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EXHIBIT 10.3
MIDCOM COMMUNICATIONS INC., DBA ADNET TELEMANAGEMENT/DEALER
AGREEMENT
AGREEMENT made and entered into this 4th day of April, 1996, by and
between MIDCOM COMMUNICATIONS INC., DBA ADNET Telemanagement ("MIDCOM"), a
corporation organized and existing under the laws of the State of Washington,
having its principal place of business at 1600 MIDCOM Tower, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and TIE COMMUNICATIONS, INC., a corporation
organized and existing under the laws of the State of Kansas, having its
principal place of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇ ("DEALER").
WHEREAS, MIDCOM, an interexchange carrier (IXC), is the holder of certain
reseller agreements with other IXCs offering telephone services, and MIDCOM is
desirous of granting to Dealer, and Dealer is desirous of accepting, the right
to solicit customer orders for telephone services through MIDCOM.
THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, the parties hereby agree as follows:
1. INDEPENDENT DEALER
MIDCOM hereby grants to Dealer the non-exclusive right to solicit orders
for the following MIDCOM Advantage services ("Listed Services"): switched
outbound, dedicated outbound, switched inbound, dedicated inbound, calling
card, private line and conference calling. Dealer's right to solicit order
extends to all jurisdictions where MIDCOM offers the Listed Services.
Dealer shall not offer services to a potential Customer which are not
specifically offered by MIDCOM pursuant to its applicable tariffs. Dealer
may market and sell telecommunications products or services of other
resellers and carriers. The customers that Dealer brings to MIDCOM through
its efforts will hereinafter be referred to as "Customers".
2. TERM
This Agreement shall be effective as of the date set forth in the preamble
and shall continue for a term of three (3) years unless terminated as
provided for in Section 9. If the parties wish to continue their
relationship beyond this three-year period, a new contract will be
negotiated and signed, otherwise this Agreement will convert to a
month-to-month relationship.
3. DUTIES OF DEALER
Dealer shall exert its best efforts to solicit and enroll new customers in
the Listed Services and to maintain its status as a qualified dealer.
Dealer shall be deemed to have maintained status as a "qualified dealer"
with respect to any month if, during the preceding three (3) month period,
Dealer has enrolled an average of three (3) Customers per month and Dealer
has made its best commercial efforts to retain Customers previously
enrolled in good standing. A Customer in good standing shall mean a
Customer who has paid MIDCOM all monthly service fees and/or usage invoices
on a timely basis. Dealer is not authorized to represent itself as an
agent, division or subsidiary of MIDCOM.
4. DEALER COMPENSATION
4.1 DETERMINATION OF COMMISSION. Subject to the terms and conditions of
this Agreement, Dealer shall be entitled to sales commissions on Customer
accounts.
(A) AMOUNTS SUBJECT TO COMMISSION. Commissions are payable on all
billed usage (not including taxes, customer adjustments, and other
non-usage charges) for international, interstate and intrastate calls
completed by Customers on the Listed Services. The commission rate
structure is specified in Exhibit 1. All other services are not
subject to a commission.
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(b) MONTHLY BILLING COMMITMENT. Dealer's commissions for interstate
traffic are based on the monthly billing commitment made by Dealer.
All other commissions are as specified in Exhibit 1 regardless of the
monthly billing commitment. The monthly billing commitment pertains to
the minimum amount of ▇▇▇▇▇▇▇▇ required by the Customers attributable
to Dealer per month. Dealer hereby agrees to one of the monthly
billing commitment levels specified below (please initial one of the
lines below):
X
---------- Standard: No monthly commitment
---------- Bronze: $25,000 monthly commitment
---------- Silver: $50,000 monthly commitment
---------- Gold: $100,000 monthly commitment
4.2 DEALER'S AGENTS. MIDCOM shall not be responsible for making
payments to any employee, agent or representative of Dealer, and Dealer
shall indemnify MIDCOM against and hold MIDCOM harmless from any and all
liability therefor.
4.3 TRAIL COMMISSIONS. Except for termination by MIDCOM for Dealer's
material breach of this Agreement under Section S. Dealer shall be entitled
to commissions after termination of this Agreement ("Trail Commissions") on
all Customers in good standing for the term specified in Section 9.4 or as
long as the Dealer is not in material breach of any continuing warranty,
promise or agreement.
4.4 CUSTOMER BAD DEBT. A Customer account sixty (60) days past due
shall be deemed to be Bad Debt and MIDCOM shall have the right to offset
such amounts from Dealer's commissions or other moneys payable to Dealer,
subject to the limitation that Dealer's maximum Bad Debt liability on any
particular account shall not exceed the total amount of commissions paid by
MIDCOM to Dealer for that account in the prior twelve (12) months. MIDCOM
will provide to Dealer the payment status of accounts on a regular basis.
Dealer shall assist MIDCOM in its efforts to collect overdue accounts and
Bad Debts of Customers.
4.5 UNAUTHORIZED PIC CHANGES. Dealer shall be responsible for, and
MIDCOM shall have the right to offset against any compensation payable to
Dealer hereunder, (i) any fines, charges and/or Customer adjustments
imposed by a Local Exchange Carrier (LEC) or by a federal or state agency
for unauthorized Primary Interexchange Carrier (PIC) changes, and (ii) an
amount equal to charges for Listed Services disputed by Customers on the
grounds that Dealer, or its employees, agents, or representatives,
misrepresented the MIDCOM services or MIDCOM's prices therefor, that the
LOA was forged or otherwise unethically obtained, that Dealer acted beyond
the scope of the rights granted pursuant to the Customer's LOA, or that the
Customer notified Dealer that it cancelled MIDCOM Services and Dealer
failed to notify MIDCOM.
4.6 TRANSFER OF CUSTOMER AND PROMOTIONS. In the event that a Customer
contacts MIDCOM to request cancellation and removal from the MIDCOM
network, MIDCOM reserves the right, in its sole discretion, to transfer the
Customer to another MIDCOM service. In such case, Dealer's commissions will
be adjusted to the commission schedule applicable to such service. MIDCOM
may, at its discretion, offer promotions to prevent attrition and Dealer
commission will be paid on the net amounts collected during such
promotional period.
5. ACCEPTANCE OF ORDERS AND PROVIDING SERVICE
5.1 SWITCHING CUSTOMER'S SERVICE. Customer Orders placed by Dealer with
MIDCOM shall be accompanied by a valid Letter of Agency (LOA) in a form
approved by MIDCOM. Dealer agrees to comply with MIDCOM's Standards Policy
for Switching Long Distance Service, attached hereto as Exhibit 3.
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5.2 ACCEPTANCE OR REJECTION OF ORDERS. All contracts, enrollments, and
potential customers recommended to MIDCOM by Dealer for enrollment must be
approved and authorized by a representative of MIDCOM. MIDCOM may, in the
reasonable exercise of its discretion, reject orders placed by Dealer on
the grounds that the Customer is not creditworthy or for any other
appropriate grounds. If an order is rejected by the LEC or the underlying
carrier because it is incomplete, it shall be Dealer's responsibility, and
not the responsibility of MIDCOM, to obtain all necessary information from
the Customer to complete the order. MIDCOM will provide Dealer with a
status on orders forwarded to the LEC or underlying carrier.
5.3 EXISTING MIDCOM CUSTOMERS. MIDCOM will not accept orders from Dealer
for Customers already using MIDCOM's services. MIDCOM and Dealer will
mutually cooperate to avoid account disputes with other MIDCOM dealers
and MIDCOM sales personnel.
5.4 PROVISIONING ORDERS. MIDCOM reserves the right to determine the
underlying carrier for the Customers attributable to Dealer. If MIDCOM
chooses to switch Dealer's existing Customers to another carrier, TIE and
MIDCOM must mutually agree on the change of underlying carrier.
5.5 CUSTOMER RATES. The available interstate rates depend upon Dealer's
monthly billing commitment as specified in Exhibit 1. All other rates are
specified in Exhibit 2. All rates, terms and conditions of service are set
forth in, and are subject to, the applicable MIDCOM tariffs. Both MIDCOM
and Dealer understand and agree that all rates are subject to prospective
change.
5.6 CONTROL AND OWNERSHIP OF CUSTOMER ACCOUNTS. Except as provided herein,
Dealer understands that MIDCOM has ultimate control and ownership over all
Customer accounts, as required under current regulatory practices. Service
is provided to Customers under the applicable MIDCOM tariffs. Dealer
understands that, pursuant to these tariffs, MIDCOM may disconnect a
Customer for non-payment or for the other reasons stated in its tariffs.
Upon Dealer's request and at such time as Dealer is certified and qualified
as an interexchange carrier or reseller by the FCC and the appropriate
Public Utility Commissions, MIDCOM agrees to convert and amend this Dealer
Agreement into a contract for resale (Reseller Agreement) whereby Dealer
shall be entitled to issue LOAs in its own name, stead, and behalf, and
that MIDCOM and Dealer will use their best efforts to transfer the existing
Customers previously enrolled hereunder to Dealer pursuant to such new
Reseller Agreement so that such Customer shall be classified as the
Customers of the Dealer, under its requisite authority to act as a carrier
of record.
6. SELLING AIDS, PROMOTION AND TRADE NAMES
6.1 SELLING AIDS, PROMOTION. MIDCOM may, at is election, assist Dealer in
its efforts to solicit orders, provide training, and/or assist in the
development of Dealer's promotional materials. All Dealer promotional
materials must adhere to MIDCOM standards and must receive prior approval
from MIDCOM.
6.2 TRADE NAMES. Dealer is authorized to refer to the full corporate name
of MIDCOM Communications Inc. and use the MIDCOM's service marks, including
its stylized logos, in combination with, but not separate from, the words
"Authorized Independent Dealer" on Dealer's business cards, business
stationary and promotional material. These written materials must display
both the complete name and identity of Dealer. In all cases, the use of
MIDCOM's name and marks shall require specific approval from MIDCOM prior
to use. MIDCOM reserves the right to terminate this right at any time upon
ten (10) days written notice to Dealer. Dealer agrees to furnish MIDCOM, on
a quarterly basis, with a current list of all sales persons in its employ
who are selling MIDCOM services.
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7. RELATIONSHIP
The parties acknowledge that Dealer is an independent contractor and is not
a legal representative or agent of MIDCOM for any purpose except as set
forth in this Agreement. MIDCOM and Dealer agree that their relationship
arising from this Agreement does not constitute or create a general agency,
joint venture, partnership, employment relationship or franchise between
them. Dealer is not authorized to, and agrees that it will not make any
warranties or representations, or assume or create any other obligations,
on MIDCOM's behalf, except with the prior written consent of MIDCOM. In
accordance herewith, Dealer shall maintain its own business offices, and
MIDCOM shall, in no respect, exercise any direct supervision of Dealer's
activities. Neither Dealer nor any employee or agent of Dealer who is
compensated for services paid by Dealer may directly or indirectly,
expressly or by implication, be construed as an employee of MIDCOM for any
purpose, including, but not limited to, insurance benefits or tax
withholdings, levied or fixed by any city, state or federal governmental
agency.
8. INDEMNIFICATION AND WARRANTY
8.1 DEALER INDEMNIFICATION. Dealer shall indemnify and hold MIDCOM
harmless from any and all claims, damages, or judgments and reasonable,
ordinary and necessary attorney fees or other costs of litigation,
including arbitration, for loss or injuries to person or property arising
from the actions or omissions of Dealer or any of its representatives or
subcontractors in connection with Dealer's obligations stated herein.
Except where solely caused by MIDCOM's willful acts. Dealer shall defend on
behalf of MIDCOM any suit brought against MIDCOM for any such judgment,
damage, expense, loss or injury, and Dealer shall reimburse MIDCOM, for all
attorney fees and expenses incurred in connection therewith promptly upon a
presentation of a statement therefor. If Dealer fails to pay such fees and
expenses as set forth in this Section, then MIDCOM shall have the right to
offset and recover said fees and expenses from Dealer's commissions or from
any other sums due to Dealer by MIDCOM.
8.2 MIDCOM INDEMNIFICATION. MIDCOM shall indemnify and hold Dealer
harmless from any and all claims, damages, or judgments and reasonable,
ordinary and necessary attorney fees or other costs of litigation,
including arbitration, for loss or injuries to person or property caused in
material part by MIDCOM in connection with MIDCOM's obligation stated
herein, as well as MIDCOM's material omissions or misrepresentations of
services provided herein.
8.3 DEALER WARRANTIES. Dealer warrants that it has the authority to
select MIDCOM to provide the services described herein and that this
selection does not and will not violate any other arrangement to which
Dealer is bound. This warranty will survive the execution of this
Agreement.
8.4 MIDCOM WARRANTY. MIDCOM WARRANTS THAT IT WILL USE ALL REASONABLE
EFFORTS TO MAINTAIN ITS OVERALL NETWORK QUALITY. THE QUALITY OF SERVICE
PROVIDED HEREUNDER SHALL BE CONSISTENT WITH TELECOMMUNICATIONS COMMON
CARRIER INDUSTRY STANDARDS, GOVERNMENT REGULATIONS, AND SOUND BUSINESS
PRACTICES. MIDCOM MAKES NO OTHER WARRANTY, WHETHER EXPRESS, IMPLIED OR
STATUTORY, AS TO THE DESCRIPTION, QUALITY, MERCHANTABILITY, COMPLETENESS OR
FITNESS FOR ANY PURPOSE OF THE SERVICE OR THE LOCAL ACCESS OR AS TO ANY
OTHER MATTER, ALL OF WHICH WARRANTIES BY MIDCOM ARE HEREBY EXCLUDED AND
DISCLAIMED.
8.5 LIMITATION OF DAMAGES. Any other provision notwithstanding,
neither party hereto shall be liable to the other for nay indirect,
consequential, special, incidental, punitive or any other similar damages
of any kind or nature, including lost profits, arising in any manner from
this Agreement and the performance or non-performance of obligations
hereunder.
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8.6 SPECIFIC PERFORMANCE. In the event of a breach of this Agreement,
Dealer and MIDCOM acknowledge and agree that each of them shall, in
addition to any other remedies available at law, have the right to seek
specific performance by the other party of its respective obligations
hereunder in a court of equity, notwithstanding Section 10.14.
8.7 CONFIDENTIAL INFORMATION. Dealer and MIDCOM hereby acknowledge and
agree that on and after the date of this Agreement and continuing for a
period of one (1) year following its termination, and provided that the
party seeking to enforce the provisions of this subsection is not then in
default of its obligations hereunder, each party shall hold in the
strictest confidence, and shall not use or disclose to any person, firm or
corporation (other than on a need-to-know basis), without the written
authorization of the other party, any Confidential Information in its
possession pertaining to the other party, including, without limitation,
Customer account data, except as may be ordered by a court of competent
jurisdiction of a claim involving the subject matter of such Confidential
Information. As used in this Agreement, "Confidential Information" means
the terms and conditions in this Agreement, including the consideration
payable hereunder, and all information, documents and materials not
generally available to the public which have been provided by one party to
the other in connection with the transactions contemplated hereby or which
otherwise relate to the Customers and Customer accounts. The parties
further acknowledge that they are entering into this Agreement in good
faith, that their relationship has been and is expected to continue to be
one of mutual respect and goodwill, and that they shall continue to
describe each other in a manner consistent with the tenor of their
relationship and shall at no time make any statement or remark to any
person, firm or entity inconsistent therewith. Dealer and MIDCOM each
acknowledge and agree that any breach of this Section would cause the other
party irreparable harm. Accordingly, the non-breaching party may seek and
obtain injunctive relief against the breach or threatened breach of this
subsection, in addition to any other remedies to which such party may be
entitled at law or in equity.
9. DEFAULT AND TERMINATION
9.1 TERMINATION FOR CAUSE. Except as provided below, either party to
this Agreement may, upon thirty (30) days prior written notice to the other
party, terminate this Agreement if such other party materially breaches or
fails to perform any obligation arising hereunder. During the thirty (30)
day period following notice of such termination, the party in breach shall
have the right to cure any such breach or default. The party in breach
shall have a longer time to cure the cause of any such notice if, by its
nature, the cause is such that it is not curable within the thirty (30) day
period, provided that the party in breach immediately initiates all
available substantial and continuing action to cure such cause(s).
9.2 TERMINATION UPON BANKRUPTCY. Notwithstanding any provision set
forth in Subsections 9.1 and 9.2 hereof, this Agreement shall be deemed to
have been breached and terminated immediately upon adjudication of either
party as bankrupt or insolvent; the assignment of a substantial part of the
assets of either party to or for the benefit of any creditor; the filing of
a petition of bankruptcy by or against either party which is not dismissed
within sixty (60) days from the filing thereof; the filing of a ▇▇▇▇ in
equity or other proceeding for the appointment of a receiver or other
custodian of the assets of either party which is not contested in the court
having jurisdiction thereof; or the dissolution or liquidation of either
party.
9.3 REMOVAL OF CUSTOMER UPON TERMINATION. Except for a termination by
Dealer for material breach by MIDCOM, and/or Dealer achieves reseller
status, Dealer shall not directly or indirectly remove any Customer
solicited by Dealer from MIDCOM's services, without MIDCOM's prior written
approval, during the term of this Agreement and for a period of six (6)
months thereafter. Any person or entity having any direct or beneficial
interest attributable to or from Dealer shall be bound by the provisions of
this covenant, including, without limitation, employees, agents,
representatives, directors, shareholders, partners, relatives of any of
these persons, or any other such related person or entity of Dealer
("Related Party"). In the event Dealer or a Related Party breaches this
Agreement by transferring Customers from MIDCOM's network to
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9.3 REMOVAL OF CUSTOMER UPON TERMINATION, CONT. another service, then
MIDCOM shall have no further obligation to pay Trail Commissions. Dealer
hereby consents to the entry of an injunction prohibiting the removal of
other Customers without the necessity of MIDCOM posting a bond or other
form of security therefor. Trail Commission on remaining Customers in good
standing will be paid provided that Dealer is not in breach of any other
material provision of this Agreement, including the Dealers continuing
warranties, promises and agreements.
9.4 TERMINATION FOR LACK OF PERFORMANCE. Notwithstanding the provisions of
Section 3, in the event the gross ▇▇▇▇▇▇▇▇ from Dealer's Customer accounts
do not equal or exceed $10,000 per month by the end of one (1) year after
the effective date of this Agreement. MIDCOM shall have the right to
terminate this Agreement. In addition, in the event the average monthly
▇▇▇▇▇▇▇▇ for any three (3) month period after the first year fall below
$10,000, MIDCOM shall have the right to terminate this Agreement. In the
event the Agreement is terminated under the provisions of this subsection,
MIDCOM will be under no further obligation to pay Trail Commissions.
9.5 TERMINATION FOR REGULATORY VIOLATIONS. In the event that customer
complaints are filed with LECs or with federal or state agencies against
Dealer, or against MIDCOM as a result of Dealer's representations or
actions, MIDCOM reserves the right to terminate this Agreement immediately
upon written notice to Dealer. Additionally, if it is determined that
Dealer has knowingly submitted to MIDCOM names of Customers for which the
LOAs were either forged, unethically obtained, or for which Dealer was
acting outside of the rights granted under the Customer LOAs, then MIDCOM
may, at its sole discretion, either terminate this Agreement immediately
upon written notice to Dealer or suspend accepting any orders from Dealer
for a period until Dealer has taken action to correct its offending
marketing practices.
10. MISCELLANEOUS
10.1 WAIVER. No waiver by either party of any default by the other party
with respect to any term or provision contained herein shall be deemed to
be a waiver of such term or provision unless the waiver is in writing and
signed by the waiving party. The waiver by either party hereto of any
breach or violation of any provision of the Agreement shall not operate or
be construed as a waiver of any subsequent breach or violation.
10.2 ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
between the parties concerning the subject matter hereof, and supersedes
all prior negotiations and understandings with respect thereto. There are
no covenants, promises, agreements, conditions or understandings, either
oral or written, between the parties and relating to the subject matter of
this Agreement other than those set forth herein. No alteration, amendment,
change or addition to this Agreement shall be binding upon either party
unless in writing and signed by a Vice President of MIDCOM and by Dealer's
authorized representative.
10.3 GOVERNING LAW. This Agreement shall be construed in accordance with
and be governed by the laws of the State of Washington, without recourse to
its conflict of laws principles. Venue for any action concerning this
Agreement shall be in the County of King, State of Washington, or the
federal courts located in King County, Washington.
10.4 OPPORTUNITY TO PARTICIPATE IN DRAFTING. The parties have been
furnished an equal opportunity to participate in drafting of this Agreement
and any schedules and exhibits attached. No ambiguity shall be construed
against any party based upon a claim that party drafted the applicable
language.
10.5 BENEFIT. This Agreement shall inure to the benefit of, and shall be
binding upon, the parties hereto and their respective successors and
assigns. This Agreement shall not be assigned, nor the performance
hereunder be delegated by either party without the prior written consent of
the other party hereto.
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10.6 NOTICES. All notices shall be in writing and shall be deemed to
have been given on the dates indicated below:
(a) OVERNIGHT COURIER. Business day following deposit of such notice
with such courier.
(b) TELEFAX. Business day of transmission if sent before 2:00 p.m.
recipient's time with receipt confirmed.
(c) PERSONAL DELIVERY. Business day of delivery.
(d) POSTAGE PREPAID MAIL. Third business day following date of
mailing (date of postmark).
(e) CERTIFIED MAIL. Eight business days following date of postmark.
If to MIDCOM, addressed to: With a copy to:
MIDCOM Communications Inc. MIDCOM Communications Inc.
Attn: ▇▇▇▇▇▇ Rebensdorff ▇▇▇▇ ▇▇▇▇▇▇▇
Senior Vice President Legal Affairs Vice President National Accounts
1800 MIDCOM Tower 1800 MIDCOM Tower
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ 1111 Third Avenue
Seattle, WA 98101 ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Dealer, addressed to:
TIE Communications, Inc.
Attention: ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
or to any such address as the party to receive the notice shall advise
by due notice given in accordance with this subsection.
10.7 PERFORMANCE. If performance by MIDCOM of any part of this Agreement is
prevented, hindered, delayed or otherwise made impractical by reason of any
flood, riot, fire, strike, explosion, power blackout, civil disturbance,
labor dispute, war, change in government regulation (including tariffs
governing the Listed Services), court action, failure of equipment, refusal
to provide or delay in providing service by an IXC or LEC, any act of God,
or any other cause beyond the direct control of MIDCOM, then MIDCOM shall
be excused from such performance. MIDCOM shall have no obligation to
provide alternative routing with respect to any transmission capacity
provided pursuant to this Agreement. In no event shall MIDCOM be liable to
Dealer or any other person, firm or entity in any other respect, including,
without limitation, for any damages, either direct or indirect,
consequential, special, incidental, actual, punitive, or any other damages,
or for any lost profits of any kind or nature whatsoever, arising out of
mistakes, accidents, errors, omissions, interruptions, or defects in
transmission, or delays, including those which may be caused by regulatory
or judicial authorities, arising out of or relating to this Agreement or
the obligations of MIDCOM pursuant to this Agreement.
10.8 NON-DISCLOSURE. The terms and conditions of this Agreement are
proprietary and confidential and shall not be disclosed to any third party
without written consent from MIDCOM.
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10.9 ASSIGNMENT. This Agreement shall be binding upon and shall move
to benefit the parties and their legal representatives, heirs and
successors. However, no interest of Dealer may be assigned, sub-contracted,
or otherwise transferred, either voluntarily, or involuntarily, without the
prior written consent of MIDCOM, which shall not be unreasonably withheld.
Any such attempted transfer shall be void and shall constitute a breach of
this Agreement. In the event of a dispute between partners and owners of a
Dealer-owned ownership of rights to Trail Commissions, MIDCOM shall have
the right to hold in an escrow account maintained by MIDCOM the disputed
commissions or it may interplead and deposit the funds with a court of
competent jurisdiction at the expense of the disputing parties.
10.10 SEVERABILITY. In the event any one or more immaterial provisions
is found to be invalid, the finding shall not affect the validity or
enforceability of the other provisions.
10.11 CAPTIONS. The captions and section numbers appearing in this
Agreement are inserted only as a matter of convenience, and shall not be
used to construe, define, limit or describe the scope or intent of the
provisions of this Agreement.
10.12 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which when executed by the parties hereto shall be deemed an
original and all of which together shall be deemed the same Agreement.
10.13 ATTORNEY FEES AND COSTS. In the event of any legal dispute
between the parties relating to the Agreement, including arbitration
provided for in Section 10.14, the most prevailing party shall be entitled
to all costs and legal expenses including, but not limited to, reasonable,
ordinary and necessary attorney fees, accounting fees, court costs, expert
witness and expenses, and investigation expenses.
10.14 ARBITRATION. Any dispute between MIDCOM and Dealer arising under
this Agreement shall be subject to arbitration in the City of Seattle,
State of Washington, pursuant to the rules then in effect of the American
Arbitration Association (or any other place or under any form or
arbitration mutually acceptable to MIDCOM and Dealer). The decision
rendered by the arbitrator shall be final and conclusive upon the parties
and a judgment thereon may be entered in the highest court of the forum so
having jurisdiction of the matter. The expenses of such arbitration shall
be borne equally by the parties to the arbitration provided that each party
shall pay for its own costs for experts, evidence and counsels' fees.
10.15 AUTHORITY TO EXECUTE. Each person executing this Agreement on
behalf of another person or organization represents and warrants to each
member of all other parties that he or she is fully authorized to execute
and deliver this Agreement on behalf of such person or organization. Each
member of each party represents and warrants to all members of all other
parties that no consent of any person not a party to this Agreement is
necessary in order for this Agreement to be fully and completely binding
upon each member of the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
MIDCOM COMMUNICATIONS INC.
DBA ADNET TELEMANAGEMENT DEALER: TIE COMMUNICATIONS, INC.
By: ▇▇▇▇ ▇▇▇▇▇▇▇ By: L. ▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------- -----------------------------------
Title: Vice President Title: Vice President Sales & Marketing
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Signature: ▇▇▇▇ ▇▇▇▇▇▇▇ Signature: L. ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------- ----------------------------
Date: 4/10/96 Date: 5/17/96
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Dealer Contact Information: Tax ID # or SSN: _________________________
Primary Contact: ___________________________________ Phone: ___________________
FAX: _____________________
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EXHIBIT I
All services will be provisioned and billed by the ADNET division of Midcom.
Pricing and rates contained herein are predicated on TIE Communications sales
revenues of one million dollars monthly. For the purposes of computation, TIE's
own long distance usage will be included and will contribute to TIE's overall
volume.
There is no monthly or annual commitment associated with this AGREEMENT.
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EXHIBIT II
SIMPLICITY STANDARD
ADNET WATS & 800
1 + SWITCHED OUTBOUND & 800 INBOUND
COST PER MINUTE % OF COMMISSION
--------------- ---------------
0.1650 27%
0.1550 25%
0.1450 20%
0.1350 15%
0.1250 10%
0.1150 4%
ADNET WATS PLUS ADNET 800 PLUS
DEDICATED T1 OUTBOUND DEDICATED T1 INBOUND
COST PER MINUTE % OF COMMISSION COST PER MINUTE % OF COMMISSION
--------------- --------------- --------------- ---------------
0.1199 30% 0.1199 30%
0.1099 27% 0.1099 27%
0.0999 20% 0.0999 20%
0.0949 18% 0.0949 16%
0.0899 15% 0.0899 12%
0.0849 11% 0.0849 7%
0.0799 7% 0.0799 4%
0.0749 4%
SIMPLICITY PLUS (AT&T)
ADNET/AT&T WATS ADNET/AT&T 800
1 + SWITCHED OUTBOUND SWITCHED 800 INBOUND
COST PER MINUTE % OF COMMISSION COST PER MINUTE % OF COMMISSION
--------------- --------------- --------------- ---------------
NOT AVAILABLE 0.2099 25%
0.1999 20%
0.1899 17%
0.1799 13%
0.1899 10%
0.1599 7%
0.1499 4%
ADNET/AT&T WATS PLUS ADNET/AT&T 800 PLUS
DEDICATED T1 OUTBOUND DEDICATED 800 INBOUND
COST PER MINUTE % OF COMMISSION COST PER MINUTE % OF COMMISSION
--------------- --------------- --------------- ---------------
0.1499 25% 0.1549 25%
0.1399 20% 0.1449 20%
0.1299 15% 0.1349 15%
0.1199 10% 0.1249 10%
0.1099 7% 0.1149 7%
0.0999 4% 0.1049 4%
All IntraState calls will pay 10% commission.
All International calls will pay 8% commission.
------------------------ ------------------------
Dealer MIDCOM
12
EXHIBIT II
SIMPLICITY STANDARD INTRASTATE RATES
DEDICATED DEDICATED SWITCHED SWITCHED
OUTBOUND INBOUND (800) OUTBOUND INBOUND (800)
STATE RATE/MIN. RATE/MIN. RATE/MIN. RATE/MIN.
----- --------- ------------- --------- -------------
AK 0.1800 0.1827 0.2169 0.2421
AL 0.0846 0.1233 0.1377 0.1512
AR 0.1116 0.1683 0.1782 0.2178
AZ 0.1206 0.1485 0.2007 0.1800
CA (1) 0.0499 0.1049 0.0599 0.1449
CA (2) 0.0949 0.1049 0.1199 0.1449
CO 0.1269 0.1197 0.1809 0.1926
CT 0.1143 0.1368 0.1341 0.2034
DE 0.1053 0.1369 0.1575 0.2025
FL 0.1134 0.1242 0.1755 0.2025
GA 0.1082 0.1116 0.1755 0.1854
HI 0.1600 0.1827 0.2169 0.2421
IA 0.1008 0.1323 0.1845 0.2106
ID 0.1260 0.1260 0.1998 0.1998
IL 0.1116 0.1305 0.1197 0.1809
IN 0.1008 0.1215 0.1512 0.1755
KS 0.1413 0.1332 0.2115 0.2493
KY 0.1161 0.1719 0.1881 0.2106
LA 0.0945 0.1233 0.1377 0.1737
MA 0.0900 0.1017 0.1440 0.1467
MD 0.1062 0.1152 0.1467 0.1449
ME 0.1845 0.2700 0.2943 0.2745
MI 0.1080 0.1314 0.1899 0.1764
MN 0.1161 0.1251 0.1890 0.1944
MO 0.1296 0.1062 0.1944 0.2214
MS 0.1395 0.1485 0.1800 0.2079
MT 0.1080 0.1422 0.1755 0.2079
NC 0.1044 0.1062 0.1764 0.1872
ND 0.1116 0.1350 0.1863 0.2115
NE 0.1251 0.1395 0.1935 0.2340
NH 0.1341 0.1431 0.2313 0.2889
NJ 0.1071 0.1161 0.1089 0.1350
NM 0.1575 0.1584 0.1827 0.2169
NV 0.1098 0.1440 0.1647 0.1656
NY 0.1296 0.1368 0.1674 0.1872
OH 0.1215 0.1422 0.1503 0.2025
OK 0.1242 0.1656 0.1827 0.2745
OR 0.1062 0.1242 0.1719 0.2133
PA 0.1026 0.1296 0.1620 0.1647
RI 0.1096 0.1305 0.1908 0.1899
SC 0.1287 0.1368 0.1926 0.2367
SD 0.1170 0.1440 0.1654 0.2115
TN 0.1341 0.1485 0.1908 0.1998
TX 0.1098 0.1089 0.1890 0.1971
UT 0.1080 0.1323 0.1674 0.1764
VA 0.1116 0.1161 0.1629 0.1944
VT 0.1280 0.1440 0.1890 0.2043
WA 0.1071 0.1125 0.1917 0.1836
WI 0.1179 0.1280 0.1980 0.2115
WV 0.1098 0.1287 0.1980 0.2016
WY 0.1242 0.1242 0.1674 0.1719
(1) - IntraLATA
(2) - Instrastate
10% agent commission on all intrastate rates.
13
EXHIBIT II
SIMPLICITY PLUS (AT&T) INTRASTATE RATES
DEDICATED DEDICATED SWITCHED SWITCHED
OUTBOUND INBOUND (800) OUTBOUND INBOUND (800)
STATE RATE/MIN. RATE/MIN. RATE/MIN. RATE/MIN.
------- --------- ------------- --------- -------------
AL 0.0900 0.1253 0.1485 0.1578
AR 0.1280 0.1847 0.1917 0.2384
AZ 0.1305 0.1626 0.2160 0.1971
CA (1) 0.0866 0.1199 0.0702 0.1775
CA (2) 0.0999 0.1199 0.1278 0.1775
CO 0.1368 0.1479 0.1944 0.2120
CT 0.1224 0.1199 0.1440 0.1782
DE 0.1170 0.1508 0.1332 0.2051
FL 0.1215 0.1367 0.1998 0.2228
GA 0.1080 0.1137 0.1710 0.1883
HI 0.1890 0.1875 0.3033 0.2129
IA 0.1080 0.1449 0.1980 0.2310
ID 0.1575 0.1380 0.2790 0.2193
IL 0.1206 0.1430 0.1287 0.1991
IN 0.1143 0.1331 0.1620 0.1922
KS 0.1440 0.1454 0.2115 0.2738
KY 0.1280 0.1892 0.2025 0.2307
LA 0.1017 0.1350 0.1485 0.1902
MA 0.0972 0.1113 0.1548 0.1607
MD 0.1143 0.1269 0.1575 0.1587
ME 0.2052 0.2968 0.3357 0.3006
MI 0.1170 0.1482 0.2088 0.1932
MN 0.1143 0.1290 0.1881 0.2003
MO 0.1358 0.1166 0.2088 0.2429
MS 0.1530 0.1449 0.1980 0.2310
MT 0.1170 0.1557 0.2070 0.2307
NC 0.1179 0.1310 0.1935 0.2051
ND 0.1188 0.1479 0.2007 0.2316
NE 0.1350 0.1527 0.2088 0.2562
NH 0.0990 0.1588 0.2250 0.3165
NJ 0.1152 0.1190 0.1170 0.1442
NM 0.1883 0.1745 0.1935 0.2385
NV 0.1170 0.1577 0.1773 0.1814
NY 0.1395 0.1499 0.1800 0.2051
OH 0.1305 0.1588 0.1620 0.2217
OK 0.1260 0.1680 0.1917 0.2662
OR 0.1143 0.1361 0.1845 0.2338
PA 0.1098 0.1461 0.1728 0.1806
RI 0.0585 0.1430 0.0918 0.2090
SC 0.1323 0.1424 0.1960 0.2222
SD 0.1260 0.1587 0.1980 0.2316
TN 0.1206 0.1635 0.2052 0.2189
TX 0.1215 0.1238 0.2070 0.2159
UT 0.1179 0.1449 0.1872 0.1932
VA 0.1206 0.1241 0.1755 0.1989
VT 0.1215 0.1587 0.1890 0.2237
WA 0.1161 0.1232 0.2061 0.2010
WI 0.1260 0.1421 0.2142 0.2316
WV 0.1161 0.1410 0.2817 0.2198
WY 0.1350 0.1725 0.1800 0.2385
(1)-IntraLATA
(2)-Intrastate 10% agent commission on all intrastate rates.