 11(C) and notwithstanding any other
provision of this Agreement to the contrary, the prices charged by NewCo to the
Reseller, and the methods applied to calculate rates and charges, shall, subject
to the other terms of this Agreement, be identical to the prices charged and
methods applied in the Other Reseller Agreement. At all times, the terms for any
prices under this Agreement and the Other Reseller Agreement (a "PRICING TERM")
shall be co-terminous. Subject to SECTION 11(C), if at any time during the term
of this Agreement, the prices in effect hereunder for any Wireless Services, or
the methods applied to calculate rates and charges hereunder, differ from the
prices in effect under the Other Reseller Agreement, or the methods applied to
calculate rates and charges thereunder, the Reseller may, by written notice to
NewCo, elect to have the prices and methods then in force under the Other
Reseller Agreement apply under this Agreement. NewCo will promptly notify the
Reseller in writing if the prices or methods applicable under this Agreement
differ from the prices or methods applicable under the Other Reseller Agreement.
(c) Notwithstanding the provisions of SECTION 11(B), if one of the
Resellers and the Other Reseller (a "CONTRACTING RESELLER") enters into an
agreement with NewCo as to any price at the expiration of a Pricing Term, and
the other (an "ARBITRATING RESELLER") does not reach agreement with NewCo and
instead engages in an arbitration under SECTION 30(E) of this Agreement or the
corresponding provision of the Other Reseller Agreement, then the pricing set
forth in the agreement between NewCo and the Contracting Reseller shall not be
available to the Arbitrating Reseller, and the pricing determined in such
arbitration shall not be available to the Contracting Reseller.
12. RELATIONSHIP ESTABLISHED. The Reseller's relationship to NewCo under
this Agreement shall be that of a purchaser of the applicable Wireless Service.
Neither party hereto shall be deemed to be the agent of the other under this
Agreement and neither party shall have authority or power to bind, contract or
negotiate in the name of or to incur any debt or other obligation on behalf of
or create any liability against the other party except in the manner and to the
extent agreed to in writing. Persons retained by a party hereto as employees or
agents shall not be deemed to be employees or agents of the other party because
of the relationship established hereunder.
13. [RESERVED].
14. PAYMENT OF CHARGES.
(a) The Reseller shall be invoiced for charges for Wireless
Service within fifteen (15) days after the Reseller or the Reseller's designated
billing agent has received the applicable magnetic billing tape substantially
complete and correct in content as referenced in SECTION 6(B). The Reseller is
responsible for payment of all charges for Wireless Service furnished to it or
its
Authorized Users, including, but not limited to, all calls originated by or
completed to the Reseller's or its Authorized Users' Equipment, as well as any
other charges billed to the Access Numbers issued for the Reseller's use by
NewCo. Bills are payable by the payment due date indicated on the monthly ▇▇▇▇,
which shall be no less than thirty (30) days after mailing.
(b) A late payment charge will be applied to any account where
payment is not received prior to the date of the next ▇▇▇▇. The late payment
charge will be the lesser of one (1%) percent per month and the highest monthly
rate allowed by law applied to the prior balance only, and will be included in
the total amount due on the current ▇▇▇▇.
(c) In the event the Reseller disputes part of a monthly invoice,
it shall notify NewCo in writing and submit the appropriate documentation
justifying such dispute to NewCo as soon as practicable, but no later than
thirty (30) days after the invoice due date. Notwithstanding the Reseller's
request for reconciliation, the Reseller shall be required to pay such billing
in full. The parties shall use their best efforts to resolve all such billing
disputes, and NewCo shall promptly refund any amount due upon dispute
resolution. Notwithstanding the foregoing, should a recurring calculation error,
including, for example, misapplication of rates, taxes or called timing
conventions, be discovered in the Reseller's billing, the Reseller may request a
reconciliation of such calculation errors for all billing during the twenty-four
(24) month period proceeding the date of such request.
(d) The Reseller shall not be liable for charges related to Home
Service for which NewCo has failed to provide data pursuant to this Agreement
within sixty (60) days from the date such Wireless Service was used.
(e) Invoices shall show, for each Market, the number of MOUs and
associated charges, the total access charges, and the total amount due. The
above billing information may also be provided on a diskette or by other
electronic means.
(f) Except where the Reseller provides to NewCo a valid
Certificate of Resale or such other documentation as would release NewCo from
any liability, levy, or duty, there shall be added to any charges due from the
Reseller an amount equal to any duty, fee, surcharge, levy or tax, including but
not limited to Universal Service Fund assessment ("USF CHARGES"), but only to
the extent such USF Charge is not levied directly on the Reseller, sales, gross
receipts, excise, utility, and use taxes, fees or surcharges, imposed by any
local, federal or state government or governmental agency with respect to the
Reseller, the Wireless Service or transactions contemplated by this Agreement,
excepting taxes on the income of NewCo.
15. OTHER CARRIER CHARGES.
(a) The Reseller is responsible for paying all toll charges
resulting from the origination of calls to points outside of the applicable
Local Service Area (as defined in EXHIBIT A) from which the call originates and
all other charges or calls billed to the Reseller's Access Numbers, including,
without limitation, any charges or calls billed (at the rate charged to NewCo by
the wireless service provider) to the Reseller's Access Numbers resulting from a
provision of Cellular Service or PCS
Service to Roamers regardless of whether the Reseller's Authorized Users made
such calls. NewCo shall provide the Reseller with roaming charges within sixty
(60) days of receipt. The Reseller will have the right to provide directly or
through a vendor chosen by the Reseller (the "RESELLER IXC"), long distance
services to the Reseller's Authorized Users, provided that the Reseller IXC has
facilities connected, directly or indirectly, to NewCo's switch, and provided
further that if, at the Reseller's request, NewCo provides such long distance
service, the charges therefor shall be determined in accordance with EXHIBIT A.
(b) At the request of the Reseller, NewCo will, to the extent it
provides such service directly, provide local directory assistance at its
then-current rates. If NewCo contracts with third parties for local directory
assistance services in any GSA, NewCo shall use its reasonable best efforts to
ensure that the Reseller shall have access to such third party provider under
the same terms and conditions as NewCo.
16. FRAUD.
(a) The Reseller shall be liable for all Roamer Fraud billed to
Access Numbers assigned to the Reseller. NewCo shall credit the Reseller with
credits received by NewCo from other Wireless Service providers for Roamer Fraud
billed to Access Numbers assigned to the Reseller.
(b) NewCo shall be liable for all Home Fraud respecting an Access
Number assigned to the Reseller until twenty-four (24) hours after the Reseller
has received notice from its Authorized User, NewCo or any other reliable source
that Home Fraud may have occurred or may be occurring with respect to such
Access Number. At that time the Reseller shall become liable for such Home
Fraud, unless deactivation is requested prior to the expiration of such
twenty-four (24) hour period. In any event the Reseller shall cease to be liable
for any Home Fraud respecting such Access Number thirty (30) minutes after the
Reseller has requested that NewCo deactivate such Access Number.
(c) The Reseller shall be liable for all activation fraud for
Access Numbers assigned to the Reseller.
(d) NewCo shall employ on the Reseller's behalf fraud detection
efforts that are the same as or better than those NewCo employs for NewCo's
other customers, and shall promptly notify the Reseller of any fraud or
suspected fraud.
(e) NewCo shall have no liability to the Reseller for
uncollectible Interexchange Wireless Service incurred with respect to Access
Numbers assigned to the Reseller.
17. MARKS.
(a) Except as described in this SECTION 17(A), this Agreement
confers on the Reseller no right to use any NewCo Marks. The Reseller shall have
the right to use NewCo Marks in connection with the resale of Wireless Services
In Region to Package Subscribers and National Accounts (to the extent such
resale is permitted hereunder) only in accordance with and to the
extent permitted by Article XIII of the Agency Agreement. Under no circumstances
will the Reseller be entitled to use the NewCo Marks (i) in connection with the
resale of Wireless Services Out of Territory (other than to National Accounts as
to which an election to resell has been made pursuant to Section 9.2 of the
Agency Agreement) or (ii) after the Reseller terminates the Agency Agreement
pursuant to SECTION 19.2 thereof.
(b) This Agreement confers on NewCo no rights to use any Reseller
Marks.
(c) Each party acknowledges that the other party would suffer
irreparable damage in the event of any material breach of the provisions of this
SECTION 17. Accordingly, in such event, the party would be entitled to obtain
preliminary and final injunctive relief, as well as any other applicable
remedies at law or in equity against the other party's breach or threatened
breach of this SECTION 17.
18. TERM OF AGREEMENT.
(a) This Agreement shall become effective on the date hereof, and
shall continue in effect for a term of fifty (50) years (the "Term"), unless
sooner terminated as herein provided.
(b) The Reseller's obligation to pay all outstanding charges
incurred during the Term shall survive the expiration or termination of this
Agreement.
(c) In the event of any change in Applicable Law that, in the
written opinion of NewCo's outside regulatory counsel addressed to NewCo and the
Reseller, in form and substance reasonably acceptable to the Reseller, prevents
NewCo from providing any type of Wireless Service, has a material adverse affect
on NewCo's ability to provide any type of Wireless Service, or has a material
adverse affect on the Reseller's authority to purchase any type of Wireless
Service, then either party may, upon sixty (60) days' written notice to the
other, terminate this Agreement in respect of such type of Wireless Service;
provided, that if such change affects less than all the applicable Geographic
Service Areas, such termination right will be limited to affected Geographic
Service Areas.
(d) In the event NewCo or an Affiliate of NewCo transfers control
of any License held by NewCo or any such Affiliate to a Person that is not NewCo
or its Affiliate, NewCo shall have no further obligation under this Agreement in
respect of the particular type of Wireless Service in the Geographic Service
Area covered by such License, but NewCo shall not transfer or agree to transfer
any License unless the transferee of the License agrees to be bound by the terms
of this Agreement for the then remaining term of this Agreement. Any purported
transfer of any License or obligation under this Agreement by NewCo or any
Affiliate to a transferee other than in compliance with the preceding sentence
shall be void.
19. TERMINATION.
(a) A party may terminate this Agreement in the event that the
other party, pursuant to or within the meaning of a Bankruptcy Law:
(i) commences a voluntary case or proceeding,
(ii) consents to the entry of a decree or order for relief
against it in an involuntary case or proceeding or to the commencement
of any case or proceeding against it,
(iii) consents to the filing of a petition or to the
appointment of or taking possession by a Custodian (as defined below)
of it or for all or any substantial part of its property,
(iv) makes or consents to the making of a general
assignment for the benefit of its creditors,
(v) for the purposes of any Applicable Law is unable to
pay or admits in writing that it is not able to pay, its debts as they
become due, or
(vi) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the other party in a
involuntary case or proceeding;
(B) appoints a Custodian of the other party or
for all or any substantial part of the property of such party
or approves as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or
in respect of any of the foregoing; or
(C) orders the winding up or liquidation of the
other party, or adjudges any of them a bankrupt or insolvent;
and any such order or decree remains unstayed and in effect for 60
consecutive days or any such case or proceeding or the appointment of
any Custodian is not dismissed within 60 days.
The term "CUSTODIAN" means any custodian, receiver, trustee, assignee,
liquidator, sequestrator or similar official under any Bankruptcy Law.
(b) NewCo may terminate this Agreement, in the event that the
Reseller:
(i) fails to pay any material amount due hereunder within
ten (10) days after NewCo gives the Reseller written notice of such
failure; or
(ii) materially breaches any other obligation hereunder,
provided that, if such breach is reasonably capable of being cured, the
Reseller fails to cure such breach within sixty (60) days after written
notice from NewCo describing the nature of such breach in reasonable
detail.
(c) The Reseller may terminate this Agreement, in the event NewCo
materially breaches any obligation hereunder, provided that, if such breach is
reasonably capable of being cured, NewCo fails to cure such breach within sixty
(60) days after written notice from the Reseller describing the nature of such
breach in reasonable detail.
20. RIGHTS OF CONTROLLED SUBSIDIARIES; ASSIGNMENT.
(a) Controlled Subsidiaries of the Reseller will have the right to
purchase and resell all Wireless Services hereunder as either a subreseller or ,
subject to SECTION 20(B), as an assignee of the Reseller, provided in either
case that any such Controlled Subsidiary (i) is identified in the signature
pages hereto or subsequently undertakes in writing to be bound by the terms and
conditions of this Agreement with respect to such purchases, (ii) shall be
primarily responsible for the performance of the Reseller's obligations
hereunder to the extent relating to such purchases, and (iii) such rights shall
terminate and, to the extent necessary, be deemed automatically reassigned to
the Reseller should such subreseller or assignee cease at any time to be a
Controlled Subsidiary of the Reseller. Under all circumstances, the Reseller
shall remain liable for the performance by any Controlled Subsidiary hereunder,
whether as a subreseller or assignee. Except as provided in this SECTION 20(A),
no assignment shall be permitted or effective without the prior written consent
of the other party, which consent shall not be unreasonably withheld or delayed.
MOUs purchased (x) hereunder by the Reseller and any such Controlled
Subsidiaries, and (y) which have been sold by the Reseller or any such
Controlled Subsidiary as NewCo's agent pursuant to the Agency Agreement, shall
be aggregated together in determining whether any MOU commitments and volumes
contained herein or otherwise applicable to the pricing hereunder have been
satisfied.
(b) The terms and conditions applicable to resale by any
Controlled Subsidiary that has become an assignee hereof shall be identical at
all times to those set forth herein and may not be modified, amended or waived,
except with the prior written consent of the Reseller.
(c) The Reseller acknowledges and agrees that in many cases
Affiliates of NewCo hold the Licenses and own and operate the Wireless Systems
required to provide Wireless Services hereunder and perform the other
obligations of NewCo hereunder. NewCo hereby delegates its obligations hereunder
to such Affiliates, and each such Affiliate shall execute an acknowledgment in
form and substance reasonably satisfactory to the Reseller, setting forth its
assumption of NewCo's obligations hereunder to the extent required to perform
such obligations; provided that NewCo shall remain primarily responsible for the
performance of such obligations and no such delegation or assumption shall
relieve NewCo from any of its obligations hereunder.
21. WAIVER. No failure on the part of either party hereto to exercise, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
remedy by any such party preclude any other right, power or
remedy. No express waiver or assent by any party hereto to any breach of or
default in any term or condition of this Agreement shall constitute a waiver of
or assent to any succeeding breach of or default in the same or any other term
or condition hereof.
22. ENTIRE AGREEMENT. This Agreement, including the attached Exhibit,
together with the Contribution Agreement and the other Ancillary Agreements (as
defined in the Contribution Agreement), supersede all prior discussions and
agreements between the parties with respect to the subject matter hereof and
contain the sole and entire agreement between the parties with respect to the
matters covered hereby. In the event of any conflict between the provisions of
this Agreement and the provisions contained in any contract, service order or
other document used by NewCo, the provisions of this Agreement shall control.
This Agreement shall not be modified or amended except by an instrument in
writing signed by or on behalf of NewCo (on behalf of itself and its Affiliates)
and the Reseller (on behalf of itself and any Controlled Subsidiaries identified
in the signature pages hereto or that have undertaken to be bound by the terms
and conditions hereof pursuant to SECTION 20(A) AND (B).
23. HEADINGS. The headings set out in this Agreement are for convenience of
reference only and shall not be deemed a part of this Agreement and shall not
affect the meaning or construction of any of the provisions hereof.
24. NOTICES. Except as otherwise provided in this Agreement, all notices
required or permitted to be given hereunder shall be in writing and shall be
delivered: (i) personally; (ii) by registered or certified mail, return receipt
requested; (iii) by a nationally recognized overnight courier service (such as
Federal Express) having a record of receipt; or (iv) by facsimile, with a
confirming copy sent contemporaneously by one of the other three methods
described in this sentence. Notices shall be addressed as follows:
(a) If to the Reseller:
BellSouth Telecommunications, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to NewCo:
Alloy LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
SBC Communications Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Senior Executive Vice President and
General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
BellSouth Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
to the other parties hereto in the manner set forth above. All notices shall be
effective on receipt.
25. SEVERABILITY. Should any part of this Agreement for any reason be
declared invalid by court order or by any regulatory agency, or if the parties
determine in good faith that this Agreement or a provision of this Agreement is
inconsistent with, or contradictory to, an FCC rule, regulation or order or any
other laws, rules, regulations or court orders, this Agreement or that provision
of this Agreement may be terminated. If a provision of the Agreement is so
terminated and the parties can legally, commercially and practicably continue
this Agreement without the terminated provision, the remainder of this Agreement
shall continue in full force and effect, otherwise this Agreement shall
terminate upon the effective date of the termination of the provision.
26. FORCE MAJEURE. Each party's performance under this Agreement, but
neither NewCo's obligation to provide appropriate credits nor the Reseller's
obligations to make payments hereunder in a timely fashion, shall be excused if
such non-performance is due to circumstances beyond the party's reasonable
control, including labor difficulties, governmental orders, equipment failure,
inability or delay in securing equipment, civil commotion, acts of nature,
weather disturbances or adverse weather conditions.
27. GOVERNING LAW. This Agreement is made and delivered in and shall be
governed by, construed and enforced in accordance with the laws of the State of
New York (without regard to conflicts of law).
28. COMPLIANCE WITH LAW. NewCo will, and will cause each of its Affiliates
to, comply with all Applicable Laws and will obtain and maintain, and will cause
each of its Affiliates to obtain and maintain, all Permits necessary to the
ownership of their respective properties or to the conduct of their respective
Wireless Businesses.
29. PROPRIETARY INFORMATION; CONFIDENTIALITY.
(a) The Reseller may transmit to NewCo and NewCo may receive from
the Reseller, certain Confidential Proprietary Information of Reseller relating
to the Reseller's Wireless Service accounts, marketing techniques, forecasts, or
business. NewCo may transmit to the Reseller, and the Reseller may receive from
NewCo certain Confidential Proprietary Information of NewCo relating to NewCo's
service, facilities, equipment or business. For purposes of this paragraph,
Confidential Proprietary Information shall be defined as any information and
documentation marked or labeled as "Confidential" or "Proprietary" (or similar
legend) and any oral information confirmed in writing within fifteen (15) days
after disclosure as "Confidential" or "Proprietary" (or similar legend) by the
disclosing party, including, without limitation, revenue reports, names and
Authorized User billing and usage information, and shall also include the terms
and conditions of this Agreement. The term "confidential" herein is meant to
include both "confidential information" and "trade secrets" under New York law
and the use of a confidential legend shall not be construed to be determinative
of the status of any information as "confidential information" or a "trade
secret".
(b) The receiving party shall maintain the confidentiality of the
disclosing party's Confidential Proprietary Information furnished in oral,
visual, written, and/or other tangible form and shall not disclose such
information to any third party, except as authorized by the disclosing party in
writing. To the extent possible, each party further agrees to keep confidential
the terms of this Agreement.
(c) The receiving party agrees to restrict disclosure of the
disclosing party's Confidential Proprietary Information to its employees,
agents, attorneys, and representatives who have a "need to know". The receiving
party agrees that such Information shall be handled with the same degree of care
which the receiving party applies to its own similar confidential information
(but in no event less than reasonable care).
(d) The receiving party agrees to take precautions necessary and
appropriate to guard the confidentiality of the disclosing party's Confidential
Proprietary Information including informing its employees, agents, attorneys,
and representatives who handle such Information that it is confidential and not
to be disclosed to any third party, except as authorized by the disclosing party
in writing.
(e) The receiving party agrees that the disclosing party's
Confidential Proprietary Information is and shall at all times remain the
property of the disclosing party. No use of such Information is permitted except
as otherwise provided herein and no grant under any of the disclosing party's
intellectual property rights is hereby given or intended including any license
implied or otherwise.
(f) The receiving party agrees to use the disclosing party's
Confidential Proprietary Information only for purposes of fulfilling its
obligations under this Agreement.
(g) The parties agree to exclude from the provision of this
Agreement and the obligations of confidentiality: Information which the
receiving party already had in its possession without confidential limitation at
the time of disclosure by the disclosing party; information which is
independently developed by the receiving party without breach of this Agreement;
information known or that becomes known to the general public without breach of
the Agreement by the receiving party; and information that is received
rightfully without confidential limitation by the receiving party from a third
party; and information that is disclosed pursuant to lawful process or
applicable regulatory authority.
(h) Upon termination of this Agreement, all Confidential
Proprietary Information transmitted to the receiving party by the disclosing
party in record bearing media or other tangible form, and any copies thereof
made by the receiving party shall be, at the disclosing party's written request,
destroyed or returned to the disclosing party, except that the receiving party
shall be entitled to retain a secure copy of the disclosing party's confidential
Proprietary Information for archival purposes only. The receiving party's
obligations under this Agreement to keep confidential and restrict use of the
disclosing party's Confidential Proprietary Information shall survive such
completion or termination of this Agreement for a period of three (3) years,
provided, however, that such obligation shall continue indefinitely as to any
information constituting a trade secret under applicable law.
30. DISPUTE RESOLUTION.
(a) Any dispute between the parties to this Agreement with respect
to the execution, interpretation, performance or non-performance of any
provision of this Agreement shall be resolved solely as specified in this
SECTION 30.
(i) Upon the written request of any party to such a
dispute, each of the parties will appoint a designated representative
who does not devote substantially all of his or her time to performance
under this Agreement, whose task it will be to meet with the purpose of
endeavoring to resolve such dispute.
(ii) The designated representatives shall meet as often as
necessary during a thirty (30) day period (or such other time as the
parties to such dispute may agree) to gather and furnish to the other
all information with respect to the matter in issue which is
appropriate and germane to its resolution.
(iii) Such representatives shall discuss the problem and
negotiate in good faith in an effort to resolve the dispute without the
necessity of any formal arbitration proceeding relating thereto.
(iv) The specific format for such discussions will be left
to the discretion of the designated representatives, but may include
the preparation of agreed upon statements of fact or written statements
of position furnished to the other party to such dispute.
(b) If the designated representatives cannot resolve the dispute
within the time period allowed under SECTION 30(A), then the dispute shall be
referred to the Chief Executive Officer of the Reseller and the Other Reseller
(the "CEOS"), for their review and resolution. If the CEOs are unable to resolve
such dispute, then the parties will continue to operate under this Agreement as
in effect prior to such dispute, provided that if the dispute relates to the
adjustment of charges pursuant to Section 10 of EXHIBIT A hereto, the provisions
of SECTION 30(E) shall apply.
(c) Prior to filing or referring any matter to a court of law or
equity, the parties agree to provide the other parties at least ten business
days' notice of the intention to so refer a matter, provided that the foregoing
shall not apply to any request for a preliminary injunction or temporary
restraining order.
(d) THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK AND THE FEDERAL COURT OF THE UNITED STATES
OF AMERICA LOCATED IN THE STATE OF NEW YORK SOLELY IN RESPECT OF THE
INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT AND OF THE
DOCUMENTS REFERRED TO IN THIS AGREEMENT, AND IN RESPECT OF THE TRANSACTIONS
CONTEMPLATED HEREBY, AND HEREBY WAIVE, AND AGREE NOT TO ASSERT, AS A DEFENSE IN
ANY ACTION, SUIT OR PROCEEDING FOR THE INTERPRETATION OR ENFORCEMENT HEREOF OR
OF ANY SUCH DOCUMENT, THAT IT IS NOT SUBJECT THERETO OR THAT SUCH ACTION, SUIT
OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SAID COURTS OR THAT
THE VENUE THEREOF MAY NOT BE APPROPRIATE OR THAT THIS AGREEMENT OR ANY SUCH
DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS, AND THE PARTIES HERETO
IRREVOCABLY AGREE THAT ALL CLAIMS WITH RESPECT TO SUCH A NEW YORK STATE OR
FEDERAL COURT. THE PARTIES HEREBY CONSENT TO AND GRANT ANY SUCH COURT
JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF SUCH
DISPUTE AND AGREE THAT, TO THE FULLEST EXTENT PERMITTED BY LAW, MAILING OR
PROCESS OR OTHER PAPERS IN CONNECTION WITH ANY SUCH ACTION OR PROCEEDING IN THE
MANNER PROVIDED IN SECTION 24 OR IN SUCH OTHER MANNER AS MAY BE VALID AND
SUFFICIENT SERVICE THEREOF.
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT
SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i)
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH PARTY UNDERSTANDS
AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH PARTY MAKES THIS
WAIVER
VOLUNTARILY AND (iv) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT
BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION
30(D).
(e) Any dispute with respect to any adjustment of charges pursuant
to Section 10 of EXHIBIT A hereto that is not resolved pursuant to SECTION 30(A)
or (B) shall be resolved solely by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association (the "RULES") and this
SECTION 30(E):
(i) Prior to initiating any arbitration pursuant to this
SECTION 30(E), the party or parties desiring to initiate such
proceedings (the "INITIATING PARTIES") shall jointly prepare and
deliver to the other party or parties to such dispute (the "RESPONDING
PARTIES") a comprehensive pricing schedule setting forth the Initiating
Parties' final pre-arbitration proposal with respect to pricing for
each Wireless Service and feature offered by NewCo and as to which the
parties' designated representatives or corporate officers failed to
agree in writing pursuant to SECTION 30(A) or (B), respectively (such
schedule, the "FIRST PROPOSAL"). Within ten (10) days after receipt of
the First Proposal, the Responding Parties shall jointly prepare and
deliver to the Initiating Parties a comprehensive pricing schedule
setting forth the Responding Parties' final pre-arbitration proposal
with respect to pricing for each such Wireless Service and feature
(such schedule, the "SECOND PROPOSAL").
(ii) If the Initiating Parties and Responding Parties fail
to resolve such dispute by negotiation within a further ten (10) days
after the delivery of the Second Proposal, then either the Initiating
Parties or the Responding Parties may deliver a notice of arbitration.
(iii) The party or parties initiating the arbitration shall
jointly designate one (1) arbitrator, and the respondent or respondents
shall jointly designate one (1) arbitrator. The two (2) arbitrators so
designated shall appoint a third arbitrator as provided in the Rules.
The arbitration shall be held in New York, New York, or such other
place as the parties to such dispute may agree.
(iv) The arbitrators will allow such discovery as they
deem appropriate, consistent with the purpose of arbitration in
accomplishing fair, speedy, and cost-effective resolution of disputes.
All discovery will be completed, and the arbitration hearing will be
commenced, within forty-five (45) days after appointment of all of the
arbitrators, and the arbitration hearing will conclude within thirty
(30) days after it commences. The arbitrators will make every effort to
enforce these timing requirements strictly, but may extend the time
periods upon a showing that exceptional circumstances require extension
to prevent manifest injustice.
(v) The decision of the arbitrators will be rendered in
writing and will explain the reasons therefor. All decisions of the
arbitrators shall require the concurrence of at least two arbitrators.
The arbitrators shall determine which of the two proposals is, in the
aggregate, most consistent with the principles set forth in Section 10
of EXHIBIT A. In their written decision, the arbitrators shall
designate either the First Proposal or the Second
Proposal (without any changes or modifications thereto) as the most
consistent proposal, and such proposal shall be binding on the parties
in its entirety, and shall apply, with retroactive effect from the
relevant Anniversary Adjustment until the next ensuing Anniversary
Adjustment.
(vi) In their final award, the arbitrators may require
that the party(ies) to the arbitration which do not prevail (as
determined by the arbitrators in their sole discretion) shall pay all
reasonable costs (including, without limitation, reasonable fees of
counsel and paralegals) incurred in conducting the arbitration and, if
applicable, enforcing the arbitration award.
31. PUBLICITY. Each party agrees to submit to the other all press releases
and other publicity matters relating to Wireless Services to be performed by
NewCo under this Agreement, wherein the other party's name or marks or the name
or ▇▇▇▇ of any Affiliate of either party is mentioned or language from which the
connection of said names or marks therewith may be inferred or implied; and
parties further agree not to publish or use such press releases or other
publicity matters without the other party's prior written approval provided,
however, that the party from whom such approval is requested shall, within three
(3) business days of acknowledged receipt of the request, either grant or deny
such approval, or provide the other party with any requested modifications or
additions to the subject press release or other matter.
32. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original Agreement, but all of
which together shall constitute one and the same instrument.
33. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, and inure
to the benefit of, the parties hereto and their respective successors and
permitted assigns.
34. PREPARATION OF AGREEMENT. This Agreement shall not be construed more
strongly against either party regardless of who is responsible for its
preparation of drafting.
35. REFERENCES. Any references herein to any law, rule, regulation, order
or other act of a Governmental Authority, or to any agreement between the
parties hereto or their subsidiaries, shall be deemed to include a reference to
any such law, rule, regulation, order or other act or any such agreement, in
each case as it may be amended or supplemented from time to time.
IN WITNESS WHEREOF, each party has caused this Agreement to be duly
executed and delivered on its behalf by its duly authorized officers as of the
day and year first above written.
ALLOY LLC
By: ALLOY MANAGEMENT CORP.,
its Manager
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Operating Officer
BELLSOUTH TELECOMMUNICATIONS, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: President
EXHIBIT A
RATES AND CHARGES
1. General
(a) Wireless Service is offered on a monthly basis (the "Billing
Cycle") subject to the minimum service requirements of
one-thousand (1,000) Access Numbers.
(b) Billing for any Access Number begins on the date such Access
Number is activated for service. Billing for fixed monthly
charges is monthly in advance of service. No charges will be
payable for non-activated Access Numbers.
(c) NewCo will not issue credit to the Reseller for Roamer charges
or other charges which may appear on any Access Number after
it has been deactivated and reassigned by the Reseller to a
new Authorized User.
(d) Prices include interconnection charges.
2. Charges for POWS.
(a) Rates under this section are for standard voice grade switched
Cellular Service, PCS Service and other conventional (as of
the date of this agreement) switched Wireless Service (other
than Internet Protocol services and the like), whether or not
such service is used by the Authorized User to transport data
or voice (in keeping with standard industry terminology
conventions, hereafter referred to as "Plain Old Wireless
Service" or "POWS"). Fixed Monthly Charges are the minimum
monthly charges per Access Number activated on NewCo's
Wireless System for POWS. Fixed Monthly Charges per month, per
Access Number for the first three years of this Agreement
shall be as provided in the table below. For purposes of
determining the number of active Access Numbers, the total
number of active Access Numbers subscribed to by the Reseller
and the Other Reseller (and their respective Controlled
Subsidiaries) shall be aggregated.
Number of Active POWS Access Fixed Monthly Charge per POWS Access
Numbers Number
---------------------------- ------------------------------------
1,000 - 250,000 $ 10.00
250,001- 1,000,000 $ 7.00
More than 1,000,000 $ 5.00
The charges for a fractional part of a month will be a
proportionate part of the fixed monthly charges based on the
actual number of days the Wireless Services are provided.
(b) Usage Charge per Digital POWS MOU for Home Service on Newco's
Wireless System for the first three years of this Agreement
shall be as provided in the table below, provided that, to the
extent a particular billing system cannot segregate digital
and analog usage, NewCo will attempt to segregate digital and
analog usage by MIN associated with a particular Equipment. If
it is technologically impractical to segregate those minutes,
NewCo will ▇▇▇▇ at analogue rates. For purposes of determining
the number of POWS MOUs, the total number of POWS MOUs billed
to the Reseller and the Other Reseller (and their respective
Controlled Subsidiaries) shall be aggregated. Charges for POWS
MOUs do not include transport beyond the Local Calling Area
whether or not NewCo imposes a separate charge for such
service on its retail subscribers ("Long Distance"). The Local
Calling Area is the geographic area, surrounding the then
location of the Authorized User, within which relevant
incumbent local exchange company does not impose a toll charge
on its landline customers.
Number of Active POWS Access Numbers Usage Charge Per Digital POWS MOU
------------------------------------ ---------------------------------
1,000 - 250,000 $ .11
250,001- 1,000,000 $ .10
More than 1,000,000 $ .09
(c) Usage Charge per Analog POWS MOU for Home Service on Newco's
Wireless System for the first three years of this Agreement
shall be as provided in the table below. For purposes of
determining the number of POWS MOUs, the total number of POWS
MOUs billed to the Reseller and the Other Reseller (and their
respective Controlled Subsidiaries) shall be aggregated.
Charges for POWS MOUs do not include Long Distance.
Number of Active POWS Access Numbers Usage Charge Per Analog POWS MOU
------------------------------------ --------------------------------
1,000 - 250,000 $ .22
250,001- 1,000,000 $ .20
More than 1,000,000 $ .18
(d) A surcharge on the Usage Charges shown in tables (b) and (c)
above will be imposed if the Reseller's ratio of Peak POWS
MOUs to Total POWS MOUs is greater than NewCo's ratio of Peak
POWS MOUs to Total POWS MOUs (the "Excess Peak Surcharge").
The Excess Peak Surcharge shall be computed as follows:
(i) Peak POWS MOUs are POWS MOUs used during the Peak
POWS MOU hours of each calendar month.
(ii) Total POWS MOUs means, with respect to the Reseller,
the total number of POWS MOUs used by the Reseller
and its Authorized Users during each calendar
month and, with respect to NewCo, means the total
number of POWS MOUs used on NewCo's Wireless Systems
during each calendar month.
(iii) NewCo shall define the hours of Peak POWS MOUs for
each GSA from time to time.
(iv) On a rolling six-month basis, NewCo shall total the
number of Peak POWS MOUs and the Total POWS MOUs used
by the Reseller ("Reseller's Ratio"), and in the same
manner shall determine the ratio for all of NewCo's
Peak POWS MOUs to Total POWS MOUs ("NewCo's Ratio").
(v) If Reseller's Ratio is greater than NewCo's Ratio,
then NewCo's Ratio shall be subtracted from
Reseller's Ratio (the "Ratio Difference").
(vi) The Ratio Difference shall be multiplied times the
charges imposed for POWS MOUs during the Billing
Cycles beginning during the last month of the
applicable rolling six-month period. The result shall
be the Excess Peak Surcharge for such month.
3. Charge For Roaming Service.
(a) The charge per POWS MOU for Roaming Service On-Network shall
be $.15. For purposes of this Exhibit A, Roaming Service
On-Network means Wireless Service provided by NewCo in any GSA
outside of the relevant Home Service Area.
(b) The charge for Roaming Service Off-Network shall be the amount
billed to NewCo by the third party service provider plus $.05
per POWS MOU. For purposes of this Exhibit A, Roaming Service
Off-Network means wireless service in respect of an Access
Number in a geographic area outside of the Home Service Area
applicable to such Authorized User's Access Number, other than
Roaming Service On-Network.
4. Prices for Wireless Data and Other New Services
Newco's wholesale charge to the Reseller for any Wireless Data Services
or other New Service Offering shall be negotiated at the time of
Newco's introduction of such service. The initial charge for any such
service shall be set in accordance with the principles for the
Adjustment of Prices of Wireless Service in Paragraph 10 below.
5. Price for Third Party Services Other than Long Distance Service
Third party provided services, which are billed to NewCo and re-billed
by NewCo to the Reseller, shall be provided at 110% of the third party
provider's charge to NewCo.
6. Charge for Long Distance Service
(a) Home Service Long Distance shall be provided at 110% of the
third party long distance carrier's charge to NewCo.
(b) Roaming Service On-Network Long Distance shall be provided at
110% of the third party long distance carrier's charge to
NewCo.
(c) Roaming Service Off-Network Long Distance shall be provided at
the amount billed to NewCo by the service provider.
(d) In the event that NewCo provides facility based long distance
service, the initial charge for such service shall be set in
accordance with the principles for the Adjustment of Prices of
Wireless Service in Paragraph 10 below.
7. Optional Features.
The minimum service period for optional features is one month.
FEATURE MONTHLY CHARGE
----------------------------------------------------------------------------- --------------
Call Waiting - Reseller or Authorized User engaged in a call is
alerted that another call is waiting and may be received. Usage
charges are incurred for each answered call. Each answered call is
timed and billed separately. $0.50
----------------------------------------------------------------------------- --------------
Call Forwarding - Calls intended for a Mobile Radio Unit may be redirected
to another telephone number. Usage charges are incurred for the entire
duration of all forwarded calls. Usage charges also apply to activations
taking one minute or longer.
$0.50
----------------------------------------------------------------------------- --------------
No Answer Transfer - Calls intended for a Mobile Radio Unit may be
redirected to another telephone number when the Mobile Radio Unit has been
rung or remains unanswered for a specified period of time. Usage charges
are incurred for the entire duration of all transferred calls. Usage
charges also apply to activations taking one minute or longer.
$0.50
----------------------------------------------------------------------------- --------------
Three-Party Conferencing - A third party may be added to an existing
call. Usage charges are incurred for each call in the conference. Each
call is timed and billed separately. $0.50
----------------------------------------------------------------------------- --------------
Voice Mail $1.50
----------------------------------------------------------------------------- --------------
Hot Line - Originating service can be used only to call one
pre-determined number, per Access Number arranged. $0.50
----------------------------------------------------------------------------- --------------
Incoming Call - No outgoing calls can be completed, per Access
Number arranged. $0.50
----------------------------------------------------------------------------- --------------
Outgoing Call Only - No incoming calls will be accepted, per Access Number
arranged $0.50
----------------------------------------------------------------------------- --------------
Toll Restriction - No outgoing calls which will result in toll message
and/or long distance charges may be completed, per Access Number arranged.
$0.50
----------------------------------------------------------------------------- --------------
8. Adjustments for Taxes, Fees, Etc.
The charges and rates set forth in this Exhibit A do not include any
amounts resulting from consumption taxes, fees, exactions imposed by or
for any municipal corporation or other political subdivision or agency
of government against NewCo or its operations, including but not
limited by any universal service fund fees, excepting only property
taxes or taxes imposed on corporations. The amounts resulting from such
taxes, fees or exactions imposed against NewCo or its operations,
excepting only general property taxes or taxes imposed against
corporations, shall be billed to the Reseller pro rata by NewCo as
appropriate.
9. [RESERVED]
10. Adjustment of Access and Usage Charges.
The charges set forth or described above shall be revised on each
anniversary of this agreement (the "Anniversary Adjustment"). Six
months prior to each such anniversary the parties shall begin
negotiation of new charges. If after four months of negotiation, the
parties have not reached agreement, Dispute Resolution, as provided in
Section 30 of the Agreement, shall be instituted. The following
principles shall govern the negotiation of the charges and rates and,
if necessary, the decision of any arbitrators pursuant to Section 30(e)
of the Agreement:
(a) The overarching goal is to set rates so that NewCo is paid its
Unit Cost of Production (described in (b) below) of producing
the products and services purchased by the Reseller plus one
half of the Available Margin (described (c) below) for each
product or service (the "Rates", as described more fully in
(d) below). Nothing herein, is intended to imply that NewCo is
obligated to sell, under the terms of this Agreement, any
product or service which is not Wireless Service, and costs
associated with such products and services shall be excluded
from the calculations.
(b) The parties acknowledge and agree that, given the length of
this agreement, it is impossible to predict with certainty,
for the entire term of this agreement, the nature of the
products and services that NewCo will offer and the Reseller
will purchase hereunder, or the appropriate pricing
conventions for such products and services. Accordingly the
parties acknowledge and agree that it is not possible to
describe with particularity the methodology for computing the
cost of producing those goods and services. Therefore, the
parties agree that the following general principles shall
govern the computation of Unit Cost of Production (described
in (b)(i) below):
(i) Because rates for Access and Usage are to be adjusted
annually, the parties agree that in computing Unit
Cost of Production, NewCo shall analyze its
historical expenses for the twelve (12) month period
comprising the fiscal year last ending prior to the
starting date of negotiations described in Paragraph
10 below (the "Measurement Period").
(ii) All of NewCo's costs and expenses shall be divided
between the production of products and services
("Production"), customer operations activities and
costs to maintain customers ("Maintenance"), and
NewCo's retail sales and marketing with respect to
those products and services ("Sales and Marketing").
(iii) Expenses which are directly attributed solely to
either Production, or Sales and Marketing shall be so
allocated.
(1) Examples of expenses which, as of the date
of this Agreement, are directly attributable
solely to Production include, but are not
limited to:
(a) Interconnect expense
(b) Cost of capital for network
infrastructure equipment
(c) Engineering expenses
(d) Depreciation of network
infrastructure equipment
(e) Maintenance of network
infrastructure equipment
(f) Rent or other expenses of real
estate used solely for network
infrastructure equipment, or which
house employees whose duties relate
solely to network infrastructure
(g) Cost of billing
(2) Examples of expenses which, as of the date
of this Agreement, are directly attributable
solely to Sales and Marketing include, but
are not limited to:
(a) Commissions to NewCo's outside
retail sales channels
(b) Commissions, salaries and benefits
paid to Newco's in-house retail
sales personnel
(c) Rent or other expenses of real
estate used solely for retail sales
(3) Examples of expenses which, as of the date
of this Agreement, are directly attributable
solely to Maintenance include, but are not
limited to:
(a) Customer services expenses
(b) Bad debt expense
(iv) Expenses which cannot be attributed solely to either
Production, Sales and Marketing, or Maintenance shall
be allocated to each of these categories ratably
based on the ratio of each category's expenses to
total direct expenses. For example, if Production
costs represent 40% of the total allocated costs of
all three categories combined, then Production would
be allocated 40% of the unallocated
costs. Examples of expenses which, as of the date of
this Agreement, shall be allocated ratably among
Production, Sales and Marketing, and Maintenance
include, but are not limited to:
(1) General and administrative overhead expenses
(2) Financial and Banking expenses.
(3) Legal expenses.
(4) Information technology and billing/call
rating systems.
(c) The general principles governing the computation of Available
Margin are as follows:
(ii) Total Expense is the sum of Total Sales and Marketing
Expense, Total Maintenance Expense plus Total
Production Expense for each product or service.
(iii) Unit Total Expense is the Total Expense for each
product or service divided by the number of units of
such product or service produced by NewCo during the
Measurement Period.
(iv) Retail Unit Revenue for each product or service is
the total retail revenue realized by NewCo divided by
the number of units of such product or service sold
at retail by NewCo during the Measurement Period.
(v) The Available Margin is the difference between Retail
Unit Revenue and Unit Total Expense for each product
or service.
(vi) The sum of Available Margin and Unit Cost of
Production is the Preliminary Rate.
(d) For products and service, which are customarily priced with a
fixed and variable component, the Preliminary Rate shall be
divided on a reasonable basis between the fixed and variable
components. For example, with respect to the Wireless Service
for which rates are set forth in paragraph 2 above, the fixed
and variable components are determined as follows:
(i) The fixed network expenses per Access Number are
estimated. That amount is the Fixed Monthly Charge
for more than 1,000,000 Access Numbers.
(ii) The Preliminary Rate as initially determined is
multiplied by the Average Number of POWS MOUs used by
an Access Number per month during the Measurement
Period to determine Average Revenue Per Access
Number.
(iii) The Fixed Monthly Charge is subtracted from Average
Revenue Per Access Number to determine Variable
Revenue Per Access Number.
(iv) Variable Revenue Per Access Number is divided by
Average Number of POWS MOUs to determine the Usage
Charge Per Digital POWS MOU for more than 1,000,000
Access Numbers.
(v) The combination of Usage Charge Per Digital POWS MOU
and the Fixed Monthly Charge are the Rates.
(e) Under no circumstances shall the Rates be less than Newco's
twelve month trailing historical costs of a unit of
production, plus a reasonable return based on Newco's cost of
capital.
11. Measurement of POWS MOU's.
The Reseller shall be charged for usage when calls are originated from
or received on its Authorized Users' Equipment.
(a) Chargeable time for completed calls originated by a unit of
Equipment begins when a connection is established to NewCo's
facilities and ends when the Equipment disconnects. No credit
or adjustment shall be given for call interrupted due to
service irregularities (i.e. dropped calls).
(b) Chargeable time for incomplete calls of a duration of more
than thirty (30) seconds originated by a unit of Equipment
begins when a connection is established to NewCo facilities
and ends when the Equipment disconnects. There shall be no
charge for incomplete calls originated by a unit of Equipment,
which are of a duration of thirty (30) seconds or less.
(c) Chargeable time for calls received by a unit of Equipment
begins when the MTSO assigns a channel and ends when the
Wireless Equipment disconnects.
(d) The minimum usage charge on each call is one (1) minute.
Fractions of a minute are rounded up to the next full minute
or increment of billing.
EXHIBIT B
BELLSOUTH MARKS
---------------------------------------------------------------------------------------
CLIENT TRADEMARK APPLICATION REGISTRATION
NUMBER NUMBER
---------------------------------------------------------------------------------------
BCC 411 EXPRESS 74/584,811 2,044,310
BCC ▇▇▇▇ Symbol 81/327,677 1,327,677
BCC ▇▇▇▇ Symbol 727,723 1,569,327
BCC BELLSOUTH 622,503 1,459,196
BCC BELLSOUTH 719,542 1,565,559
BCC BELLSOUTH 75/598,788 2,307,506
BCC BELLSOUTH ALL-IN-ONE 75/660928
BCC BELLSOUTH CELLULAR 75/195,478 2,189,845
CORDLESS
BCC BELLSOUTH MOBILITY 74/662,687 2,020,258
BCC BELLSOUTH MOBILITY 056650 1,702,143
BCC BELLSOUTH MOBILITY 058775 1,670,082
BCC CALL WIZARD 75/510658
BCC CALL WIZARD 75/574730
BCC CELEBRATION 74/584,808 2,067,533
BCC CELLULAR CLEAR AND SIMPLE 74/662,398 2,011,506
BCC CELLULAR LINK 773479 1,848,727
BCC CELLULAR TO GO 75/761677
BCC CELLULAR TO GO 75/502701
BCC COSMOS 74/513,593 2,027,441
BCC COSMOS UNIVERSAL CELLULAR 74/573293 2,178,749
DESIGN
BCC Design of Cellular Telephone with 75/243,737 2,132,638
Eyes, Arms & Leg
BCC FREE WAY TO CALL, THE 74/471,957 1,852,079
BCC GOLD SERIES 74/557,951 1,916,216
BCC GUARDIAN ANGEL PROGRAM 75/316,918
BCC MOBILE 2 MOBILE 74/597,773 2,044,365
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇/▇▇▇,▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and design 75/331,150
BCC MOBILE MEMO 73/817181 1,605,962
BCC NEVER STAND STILL 74/514,689 2,000,239
BCC PROGRAMIT 74/678,434 2,058,096
BCC PROMOTION WORKS 74/686,065 2,044,846
BCC RAPIDREPLY 75/270843 2,200,538
BCC ROAMMATE 75/688589
BCC ROAMMATE 75/409403
BCC STAR *EXPRESS & DESIGN 74/471,958 1,875,521
BCC STAR* EXPRESS 74/471,965 1,865,946
BCC STAR*LINES 74/655,589 1,965,443
BCC TALKAMERICA 75/061,882 2,073,462
BCC TALKBANK 74/614,654 2,046,394
BCC THE ONE PHONE FOR HOME AND AWAY FROM HOME 75/493833
BCC VISION SS7 ONLINE 75/357101
BCC WINCENTER 75/200558
2
BCC WINCONNECT 75/200560
BCC WINLOGIC 75/930552
BCC WIRELESS ACCESSORIES 75/392750 2,317,344
HOTLINE
BMDCS BELLSOUTH PREPAID TO GO 75/374788 2,305,183
BMDCS DCS 2N1 75/302030
BMDCS DCS 2N1 75/776404
BMDCS DCS 2N1 NUMBER 75/495530
BMDCS DCS and Design 75/360,891 2,176,964
BMDCS DCS and Design 75/976,869 2,166,626
BMDCS DCS MINUTE MANAGER 75/475825
BMDCS NONSTOP NICKEL TALK 75/915061
BMDCS WE'VE GOT YOU IN OUR SITES 75/653172 2,306,282
BMDCS WIRELESS MINUTE MANAGER 75/875425
BSM CAR & PHONE DESIGN 650,640 1,465,876
BSM COUNT ON IT 75/466131 2,220,620
BSM LIFE'S CALLING. WHY WAIT? 75/603603
BSM MOBILITY ONE 489,828 1,348,585
BSM SPEED CENTER. WHERE FANS CONNECT. 75/822652
BSM WHY WAIT WARRANTY 75/376,343 2,184,227
BSMD ONDACOM 75/395577
BSMD ONDACOM and Design 75/395580
BSWD BELLSOUTH 75/598788 2,307,506
▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇/▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ BEYOND 75/582069 2,309,057
PROTECTION PLAN
BSWD BELLSOUTH GATEWAY 75/606994
BSWD BELLSOUTH INTELLIGENT 75/585342 2,288,032
WIRELESS NETWORK
BSWD BELLSOUTH INTERACTIVE 75/702644
DISPATCH
BSWD BELLSOUTH INTERACTIVE 75/582068 2,291,241
PAGING
BSWD BELLSOUTH POWERTOOL 75/666458
BSWD BELLSOUTH PROFESSIONAL 75/621671
SERVICES
BSWD BEYOND PROTECTION 75/598789 2,304,223
BSWD COMMUNICATE@LIFESPEED 75/703523
BSWD COMPETE@LIFESPEED 75/703522
BSWD GO BEYOND PAGING 75/541571
BSWD INTERACT@LIFESPEED 75/703521
BSWD RAM INTERACTIVE DISPATCH 75/356063
BSWD REACT@LIFESPEED 75/703520
BSWD RESPOND@LIFESPEED 75/703519
BSWD THINK@LIFESPEED 751703518
BSWD WORK@LIFESPEED 75/703517
4